Sitting of 10 December 1992

Preamble
The House met at half-past Two o'clock
PRAYERS
[MADAM SPEAKER in the Chair]
PRAYERS
  PRIVATE BUSINESS

    RIVER HUMBER (UPPER BURCOM COOLING WORKS) BILL [Lords] (By Order)
    Orders for Second Reading read.
    To be read a Second time on Wednesday 16 December.

Oral Answers to Questions
  NATIONAL FINANCE

    Premium Bonds
    Ms. Quin: To ask the Chancellor of the Exchequer what representations he has received about the conditions governing the purchase of premium bonds by individuals.
    The Economic Secretary to the Treasury (Mr. Anthony Nelson): I have received a number of representations concerning the purchase of premium bonds.
    Ms. Quin: Do the Government accepted that the sale of premium bonds has plummeted since they changed the rules so that £100 became the minimum amount that one could purchase? Does that not penalise many people who would like to buy bonds in small amounts for themselves or as presents? Are the Government trying to kill off the premium bond scheme altogether?
    Mr. Nelson: I acknowledge the need to encourage the savings ethic, but it is also important to ensure that the taxpayer's interests are protected. The cost of administration is considerable and that change, associated with the other changes to National Savings bank accounts, will save the taxpayer about £5 million a year.
    Mr. John Greenway: Does my hon. Friend agree that if we want to encourage the savings ethic among young children, it is important that they learn what is a realistic return on the investments made on their behalf? A return
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    based on a computer deciding whether they have won a cash prize seems totally artificial and unrealistic. Would it not make more sense if young children invested in National Savings certificates?
    Mr. Nelson: I am bound to agree with my hon. Friend. Rather than rely on the luck of the draw, it is better for a young saver to build up savings that have an assured rate of return. After March, the odds of winning will be 15,000:1, but the rate of interest applying to savings certificates will be about 5 per cent.

    Investment (Tax Relief)
    Mr. Wareing: To ask the Chancellor of the Exchequer what plans he has to introduce further tax relief incentives for United Kingdom-based manufacturing firms investing in the United Kingdom.
    The Paymaster General (Sir John Cope): The existing tax relief for capital investment allows appropriate write-offs. The measures announced in the autumn statement will give additional encouragement to investment in the year to October 1993.
    Mr. Wareing: Is the Minister aware that between 1987 and 30 June this year, no fewer than 24,725 manufacturing concerns went into liquidation? What could the Government have done? Does the right hon. Gentleman believe that they could have done anything to prevent those bankruptcies? Is he aware that, although reductions in interest rates are welcome, confidence is needed? Until unemployment is reduced, there will be no confidence, no demand and no inducement to invest.
    Sir John Cope: Measures were introduced by my right hon. Friend the Chancellor in the autumn statement to deal with those problems. The measures were widely welcomed and, on investment and other matters, responded to the calls made by industry.
    Mr. Bill Walker: My right hon. Friend will be aware that one of the finest industries in Scotland is the Scotch whisky industry, which contributes massively to the Exchequer through excise duties and value added tax and produces more than £1,700 million worth of exports a year. Will my right hon. Friend give serious consideration to the proposal that, rather than the present system, excise duty should be levied on the alcoholic content of the product? That would help negotiations in Europe, increase revenue intake for the Treasury and give substantial help to the Scotch whisky industry.
    Sir John Cope: I am, indeed, aware of the importance of the Scotch whisky industry, from what my hon. Friend and other hon. Members have told me about it, from what I have been told by the Scotch Whisky Association and from my own appreciation of it. I note my hon. Friend's comments and assure him that we consider everything carefully in the approach to the Budget, but I could not possibly anticipate my right hon. Friend's Budget statement. My hon. Friend will also be aware of the disadvantages, from our point of view, of the system he suggests.
    Ms. Harman: Is the right hon. Gentleman not concerned by the fact that his Department's monthly monetary report, issued today, shows that manufacturing employment fell in September by 32,000 and that the rate

    981
    of job loss in manufacturing is accelerating? Is it not time that the Government recognised that unemployment is not just, as they call it, a lagging indicator but is now in itself a cause of the continuing recession, which is why the Government must take action on unemployment?
    Sir John Cope: The proportion of output from manufacturing has been declining for a long time not just in this country but far more widely. Investment in plant and machinery, which is part of what is needed, is already increasing and productivity is at a record level. That is what we need and what the autumn statement encouraged.

    Interest Rates
    Mr. Sykes: To ask the Chancellor of the Exchequer which EC countries have lower short-term interest rates than the United Kingdom.
    The Chancellor of the Exchequer (Mr. Norman Lamont): None. The United Kingdom has the lowest short-term interest rates in the European Community.
    Mr. Sykes: I am grateful to my right hon. Friend for that reply. Is he aware that in Scarborough and Whitby, England's two finest resorts, we have many successful companies, such as McCain Foods makers of oven chips, and Pindar Graphics, and that interest rates and exchange rates are so competitive that great British companies such as those are winning orders hand over fist at home and abroad?
    Mr. Lamont: I am sure that my hon. Friend's constituency is typical of many that are benefiting from the reduction in interest rates. That is being reflected in high streets throughout the country. Retail sales in the last three months are up 1 per cent. on the previous three months and are the highest since 1990. In the car industry—it is not so strongly represented in my hon. Friend's constituency, although car retailers are—we have also seen an increase in recent months. There is no doubt that the economy is benefiting from the reduction in interest rates, which I believe will work through increasingly into other parts of the economy.
    The key consequence of the reduction in interest rates is through mortgage rates. There have already been substantial reductions in mortgage rates, but many people, particularly those with annual mortgages, have yet to see—they will do so early in the new year—further, very substantial, reductions in their mortgage rates. That will help consumer spending very considerably.
    Mr. Beith: Does the Chancellor accept that lower short-term interest rates, although welcome, are not likely to have as rapid an impact on the economy as, for example, contracts held by companies that benefit from increased spending on public works? Does he recognise that many small businesses do not have confidence that interest rates will remain low and that they are at a disadvantage compared with businesses in many other European countries, because they are much more dependent on short-term interest rates than those businesses?
    Mr. Lamont: I am very surprised by the right hon. Gentleman. We have had from him and his hon. Friends on the Liberal Bench and from Labour Members nothing
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    but pressure to reduce interest rates. We now have the lowest interest rates in the European Community. That is good for our economy, and nobody can gainsay that.
    Mr. John Townend: Leaving aside the remarks of the right hon. Member for Berwick-upon-Tweed (Mr. Beith), does my right hon. Friend take encouragement from the fact that the very low rates of interest in America are now resulting in significant economic growth in that country? Does he agree that that gives enormous opportunities to British exporters, in view of the more competitive pound, and that countries that remain in the exchange rate mechanism will see no significant recovery until the Bundesbank reduces its rates?
    Mr. Lamont: It is certainly true that recovery is strongly under way in the United States, based on the low interest rates that have obtained there for some time. Given that a higher proportion of our exports goes to the United States than do the exports of other European Community countries, we stand to benefit enormously. I have made clear for many months my belief that it would be for the benefit of the European economy if interest rates in Europe were generally lower.
    Mr. Gordon Brown: On the question of a co-ordinated reduction in interest rates, does the Chancellor support the Christopherson European recovery plan? Why is the French Finance Minister and not the British Chancellor taking the lead with new proposals for a European recovery programme? Why has the issue of unemployment been relegated on the British agenda for Edinburgh from the formal session to a mere open-ended discussion over lunch? Will the right hon. Gentleman not realise, even at this late stage, that the test of the British presidency is whether the Government will show the political will to take a lead in reducing unemployment?
    Mr. Lamont: As question 5 is on that subject, I do not know why the hon. Gentleman could not hang on and ask a supplementary question that is relevant to the question tabled. He may insist on asking an irrelevant question but I shall give a relevant answer. First, the Christopherson plan has nothing to do with interest rates, so the hon. Gentleman should be clear about that. Secondly, we shall discuss at Edinburgh with other member states a package of measures designed to get the European economy moving again. Contrary to what the hon. Gentleman says, this country has led the way with the package that I announced in my autumn statement: greater priority for capital programmes, with tight control over current spending; special help for the housing market and the construction industry; and additional incentives for private sector investment. Moreover, in the past couple of months, I have announced three percentage points off interest rates, which is providing significant extra help to British business and those with mortgages. At Edinburgh, we shall suggest that others in Europe follow Britain's lead.

    Manufacturing Industry
    Mr. Nicholas Winterton: To ask the Chancellor of the Exchequer what further proposals he intends to bring forward to stimulate manufacturing industry.
    The Chief Secretary to the Treasury (Mr. Michael Portillo): Manufacturing industry enjoys the benefits of

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    the lowest interest rates in the European Community, inflation below the European Community average in each of the last 14 months, as well as a competitive exchange rate. In addition, the measures in the autumn statement are targeted on sectors where assistance will be most effective. Against that background, I hope to see increasing optimism and confidence about the future.
    Mr. Winterton: Does my right hon. Friend agree that, if the manufacturing and construction industries are to be stimulated again and are to rise to fulfil their potential as vital parts of the United Kingdom economy, we need a new recognition and understanding by his Department, the Department of Trade and Industry and the banking and investment sector of the vital long-term potential of those industries as the only source of non-inflationary economic growth? Does he agree that they must not be sacrificed on the altar of a quick buck or a big dividend?
    Mr. Portillo: My hon. Friend's support for manufacturing industry is one of the best-known facts about the House of Commons. My right hon. Friend the Chancellor has strongly echoed part of what he said, in particular in his speech at the Mansion House when he said that the Government should examine every policy to ensure that it supports industry. My hon. Friend will have been pleased—indeed, I remember his remarks at the time—at the measures in the autumn statement: increased capital allowances; a new 20 per cent. allowance for industrial buildings; the abolition of car tax; the additional export credit cover; and a further reduction in interest rates.
    Mr. Skinner: If the Chancellor of the Exchequer has decided on an individual policy of spending his way out of the recession, why cannot it apply to the rest of the country?
    Mr. Portillo: The autumn statement set out what we believe to be an appropriate level of public spending. It is extremely important to keep it under tight control. I am surprised that the hon. Gentleman appears to be proposing that we should have higher spending and higher borrowing.
    Mr. Ward: Does my right hon. Friend agree that the best thing that the House could do for this country is to prevent the Labour party from talking down the country, particularly the manufacturing industry, at every opportunity both at home and abroad?
    Mr. Portillo: My hon. Friend is absolutely right. The greatest challenge that we face now is the restoration of confidence. It is not only the Government who must play a part in restoring confidence; it is business, the Labour party and the media. There are many reasons why we should feel confident about the future, and I have already given some of them. Recovery in our car industry is another example. Recently, production increased by 20 per cent. on the same period last year, and forecasts show that there will be a 12 per cent. increase in car production next year. One would hope that Opposition Members would promulgate such facts as evidence of the recovery and evidence that confidence should be picking up.
    Mr. Llwyd: When will the Chancellor take effective action to ensure that the banks pass on interest rate cuts to their hard-pressed customers?
    Mr. Portillo: My right hon. Friend the Chancellor has expressed his concern about the matter, as I have. He has already held a meeting with the banks, and will be meeting them again next week.
    Mr. Anthony Coombs: Does my right hon. Friend agree that, with low interest rates, record productivity and a competitive exchange rate, the base for the manufacturing industry to take advantage of the upturn is the best that it has ever been? Does he agree that the last thing that manufacturing industry wants is to be burdened with additional costs of the sort that the social chapter would impose on it?
    Mr. Portillo: My hon. Friend is absolutely right. Productivity in the third quarter was up by 4.4 per cent. on the year before and stood at a record level. Manufacturing exports now stand at a record level. The United Kingdom is in a highly competitive position. We should like to see all of the European Community being more competitive in world markets.
    It is certainly the United Kingdom's policy not to adopt the social chapter, because of the extra costs that it would impose. Our Community partners have already decided to adopt it. That decision may be to their disadvantage, but the United Kingdom will not follow them down that road.

    European Economic Growth
    Mr. Cann: To ask the Chancellor of the Exchequer what new projects he is advocating to stimulate co-ordinated European economic growth.
    Mr. Lamont: Ministers at the last Economic and Finance Council agreed that there should be a full discussion of the Community's economy at the Edinburgh Council and that member states should consider what action can be taken, both individually and collectively, to hasten recovery.
    Mr. Cann: Does the Chancellor accept that the half-yearly report of the Organisation for Economic Co-operation and Development forecasts that 34 million people in the western countries and Japan will become unemployed and that unemployment in the United Kingdom will reach 3 million shortly after Christmas, even by the Government's method of accounting, and 4 million by the method of accounting that applied in 1979? Does the Chancellor agree that it would be totally wrong to go to the meeting of Finance Ministers tomorrow and say, "Look what we have done in the autumn statement. Why don't you do that?"? We need a proper, well-funded European-wide growth strategy.
    Mr. Lamont: I do not agree with the hon. Gentleman. I believe that the measures that I announced in my autumn statement have been widely welcomed by industry and all the representative organisations of industry. They accorded very well with the proposals that they were asking for and thought were appropriate from the Government.
    Although unemployment in the United Kingdom has risen, it has risen, as the hon. Gentleman well knows, in many other European countries as well. Other European countries have higher levels of unemployment than we do. But we now have the lowest interest rates in Europe, which will be of enormous benefit to this country. Not only the consequences of the lower interest rates, but the actions in

    985
    my autumn statement, put the United Kingdom in a strong position. At Edinburgh we will urge other countries to follow where we have led. We will persuade the Community to take measures that protect jobs, promote investment and lead the way to recovery.
    Mr. Oppenheim: Is not one thing certain—that the surest way to prevent growth in Europe would be for the European Commission to increase burdens on the European economy by massively increasing its spending, as it proposes? That burden would come on top of the onerous load of regulations and the hefty burden of the social chapter, which the Opposition are always so keen to support.
    Mr. Lamont: My hon. Friend is absolutely right. Opposition Members and the shadow Chancellor seem to think that the only place where jobs come from is Government spending. The shadow Chancellor's only answer to the unemployment problem is more spending. As my hon. Friend says, more spending can destroy jobs rather than create them. It is essential, when not only Britain but every country in Europe is seeking to control spending, that spending should be controlled at European Community level just as much as at national Government level. The important point that will come up at Edinburgh is our rebate from the European Community. We in Britain are determined to stand firm on that. I notice that the shadow Chancellor has said that there should be a negotiation about that.
    Mr. Darling: Is not the truth of the matter that the British Government reluctantly agreed to discuss unemployment over a lunchtime chat—as opposed to making it the main priority at Edinburgh—as a result of pressure from other European states? Will the Chancellor accept that there will be no investment, and no recovery unless confidence improves, and that confidence will not improve unless unemployment comes down? What specific new projects does he intend to propose at the European summit in the next few days? How many jobs will be created in Britain and Europe, without which there will be no return to the confidence that we so desperately need?
    Mr. Lamont: The truth is very different from what the hon. Gentleman says. As I have already said, Britain has taken the lead in putting the economic issues on the agenda at Edinburgh. Labour Members ought to tell us why they make it appear to all those who follow these events from abroad that our rebate is up for negotiation. Why should the Opposition weaken our position at Edinburgh?

    Value Added Tax
    Mrs. Gorman: To ask the Chancellor of the Exchequer what plans he has to increase the rate of value added tax.
    Sir John Cope: My right hon. Friend has no plans to do so.
    Mrs. Gorman: I thank my right hon. Friend for his reply. Will he take this opportunity to reiterate that it is no part of the Government's policy to increase either indirect or direct taxes? We know that economic recovery means that we must leave spending power in the domestic economy and relieve the pressure for increased wages. Of course, higher taxes would reduce people's income and
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    take money out of the pocket of the business man who wishes to invest his money in his firm. Does my right hon. Friend agree that the economic strides made by the Government in the last decade were built on the back of tax reductions, not of tax increases?
    Sir John Cope: My hon. Friend has given us a shrewd analysis of some of the factors that my right hon. Friend the Chancellor will need to take into account in the Budget.
    Mr. William Ross: The Minister has told us that the Government have no plans to increase the rate of taxation. Will he also assure us that they have no plans to increase the scope of taxation, and especially that they have no plans to include newspapers and other periodicals?
    Sir John Cope: We have no plans of that sort.
    Mr. Alan Howarth: If at some point my right hon. Friend the Chancellor has reason to suppose that the public sector borrowing requirement might become disproportionately large, and if the Cabinet concludes that that cannot be remedied by tightening control of public expenditure, will the Government be willing to increase taxation, and to do so sooner rather than later?
    Sir John Cope: Those are decisions that my right hon. Friend will have to take as we get nearer the Budget. As always, we are grateful for my hon. Friend's advice.
    Mr. Campbell-Savours: Did the £4,000 contribution that was made by the Treasury to the Chancellor of the Exchequer to enable him to evict a stripper from his private home include a VAT component? Do the Government intend to increase VAT on legal matters?
    Sir John Cope: We have no plans in that respect. The hon. Gentleman will always do his best to cheapen the debate.
    Mr. Nigel Evans: Does my right hon. Friend agree that not so long ago we fought a general election and that one of our major platforms was taxation—both direct and indirect? The public knew our taxation policies and were also well aware—[HON. MEMBERS: "Ask a question."] Does my right hon. Friend agree that the public knew what our taxation policies were and what those of the Labour party were? That is one of the major reasons why we are sitting on this side of the House and Labour Members are sitting on that side.
    Sir John Cope: I absolutely agree with my hon. Friend.
    Mr. Nicholas Brown: The Paymaster General is being unnecessarily coy. On 12 March, his predecessor told us of the "categorical pledges" that had been given by the Chancellor and the Prime Minister that there would be
    "no increase in the standard rate of VAT either before or after the election."
    The Paymaster General's predecessor also assured us that there were
    "no plans to extend the standard rate, or to put up other taxes."—[Official Report, 12 March 1992; Vol. 205, c. 959.]
    Will the Paymaster General confirm that those categorical pledges still hold good?
    Sir John Cope: Those categorical pledges stand as they did at that time.

    Drug Trafficking (Seizure of Assets)
    Mr. Hargreaves: To ask the Chancellor of the Exchequer what was the value of assets seized by Her Majesty's Customs and Excise in each year since the Drug Trafficking Offences Act 1986 became operational; how much of the assets were put back into Customs and. Excise work; and if he will make a statement.
    Sir John Cope: The total amount of confiscation orders made by the courts since the Drug Trafficking Offences Act 1986 as a result of Customs and Excise cases is £21.96 million. I will arrange for the figures for individual years to appear in the Official Report, The amount distributed to Customs and Excise through Home Office administered seized assets funds is £614,000 for 1992–93, the first year of the fund's operation.
    Mr. Hargreaves: I am sure that my hon. Friend will wish to congratulate the Customs and Excise drug investigation division on the success of its recent operations, which have resulted in huge seizures. Will he also reassure the House that, after 1 January, when border controls are removed, a far greater proportion of any assets—or, rather, funds realised from the seizure of assets from drug trafficking—will be redirected towards the investigation division?
    Sir John Cope: I certainly join my hon. Friend in congratulating Customs and Excise, both on last year's seizures of dangerous drugs with a total street value of about £350 million and, in particular, on two recent seizures which have gained a good deal of publicity.
    The fight against drugs will certainly remain the top priority of Customs and Excise after 1 January, and we are arranging to step up that fight. We must fight drugs at all costs. The majority of resources come from the usual public expenditure round, although the seized assets allow us to use some international funds to top up the public funds.
    Mr. Foulkes: Does the Paymaster General recall a report produced during the previous Parliament by the Select Committee on Home Affairs, which suggested that the Channel islands were being used to launder drug money? What action are he and his colleagues taking to ensure that such reprehensible action does not continue?
    Sir John Cope: Since that time the law has been improved, and it is being stepped up further in the Criminal Justice Bill, which will help us to obtain more money from seized assets.
    Following are the figures:

    year

    £ million

    1986–87

    nil

    1987–88

    0.80

    1988–89

    6.00

    1989–90

    7.59

    1990–91

    4.73

    1991–92

    2.84

    Gross Domestic Product
    Mr. Milburn: To ask the Chancellor of the Exchequer what was (a) the growth in gross domestic product since 1979 for the United Kingdom and (b) the OECD average.
    Mr. Nelson: Average annual growth between 1979 and 1991 was 1.8 per cent. in the United Kingdom and 2.8 per cent. on average in OECD countries respectively; but between 1981 and 1991, of the G7 countries only Japan had a substantially higher average annual rate of growth than the United Kingdom.
    Mr. Milburn: Is the Economic Secretary aware that, if economic growth in this country had matched the performance of our leading industrial competitors, the United Kingdom's output since 1979 would have been some £245 billion higher than it was under his Government? Does he not recognise that his failure to ensure long-term investment in British industry means that, day by day, the gap between Britain and other industrialised nations is widening rather than narrowing? Is not that £245 billion growth shortfall a simple indication that the Government have failed this country?
    Mr. Nelson: Like so many Opposition Members, the hon. Gentleman seems to enjoy talking down the United Kingdom's economic performance. Let me tell him that, during the 1980s, this country grew faster than France, Italy or Germany, and took the lion's share of inward investment from the United States and Japan. They have confidence in this country's economic future, even if the hon. Gentleman does not.
    Mr. Butterfill: Does my hon. Friend agree that the surest way to ensure that we did not have good economic growth would be to adopt Labour's policies, have the Government choose where we invested and pile tax increase on tax increase, as was so enthusiastically espoused by the Labour party in the last election?
    Mr. Nelson: That is self-evident, and the electors agreed.
    Mr. Andrew Smith: Is not the truth that it is not us talking Britain down but the Government who have been doing Britain down? The failure of their policies for growth are evident in the wrecked businesses, wrecked industries and wrecked lives up and down the land. We need action for investment, action for training, action for research and development, and an emergency programme for jobs. If the Government will not give us that programme, are they not accepting that unemployment will carry on rising?
    Mr. Nelson: I assert again that we never hear any good news from the Opposition. The facts of the matter—[Interruption.] I shall give some facts. Industrial production is up; retail sales have not been higher for more than two years; interest rates have come down; and inflation is falling. The hon. Gentleman should recognise that Britain is well set for growth.
    Mr. Ian Taylor: Does my hon. Friend agree that one of the most important facts of the past five years has been the level of inward investment in Britain, compared with the lack of it in other countries? That was recently recognised by Germany, which tried to increase tax incentives. Some

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    250,000 jobs have been created by that inward investment. Does he agree there are two potential threats to its continuation? One, earlier this year, was the possible election of a Labour Government; the second is the possibility that we might be sidelined by not ratifying the Maastricht treaty.
    Mr. Nelson: My hon. Friend is right: the level of inward investment, which is precious and important, has been a tremendous vote of confidence in Britain's future economy and industrial performance. The extent to which inward investment in the car industry has been translated into jobs in some of the most important regions of this country is remarkable. That must be succoured and encouraged.

    Government Deficits (Convergence Criteria)
    Mr. Hall: To ask the Chancellor of the Exchequer what are his latest proposals to help the United Kingdom meet the convergence criteria on Government deficits as laid out in article 104c of the treaty of Rome proposed under the Maastricht treaty.
    Mr. Portillo: The Government are determined to return their budget towards balance as the economy recovers. On the expenditure side, the autumn statement set out firm plans for public expenditure to grow over the medium term at a rate within the average rate of growth of the economy. This will help to ensure that fiscal policy remains consistent with the requirements of article 104c.
    Mr. Hall: The Minister will be aware that in my constituency of Warrington, South there are 4,139 people out of work and claiming benefit. Does he agree that the convergence criteria of the Maastricht treaty represent the economic agenda of the 1980s, which was a deflationary agenda, and do not meet the needs for growth of the 1990s? Will he therefore give a commitment that he will place at the top of the Government's agenda the eradication of the fear of unemployment?
    Mr. Portillo: I believe that the Government's policy on spending and borrowing is appropriate to the 1990s. The Government have allowed for the extra spending required during the recession to meet additional Government obligations in respect, for example, of the unemployed. None the less, the Government cannot borrow on the never never and it is extremely important that our borrowing should he reduced as the economy recovers. That is why it is our determination that the budget will return to balance as the economy recovers.
    Mr. Brazier: I welcome my right hon. Friend's commitment to meet the convergence criteria on the fiscal side by moving our budget into balance, but we should reconsider the full-funding rule. We have substantially lowered the price of money, but we need to increase its availability by easing the liquidity in our over-tight banking system.
    Mr. Portillo: I know that that is my hon. Friend's view. He will know that my right hon. Friend the Chancellor of the Exchequer is following a full-funding policy. That is the clear policy of the Government.
    Mr. Denzil Davies: Is it not a fact that the convergence criteria in the Maastricht treaty are a recipe for deflation, depression and higher unemployment in Europe? Is there not a contradiction between support for the Maastricht
    990
    treaty on the one hand and calls for a co-ordinated European policy of economic growth on the other? After all, one cannot worship God and mammon at the same time.
    Mr. Portillo: I am extremely surprised that the right hon. Gentleman believes that the ambitions to bring down rates of inflation and interest rates and to keep tight control of national debts and borrowing are to be regarded as in some way harmful policies. If we were to allow our borrowing to get out of control, it would mean that year by year more and more public spending would be pre-empted by debt interest payments. and less and less would be available for priority public spending programmes. I cannot believe that that is what the right hon. Gentleman seriously wants.

    Car Registrations
    Mr. Hendry: To ask the Chancellor of the Exchequer what was the number of new car registrations in the latest period for which figures are available; and what was the comparable figure for the same period last year.
    Mr. Lamont: The Society of Motor Manufacturers and Traders estimates that there were 106,902 new car registrations in November—6.25 per cent. more than in November 1991.
    Mr. Hendry: I am grateful to my right hon. Friend for that most encouraging reply. Is he aware that the SMMT expects car production to be up 12 per cent. next year, which is clear evidence of the recovery in the car industry? Does he agree with me that one major component of that recovery will be Toyota in Derbyshire, whose model the Toyota Carina—it might perhaps have been better named the Toyota Edwina, in view of the support received from that quarter—comes off the production line next Wednesday?
    Mr. Lamont: My hon. Friend is absolutely right that foreign investment in the motor industry in this country is making an enormous contribution both to manufacturing output and to our exports. As my hon. Friend said, the SMMT is expecting a substantial rise in production, not just next year, when Nissan, Toyota and Honda come on stream—[Interruption.] Hon. Gentlemen are quite wrong. Those companies are British companies just as much as any others. They have invested here and deserve to be regarded as British companies, just as those who came from the United States are regarded as British companies. Furthermore, I notice that DRI Europe, which does the forecasting for the SMMT, is forecasting that in the United Kingdom car output will rise from 1.4 million to 2.7 million in 1997. That is a tremendous contribution from foreign investment and ought to be widely welcomed by everyone in the House.

    Autumn Statement
    Mrs. Browning: To ask the Chancellor of the Exchequer what response he has received from business organisations to his autumn statement.
    Mr. Portillo: The Chancellor's autumn statement has been widely welcomed by business organisations throughout the country.
    Mrs. Browning: Does my right hon. Friend agree that the warm welcome from the Confederation of British Industry to the autumn statement is welcomed by many businesses, particularly small businesses? In particular, will he encourage his right hon Friend the Chancellor, in considering measures for the Budget, to look at the tax treatment of capital allowances so that small businesses can, under a favourable taxation policy, carry forward profits for capital purchases from one tax year to the next?
    Mr. Portillo: My hon. Friend was certainly right to draw attention to the breadth of support that there was for the autumn statement: it came from the CBI, the Institute of Directors and a very large number of different business leaders. I believe that one of the reasons why it was so welcomed was that the Government were responsive to ideas that had been put to them by British business. My hon. Friend seeks to take the debate on further by putting forward new proposals that my right hon. Friend the Chancellor might wish to consider in his Budget. I cannot at this stage pre-empt what may be in that Budget, but I am very grateful to my hon. Friend.
    Mr. Hain: Why did the Chief Secretary not report the statement of the Engineering Employers Federation, which said that the Government's policies were not only economically incompetent but industrially illiterate as well?
    Mr. Portillo: Why, in turn, did the hon. Gentleman not refer to the CBI, the chairman of Grand Met, the British Retail Consortium, the Institute of Directors, Williams Holdings, GKN, Wimpey, the National Association of Estate Agents, the Halifax, the Council of Mortgage Lenders, the chief executive of the SMMT, the Rover group, Vauxhall, the chief executive of the Retail Motor Industry Federation, or any of the others?

    Autumn Statement
    Mr. Brandreth: To ask the Chancellor of the Exchequer what representations he has received from businesses in the north-west about his autumn statement.
    Mr. Portillo: The Chancellor's autumn statement has been widely welcomed by business organisations in the north-west and throughout the country.
    Mr. Brandreth: Is my right hon. Friend aware that in Chester the chamber of commerce has warmly welcomed the broad range of measures introduced in the autumn statement, warmly welcomes the fact that we now have the lowest interest rates in the European Community and believes that the only missing ingredient is confidence, which in Chester is now beginning to return?
    Mr. Portillo: I have been very pleased by some of the news from the north-west. General Motors and Vauxhall have invested £190 million in a new V6 engine plant at Ellesmere Port, and AMCOR in my hon. Friend's constituency of Chester has invested £25 million to build a new corrugated box manufacturing plant. I am sure that that is good news for my hon. Friend and for all his constituents.
    Mr. Mandelson: Would not growth in the north-west and the rest of the country be greatly assisted by greater financing of capital projects? Has not the president of the European Investment Bank said that if the bank were
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    asked, it would increase and speed up the financing of capital projects throughout this country and Europe? Why have the British during their presidency not asked the bank to do so?
    Mr. Portillo: First, I believe that one of the reasons why such a broad welcome was given to the measures contained in the autumn statement was that it offered so much protection for capital projects. Individual projects that we have announced, such as proceeding with the Jubilee line, are of tremendous symbolic significance and very helpful. As for the European Investment Bank, my right hon. Friend the Chancellor of the Exchequer may have some proposals regarding the bank which he will wish to put to the European Community at the Council meeting in Edinburgh.

  PRIME MINISTER

    Engagements
    Mr. Hinchliffe: To ask the Prime Minister if he will list his official engagements for Thursday 10 December.
    The Lord President of the Council and Leader of the House of Commons (Mr. Tony Newton): I have been asked to reply.
    This morning my right hon. Friend the Prime Minister presided at a meeting of the Cabinet before departing to Edinburgh for the European Council meeting.
    Mr. Hinchliffe: Does the Leader of the House agree that the extent of marriage breakdown in Britain, and especially its implications for the children involved, is a matter of great concern to the nation as a whole? Will he press on the Prime Minister the need properly to fund the conciliation and counselling services undertaken by organisations such as Relate and the National Children's Home? Does he recognise the direct connection between the Government's policies and the current incidence of marriage breakdown?
    Mr. Newton: As it happens, I know well from my own previous and, indeed, present association with Relate that a great deal is going on between the Government and that organisation and others to help in this very important matter. I shall take the hon. Gentleman's question as an expression of his support for our encouragement of those organisations.
    Mr. Thomason: Will my right hon. Friend invite the Prime Minister to come to my constituency of Bromsgrove, where he will find a well managed and well run local authority which is Conservative-controlled? Will he also suggest to the Prime Minister that he might choose to visit Monklands, the constituency of a member of the Opposition, where he will find a local authority riddled with nepotism?
    Mr. Newton: I think perhaps the proper response to that question is that it is to be hoped that the right hon. and learned Member for Monklands, East (Mr. Smith), who is also holding a meeting in Edinburgh, might pay a visit to Monklands and look into it himself.
    Mrs. Beckett: Has the Lord President seen the growing number of references to the likelihood that we shall soon see the emergence of an explicitly two-tier Europe? Which tier will Britain be in?
    Mr. Newton: I have seen the references and I know that Britain will be in the fast lane. I also know that if the Labour party had its way, we should have been forced into the slow lane.
    Mrs. Beckett: The position that the Lord President describes is certainly that which should exist, but I do not think that anyone else will think that it is the position which does exist. Does he recognise that a two-tier Europe with Britain in the second tier is just what British business has long feared, and that if that happens, it is not only likely to be extremely damaging but will be in no small part due to the incompetence of the Government's economic policy and their chaotic mismanagement of the British presidency?
    Mr. Newton: I do not quite know on what basis the hon. Lady puts her point that nobody agrees with us. The whole of British industry knows that Labour policies in relation to the social chapter, tax policies and payroll tax would mean that Britain would be in the slow lane throughout the world.
    Mr. Gallie: Is my right hon. Friend aware that yesterday 9,000 Rangers fans travelled to Germany at a cost of £300 per head to witness Rangers' magnificent win over Moscow? Does he agree that on that basis there is light at the end of the recessionary tunnel?
    Mr. Newton: I did not know about the 9,000 figure, but I am delighted at the result and my hon. Friend makes a good point.
    Mr. Ashdown: Will the Leader of the House respond to the question of which I gave him notice yesterday so that he might have a chance to discuss the answer with the Prime Minister? In view of the deteriorating situation in the area, will he give us a categorical assurance that the Government, working with others, are not prepared to allow the city of Sarajevo to fall to the aggression of the Bosnian Serbs?
    Mr. Newton: I am grateful to the right hon. Member for Yeovil for his courtesy. I can tell him that the British Government see no justification whatever for continued Serb aggression in Sarajevo or anywhere else in Bosnia. Clearly, the western powers to which he referred could give the sort of undertaking that he seeks only by introducing a massive injection of foreign military power. The Government have made it clear on a number of occasions that they do not believe that such an intervention would contribute to a solution of the crisis. The right hon. Gentleman will know, however, that after the steering committee meeting of the conference on Yugoslavia here in London there will be a meeting in Geneva next week when the main item on the agenda will he the war in Bosnia.
    Miss Emma Nicholson: Will the Lord President lead the House in condemning the religious violence which has now spread worldwide? Will he also agree that the International Moslem Foundation, a moderate organisation, and the Al Khoei and Ul-Bayt based in the United Kingdom, are just as horrified as we are by the violence and are solid and sincere members of the United Kingdom?
    Mr. Newton: I very much endorse the concern and support that my hon. Friend has expressed and also the calm support by numbers of people, including the Indian Prime Minister, throughout the world.
    Mr. Tony Banks: To ask the Prime Minister if he will list his official engagements for Thursday 10 December.
    Mr. Newton: I have been asked to reply.
    I refer the hon. Member to the reply that I gave a moment ago.
    Mr. Banks: I say this with no disrespect to the Leader of the House, but this is like getting 24 points on the football pools and finding that the first dividend is only 50 pence. Does the right hon. Gentleman have any regrets about the fact that the Conservative party sent two experts from its dirty tricks department to help President Bush, that the Foreign Secretary sent a telegram to James Baker saying "happy shooting" just before the election, and that some idiot authorised a search of Bill Clinton's files? Is it any wonder that in Arkansas the Prime Minister is regarded not so much as an FOB as an SOB?
    Mr. Newton: If the hon. Member for Newham, North-West were to win as much as 50 pence on the pools, he would be doing better than I did in the days when I did them. On his question, he may like to know that there have been some very friendly exchanges between President-elect Clinton and the British ambassador only yesterday evening, and that President-elect Clinton has made it clear that he looks forward very much to meeting my right hon. Friend the Prime Minister after the inauguration.
    Mr. Luff: Will my right hon. Friend confirm that, among the many issues facing the Edinburgh summit, the Government attach the highest possible priority to the future financing of the Community, and especially to securing Britain's abatement?
    Mr. Newton: I assure my hon. Friend that that is precisely the case. Future financing, enlargement and finding a solution to the Danish problem are important key items on that difficult agenda. My right hon. Friend the Prime Minister will certainly make it clear that Britain has no intention of compromising on the abatement.
    Mr. Kilfoyle: To ask the Prime Minister if he will list his official engagements for Thursday 10 December.
    Mr. Newton: I have been asked to reply.
    I refer the hon. Member to the answer that I gave some moments ago.
    Mr. Kilfoyle: As we approach Christmas, may I draw the Lord President's attention to the publication today of "Sick to Death of Homelessness" by the housing charity, Crisis, and to the "This Week" television programme this evening entitled "Dying for a Home"? One of the conclusions drawn is that of the 617 deaths of homeless people up to 31 August this year, 65 per cent. were preventable, given proper housing and good medical care. Is that not a terrible indictment of the callous disregard with which the Government treat those least able to help themselves?
    Mr. Newton: The hon. Gentleman might have been more persuasive if he had mentioned that, as a result of measures introduced by the Government during the past

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    year, the number of households accepted as homeless has fallen, the use of bed-and-breakfast accommodation has fallen by nearly a quarter, and the number of people known to be sleeping rough on the streets of London has dropped by about 60 per cent. according to an assessment made by the voluntary organisations themselves.
    Mr. Hargreaves: Notwithstanding the reply that my right hon. Friend gave to the right hon. Member for Yeovil (Mr. Ashdown) about our intervention in Sarajevo, will he consult the Prime Minister to ensure that an undertaking is given to come to the House and provide a debate before any British troops are used for anything other than strictly humanitarian aid purposes?
    Mr. Newton: I note my hon. Friend's point, and I shall of course draw it to the attention of my right hon. Friend the Prime Minister.
    Ms. Glenda Jackson: To ask the Prime Minister if he will list his official engagements for Thursday 10 December.
    Mr. Newton: I have been asked to reply.
    I refer the hon. Member to the answer that I gave some moments ago.
    Ms. Jackson: Is the Lord President aware that more than 7,000 homeless families will spend Christmas in bed-and-breakfast accommodation without the means or resources to prepare the simplest of meals? In the light of the growing body of evidence of the ill health and malnutrition suffered especially by the children of families in bed-and-breakfast accommodation, does not the right hon. Gentleman think it time for a boarder premium to be paid to such families so that while they wait for the right to a home at least their children have the right to a decent diet? Or is he prepared to allow the increasing poverty and homelessness on our streets to be accompanied by scurvy and rickets?
    Mr. Newton: I have already commented on the general question of homelessness. The hon. Lady will know that, in addition to what I have already said, it has recently been announced that the Government are to put a further sum of nearly £90 million over three years into the rough sleepers initiative to tackle some of the problems which worry her. She will also be aware that, as a result of the announcement made by my right hon. Friend the Secretary of State for Social Security a few weeks ago, there will be a real increase in the value of income-related social security benefits next April.
    Mr. Clappison: To ask the Prime Minister if he will list his official engagements for Thursday 10 December.
    Mr. Newton: I have been asked to reply.
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    I refer my hon. Friend to the answer that I gave some moments ago.
    Mr. Clappison: Does my right hon. Friend agree that in view of the great interest that parents have recently expressed in information about their children's examination performance—information which they have every right to have and which the Government have allowed them to have, but which the Opposition would deny them—parents would feel huge disappointment if some teacher unions boycotted their children's tests?
    Mr. Newton: I very much agree with my hon. Friend. A boycott of the tests would betray the pupils who have been working hard at the national curriculum and who deserve to have their achievements recognised. Her Majesty's inspectors' reports on the trial tests have said that they were a great success. It is absolutely right to say that it is time that the Opposition stopped opposing everything that helps to improve the quality of education and choice for parents.
    Mr. Boyce: Given the state of the economy, the homelessness and the poverty in this country today, does the Leader of the House agree that the worst possible scenario is that the Government know what they are doing?
    Mr. Newton: When the hon. Gentleman makes such a point, he might remember that in the past two years the rate of inflation has been more than halved and interest rates have been more than halved. We see exports at record levels and we see increases in retail sales. In the past three months, we have seen a 20 per cent. increase in car production.
    Mr. Duncan: To ask the Prime Minister if he will list his official engagements for Thursday 10 December.
    Mr. Newton: I have been asked to reply.
    I refer my hon. Friend to the answer that I gave some moments ago.
    Mr. Duncan: Does my right hon. Friend agree that those who try to criticise the basis on which houses have been valued for the purposes of the council tax risk severely misleading the public? Does he agree that it is relative house prices and not absolute house prices that matter? Does he agree that we have devised a fair basis for the fair implementation of a very fair tax?
    Mr. Newton: I of course agree with my hon. Friend that the purpose of the valuations is a comparison between relative property values. I agree even more with him that a system that takes relative values into account—alongside other factors, including rebates—will be far fairer than the discredited rating system to which the Labour party wishes to return.

Business of the House
3.30 pm
Mrs. Margaret Beckett: Will the Leader of the House state the business for next week?
The Lord President of the Council and Leader of the House of Commons (Mr. Tony Newton): Yes, Madam. The business for next week will be as follows:

MONDAY 14 DECEMBER—Motion for Christmas Adjournment.

Proceedings on the Consolidated Fund Bill.

TUESDAY 15 DECEMBER—Timetable motion on the Education Bill, followed by remaining stages of the Civil Service (Management Functions) Bill [Lords].

WEDNESDAY 16 DECEMBER—Remaining stages of the Prisoners and Criminal Proceedings (Scotland) Bill [Lords].

Motion on the Environmental Information Regulations.

THURSDAY 17 DECEMBER—Debates on the Adjournment.

Mrs. Beckett: I thank the Leader of the House for that statement. Will he ensure that there is a statement before Christmas on the scale of the sharp increases in food prices which we can expect to see in the new year as a result of the effects of devaluation of the green pound? Should not the public be warned of that and other inflationary consequences of the Government's failures?
Does the right hon. Gentleman recognise the real and growing concern that the Government's reluctance to listen to debate and to other points of view will be heightened by his announcement just now of a guillotine on the largest ever education Bill? It went into Committee only three weeks ago, and the meat of the Bill is in the early clauses. There will be considerable concern about that.
The Leader of the House may recall that we asked last week for a statement on guidelines on electoral registration because of the position in the Conservative-controlled London borough of Brent. The electoral register there has fallen by 26,000 in the past year. Is the right hon. Gentleman aware that Mr. Justice Potts has said in court today that there is a case to answer because of the discrepancy between the electoral register in Brent, at under 150,000, and the poll tax register, which shows 190,000? Will the right hon. Gentleman reconsider? May I press him again on that statement?
Does the right hon. Gentleman recognise that there will be concern among hon. Members of all parties about the Audit Commission report that, despite the work being speeded up of late, works on fire precautions in this building, which were commissioned in 1979, are not completed? A fire certificate cannot be issued for three or four years yet. That will be of great concern to hon. Members and to staff everywhere in the House.
Mr. Newton: The hon. Lady asked first about food prices. She will know that some of her right hon. and hon. Friends have been seeking an undertaking that there will be a statement following the Agriculture Council next week. Although I cannot give an absolute guarantee of that at the moment, we are certainly considering the matter and may be able to provide an opportunity of the sort that the hon. Lady seeks.
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The hon. Lady asked about the timetable motion on the Education Bill, which will be debated on Tuesday. I remind her that—I think almost unprecedentedly—we gave two full days for the Second Reading of the Bill. Let me state the position simply: the Bill has now been debated in the Standing Committee for 61 hours, and the Committee has only reached clause 13. There is nothing unusual about a Government seeking to make more progress than that on such a Bill.
The hon. Lady's third question related to electoral registration. I have not had an opportunity to study the remarks that she attributed to Mr. Justice Potts but, on the assumption that she has reported them accurately—which I have no reason to doubt—I am sure that my right hon. and learned Friend the Home Secretary will want to consider what the hon. Lady and the judge in question have said.
The hon. Lady asked about the Audit Commission's report on safety precautions. She will be aware that the Chairman of the Accommodation and Works Committee answered a question on that matter very recently, and that there are significant signs that better progress is being made. Nevertheless, I am sure that the Chairman of that Committee will wish to consider what she has said this afternoon.
Sir Peter Emery: Will my right hon. Friend pay some attention to the fact that the Procedure Committee has now been appointed and has met, but that we await a reply from the Government in respect of a number of reports that have already been made? It would be helpful to the progress of the work of that Committee if those replies could be made as soon as possible.
Mr. Newton: Let me take this opportunity to congratulate my hon. Friend on his re-election as Chairman of that important Committee. He knows that I am anxious to make progress on these matters, which concern, among other things, some useful possible changes in the arrangements for petitions. I hope to respond to my hon. Friend quite quickly.
Mr. Derek Enright: Does the Leader of the House recall that the President of the Board of Trade assured the House from that very Dispatch Box that, during the review of the 10 pits, no miner would suffer in terms of benefits and payments? Is he further aware that British Coal announced yesterday that it will not be paying what is known as the Christmas bonus, on the ground that the miners are not working underground? I have confirmation of that in a letter from the Minister. Will he drag the President of the Board of Trade away from his lunch and to the Dispatch Box so that we can debate the disgraceful nature of this Scrooge-like decision?
Mr. Newton: This is the latest in what must by now be a long line of occasions on which I have been invited to drag the President of the Board of Trade to the House. I do not think that I can undertake to do that, but I can certainly undertake to bring to my right hon. Friend's attention what the hon. Gentleman has just said.
Mr. Bill Walker: Has the Leader of the House seen early-day motions 991, 992 and 1040?
[That this House is concerned that for the last 10 years Councillor J. Brooks has been Labour Leader of Monklands District Council, where with the help of the local Labour Party he has achieved a position of near absolute power

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which has resulted in ( 1 ) a £1 million land deal for a company owned by Councillor Brooks and his brother, whereby the company acquired council land for £50,000 and forced through planning permission to make the land worth more than fl million the payment of generous fees to Councillor Brooks and his brother and other expenses followed by the company being placed in liquidation with unpaid bills to third party creditors of over £200,000, ( 2 ) the employment by the Council of Councillor Brooks' son in Direct Works, another son in the Planning Department and a daughter in a temporary post, (3) the sacking from council employment of Labour Party member Tom McFarlane at 51 years of age, believed to be the only Monklands District Council worker ever made redundant without being offered alternative employment, because he and his wife had dared to question the internal procedures of the local Labour Party and its corrupt rule of the Council and (4) the attempt by Councillor Brooks to cover up the mafia-like behaviour of himself and other Labour councillors by seeking to obtain council funding for legal fees for a private libel action against the local newspaper and by starting a council-owned free newspaper; believes that other allegations about relationships between the expenditure of council money and benefits to Councillor Brooks and his family need to be independently investigated; and is further concerned that the manner in which the Labour party is governing local councils in Scotland is against the public interest and requires to be independently investigated.]
May we have an early opportunity to debate the behaviour of Monklands district council—and, in particular, the Labour leader of that council—so that the Leader of the Opposition and the shadow Secretary of State for Scotland can give us their views on the conduct of the council?
Mr. Newton: I made some observations on that matter a few moments ago, albeit wearing a slightly different hat. I shall not add to them, except to say that my hon. Friend will recall that the first items of business that I announced for next week were the motion for the Christmas Adjournment and the proceedings on the Consolidated Fund Bill. I leave it to him to decide whether on the former he might argue that the House should not adjourn until the right hon. and learned Member for Monklands, East (Mr. Smith) has had an opportunity to say something about the matter.
Mr. John Spellar: Has the Leader of the House taken note of the considerable and growing concern expressed by hon. Members on both sides of the House about private wheel clamping? Will he make time next week for the Home Secretary to make a statement about the instigation of the public consultation that has been promised for so long?
Mr. Newton: I am aware that a number of comments—some of them criticisms—have been made on that subject, and also that it is one that the hon. Gentleman has been pursuing. I shall bring to the attention of my right hon. and learned Friend the Home Secretary the point that he has just made.
Mr. Patrick Cormack: As it cannot really matter whether we debate the Prisoners and Criminal Proceedings (Scotland) Bill next week or when we come back after Christmas, may I urge my right hon. Friend to think again about the business for next week and
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give us a debate on foreign affairs? It really would be appalling if Sarajevo fell during the Christmas recess and the House had not debated the matter.
Mr. Newton: I cannot promise my hon. Friend the debate that he seeks but, to echo something that I just said, it is clear that there are a number of opportunities between now and the recess on which my hon. Friend and other hon. Members could make known their anxieties on that matter.
Rev. Martin Smyth: Can we have an urgent statement by the Secretary of State for Northern Ireland concerning the scandalous suggestion that water privatisation should be within the trade? Would that not repeat the folly of electricity privatisation, since we have discovered that contributions deducted from workers' wages to pay for their electricity bills were used by a purchaser of one of the businesses to pay for that business?
Mr. Newton: I shall draw the attention of my right hon. and learned Friend the Secretary of State to the matter that the hon. Gentleman raises.
Mrs. Elizabeth Peacock: Will my right hon. Friend consider whether he could ask our right hon. Friend the President of the Board of Trade to make a brief statement in the House next week about progress on the coal closure issue? Following on from the question of the hon. Member for Hemsworth (Mr. Enright), I think that there is much concern and not a little confusion about exactly what is happening, and whether British Coal is taking the correct action.
Mr. Newton: My hon. Friend's concern for those matters is well known and well documented. She will be aware that my right hon. Friend gave evidence to a Select Committee earlier this week, in which a number of further points were raised, which I hope made it clear that the review is genuine and real, and not simply a rubber-stamping exercise.
Mr. Brian Sedgemore: Is the right hon. Gentleman aware that a petition containing half a million signatures was handed to Downing street this morning to save St. Bart's hospital from closure? Now that Londoners have delivered their democratic verdict, will he ensure that the Secretary of State for Health comes to the Dispatch Box next week to announce that Professor Tomlinson's mad, bad and sad proposal to close that hospital will be assigned to the dustbin of medical history?
Mr. Newton: I hope that, in giving a more measured response than the hon. Gentleman's question, I shall not be misunderstood if I say that it is well recognised—I am not commenting on a particular proposal—that it is right to deal with the balance between primary care and other forms of health spending in London against the background of a long period in which health care in London has received far more per head of population than that in other parts of the country. I do not think that it is wrong to examine issues arising from that.
As far as the specific case is concerned, I have no doubt that my right hon. Friend will be aware of the petition and will take it into account, but she is considering a wide variety of issues and representations and intends to respond in a proper, measured way in the new year.
Mr. James Pawsey: Does my right hon. Friend accept that his announcement on the timetable for the Education Bill will be widely welcomed? As he said, about 61 hours have been spent on the Bill and only 5 per cent. of it has been achieved. We are anxious to make progress, despite the filibustering efforts of Opposition Members. In his statement, my right hon. Friend referred to the fact that, unprecedentedly, two days were spent discussing the Bill on Second Reading. Will he agree to a further two days being spent on the Bill on Report?
Mr. Newton: I note my hon. Friend's request and endorse some of his earlier comments. We shall consider what should be in the motion that we shall invite the House to endorse—I deliberately reply in general terms—and that will be against the background that what we did at Second Reading clearly demonstrates that there is no question that we are seeking arbitrarily to curtail discussion of the Bill, but rather that we are seeking to provide a proper opportunity for it to be discussed sensibly.
Mr. David Alton: Will the Leader of the House arrange for the President of the Board of Trade and the Attorney-General to make early statements about the protection given to would-be holidaymakers? Is he aware of a letter that I received today from the Prime Minister, which confirmed that the Government knew that Land Travel had liabilities over assets totalling £2.1 million a year before the collapse of that firm? The letter states:
"the Department of Trade and Industry did in fact receive a complaint about Land Travel in August last year … the Department had overlooked this letter when they were consulted over"
my earlier correspondence to the Prime Minister. In the light of that, and given that that company must have been trading illegally, does the right hon. Gentleman agree that compensation should be provided to those who lost their savings, and that early criminal action for fraud should be taken?
Mr. Newton: The hon. Gentleman will appreciate, in view of some of the points he made, and particularly his suggestion of possible criminal charges, that I must respond cautiously. I shall make sure that the President of the Board of Trade is aware of what he said. I should perhaps make it clear that the Department of Trade and Industry has no general monitoring role in relation to companies; nor is it responsible for scrutinising company accounts.
Mrs. Angela Knight: I thank my right hon. Friend for announcing the timetable motion on the Education Bill. Is he aware of the concern that is felt by Conservative members of the Standing Committee at the fact that the Bill has been taking, on average, six hours per clause—which, at the current rate of progress, would have meant 1,500 hours in Committee? Is he also aware of the great concern of many parents in my constituency that so much time should have been spent on a handful of clauses rather than the Committee getting on with the proper job of scrutinising the Bill?
Mr. Newton: I am grateful to my hon. Friend for a singularly striking statistic, which shows that we are being reasonable in proposing that there should be a different way of making progress with the Bill.
Miss Joan Lestor: Bearing in mind the almost universal and informed criticism of the Government's lukewarm response to the Warner report, dealing with the plight of many children in residential care, may I ask the right hon. Gentleman for an assurance that that report will be debated at the earliest possible moment? Is he aware that, unless its recommendations are carried out quickly, more children will suffer at the hands of people who are not trained to deal with them but are there simply to abuse them, since the vetting processes for people looking after children in care are very poor indeed?
Mr. Newton: The hon. Lady, who has taken a long and careful interest in those matters over many years, will be aware that, far from dragging her feet—to summarise the suggestion in the hon. Lady's question—the Secretary of State for Health has already instructed local authorities to take immediate action on that aspect and to report back to her by Easter. I do not regard that as foot-dragging.
Mr. Richard Alexander: Can my right hon. Friend advise the House of likely timings for discussions on the reform of Sunday trading? He will be aware that a Bill, of which I am a sponsor, is currently being published by my hon. Friend the Member for Gillingham (Mr. Couchman), and that there is another Bill in the name of the hon. Member for Ogmore (Mr. Powell). Is my right hon. Friend aware that it would be sensible for the Government to introduce their own proposals in debate before wasting time on private Members' legislation which would probably prove to be unnecessary?
Mr. Newton: My hon. Friend will know that, in addition to the measures to which he referred, there is another with a somewhat different purpose due for debate early in the new year. I shall bring his remarks to the attention of the Home Secretary, who has made it clear that it is not possible at present to take a decision quite in the way that my hon. Friend suggests, not least because we have not yet had the judgment of the European Court of Justice.
Mr. Richard Burden: I draw the attention of the Leader of the House to early-day motion 615 dealing with the Caring Costs campaign.
[That this House welcomes the launch of Caring Costs, the campaign for an independent income for carers, which has the backing of 45 voluntary organisations and charities; recognises the substantial contribution made to community care by Britain's six million carers; and urges the Government both to review the level of financial support given to older carers and hold a debate on the financial aspects of providing care and support at home.]
Is he aware that that motion today received its 150th signature, confirming the support it has in all parts of the House? Carers save the country £24 billion a year, yet are racked with poverty, although they provide care for 24 hours a day, seven days a week? Does my right hon. Friend agree that it is time we had an early debate on the subject, as is clearly requested by many hon. Members?
Mr. Newton: The hon. Gentleman will know that we have invested much effort over a long period into improving matters for carers, and we expect further improvements as a result of the move to community care from April onwards. This is a subject about which I know something, having played a part, in a former incarnation,

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in making a number of significant improvements in social security benefits for carers, which now involve expenditure in their support of £260 million a year.
Mr. Harry Greenway:: Will my right hon. Friend arrange a debate next week on pedestrian safety? Could the motion take account of the people of Northolt, who have great problems arising from the opening of the Hayes bypass, which is pouring large amounts of traffic into Northolt? Could it be coupled with concern for Hanwell, where the children of Hartmain school have been to see me to seek a pedestrian crossing in Greenford avenue, where the traffic is very dangerous for them?
Mr. Newton: My hon. Friend's question is, as ever, a tribute to his vigour in pursuit of his constituents' interests. He seems to have raised points that would classically be the focus of the Christmas Adjournment debate on the Consolidated Fund Bill.
Mr. Bob Cryer: May I draw attention to early-day motion 1041 on delegated legislation?
[That this House notes with alarm that over three thousand statutory instruments have been issued so far in 1992 and that this quantity of delegated legislation is unprecedented in the history of Parliament; regrets that the Government is reluctant to grant time for debate on Prayers against such instruments, and that affirmative instruments can be debated even before the Joint or Select Committees exercise their scrutiny; further regrets that any change in this arbitrary and unhelpful procedure has been rejected by the Leader of the House; and concludes that the increased burden of statutory rules, regulations and orders comes from a Government dedicated to arbitrary, centralised and undemocratic control.]
Will the Government make a statement devoted to removing regulations from the backs of small businesses and other organisations, because the Government have issued 3,000 statutory instruments in the past calendar year, which is an unprecedented number in the history of Parliament? Moreover, they are still being issued. Will the Leader of the House recognise that such a statement would be handy in providing an opportunity for hon. Members to debate prayers against statutory instruments to make up for the significant democratic deficit that exists in the scrutiny of the huge flood of statutory instruments which the Government are producing?
Mr. Newton: May I reply in a slightly different tone by paying tribute to the work of the hon. Gentleman arid his Committee for their detailed work in that area for the House? I shall do what I can, within practical limitations, to ensure that his Committee's work continues to be effective.
Mr. John Bowis: Is my right hon. Friend aware of the deep sense of outrage among parents of children with special educational needs at the statement by the deputy leader of the Labour party that the section of the Education Bill on special educational needs was not part of the "meat" of the Bill? Is that not why we need a timetable motion for the Bill? Will he ensure that that section of the Bill receives adequate time for proper scrutiny and debate, because Conservative members of the Committee wish to see that the interests and needs of those children are taken fully into account?
Mr. Newton: I very much endorse what my hon. Friend says. From my constituency experience, I am well aware that many parents with some of the most difficult problems see the special needs provisions of the Bill as a key element of it and a good reason for getting on with it.
Mr. Frank Cook: Is the Leader of the House aware of the announcement that has been made this afternoon by means of a planted question that tells the House that 182 jobs are to be removed from the royal naval ordnance depot at Eaglescliffe in Stockton, Cleveland? Is he aware that this is the second time that the Ministry of Defence has betrayed the Cleveland community in less than 18 months? Is he further aware that that announcement has been made in a surreptitious way after meetings at which the Minister of State for the Armed Forces undertook to give the basis of the costings on which Admiral Pulvertaft founded his so-called recommendations?
Will the Leader of the House seek to bring the Minister of State to the Dispatch Box where he can be questioned openly, in public, about the falseness of the advice that he has received from the treacherous mandarins in his Department?
Mr. Newton: The hon. Gentleman no doubt has, as I have, a copy of the answer that my hon. Friend the Minister of State has given. It makes it absolutely clear that my hon. Friend has thoroughly conducted the required consultation and carefully considered the points that were raised, but has nevertheless come to that decision.
Mr. David Shaw: My right hon. Friend will be aware that the European single market commences on 1 January, and that a number of freight forwarders and customs clearance agents in my constituency will lose their jobs as a result of their work no longer being required. My right hon. Friend will also be aware that I have received assurances from the Department of Employment that moneys will be made available for retraining purposes and that money will be made available through the European social fund. I understand that the Government will ensure that that money is available.
There is no evidence that the money will trickle down to the companies and people who will be made redundant. Can my right hon. Friend give an assurance that, if necessary, the House will be recalled, so that we can call the Ministers and civil servants to the Bar of the House if the money is not made available to the companies for the benefit of those who will be made redundant?
Mr. Newton: I hope that my hon. Friend will understand if I do not immediately give him the undertaking that he requests. I am sure that he will accept that I will ensure that my right hon. Friend the Secretary of State for Employment is made aware of the point that he has made.
Mrs. Barbara Roche: Will the Leader of the House make time for his right hon. and learned Friend the Home Secretary to come to the House and make a statement about security in London, given that two bomb explosions occurred in Wood Green in my constituency this morning? I have just returned to the House from visiting the scenes of the explosions. A number of members of the public and police officers have

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been injured. I am glad to be able to report to the House that all of those members of the public and police officers have now been released from hospital.
I should like to take this opportunity to pay tribute to the police and the emergency services who responded so promptly and efficiently to this absolutely contemptible and cowardly attack.
Mr. Newton: The House will appreciate both the reasons for the hon. Lady raising that matter and the way in which she has done so. I will ensure that my right hon. and learned Friend the Home Secretary is made aware of both matters.
Mr. Phillip Oppenheim: Is there any possibility of having a debate on either the Edinburgh summit or the GATT round to enable hon. Members to point out gently to our French partners that Europe has consumers of food as well as producers? French farmers, who expect to export a high proportion of what they produce, have no right to block the exports of others, be it grain from the United States or lamb from Britain.
Can we have an opportunity to make the point that European consumers already heavily subsidise French farmers and have no right whatever to insist that European consumers buy French food? European consumers should be free to buy the food of their choice.
Mr. Newton: I am not sure that I have the standing to undertake to draw remarks to the attention of a Minister in another country, but I hope that my hon. Friend's remarks are read in France as well as in the United Kingdom. As to opportunities to raise such matters, I anticipate that my right hon. Friend the Prime Minister will wish to report to the House following the Edinburgh Council, which is about to get under way.
Mr. Harry Barnes: Given recent events, is it not time that the royal prerogative powers on the dissolution of Parliament, the appointment of Ministers and the signing of treaties and Bills were discussed in the House with a view to them being taken over by the House and perhaps exercised by Madam Speaker rather than by the Crown?
Mr. Newton: I have no plans to bring about such a discussion or a proposal.
Mr. Eric Pickles: Will my right hon. Friend persuade the Secretary of State for Education to come to the House to make a statement on teacher numbers, which is necessary following a press release issued by the hon. Member for Blackburn (Mr. Straw) which suggested that teacher numbers have gone down? It is a fact that teacher numbers have gone up. I am sure that the hon. Member for Blackburn would want to use the occasion to congratulate the Government on achieving such record numbers.
Mr. Newton: On the latter part of the question, I can only say that hope springs eternal. I share my hon. Friend's hopes. I can promise him a splendid opportunity to raise such matters next week, because my right hon. Friend the Secretary of State is due to answer questions on Tuesday.
Mr. David Winnick: Is it possible for a debate to take place, if not next week, then shortly after we return, about the way in which Government Departments are increasingly seen, with justification, as virtually an extension of Conservative central office? That was witnessed by the way in which the passport records of President-elect Clinton were examined to see whether he had applied for United Kingdom citizenship. Apparently, he had not. Should we not be worried about not so much one particular town—which Tory Members have been on about this week—but the way in which the Government of the day are corrupting public life by using Government Departments in the way I have just described?
Mr. Newton: When one contemplates what has happened in some Labour local authorities over the years, the hon. Gentleman's point seems pretty strange. I can only say, and I do so with feeling, that, from my own fairly considerable experience as a Minister, the hon. Gentleman's suggestion that civil servants allow themselves to be treated as an extension of central office is totally at variance with the facts.
Mr. Barry Field: May I draw my right hon. Friend's attention to the amendment that I have tabled to the Housing and Urban Development Bill, in which I seek to extend the right to buy to tenants of former Greater London council homes? They gave up their homes on the understanding that they were being transferred to the seaside to take up accommodation which was wholly the same as that of tenants of all other local authorities, to whom the right to buy has been extended. They have since been deprived of the right to buy and are unhappy about it.
As my right hon. Friend is something of a wise owl in such matters and was helpful to me last week, will he give me his advice on how I might persuade the Government to take up that necessary reform, which would affect the constituents of many hon. Members?
Mr. Newton: I am grateful for my hon. Friend's kind words. There must be some limit to the extent to which I can offer him advice, helpful or otherwise, on the Floor of the House. However, I should be surprised if my hon. Friend could not find some opportunity to raise the matter during the passage of the Housing and Urban Development Bill. In any case, I am sure that my right hon. and learned Friend the Secretary of State for the Environment will read the words that my hon. Friend has uttered.
Mr. Dennis Skinner: In view of all the statements that were made and the questions that were asked at Prime Minister's Question Time, and as the Government refuse to allow local authorities to build homes for people on the streets, would it not be a good idea at Christmas when we pack up for three and a half weeks to shift the rough sleepers in the House of Lords and put in the rough sleepers off the streets? At least one palace—or at least a few rooms—is going empty, and that accommodation could be used.
If any more homeless want accommodation, they can have three and a half weeks here. There are all these empty Benches. The place is warm and well lit. The people would have accommodation, a canteen and all the facilities they need. If the Government are really concerned about the homeless, they should get it going.
Mr. Newton: I am not sure that those in another place will regard that as an entirely helpful and friendly suggestion. However, I shall certainly make sure that my colleague the Lord Privy Seal is made aware of the elegant way in which the hon. Gentleman put it.
Mr. D. N. Campbell-Savours: Will the Leader of the House read the proceedings of European Standing Committee A yesterday? A Member of the House who is not a member of the Committee was able to walk in under the umbrella of a commercial consultancy. On matters relating to that consultancy, he asked detailed questions of a Minister which the Minister was required to answer because of the questioning procedure of that Standing Committee.
What happened was—
Madam Speaker: Order. May I remind the hon. Gentleman that, if an hon. Member was in a Committee, he was surely there in his own right as an elected Member of Parliament. That should be placed on the record.
Mr. Campbell-Savours: That is absolutely correct, but he was also acting under the umbrella of his consultancy. Although what happened was in order, and the hon. Gentleman did not break any rules of the House, is it not clear that that procedure, as it was exercised yesterday, is incorrect?
While it is of great benefit to Parliament that Members can ask questions in detail, surely some discipline must be exercised personally by Members not to abuse procedures in that way or the Procedure Committee should re-examine the procedure with a view to some reform.
Mr. Newton: I think that you would agree, Madam Speaker, that, as I have not read the report to which the hon. Gentleman referred, it would be wrong for me to make any immediate response. I will read it, however.
Mr. Paul Flynn: Will the Leader of the House arrange a debate next week so that we can congratulate all concerned on the continuation of semiconductor manufacturing in my constituency, and also to examine the worrying claims in today's Electronic Times? It is said that INMOS—International Metal Oxide Semiconductors—which was valued at £120 million 10 years ago, was sold to a Hong Kong company for less than £6 million; that the Government are prepared to assist the company with a maximum of £3 million, whereas the French and Italian Governments have invested tens of millions of pounds; and that the manufacture of the British-controlled, British-invested transputer will not be conducted in Newport in future, but will take place abroad.
Will the Leader of the House give a guarantee that the new company, Newport Wafer Fab, can look forward to at least the same amount of confidence, support, encouragement and investment from the British Government as the French and Italian companies are given by their Governments?
Mr. Newton: For slightly different reasons, I shall respond nearly as cautiously to the hon. Gentleman as I responded a few moments ago to his hon. Friend the Member for Workington (Mr. Campbell-Savours). I can, however, reply in general terms, as well as ensuring that my right hon. Friend the President of the Board of Trade is aware of what the hon. Gentleman has said. As has been
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clearly shown, the Government will continue to take a range of actions designed to encourage British manufacturing industry in that and other sectors.
Mr. Alan Milburn: Will the Leader of the House find time next week for us to debate the Government's regional policy, in the light of the announcement made by his right hon. Friend the Minister of State for the Armed Forces about the closure of the Eaglescliffe depot? As the Leader of the House will realise, that announcement will have been received with considerable alarm and disbelief in the north-east—not just because this is the second time in 12 months that the region has been let down, but because the skills and expertise of many of my constituents who work at Eaglescliffe have been insulted by the Government's latest decision.
Is the Leader of the House aware that the decision to close the Eaglescliffe facility runs completely against the grain of the Government's declared intent to switch jobs from south to north, and to narrow regional inequalities rather than widening them?
Madam Speaker: Order. Let me issue a long overdue reminder. Hon. Members should be questioning the Leader of the House's statement and asking him to change next week's business; this is not simply a continuation of Question Time. Would the Leader of the House like to make some response?
Mr. Newton: I shall reply briefly, in the light of your strictures, Madam Speaker. Although I well understand why the hon. Member for Darlington (Mr. Milburn) has raised the subject of Eaglescliffe, I cannot add to what I said earlier to his hon. Friend the Member for Stockton, North (Mr. Cook)—except to say that the Government have put considerable effort into bringing new employment to the north-east, as the hon. Gentleman will know from contacts that he and I had in previous incarnations.
Mr. Andrew Miller: The Leader of the House has told us that the Environmental Information Regulations will be discussed next week. May I draw his attention to column 836 of yesterday's Hansard? The Minister for the Environment and Countryside, who has just left the Chamber, said in answer to a question that the environmental toxic waste regulations should be examined. I have been told, in answer to a question that I posed to the Minister, that the regulations are not yet available. In view of next week's debate, will the Leader of the House impress on his colleague the fact that they should be placed in the Library at the earliest opportunity? I understand that they are in public circulation.
Mr. Newton: I shall certainly look into that, and I shall draw the hon. Gentleman's remarks to the attention of my right hon. and learned Friend the Secretary of State for the Environment.
Mr. Andrew Mackinlay: Will the Leader of the House arrange for a statement to be made before the recess about the haemorrhaging of rail freight from British Rail? Hon. Members on both sides of the House are concerned about that, and also about the state of the manufacturing industries that build our carriages and rolling stock. It has become abundantly clear to the Select Committee that both the rolling stock industry and rail freight are haemorrhaging. Unless ministerial action

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arrests the process, we are about to lose an important British industry, and the loss of rail freight could lead to Beeching-style cuts in our rail structure with no consideration of the matter by the House of Commons.
The matter will not keep until the new year. May we have a statement next week about the danger to our railway structure and industries?
Mr. Newton: I cannot undertake to provide time for a debate of the kind that the hon. Gentleman seeks, but I know from my contacts with other hon. Members that his concern has been expressed elsewhere. I have specifically drawn it to the attention of my right hon. Friend the Secretary of State for Transport.
Mr. Mike O'Brien: Will the Leader of the House arrange for an investigation and a statement by the appropriate Minister into the winding up of the pension scheme of the Burlington International Group, leaving a deficiency of £6.5 million and affecting more than 1,000 people, many of them my constituents? They will not be able to get the pensions that they had every right to expect and to hope for. We have seen the same with Maxwell and too many other companies. Is it not time that the Government introduced regulations to prevent the plundering of so-called surpluses from those pension schemes?
Mr. Newton: I am not in a position to comment on the specific case, but I imagine that the hon. Gentleman may have taken it up with my right hon. Friend the Secretary of State for Social Security, or that he intends to do so. On the more general point, he will know that the Government have taken substantial steps to improve the protection of pension funds over the years but in the wake of the Maxwell case have appointed a substantial inquiry to review that. It is operating on as speedy a time scale as can properly be expected.

Adjournment of the House
4.10 pm
Madam Speaker: I have a short statement to make to remind hon. Members that on the motion for the Adjournment of the House on Thursday 17 December up to nine hon. Members may raise with Ministers subjects of their own choice.
Applications should reach my Office by 10 pm on Monday next. A ballot will be held on Tuesday morning and the result made known as soon as possible thereafter.

Points of Order
4.11 pm
Mr. Frank Dobson: On a point of order, Madam Speaker. I know that you are most concerned to ensure that major Government decisions are announced to the House so that hon. Members have the opportunity to question Ministers. Today, the Secretary of State for Employment has announced that she is abandoning Government funding of trade union ballots and of training for trade union officials. The Government fund the training of the other side of management but are not, apparently, willing to fund the training of the people who will be on the other side of the negotiating table. The funding of trade union ballots, which Lady Thatcher introduced, is apparently to be abolished by the present allegedly more concerned Government.
A statement should have been made on these important matters, either today, when there is no statement other than the business statement, or on Tuesday, when the Secretary of State replied to our Opposition day motion on unemployment, and when again there was no statement. The decision was clearly made then, and it seems to us to be wholly unreasonable that the Secretary of State is not willing to explain why the Government have reached these appalling decisions.
Madam Speaker: As the hon. Gentleman will understand, there has been no breach of our Standing Orders or of our procedures. The matter therefore is not one for the Speaker.
Mr. Dobson: Further to that point of order, Madam Speaker. Your predecessors and you yourself have been keen to ensure that hon. Members have the opportunity to question Ministers on such matters. There will not be any opportunity to question the Secretary of State for Employment until well after Christmas. That is at variance with normal practice, even if it is not out of order.
Madam Speaker: I have made it clear on a number of occasions in this House that I deplore statements being made outside the House rather than to hon. Members. I stand by that. When major changes are made, they should be announced first in the House so that a statement can be questioned. But, as the hon. Gentleman and the House know, I have no authority on these matters, which is why I simply said, so as not to waste the time of the House, that there had been no breach of our Standing Orders or of our procedures. I have previously made my views known very clearly on these matters. Perhaps, if the hon. Gentleman had been present for business questions, he might have put that question to the Leader of the House.
Mr. Dobson: Further to my point of order, Madam Speaker. Business questions were within two questioners of coming to an end before I received the information that I have now. I am, however, grateful to you for once more saying that it is best for Ministers to come and face the music.
Mr. Andrew F. Bennett: Do you not agree, Madam Speaker, that one of your prime roles is to ensure that there is good order in the House? Do you also accept that, if the Government continue not to take any notice of your warnings to them that when they are making important statements they should make them in

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the House and not to the Press outside, the only recourse for Opposition Members is to raise points of order and to make a fuss? That does not, on the whole, reflect well on the House. It seems to me that it is very important that, rather than forcing the Opposition into such tactics, the Government should take note of your warning and make sure that on every possible occasion they make statements to the House.
Madam Speaker: Only today, 12 answers have been given to written questions by the Government. It is outside my control whether the Government give written answers to questions or make oral statements in the House. I have noted what the hon. Gentleman has said.
Mr. Dennis Skinner: Do not the complications that are caused for the Chair arise from the fact that, when major statements are made in this way outside the House, hon. Members go to the Table Office, for which you have responsibility, and put questions down—about trade union ballots, say—not knowing that a major change has taken place? Complications can ensue for any hon. Member who tries to table a question on something that has changed on the day without his knowing about it.
That is where the Chair becomes involved, because a Member can take that question that is turned down by the Table Office to the Speaker. I think that the Government ought to bear in mind the fact that, when major changes take place, those complications are created. The trade unions now have only one recourse—to refuse to hold these ballots which the Government decided upon years ago.
Madam Speaker: Order. This was a parliamentary answer. It is not for the Speaker to work out the criteria for what is major and what is not major in these matters.

Points of Order
  BILL PRESENTED
    NATIONAL HEALTH SERVICE (FREEDOM OF SPEECH)
    Mr. Derek Fatchett, supported by Robert Ainsworth, Mr. John Battle, Mrs. Anne Campbell, Mr. Jim Cousins, Mr. Jim Cunningham, Mr. Ian Davidson, Mr. Terry Davis, Mr. Alan Milburn, Ms. Dawn Primarolo, Mr. Terry Rooney, and Mr. Mike Watson, presented a Bill to guarantee National Health Service and related staff freedom of speech on issues of patient and client care; to require the Secretary of State to specify procedures for the expression and investigation of concerns and to provide for the implementation of such procedures; to provide for the drawing up of a Charter setting out the rights and duties of staff; to set up a system of independent appeals; and for connected purposes: And the same was read a First time, and ordered to be read a Second time upon Friday 29 January 1993; and to be printed. [Bill 102.]
Orders of the Day
  ESTIMATES DAY
  [IST ALLOTTED DAY, IST PART]
  ESTIMATES DAY
    CLASS VII

      Coastal Zone Protection
      [Relevant documents: The Second Report from the Environment Committee of Session 1991–92 on Coastal Zone Protection and Planning (HC 17) and the Government's reply thereto (Cm. 2011).]
      Motion made, and Question proposed,
      That a sum not exceeding £17,763,619,000 be granted to Her Majesty out of the Consolidated Fund, on account, for or towards defraying the charges for civil services, in Class VII, for the year ending on 31st March 1994, as set out in the House of Commons Paper No. 232 of Session 1992–93.—[Mr. Maclean.]
      4.19 pm
      Mr. Robert B. Jones: It is a great privilege to be able to introduce this debate, particlarly since it is the first opportunity that I have had to pay a tribute to my predecessor, Sir Hugh Rossi, under whose chairmanship this report was produced in April. Sir Hugh was a very distinguished public servant, both as a Minister and, latterly, as the Chairman of the Select Committee on the Environment. I believe that history will say that he had a unique influence on environmental legislation in this country. His is a very hard act to follow, and I am delighted that I had a piece of my apprenticeship under his chairmanship.
      I begin by summarising what the Committee said in its report, as I think that that will be of assistance to the House. The report was published in April this year. The Committee chose to take a broad and integrated view of coastal issues and the multitude of bodies, including Government Departments, local authorities and public agencies, which have policies, responsibilities or interests in the coastal zone.
      Throughout the inquiry Government officials stressed repeatedly that existing arrangements for coast protection and sea defence were working extremely well. Of course, that was not the view of the vast majority of witnesses in the evidence that they submitted to us. Perhaps the discrepancy is because of the traditional arguments between Departments over such matters—I am thinking especially of the relationship between the Ministry of Agriculture, Fisheries and Food and the Department of the Environment.
      After the Committee had heard the evidence, the main conclusions of its report were that coastal protection, planning and management in the United Kingdom had suffered centuries of unco-ordinated decisions and actions—perhaps better described as "inactions"—at national and local levels; that there are inadequacies in the legislation, anomalies in the planning system, a lack of central guidance, and overlapping policies and responsibilities among a host of bodies with poor co-ordination between them.
      We concluded that the reasons for such failings were partly a result of the pattern of ownership of the coastal zone and partly because the boundaries separating the

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      administrative authorities are not meaningful in terms of natural coastal processes and the consequences on one part of the coast of interference in another.
      The Committee is certain that there is no single panacea to resolve all the problems currently experienced in the coastal zone, but we are equally convinced that the complexity of the current situation demands a more comprehensive and integrated approach than is presently being taken. We therefore supported the overall perspective commonly known as "coastal zone management", or CZM for short.
      Coastal zone management aims to balance demands for coastal zone resources, to promote their sustainable use and, as far as possible, to resolve conflicts of use by integrated planning and management within coastal cells that are defined by natural coastal dynamics rather than administrative tidiness.
      Britain is fortunate in having the building blocks for an integrated coastal zone management approach: a whole range of bodies is committed to the concept, and existing coastal groups and forums could be adapted to take on new coastal zone management roles. The Committee therefore concluded its report by recommending that coastal zone management, delivered through a "cascade" of national, regional and local coastal zone management plans, is the key to sustaining the future use, enjoyment and ecology of the coastal zone.
      The Government's response dealt with a number, although not all, of the issues. Perhaps it would be helpful if I also summarised what the Government said. It was significant that, at the start of our inquiry, our request for evidence from the Department of the Environment resulted in a memorandum that set out for the first time a full statement of the Government's policies and activities for coastal zone protection and planning. It is one of the features of the Select Committee system that, almost as soon as a Committee embarks on an inquiry, there is a flurry of activity in the Departments involved and a rationalisation of existing policies. If the Committee achieved nothing else, that is a powerful achievement to its credit.
      Equally welcome was the Government's response to the Committee's report that was published last July. That document is a considered and well-written response, and we were heartened to read that the Government considered our report to be
      "a valuable contribution to the debate on coastal zone protection and planning."
      The Government accepted several, although not all, of our recommendations. In particular, we were pleased that they accepted the need for local coastal management plans as a vehicle for implementing national policies and for such plans to be incorporated into the statutory plan system. The intention to promote multi-agency estuary and coastal management plans is most welcome.
      It is encouraging that the Government accept that strategic consideration of environmental issues must cross the land-sea divide. While not wholly in accord with our recommendation to extend local authority planning powers to the 12-mile limit, the Government agree to "take the debate further" by issuing a discussion paper. We are told that the paper will also consider the form and scope
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      of coastal management plans, and we look forward to receiving the Government's proposals for consultation in due course.
      We were also encouraged that the Government agreed to consider the Committee's views in their review of the marine aggregates licensing procedures and their review of the mineral planning guidance note 6 on the provision of aggregates. We were pleased to learn that such a review would also discuss the continuing role of the Crown Estate in that matter.
      Mr. A. J. Beith: Will the hon. Gentleman recognise that one thing that ought to be considered in that review is the situation at Druridge Bay in Northumberland, which was drawn to the Committee's attention, where sand continues to be dug from the beach on the basis of a planning decision granted on appeal decades ago and the Government still consider that the local authority should find what might be unlimited sums for compensation arising from a decision that it never took?
      Mr. Jones: The right hon. Gentleman would not expect me to go into detail on a constituency point, but there are deficiencies and I believe that my hon. Friend the Member for the Isle of Wight (Mr. Field) wants to go into that if he catches Madam Speaker's eye. That is the purpose of the review and I hope that these issues will be addressed.
      The Government are also reviewing permitted development rights accorded to the port and harbour authorities under the General Development Order and will consider subjecting certain activities to environmental assessment, which I welcome. The Government agree with the Committee that the application of environmental assessments in the coastal zone could be improved.
      Other areas where the Government and the Committee are of the same mind include, first, the value of "controlled retreat" as an attractive option in certain cases, and the need to support research and development in this area; secondly, the extension of grant-aid provision to beach management schemes as well as capital coastal works—we found that the existing grant system favoured "hard" engineering works above the more environmentally-friendly "soft" works; thirdly, better protection for conservation areas that straddle the interface between land and sea, especially in the context of the new European Community habitats directive; fourthly, the advantages of protective ownership for coastal land in achieving conservation objectives; and fifthly, the need to clarify the role of the many agencies involved in monitoring, regulating and cleaning up marine pollution.
      Finally, in response to our recommendation for greater co-ordination of information and research on the coastal zone, the Government produced a most useful summary of the various information networks and databases operated by different bodies, and as such represents a source of reference in its own right.
      There were, of course, several of the Committee's recommendations that the Government rejected, and these remain outstanding issues for debate. For example, we were disappointed that the Government saw no need for a national coastal strategy. We urge the Government to reconsider this matter, since a national strategy is essential for setting long-term objectives and targets for coastal policy and for providing an overall framework for coastal management plans. The recent planning policy guidance

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      on coastal planning, although a welcome development, is no substitute for a national coastal strategy that sets out policies and priorities and guides the allocation of national coastal resources and local coastal plans.
      The Government also refused to accept the Committee's argument that there is widespread duplication of responsibilities or poor co-ordination between the many bodies involved with the coast. While it acknowledges the need for a national overview of coastal policy, it rejects our recommendation for the creation of a national coastal zone unit, arguing that co-ordination can be achieved via the existing interdepartmental group at official level. I find it difficult to accept that as we shall find it difficult to monitor the work of this group because we understand from the Minister that it will meet in private.
      It came as no shock to the Committee that its recommendation that coastal defence policy be taken away from the Ministry of Agriculture, Fisheries and Food was rejected outright. Nevertheless, we still believe that coastal defence is no longer an appropriate MAFF responsibility, and that the Department of the Environment would provide a more suitable lead on coastal defence issues, operating through the National Rivers Authority.
      May I, Madam Deputy Speaker, welcome you to the Chair at this point, as I know of your particular interest in the coast. It is rather ironic that I should open this debate since I believe that my constituency of West Hertfordshire is about as far from the coast as it is possible to be. But of course the maritime tradition of our nation is such that nearly all of us have a particular interest in concern about the marine environment. We stated in the opening sentence of our report:
      "Coastal zone protection and planning cannot be reviewed in isolation; they are inextricably linked to the administration and management of the many activities and uses of the coastal zone".
      We were therefore most concerned that, although the Government will accept boundary and membership changes to the existing coastal groups, they rejected our recommendation for these groups to extend their chiefly engineering role to include coastal zone management. In our view, that represents a failure to integrate coastal defence with the other elements of coastal planning and protection.
      The Government rejected the Committee's recommendation that coastal zone plans be based on natural coastal "cells"—on the ground that it was not a practical approach. I am not sure what a practical approach is, if we are to be permitted to pursue diametrically opposed policies on, for example, the north and the south sides of the River Dee because the local authorities concerned happen to have different ideas of what the major tasks for their areas are.
      Several developments have taken place since the report was written and the Government responded to it, and I shall now deal with those. The first key development since the Government's response was the publication in September of the planning policy guidance on coastal planning. That is to be welcomed, because it is exactly 20 years since the last planning guidance on coasts was issued. In general, it will be most useful for local planning authorities, but if the Government had chosen to adopt coastal zone management in full that would have promoted a more integrated approach by giving coastal zone management plans a higher profile.
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      Secondly, the Government have included a section on the coast in the second-year report on "This Common Inheritance". Thirdly, "Agenda 21", from the Earth summit, supports coastal zone management. Fourthly, the Public Accounts Committee published its report on coastal defences in England on 26 November.
      We are also aware that earlier this month the Ministry of Agriculture, Fisheries and Food endorsed support for a more environmental approach to coastal defence, such as facilitating "soft" defence measures—for example, beach replenishment—as part of the strategy for flood and coastal defence currently being developed in consultation with other organisations, which MAFF intends to publish next spring.
      I was encouraged by the launch of English Nature's Campaign for a Living Coast on 14 October. That is a long-term conservation programme for the maritime environment, which sets up three task groups to tackle the main problem areas—coasts, estuaries, and marine conservation. Finally, any day now we should receive MAFF's environmental guidelines for coastal works and the guide for local authorities to good practice on coastal planning from the National Coasts and Estuaries Group.
      I said that there were a number of outstanding issues, and I shall tackle those now. Judging from the number of developments that I have listed, it is significant that so much has happened since coastal policy came under the scrutiny of the Select Committee on the Environment. Many of those developments were already under way when we began our inquiry, but I should like to think that the Committee has helped to raise the profile of the coastal zone, and contributed to the rate at which coastal initiatives have progressed.
      Having painted a fairly full picture of the current coastal scene, I shall now pursue a few issues which I hope that the Minister will consider in his reply. From the United Kingdom angle, although our report made it clear that our findings and recommendations were focused on England and its shared estuaries, we trusted that they also had a nationwide relevance and would be considered for application throughout the United Kingdom. I therefore ask my hon. Friend the Minister to clarify the position in Scotland, Wales and Northern Ireland and to explain the Government's intentions on coastal policy in those countries.
      The Government have clearly rejected our proposals for regional coastal zone management plans. It is interesting that, nevertheless, MAFF is encouraging coastal defence authorities to form coastal groups to share experience and develop a strategic approach to coastal defence in their areas, and has also given grants towards regional coastal defence studies, to allow a strategic view to be taken of the options available. It appears that although coastal defence may develop along regional lines, coastal zone management may not.
      English Nature supports the Committee in advocating a regional approach to shoreline management, which should include activities other than simple coastal defence. It also supports the restructuring of regional coastal groups to reflect natural rather than local government boundaries. I ask my hon. Friend to clarify that apparent anomaly in the Government's thinking. If he is not prepared to move on the issue of regional coastal zone management plans, will he tell us whether he is prepared to

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      compromise by producing regional policy statements or guidance that reflects the different priorities and problems around the United Kingdom?
      As the Government have until today set their face against any national overview of coastal zone management and against regionally based plans, but have proposed to encourage the preparation of local management plans for particular stretches of the coast, will my hon. Friend the Minister explain what form that encouragement will take? If the Government are not going to do anything at national level, surely they must be prepared to assist local authorities and other agencies at local level.
      We know about the resources that have gone to English Nature for estuary plan support. The Department of the Environment also supports the Mersey estuary plan study through the Mersey Basin campaign at £15,000 over three years to be matched by local authorities, by English Nature and by the National Rivers Authority. The Committee visited the area during our study tour of coastal sites in Sefton. There is much criticism that the level of resourcing will not achieve progress at a sufficient rate despite the considerable enthusiasm among the groups now formed for all the major estuaries in the north-west.
      At the European level, the EC has been relatively quiet on the subject of coastal policy, although we are aware that the Commission is preparing a
      "comprehensive strategy on integrated management and planning of the Community coastal zones."
      Will my hon. Friend bring us up to date on what progress has been made under the United Kingdom presidency of the European Council to develop policy in that area? Is he encouraging EC development proposals on coastal zone management, for example?
      On marine conservation legislation, it appears that the Government envisage a non-statutory system, based on marine conservation areas, for some form of management plans and something statutory for sites that need protection under the habitats directive. How will the Government address sites that are important but not of habitats directive standard? Are they to be left to voluntary arrangements, for example, or will they be covered by legislation designed to fulfil the habitats directive?
      Planning offshore is also an important issue. The Government said that they would look at the planning system offshore, but in their response to the Committee, they also said that the role of the Crown Estates Commissioners needed to be reviewed only in the case of licensing marine aggregates. As the role of the Crown Estate Commissioners and planning offshore are intimately linked, I do not see how the Government can review one without reviewing the other. Perhaps my hon. Friend the Minister will explain the Government's position on that point.
      As I have mentioned, the Government gave a commitment to review the permitted development rights of ports and harbours. Will my hon. Friend tell us the Government's time scale for that? Will he also tell us whether the review will cover only projects requiring environmental assessment or whether it will be wider ranging than that?
      The Government agreed with the Committee that there is a need to identify areas at risk from flooding, but they
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      took cover behind their flood risk circular and the work of the National Rivers Authority's Anglian region. It is the NRA which needs to define risk areas, but that is not only a coastal issue, as recent events have shown. I speak rather bitterly, as my own house was flooded in the September floods. Many NRA regions are not able to define up-to-date flood risk areas for incorporation in development plans. One study in East Anglia is all very well, but will my hon. Friend the Minister tell us what is happening in the rest of the country? Is the NRA sufficiently resourced to provide local planning authorities with reliable data that can stand the test of planning appeal inquiries?
      The Government have taken some welcome first steps towards a more considered and co-ordinated approach to protecting and planning the many different activities and issues in the coastal zone. However, we are left with the impression that the main thrust of the Committee's report has been somewhat sidestepped. The Government can be accused of failing to take the plunge into a truly holistic approach to coastal zone management and its delivery through a hierarchy of plans that deal with all relevant issues in the coastal zone within meaningful coastal cells. A system such as the one that we recommended would form the linchpin of integrated protection and planning of the coastal zone. Anything else may be determined to be paddling around the edge.
      The coast and its protection are important issues for the whole country and not simply for people who live on the coast. Our natural environment there, the facilities for those who spend their leisure time there and the interests of those who have homes and land in the region of the coast are matters for us all. I hope that this debate will provide an ample opportunity to discuss the Committee's thoughts and hon. Members' thoughts in the right context.
      4.39 pm
      Mr. Gareth Wardell: I welcome the report of the Select Committee on the Environment, and I am delighted to follow the hon. Member for Hertfordshire, West (Mr. Jones) who, in his inimitable way, summarised excellently the main points in his Committee's report and in the Government's response to it. I welcome the hon. Gentleman to the Chair of the Select Committee. I am sure that he will follow in the footsteps of his great predecessor in that position and do a tremendous job.
      I hope that the Government will do more than pay lip service to the Committee's recommendations. I welcome some of their positive responses but I hope that, following the report on the need for greater protection and planning, their commitment to implementing their promised responses will be much greater than it has been in the past.
      My interest in coastal protection relates to the undermining of the marine and coastal environment by the dredging of sand and gravel. In 1990, the Llanelli Sand and Dredging Company applied for a licence to extract 100,000 tonnes of sand a year from Helwick bank, a sand bank just off the south-west point of the Gower coast. It was the first time that the Welsh Office had dealt with an extraction licence application under the Government view procedure. We had great hopes that Wales would take a lead in meeting environmental demands, especially as evidence given at the Environment Committee's sittings was already highlighting inadequacies in the procedures for issuing licences. However, the Secretary of State for Wales gave a

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      favourable view on the application at the end of October—three months after the Government's response to the Select Committee was published.
      I wish to use the example of the licence application at Helwick bank to make three points. First, the way in which the Welsh Office responded to the application says much more about the Government's real attitude to the marine aggregate licensing system than do the promises that they set out in annex A of their response to the Committee's recommendation for a review of the approval process for marine-dredged minerals.
      Objections to the issuing of licences at Helwick bank reflected a wide range of informed opinion, including the county council, district and community councils, the south Wales sea fisheries group, the Swansea bay coastal group. the National Rivers Authority, the National Federation of Fishermen's Organisations, the National Trust, the Committee for the Protection of Rural Wales and other local conservation groups.
      What we all wanted was an environmental assessment before any extraction took place. Sand and gravel take so long to form that they cannot be regarded as a renewable resource. We wanted to know the estimated amounts of exploitable sand and gravel that were in place. We wanted to know what, exactly, was the resource of Helwick bank. We wanted to know about Helwick as an ecological resource.
      Two detailed research studies undertaken at Swansea university showed that the sand bank was ecologically important in terms of marine habitat and the food chain. The bank is one of those many spots that the Ministry of Agriculture, Fisheries and Food may not designate as a significant fishery. Nevertheless, it provides an additional source of income for a few local fishermen who trawl for regular, if not frequent, catches.
      We wanted to know about the environmental resource that Helwick comprised. What was the relationship of the bank to the headland, to the shifting sands of the sea bed and to the local beaches, which had definitely been losing sand over a long period? Such information was crucial to the coastal protection of the first area of Britain to be designated as one of outstanding natural beauty.
      In annex A of the response to the Select Committee's report, the Government promise to ask for appropriate information to support licence applications, including an environmental statement. That document was published in July this year. The Welsh Office gave a favourable view to the Helwick bank application at the end of October—all of three months later. So much for promises. I hope that the Government's other promised reforms in respect of dredging will be more meaningful.
      By not insisting on an environmental assessment before extraction began, the Welsh Office has ensured that it has no baseline against which the information provided under the monitoring conditions can be judged. The strict monitoring conditions will be meaningless because we shall not know what we have before it is subjected to enormous upheaval or destruction. It is impossible to measure how high one has jumped if one does not know where the floor is at the outset.
      Sand levels on beaches will be elaborately monitored, and I am glad of that. But let us not fool ourselves: if aerial photographs show that a foot of sand has disappeared from Oxwich bay in six months, no one will be able to prove that dredging has caused it. No one will be able to stop the operations once they have been approved. If the
      1020
      number of bass caught falls in a year or two, no one will be able to prove that stocks are lower because of the destruction of one of the bass nursery areas and feeding grounds at Helwick bank.
      Although the Secretary of State for Wales has imposed on the Llanelli Sand and Dredging Company a limit of 100,000 tonnes a year for four years, we must remember that that company is only the first to arrive on the bank. We know that others are waiting to apply for licences. What conditions will be put on those?
      That brings me to my second point, which concerns the role of the Crown Estate in the Government view procedure. The Crown Estate has repeatedly said that it wants to move away from its quasi-planning authority role and concentrate on its role as landlord. That was the position that it took in its evidence to the Select Committee.
      The Crown Estate is placed in an invidious position in the Government view procedure. As it pointed out in evidence to the Select Committee, the Crown Estate has never gone against a Government view and has always imposed the conditions that the Government had suggested. In practice, therefore, it is the Government who decide whether an extraction licence will be issued. That means that the Government take the credit for an unfavourable view but, as the Secretary of State for Wales told me in a letter dated 8 January last year:
      "it is for the Crown Estate Office to grant or refuse production licences"
      when the Government's view is favourable. That means that the Crown Estate never gets the credit but always gets the blame for decisions.
      I must say that we in Gower regard the Crown Estate as a rather complacent landlord. I do not know many landlords who are so casual with their assets as not to want to know exactly what they are and to maximise their value, but that is how the Crown Estate manages its marine aggregates. If it wants to emphasise its role as a landlord and forgo its purely theoretical role as planning authority for licensing, the Crown Estate should take on the responsibility for managing its own resources. It should assess resources such as Helwick bank, and provide studies, research, information and projections for each project. It should undertake an environmental impact assessment and state, at the time of applying for permission for marine extraction, how much aggregate a year is to be taken, for how many years and by how many sub-contractors.
      In short, the Crown Estate should commission a national comprehensive picture of marine aggregate. resources and should develop a strategy for extraction which has due regard for ecological, environmental and coastal protection. Such a management system would work much better in the interests of administrative and economic efficiency, in maintaining uniform and high standards and in maximising the value of the resource.
      As I have said, other companies are expected to apply for licences to dredge on Helwick bank. How will their applications be evaluated? How can the expensive monitoring programme forced on the Llanelli Sand and Dredging Company possibly have any meaning if another company comes along and dredges another 100,000 tonnes a year—and another, and another? Will all the companies carry out monitoring? If not, why should the Llanelli Sand and Dredging Company pay out just because it was the

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      first applicant? Or has it been given a monopoly for dredging on Helwick? One can see the confusion which arises when one really looks at this can of worms.
      Finally, I want to comment on that part of the Select Committee report which refers to the confusion in coastal protection and coastal planning between the roles of the Department of Environment, or in Wales the Welsh Office, and local authorities. Again Helwick bank provides the illustration. As one of the funding authorities for the Swansea bay coastal study, which shows that not nearly enough is known about the marine environment to permit dredging, Swansea city council was an objector to the licence application. The city wants to prevent dredging at Helwick bank until more is known about coastal erosion in the area. On its own evidence, the city council has a duty to prevent dredging because it is a coastal protection authority.
      The council therefore looked to section 18 of the Coast Protection Act 1949 to make an order
      "prohibiting the removal of any material on, under, or forming part of the sea shore within their area, or of the sea shore lying to the seaward side of the area but within three nautical miles thereof."
      Before any such order can be made, however, the council must prepare and publish a draft order. In the event of any objections—one would expect the dredging company at least to object—the Secretary of State may convene a public inquiry. In other words, in practice it is the Secretary of State who decides the application. As he has already given a favourable view in this case, the Secretary of State will not agree with the city council.
      In the response to the Select Committee report, again at annex A, the Government say that they will look at the roles and interaction between the owners of the sea bed, central Government and local authorities. The case of Helwick bank shows the need for such an examination and for remedies to deal with contradictory and inadequate procedures. You, Madam Deputy Speaker, will understand why my constituents in Gower were so disappointed about the Helwick bank decision. We shall be watching with as much interest as the Select Committee to see how quickly the Government will honour the promises that they have made in response to the Select Committee report.
      I hope that improved procedures will be in place before the next company applies for a licence to dredge at Helwick bank off my constituency of Gower.
      4.53 pm
      Mr. Barry Field: I congratulate my hon. Friend the Member for Hertfordshire, West (Mr. Jones) on his election as Chairman of the Select Committee on the Environment. Following, as he does, in the footsteps of such an illustrious predecessor, I am sure that he too will earn an enviable reputation as a guardian of the nation's environment.
      I welcome to our debate this evening my hon. Friend the Minister for the Environment and Countryside. I believe that I am correct in saying that his is the first response in this Parliament to a Select Committee report, which shows, as always, that he is pre-eminent in spotting a trend.
      Only the other day I followed him during a water meter debate in which he put forward the novel suggestion that
      1022
      we should re-use our bath water in domestic dwellings to preserve that necessary natural resource. I have to tell him that such is the infrequency of that activity in my household by my children that were he to see what they leave behind in the bath his Department would be more likely to license bath water as a dangerous substance rather than wishing it to be recycled.
      My hon. Friend the Member for Hertfordshire, West made two points which I want to develop. One concerned marine aggregates and the review of the mineral planning guidance note number six, as well as the review of the continuing role of the Crown Estate in that area. The second concerned the Government's consideration of the planning system offshore. My hon. Friend rightly highlighted the role of the Crown Estate and its involvement in planning offshore and asked the Minister to clarify the fact that the Crown Estate's role in planning was not to he reviewed.
      I want to pick up those points and develop them further as well as drawing attention to the absence of any reference in planning police guidance note number 20, so recently issued, to the dumping of dredged material, as highlighted in paragraph 97 of the Select Committee's report. The highlighted comment says:
      "We recommend that there should be better co-ordination between those authorities responsible for dredging, disposing of and utilising marine aggregates in order to avoid the unnecessary dumping of dredged material, and to encourage its use elsewhere as appropriate. In addition, we recommend that environmental impact assessments be made of the possible effects of dumping".
      I deliberately drew attention to that omission earlier in the debate so that the Minister's officials would have sufficient time to address the point. I hope that my hon. Friend the Minister will consider that as a helpful move on my part.
      Planning policy guidance number 20, paragraph 2.21, mentions the dredging of marine aggregates but says:
      "Projects which require consent outside the planning system, such as dredging of marine aggregates, are subject to environmental assessment where appropriate under the relevant consent procedures."
      But it does not include any environmental assessment for the dumping of dredged material. Paragraph 3.1 mentions waste water and sewage disposal, but there is no mention of dredged material. I hope that the Government will be able to set out the reasons why the taking out of aggregate rightly requires an environmental assessment, but the dumping of dredged material does not.
      As was regularly mentioned in evidence to the Select Committee in preparing its report, the Isle of Wight has set an outstanding example in the setting up of the Standing Conference on Problems Associated with the Coastline—SCOPAC for short. I am very much obliged to David Court, chairman of the officers working group, which includes most, if not all, of the surrounding coastal authorities from West Sussex in the cast along the coast to Portland in the west.
      I am pleased to be able to tell the House that officials from the Department of the Environment, the Ministry of Agriculture, Fisheries and Food and the National Rivers Authority attended the SCOPAC conference in October in Littlehampton. However, the feeling remains that the opportunity to clear up the duality of those Departments as regards the coastal zone has not been grasped. Indeed, the omissions on the dumping of dredged material are perhaps one manifestation of the problem caused by that duality. There are others. For example, coast protection is

      1023
      the duty of the local authority, whereas sea defence is the duty of the National Rivers Authority. It is true to say that good will helps and I am certain that my hon. Friend the Minister will say that in his reply to the debate. However, the duality must militate against efficient and effective working. Indeed, the Royal Society for the Protection of Birds believes that the decision-making process needs to be restructured, and land drainage and sea defence legislation reformed, to reflect urban development and nature conservation priorities.
      Will my hon. Friend the Minister review the role of the internal drainage boards with regard to their conservation duties, as recommended by the Select Committee? Lest anyone forget why that is so important, I remind the House that our sea bird breeding colonies are of global importance, as a significant proportion of the world populations of some species are present here. Of the 261 internationally important bird areas in the United Kingdom, 28 qualify because they hold more than 1 per cent. of the European population of certain sea birds. The United Kingdom's estuaries are among the most biologically productive systems in the world. Estuaries also provide spawning and nursery grounds for fish, including many of commercial value, and are key areas for water-borne and waterside recreation. In spite of that importance, coast management is piecemeal and unco-ordinated.
      The British marine aggregate producers want prospecting licences to be left with the Crown Estate and production licences placed with the Department of the Environment. They believe that that would avoid the lengthy duplication inherent in the present system. That was the view that the industry expressed to the Department of the Environment review which was recommended by the Select Committee report. If that view prevails, it will become even more important for the Department of the Environment to practise open government in that area, and for data from the assessing hydraulic authorities to be doubly scrutinised and made public. Why? Because, otherwise, the Department will be both policeman and provider: it sets out the aggregate material forecasts for the building industry and is the lead Department for the needs of the construction industry. It cannot wear two hats without misgivings and mistrust. During the 1980s and into the 1990s, the great success of Government policies in protecting the environment has been to separate the policeman and the provider, which has led to far higher standards.
      The fact that so many coastal communities are seriously concerned about inshore or near-shore aggregate dredging sets my hon. Friend the Minister a special challenge—to make decisions more transparent and capable of proper scrutiny. That is what the Select Committee was endeavouring to do. There is an example in the western Solent at the moment, with the prospect of 300,000 cu m of gravel being taken from the Shingles bank by the New Forest district council, which has submitted the scheme on behalf of English Heritage, which wants to replenish Hurst Spit to protect Hurst castle.
      Local fishermen tell me that the Shingles bank has a sheer wall, and that if one takes 300,000 cu m of gravel out of that structure it will cause serious harm. So far as I am aware, the bank has never been dredged effectively. That is a good example of the sort of misgivings that local communities may have.
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      On consolidation and planning, if I understand correctly the Department's response to the Select Committee's comments, the Minister is saying that consolidation is not on the agenda because of the recent consolidation of planning law. I may be wrong, but I thought that the Committee wanted consolidation in several areas. I draw my hon. Friend's attention to that matter, because I do not think that the Committee was restricting its remarks on consolidation to planning.
      The Royal Yachting Association has rightly pointed out that the planning system does not cater for the needs of increasing numbers of people to take part in water sports. The French have added more than 7,000 marina berths between Le Tréport and Cherbourg during the past few years. Why do we British not want to exploit the same opportunities in a structured and sensitive way which will meet the needs of all the competing interests?
      I have no doubt that the Minister will again point me towards planning policy guidance note 20, paragraph 4.17, which allows planning authorities and other agencies to co-operate. I must inform my hon. Friend that the planning inspector's ruling, at the Isle of Wight replacement structure plan inquiry, was that they are not required to do so. While adjoining land-based authorities must interlock, there is no such presumption when water intervenes.
      My hon. Friend the Minister will find copious correspondence on the subject between myself and Mr. Christopher Chope, who served so illustriously in the House. It is ludicrous that the Isle of Wight has no mechanism for influencing the means of departure from, or arrival at, the mainland—England. That is why we are so poorly served. If one arrives from Brussels or France it is different, but not if one comes from within one's own country.
      The consolidation sought by the Select Committee was surely not merely on planning. The Merchant Shipping Act 1984 requires that all objects recovered from below the mean low water mark should be reported to the Receiver of Wrecks. That system does nothing to preserve sites of historic interest, because, if the item is unclaimed, the Crown encourages auction as a means of rewarding the finder. Just imagine the hullabaloo if people were allowed to dig around designated land-based sites in the same way. Sadly, it would appear that the Department is unable to get its mind around that fact.
      Mineral extraction on land would never take place without, where appropriate, an archaeological evaluation. That requirement is contained in policy planning guidance note 16, which was issued last year. There is no such safeguard below the mean low water mark: why not?
      Development often requires the dumping of material or building on the sea bed. Such activity can do untold damage to our nation's heritage. Again planning policy guidance number 16 can only be invoked once the construction has risen above the mean low water mark.
      The Protection of Wrecks Act 1973 offers some protection to a limited number of wrecks which are deemed to be of national importance. The Act is not, and cannot be, used to protect archaeological sites which lie below the mean low water mark. The Ancient Monuments and Archaeological Areas Act 1979 has never been applied to underwater sites in England.
      Planning policy guidance note 16 is serviced by sites and monuments records so as to intercept threats to sites of significance, yet the constraints of local government

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      boundaries at mean low watermark impede that process. As the hon. Member for Gower (Mr. Wardell) pointed out, under section 18 of the Coastal Protection Act 1949, local authorities can, by arrangement with the Crown Estates Commissioners, take control and licensing powers over the sea bed.
      The evidence given to the Committee and the replies to some of my questions eventually elucidated the fact that, in the whole of England and Wales, only South Wight borough council on the Isle of Wight is using those powers. The departmental evidence revealed the real confusion that exists over the matter.
      Hon. Members may wonder why I have spent so much time dealing with these points. As the Minister will confirm, his Department was the lead body at the summit on the environment at Rio and takes a keen interest in the rise in sea level that has been forecast. The flooding of the Solent concerns an area so rich in archaeology that experts believe that it might yet mean land sites being delisted because of their relative insignificance compared with the Solent.
      In view of the Minister's well-known interest in global warming, he will be interested to note that it has been shown from the excavation of Roman artefacts dating back 6,000 years that there has been a rise in sea level in the area over that time of 3 m. Artefacts found there include hand-made cooking pots ranging from the eighth to the 11 th centuries. An important cultural item from the period is a copper alloy cloak pin of the loose-ringed type. The decoration of the pin draws its inspiration from Viking dress fasteners, while its type can he equated with pins in use in Ireland between the 10th and 13th centuries. The pin signifies long-distance maritime trade and should be seen in conjunction with two contemporary Norwegian mica-schist honestones that have been removed from the Solent.
      As the Minister will be aware, the Department of National Heritage has recently succeeded in gaining control over the export of fossils, remembering that the Isle of Wight is considered to be the best archaeological centre for the discovery of fossils and dinosaur bones in the whole of the northern hemisphere, if not of the world. It is a little-known fact that only one of all the dinosaurs at the natural history museum is the genuine article, and I am proud to say that it comes from the Isle of Wight. [HON. MEMBERS: "Hear, hear."] I note that I strike a chord across the Floor of the House when I talk of dinosaurs.
      This is a serious matter because the Minister may not be aware that along the coast of the Isle of Wight, where the wave action exposes the remains, pirates come to the island and dig up the bones at night, since a single bone of the right variety can fetch over £100,000 on the black market. Not only is it a serious problem, but it is another reason why the Committee sought to extend the protection of land-based legislation to our wonderful aquatic environment. Perhaps such facts speak more forcefully than the Select Committee report, the RSPB, SCOPAC or any other body.
      I hope that the Minister will re-examine the whole issue and will put his rudder hard over, go about and ask his crew to look again at the legislation and the whole area to which I have referred. Does Britannia rule the waves? I
      1026
      regret to say that for a maritime nation, if we in Whitehall do not waive the rules, we are certainly refusing to enforce them.
      5.14 pm
      Mr. Paul Tyler: I hope that the hon. Member for the Isle of Wight (Mr. Field) will forgive me for not going back to the era of the dinosaurs. I want to look forward. I am grateful for catching your eye at this time, Madam Deputy Speaker, because last night and the night before I managed to do so just before midnight. It is a privilege for me to be addressing the House in prime time.
      I am also grateful to have been called because—as you know, Madam Deputy Speaker, being a close neighbour—I am lucky enough to represent the most beautiful and one of the longest coastlines in the United Kingdom. For that and ancestral reasons, I regard this as an extremely important debate and, like other hon. Members, I pay tribute to the pioneering work of the Select Committee and its Chairman, the hon. Member for Hertfordshire, West (Mr. Jones).
      Cornwall and Devon have some of the finest coastline and most beautiful coastal waters in the United Kingdom. We have the Fal, the Fowey, the Camel, the Tamar, the Teign, the Torridge, the Taw and the Exe as world-famous estuaries. In addition, we have a coastal zone inland from that coastline which is recognised as being of international importance.
      The coastline also has an economic importance because it is an area for fishing and tourism and supports two of our most important local indigenous industries. A well kept coast is not just a thing of beauty: it is an extremely important economic asset. The many thousands of tourists who come to Cornwall, Plymouth and Devon are drawn by beautiful images of lovely places of natural and human manufacture. Tintagel, Padstow and the Newquay area of my constituency are examples, but they are replicated throughout the south-west. It is vital, for every reason, that they receive the care and attention that an orderly, clean and well managed environment should provide.
      But we must also demonstrate the vulnerability of the coastline. As hon. Members from places as far apart as Gower and the Isle of Wight have demonstrated, the vulnerability of the coastline is its other special characteristic. We have in Cornwall the continuing saga of governmental incompetence over Weal Jane, as often described by the hon. Member for Truro (Mr. Taylor).
      The United Kingdom coastline is the habitat of an extraordinary range of animals and birds. The sea bird breeding colonies are of global importance, with significant proportions of the world's population of some species. Our estuaries, as the hon. Member for the Isle of Wight said, provide the most biologically productive systems in the world. They also provide spawning and nursery grounds for fish stocks, including many of considerable commercial value. They are key areas of income generation in respect of waterborne and waterside recreation.
      Despite that importance, and despite all the evidence to, and recommendations of, the Select Committee, we still have a totally piecemeal and unco-ordinated policy for our coastline. At present, the responsibility for coastal zone management is split between a ridiculously large number of bodies. Earlier in the year, I tried to discover exactly

      1027
      how many Ministers had responsibilities relating to coastal policy. Finally I discovered that the full list—I will not bore the House with the details; there are 12 or more—ranges from the Department of National Heritage to the Ministry of Defence, via the Duchy of Lancaster and the Ministry of Agriculture, Fisheries and Food.
      That does not even display the whole iceberg: it is only the tip. Underneath the surface is an absolute plethora of statutory bodies with responsibilities, such as the National Rivers Authority, the Countryside Commission and the whole range of local authorities and harbour commissions. There are significant differences in hierarchy on the other side of the borders in Scotland and Wales.
      At central Government level, differences of approach that seem to result from that dichotomy between the Department of the Environment and the Ministry of Agriculture are ably demonstrated by the current approach to the implementation of the EC's habitats directive, which should cover both the terrestrial and marine environments, yet seems to be delayed. We hope that the Minister will say that both Departments will make comprehensive statements on that directive.
      Local anomalies also exist. It was recently drawn to my attention that the siren system around the Norfolk coast, originally introduced to warn of impending invasion but used more recently to warn of possible tidal flooding, is about to be discarded by the Home Office, yet no other Department is prepared to take up that responsibility. To load it on to local authorities will cause difficulties if they do not have the necessary resources.
      Many coastal communities throughout the country are threatened by coastal erosion, possibly brought about by the climatic changes as a result of global warming. If that is so, it will be an increasing problem for local authorities to tackle, especially as it tends to happen in areas of comparatively low income.
      Even the National Rivers Authority's income will be unable to deal effectively with that. The problem can exist anywhere in the country, from Lower Hawkesbury in the constituency of my right hon. Friend the Member for Berwick-upon-Tweed (Mr. Beith) to Downderry in south Cornwall. Those problems suffer from a lack of effective co-ordination and resourcing.
      In that context, this debate is timely. The Select Committee's report was excellent, and the Government should say what they are thinking, following their response to that report. I hope that we shall give the Minister much food for thought for his Christmas break. Incidentally, if his plans are still fluid, I recommend an excellent fish restaurant with rooms at Padstow in which he could digest the points made this afternoon.
      Two points result directly from what the Government said in their paper, "This Common Inheritance—the Second Year Report":
      "Decisions about development should take account of the natural resources which Britain's coast provides."
      In that context, I want to concentrate on coastal zone management plans and the special place that we should afford to heritage coasts.
      First, both sides of the House echo the words of the Select Committee Chairman, the hon. Member for Hertfordshire, West, about the clear need for a national strategy. It is not in place and does not look as though it is coming, and we need it urgently. All the organisations concerned should be singing from the same hymn sheet. There are so many of them that that is the only way in
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      which we can secure some cohesion and comprehension. There is a cacophony of conflicting policies, which must be set in a sensible context.
      It was illuminating that, when the Marine Conservation Society conducted its survey on coastal management plans in 1990, it found that the most widely expressed concern was about the lack of a national policy or strategy. It is now clear that the demand for one is intense, and I hope that the Minister will respond to that this evening.
      Similarly, we need a discrete unit within the Department of the Environment and the Scottish, Welsh and Northern Ireland Offices to develop and co-ordinate that national strategy, because a strategy without such a back-up would be meaningless. In view of the Government's support for the concept of coastal zone management, will the Minister consider setting up such a unit linked to the other Departments, as the Select Committee recommended?
      There seems to be a contradiction in the Government's thinking. Virtually all the evidence to the Select Committee spoke of the need for planning to be carried out on the basis of natural coastal cells—the ones that exist and are recognised. In the Government's response, they argued that coastal cells
      "provide a useful basis for the formation of groupings of local authorities and other interested parties for the consideration of physical processes at the coast and co-ordination of coastal defence issues".
      The adjoining paragraph went on to say that the coastal cells are not an appropriate basis for decision-making and management. So what is the Government's view?
      Coastal zone management should be designed to provide a management framework for the whole coastline, not simply areas under pressure. Those plans need a statutory basis if they are to provide the necessary powers to resolve conflicts of interest within the coastal area.
      If, as the Government suggest, those plans are not to be universal or mandatory and an ad hoc system of coastal planning results, we forecast chaos in future. The conflict of interests and the problems will not be resolved even within a managed framework if that framework is piecemeal. They will simply migrate along the coast from more progressive local authority areas with management plans to those that are not covered by plans.
      As a result, new areas of what the Select Committee described as "demonstrable conflict and pressures" will undoubtedly result. The problems described by the hon. Members for Gower (Mr. Wardell) and for Isle of Wight in relation to marine aggregate could arise if the approach were piecemeal instead of comprehensive.
      The finest stretches of coast clearly deserve national recognition as heritage coasts. Although some have already been designated and are recognised on an international or European basis, they must be given effective protection and management. It is now necessary to ensure that stronger measures are available and apply there.
      The quality of the heritage coast and the principles and techniques of management and protection that underpin them already provide a model that attracts that wider international interest. Other European countries wish to learn from our experience and, in turn, heritage coasts are recognised as having a quality that stands international comparison.
      However, we cannot be complacent, because the mechanism of designation and management techniques

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      leave much to be desired. We need rigorous control, which must he exercised to preclude all forms of development that are incongruous in an area of fine natural beauty by reasons of scale, siting, design, noise, disturbance or traffic, or that could adversely affect heritage features such as flora, fauna and archaeology. We must ensure that remote stretches of coast and access to them are also carefully managed.
      Clearly, it is necessary to integrate the policy for heritage coast planning with management of the wider undeveloped coastline. Heritage coasts cannot be protected by action simply within their immediate boundaries, because their future will be bound up with coastal policy as a whole, and a holistic approach will be necessary. The Government need to move quickly to review the role of local authorities in planning and development control below the high water mark. I call on them to set that in motion urgently.
      Whatever happens, it must be right that all that should not come about simply by creating more bureaucracy, quangos and by-passing directly elected and accountable local government. The necessary structures already exist within the tiers of local government. The Chichester harbour conservancy group is but one example of the way in which local government can take a wider lead, as the hon. Gentleman said. The initiative taken by the Isle of Wight county council to create a network shows that the central role should be for local authorities.
      I do not understand—I think that this may be the crucial issue in today's debate—why the Government reject the concept of coastal zone management. Why do the Government reject the concept of natural coastal cells as the linchpin of an integrated protection and planning policy for coastal zones? All the evidence to the Environment Committee—and, indeed, all the evidence of our eyes and experience since that excellent report—shows that coastal zone management will be the most effective and efficient way forward. I urge the Government to reconsider their decision.
      As with so many other issues in the House, in the end we must be sure that the Government will be able and willing to resource the necessary changes. We want answers from the Minister and prompt action to set in train mechanisms to bring about the widely desired changes. The coastline of Britain is a jewel in our crown, and it must be preserved.
      5.31 pm
      Mr. Nick Hawkins: I suggest that few hon. Members would disagree that sea defences principally involve the protection of, first, people and, secondly, property. I welcome the fact that my hon. Friend the Minister for the Environment and Countryside and his colleagues have increasingly concentrated within the Ministry of Agriculture, Fisheries and Food on the protection that needs to be provided in urban areas such as my constituency of Blackpool, South.
      Because of the problems in my constituency with elderly sea defences which are clearly crumbling away, I am especially glad to have the opportunity to participate in the debate. My concern is enhanced by the bureaucratic complexity which has been highlighted by the report of the Select Committee on the Environment and already
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      referred to in some detail by other hon. Members, especially my hon. Friend the Member for Hertfordshire, West (Mr. Jones).
      Despite the many years of diligent work by my predecessor, Sir Peter Blaker, to ensure that sea defences were improved along the south shore at Blackpool, about which he was extremely concerned, as I am, one must concede that nothing has been done. I must evince a note of considerable concern that, if nothing is done soon, there will be substantial flooding.
      My hon. Friend the Minister is concerned about such matters. I must tell him that there is a great deal of high-value property just beyond the land side of the sea wall, which is all along the shore at Blackpool. That property includes many successful and prosperous hotels and a number of high-value residential areas. It also includes the biggest tourist attraction in the whole of Europe, the Blackpool pleasure beach. More than 6 million people visited that beach last year. I mention that because the significance to such a business, to hotels and to residential areas of the sort that I have described of the kind of flooding that we have had on a number of occasions recently is substantial. My constituents and I are worried that whenever there is a flood warning, which happens frequently throughout the autumn and the winter, the only action taken is that hotels and residential areas are asked to collect sandbags from the local authority.
      I recognise the importance of local authorities being able to give a local response to particular areas of need, but I echo the views of the Select Committee, as confirmed by my hon. Friend the Member for Hertfordshire, West, that it is crucial to have a national strategy for sea defences and coastal zone protection. It is also crucial to have a much simpler and more straightforward system. It is apparent not only from the report of the Select Committee, but from the National Audit Office, that about 160 bodies have some responsibility for coastal zone matters. From the discussions that I have had with local authorities, the National Rivers Authority, the people at North-West Water and departmental officials, I can only describe the situation as a bureaucratic jungle and nightmare.
      Tonight I feel something like Cassandra crying in the wilderness for some action to be taken. I am sorry that I have to predict that, unless something is done urgently to improve the sea defences along the south shore of Blackpool, there will be a disaster akin to the one that took place in Towyn in north Wales in 1990. I am sure that most hon. Members remember the horrifying news pictures. I remind hon. Members that the failure of the Towyn sea wall on 26 February 1990 occurred during a violent storm from the north-west. A storm from the same direction would affect my constituency if it happened again. The storm produced a surge of 1.3 m to the tide level, coupled with 4 m waves. Frequently, there are storms of the same or similar intensity which affect the Fylde coast. My constituents and I are worried about precisely such storms.
      In the Towyn disaster there was substantial damage to property as a result of salt water flooding of housing behind the breached sea wall. Although we were delighted to note that extremely efficient and prompt evacuation procedures were immediately put into effect by the emergency services—to whose work I pay tribute—which prevented any loss of life, the dislocation and rehabilitation problems were severe. The problems had not been fully resolved at the time when the National Rivers

      1031
      Authority produced its report on sea defences and the advisory committee to my hon. Friend's Ministry produced its report on research and development into flood and coastal defence.
      In the 1989–90 winter storms, some 30 km of sea wall revetment and about 10 km of embankment were damaged. The cost of repair and reinstatement of those damaged coastal defences has been estimated at more than £40 million, and Towyn alone accounted for perhaps 25 per cent. of that total. The amount does not include the social costs of shattered homes and lifestyles or the ecological cost of damage to beaches, dunes and cliffs. More than 150 km of coastline were severely affected by one winter night's events.
      I urge my hon. Friend to re-examine with great care the report of the Select Committee and to bear in mind that a stitch in time saves nine, especially when it comes to coastal defence. I am aware that firm plans have existed for a number of years in my constituency, based on the most sophisticated technology of sea defence. My hon. Friend may be aware of the colonnade scheme. Those plans can be put into effect in a relatively short period, but, with the administrative structure that exists, and with so many bodies involved, there is endless opportunity for what I can only describe as buck passing between the local authority, the Ministry, the National Rivers Authority and water authorities.
      I echo the comments of my hon. Friend the Member for Hertfordshire, West that it seems entirely logical that the matter of sea defence should be placed under the direct control of one Ministry. I know that my hon. Friend the Minister is concerned about the matter. I pay tribute to his work and that of his ministerial colleagues in the Ministry of Agriculture, Fisheries and Food. However, I suggest that it would be much more logical for the matter to be brought under the direct control of the Department of the Environment, because of the Department's other responsibilities, including many other matters which relate to coastal zones.
      As the policy has rightly concentrated substantially on urban sea defences, it seems peculiar that the issue remains within the purview of the Ministry of Agriculture, Fisheries and Food. I submit that coastal defences are an environmental issue and that the Department of the Environment should deal with it.
      The Coast Protection Act 1949 is now fairly old and perhaps a new statute is overdue. Under the Act maritime district councils carry out coastal protection works that have been approved by the appropriate Minister. The Environment Select Committee report points out that before they even submit proposals, maritime councils must consult the National Rivers Authority, neighbouring maritime district councils, the county council, harbour, conservancy and navigation authorities, fisheries committees and MAFF for licensing under the Food and Environment Protection Act 1985.
      With so much consultation required, one can see why it takes years before a formal proposal is even considered. That applies to all works except maintenance, repair and emergency works. I suggest that fewer emergency works would be needed if the main works were done more quickly. There is frequently agreement across party divisions in areas where priority work needs to be done, including my own. A single Ministry could make a quicker
      1032
      decision. Of course, there must be some consultation, but I suggest that the procedure could be made much more streamlined.
      The complex bureaucracy causes problems that could have contributed to the Towyn disaster. The Royal Institution of Civil Engineers recently hosted a presentation about vital issues that affect the north-west and north Wales. It was attended by many Conservative and Opposition Members from those areas, including myself. It was interesting that the subjects that the institution chose to highlight as of particular importance to north-west and north Wales Members of Parliament were, first, transport and, secondly, sea defence and coastal protection.
      Many hon. Members heard an extremely effective presentation by one of the senior scientific advisers who worked on rebuilding the sea defences at Towyn. I am sure that several of the points that he made about the urgency with which sea defences in the north-west and north Wales should be improved struck a chord with many of the hon. Members who were present. I urge my hon. Friend to look again at the work that was done in the aftermath of Towyn and recognise that a great deal more could be done.
      I apologise to my hon. Friend the Minister that, because I was committed to chairing a meeting elsewhere in the House before I knew the business for this week, I shall not be present to hear his reply. However, I look forward to reading it in the Official Report.
      5.42 pm
      Mr. Jack Thompson: I add my congratulations to the hon. Member for Hertfordshire, West (Mr. Jones) on taking over the role of Chairman of the Select Committee on the Environment. My experience of that Committee is such that I have full confidence in its reports and especially in the one that it has just completed.
      I make no apology for examining the report and the Government's response to it in the context of my constituency. Coastal defence is a matter of great concern to me. In case anyone wonders where my constituency is, it is 15 miles north of Newcastle on the coast. The eastern boundary of the constituency is the North sea coastline.
      My constituency suffers not only from the loss of some of its skilled young people as a result of the dire employment situation in the north of England but from the loss of some of its land mass through coastal erosion. The problem of coastal erosion is not a new one in my constituency. For example, the village of Newbiggin-by-the-Sea is reputed to be the third one with that name. The two previous villages are said to have disappeared into the sea many years ago, and there are fears that the present village could suffer the same fate. Cynics describe it as Newbiggin-in-the-Sea.
      The village was provided with a limited form of sea defence in 1931—mainly to provide employment during the slump. That sea defence proved fairly satisfactory until the mid-1970s. Since then, there have been changes in the sea bed levels as a result of collapsing mineworkings in the bay on that part of the coast. That seriously affected and undermined the sea defences. Various projects have been undertaken to improve the sea defences, but in a piecemeal fashion. Some of the sea defences are an eyesore due to the lack of proper funding and because people have tried to do schemes on the cheap. If the Select Committee's proposals had been implemented 20 years ago, the problems would

      1033
      have been alleviated properly by means of a comprehensive development rather than the patchwork schemes which now despoil an attractive village.
      To the north of Newbiggin-by-the-Sea is an area described as East Sea Sands. It is a stretch of common land which has little if any defence. While some protection is provided for the village, the limitations on coastal protection allow the coastal strip on East Sea Sands to deteriorate, so coastal erosion threatens the village from a different point. That is a further example where a comprehensive plan could have resolved the problem.
      When I was a youngster—I may be giving my age away—in the last years of the second world war, many old army vehicles were placed on the rock formations in the area. They were far enough out in the sea to allow the RAF to use them as target practice. Not only the vehicles but the rocks on which they stood disappeared into the sea many years ago. The erosion has taken huge areas of that part of my constituency away. If I stand on the cliff edge I can see 200 yd or more of the area which has disappeared into the sea in the past 10 years.
      The overriding need for a national coastal zone unit is a major theme in the Select Committee report. I endorse that view. I would couple with it more localised co-operation. That has already begun in the county of Northumberland. Some people in my county think that the world begins at the north part of the county—the border with Scotland—and ends at the south, the border with Tyne and Wear. We have the North sea to the east and Cumbria to the west. However, I recognise that the world goes beyond that.
      The authorities in my county have formed a consortium of local authorities with coastal boundaries. They are Wansbeck and Alnwick district, and Blyth, Castle Morpeth and Berwick borough councils. The consortium has been in existence for about one year. I understand that it is currently working on sea defence issues. The programme is to examine the problems all along the coast. I repeat that the problem exists beyond the Northumbrian coast and affects areas which have boundaries on each side of our county. Wansbeck district council has obtained the services of the consultants Babty Shaw to produce a comprehensive report on its coastline. Such efforts could make a useful contribution to the work of a national coastal zone unit.
      I also draw the attention of the House to a further cause of coastal erosion in my constituency and in that of the right hon. Member for Berwick-upon-Tweed (Mr. Beith), who intervened earlier in the debate on this topic. I am sure that he will appreciate my support for the comments that he made, which were relevant and appropriate. However, I may also add to them. The problem is sand extraction in Druridge Bay in the right hon. Gentleman's constituency. That is close to my constituency. Sand has been extracted for about 25 years and it is estimated that 1.5 million tonnes of sand have been removed. That has seriously affected the whole coastline in both the right hon. Gentleman's constituency and mine.
      Northern Aggregates, a subsidiary of Ready Mixed Concrete, was given permission to extract the sand by the then Ministry of Housing and Local Government, despite the refusal of Northumberland county council and the then Morpeth district council to grant planning
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      permission. As a result of the Government's decision, sand extraction on a huge scale has caused damage which may be irreparable. More notice should have been taken of local opinion. Any proposals to strengthen the power of local decision making will therefore gain my support.
      I note that the Government are reviewing mineral planning guidance note 6, which deals with the provision of aggregates in England and Wales. That is welcome, on condition that the review concludes that more control should be placed in the hands of local people. I am advancing the same argument in regard to planning guidance note 3, which deals with opencast mining. I suspect, however, that my efforts will be to no avail; and by the time the review has been completed, whatever the outcome, it will probably have little effect on the specific problem of sand extraction.
      The Select Committee recommendations show a reasoned and sensible attitude to coastal erosion problems. They include some extremely good proposals, including the proposal in paragraph 78 to transfer responsibility from MAFF to the Department of the Environment, a proposal which I am sorry to say has received no response from the Government:it seems that they are happy for the responsibility to remain with MAFF. I agree with hon. Members who have suggested that such matters belong under the aegis of the Department of the Environment. Perhaps the Government will have second thoughts about some of the Committee's proposals—I hope so.
      Mr. Robert B. Jones: We all have our theories: mine is that MAFF is still obsessed with the idea that coastal defence is all about protecting farmland. That is not so, but that idea pervades the whole system. It emerged during the inquiry that every chairman of a regional front defence committee was a farmer, and the same applies to the land drainage committees. Of course, that may change over a period, and more environmentalists are becoming involved; nevertheless, I feel that the philosophy of MAFF is at fault.
      Mr. Thompson: I hope that the hon. Gentleman and his Committee will continue to pursue that aspect of the problem.
      The basic theme of the Select Committee recommendations is the need for a co-ordinated response to the difficulties involved in coastal protection. The hon. Member for Blackpool, South (Mr. Hawkins) represents a seat in the north, while mine is in the north-east; unlike Blackpool, my constituency is a village containing about 8,000 people; nevertheless, our problems are similar. The problems of coastal protection require a comprehensive view and full co-operation, which should extend beyond the boundaries of England and Wales. Any consideration of my county of Northumberland will relate to Scotland. Although a different attitude may be taken there, the two areas affect each other.
      I compliment the Select Committee on its report, and I hope that the Government will take note of its contents.
      5.53 pm
      Mr. Iain Sproat: I wish to direct my remarks to only one aspect of the Committee's excellent report. I shall take my text from the Government's response in the introduction to paragraph 1:
      "The Government is firmly committed to the effective protection and planning of our coast".

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      I have no doubt that the Government are doing effective work in many areas, but in one part of my constituency they are certainly not acting effectively. This is not a criticism of the present Government in particular: for many years, Governments have not acted effectively in helping to protect this particular piece of coast.
      The piece of coast to which I refer goes round a piece of land known as the Naze—a word related etymologically to the word "nose", because the Naze sticks out into the North sea. It is a beautiful open space, comprising some 150 acres, and its centrality to local life is proven by the fact that the beautiful and picturesque little town next door to it is called Walton on the Naze; yet the Naze is being steadily destroyed.
      In his excellent speech, the hon. Member for Wansbeck (Mr. Thompson) described how, at the end of the second world war, he had seen army lorries standing at a point that is now far out to sea. I can tell the hon. Gentleman that, at the time when he was watching those lorries, there were block houses in the Naze, about 50 yards from the edge of the cliff. Now, those block houses are so far out to sea—because the cliff has collapsed—that it is impossible to see them: the waves wash over them.
      A beautiful open space is being eroded at a rate of some 6 ft a year—or so it is said, and I am sure that as an average that is correct. Cliffs do not crumble in a regular line, however, and huge chunks of the Naze will fall into the sea. In a single night, a patch of land about as big as the space between the civil servants' Box and the Gangway will go down. A wonderful recreational area for local people, measuring some 150 acres, is being steadily destroyed.
      In another excellent speech, my hon. Friend the Member for Blackpool, South (Mr. Hawkins) rightly said that the first duty of Departments involved in such matters is to protect lives and property. At present, not much property on the Naze is threatened, but we should not only consider property; we should also think of the concept of heritage coasts and amenity value. That does not apply only to local people, for the Naze provides a tremendous tourist attraction. My constituency has a high unemployment rate: it is over 12 per cent. in Harwich and ever 14 per cent. in Clacton, and Walton on the Naze is between the two. The constituency has the highest unemployment percentage in the south of England. Tourism is one way in which we can help to mop up that serious unemployment rate: about 100,000 people visit the Naze every year.
      Unfortunately, year after year, the Naze has been allowed to crumble away, because the local authority has not enough money to deal with the problem. My right hon. Friend the Minister of Agriculture, Fisheries and Food kindly received a delegation the other day, but ultimately no money was forthcoming. Meanwhile, a beautiful piece of old England is being eroded, and in 50 or 100 years nothing will be left.
      The House may say, "Why? Here is a lovely bit of old England, central to local life and providing a wonderful amenity for locals and tourists". Indeed, a listed building stands on it—the Naze tower, built in 1720. In not many years' time, that tower will have crumbled into the sea unless something is done.
      In the past, Departments have given as their main reason for doing nothing the fact that houses are not immediately threatened; but if the Naze—hon. Members should picture it as a chunk, or nose, sticking out into the North sea—disappears, the sea will sweep in and not only
      1036
      curl around and start attacking Walton on the Naze from the back, but wash away places such as Kirby le Soken, just a few miles up the coast. As my hon. Friend the Member for Blackpool, South said, a stitch in time saves nine: that may be a cliche, but it is a truism because it is true.
      It is extremely irritating—indeed, infuriating—for people who live in the area to learn that one of the reasons why the Government have not provided money to save this chunk of my constituency is the fact that some fossils have been found under it. They are very interesting, as they are about 50 million years old, but the problem is that, the more the sea washes away the Naze, the more fossils will become available for people who are interested in them. It is ludicrous for the care of fossils to be put above the care of local residents. I see a sympathetic frown of amazement across the face of the hon. Member for Islington, South and Finsbury (Mr. Smith), but I asure him that that is so. That is what is so infuriating.
      Hon. Members have already mentioned the nightmare of the bureaucratic jungle—the Department of the Environment, MAFF, the National Rivers Authority and English Heritage. Hardly a body exists which does not seem to have some interest in this matter, and all to the detriment of my constituents.
      Mr. Barry Field: My hon. Friend might like to know that he has a comrade in arms, because in Whitecliffe bay, English Nature prevented a caravan park owner from erecting sea defences, at his own cost, because the sea was exposing a variety of fossils that were exceptional in northern Europe. I wondered whether the Isle of Wight will have to wash away in the cause of fossils.
      Mr. Sproat: My hon. Friend makes a good point; it is absurd. However, when one tries to pin down that absurdity and to say that such an argument cannot stand in the way of our constituents, one cannot find the right people to talk to. No one group will take up and weigh all the arguments and say, "The interests of the people who live there must come first." I say to my hon. Friend the Minister that the interests of my constituents and their children are not being considered as they should be. The Government should provide funds to save this beautiful bit of England and the local amenities and to help the tourism industry rather than interesting but hardly prime objects of importance like fossils.
      6.1 pm
      Mr. Andrew F. Bennett: It is interesting to follow the hon. Member for Harwich (Mr. Sproat), who began by firmly praising the report. I wonder how far he read the section on managed retreat. There is a lot of evidence to show that, even where people can persuade the Ministry of Agriculture, Fisheries and Food or other bodies to fund the construction of sea defences, such defences are not always successful. I suspect that a considerable sum has been spent on unsuccessful sea defences. Some schemes that have been proposed to defend the coastline have resulted not only in it being attacked further along but have proved to do more damage that good. Although I fully understand the hon. Gentleman's concern for his constituents, a massive sea defence scheme will not necessarily solve the problem.
      I was not a member of the Environment Select Committee in the last Parliament. I am pleased to be a

      1037
      member now, and its members, certainly Sir Hugh Rossi, can be praised for producing a series of environmental reports on the green side of the Department of the Environment that did much to inform the House and attracted praise from people outside. It seems a paradox that, between 1983 and the dissolution of the last Parliament, the Select Committee never investigated council funding, the poll tax, housing and homeless people.
      All those who believe that the establishment of Select Committees was one of the best things that the House did must strike a balance between the need for Select Committees to mirror Departments and to investigate the topics of the day. When the Select Committees were set up, there were Committees for trade, for industry and for energy, but they have now been combined into one. It is perhaps ironic that the Select Committee on the Environment is now engaged in a major inquiry into energy. I wonder whether the House is best served by having one Select Committee for the Department of the Environment, which covers a large area and inevitably means that the Committee must be selective about what parts of the Department to scrutinise. Perhaps Select Committees should more accurately reflect the scope of Departments and the need for scrutiny of them.
      I welcome the Select Committee's report and the debate. There has been a tendency to use Supply days to debate Select Committee reports, in which members of the Select Committee, the Minister and the Opposition spokesman tell each other what a great report they have produced. That does not inform our proceedings or other hon. Members. Interestingly, perhaps because it is a new Parliament, we have heard tonight from more hon. Members who did not serve on the Committee but who have read the report. If Committee reports inform the House rather than allowing Committee members to congratulate themselves, I shall welcome it.
      I am disappointed that the Government did not accept the recommendation of the Committee to set up administrative bodies that respond to the natural cells of coastal activity. The Committee persuasively suggested that bits of the coast should be considered not in isolation but rather as part of a network. I was slightly disappointed on asking a geomorphogenist whom I know well, "Can I find a map of the British isles that sets out cell patterns?" to discover that, although some of the patterns are fairly well documented, others are nothing like as well documented and understood, and there is a fair amount of argument about how far the systems are closed or open.
      I accept that there may be a little difficulty in working out where the cell boundaries would be, but I have always argued that it is important that administrative boundaries reflect the physical realities, because artificial boundaries cannot be imposed. It is important that natural cells are recognised and reflected in boundaries.
      It is important that more work is done on the cost-benefit analysis of environmental works along the coast. Too often, the environmental benefit analysis is conducted by the engineers who are proposing schemes. Like statistics, cost-benefit analysis can be made to prove what is wanted. It is important, therefore, that such schemes are scrutinised by people from different backgrounds who can test them.
      1038
      As the hon. Member for Hertfordshire, West (Mr. Jones) said, MAFF, which is responsible for coastal works, still seems to be driven by farmers who were brought up to try to expand the amount of productive land. It would be much more logical if responsibility were handed from MAFF to the Department of the Environment, which might take more of an overview of the situation. Before any work is done, there is at least supposed to be consultation between MAFF and English Nature to consider the scientific evidence on the impact of the environment. If English Nature puts up a case that a particular scheme is not in the best interests of the natural environment, the scheme does not go ahead.
      As I understand it, if any county engineer or other person responsible for putting up a scheme says that it has to be carried out as emergency work, this consultation does not have to take place. I accept that, if there is a problem such as that which occurred in north Wales, at Towyn, where emergency means that something has to be done in the next five minutes or the next hour or two, consultation just cannot take place. But local groups often take the view that the emergency is not something that has to be dealt with within the next five minutes, the next day, or the next couple of days, that it can be dealt with on a much longer time scale.
      I would like the Minister to address a particular problem that has been drawn to my attention—what happened in the destruction of the SSSI at the Milford marine band at Milford-on-Sea in Hampshire. I understand that the work was done there on the basis that it was an emergency and there was no need for the engineers to consult English Nature. I do not expect the Minister to get the details now: it would be remarkable if his civil servants could come up with the details of that site at this stage.
      Of course, if I hear his answer when he winds up, I shall be delighted, but I am very happy to wait, and receive a letter from the Minister telling me exactly why the work had to be carried out on an emergency basis on that site; why there was such a short time scale that it was not possible for any discussion to be held between the county and English Nature on what work was to be carried out; and why it was that the SSSI was destroyed as a result of carrying out the work. The destruction was not, I gather, the result of the work carried out on the beach but occurred in putting in an access road for the contractor to get down to the beach.
      That is an amazing state of affairs, and I would like the Minister to look into the question whether the consultation procedure between MAFF, the local authority and English Nature could be improved, so that, unless the emergency is a matter of hours away, consultation can take place.
      I also understand that there is often argument as to whether a grant should be paid, and that normally, when it can be shown that it is an emergency, the grant is paid. Of course, one of the best things about dealing with an emergency is that it is very difficult for anyone to come along afterwards and look at what was there before. If it is not treated as an emergency, that is not the case.
      My next point concerns the question of how far there is good co-operation between the Department of Energy, MAFF and the Department of the Environment, or, in some specific cases, the Welsh Office. Greenpeace has been expressing to me considerable concern about the last

      1039
      round of oil and gas exploration licensing. It is particularly concerned about blocks 107/1 and 107/6, close to Bardsey Island and the Lleyn peninsula in north Wales.
      There are questions about how far we should be searching in Britain for every spot where there may be oil and gas, how much we want to exploit and how much of the locked-up carbon in the earth should be released into the atmosphere. I certainly think that, unless the Government are committed to trying to release every last bit of oil or gas from the earth into the atmosphere, they ought to question whether sites so close to ones which are particularly important for sea birds and sea creatures ought to be exploited.
      I wonder whether the Minister can tell us what consultation there was over the granting of licences by the Department of Energy for oil and gas exploration close to Bardsey Island and the Lleyn peninsula, and how far they looked at the implications for kittiwakes, guillemots, razorbills and other sea birds, and such things as the grey seal off that coast.
      The Department of Energy, or the energy section within the Department of Trade, is encouraging the oil companies to decide which blocks they want to bid for again, and quite a lot of seismic studies are going on around the coastal waters with regard to possible bids for future blocks. I wonder how carefully the Government have been looking at the implications of oil and natural gas exploration in terms of a strategy for protecting the marine environment around our coasts.
      Finally, I must stress my disappointment that there has not been more of a response by the Government to the need for a national strategy for our coastal waters. I have frequently put down questions to Ministers asking if they will list all the estuaries around the coast of England and Wales which have received any Government money to consider the feasibility of, for example, barrages to improve transport, barrages to be concerned with either power generation or power storage, or barrages for other purposes. There seems to be great difficulty in getting from the Government lists of estuaries where Government money is being spent on considering schemes.
      I can understand the argument that we might want a water power scheme on one of the estuaries around the British Isles, but there ought to be a deliberate Government strategy. There ought to be some attempt to draw up priorities. It would be very unfortunate if there were not some balance between the loss of natural habitat within our estuaries and schemes which might have commercial advantage.
      Will the Minister, either in this debate or in some other way, inform the House how much Government money is going into schemes. There are discussions about the Severn, the Mersey and the Dee, and I believe that schemes are being considered for the Humber, but I would like to see from the Government a comprehensive list of schemes being undertaken, how much money is being spent on that sort of inquiry and what the results are.
      This is certainly a very useful report. I listened with considerable interest to the Minister's explanation of why he could not implement all the recommendations. I look forward to the opportunity of seeing the Minister before the Committee in the not too distant future so that the Committee can itself pursue some of the questions which have been left unanswered.
      6.17 pm
      Mr. Michael Stephen: I welcome the opportunity to contribute to this important debate as I too have the honour to represent a coastal constituency. Although the name of the constituency is Shoreham, it includes not only the town and port of Shoreham, but also a long stretch of the channel coast from Hove to Littlehampton, with the exclusion of Worthing borough.
      I welcome the Government's co-ordinated approach to the problem of coastal defence, but I believe that we need a much more co-ordinated approach to the management and planning of the coastal zone, not only the natural environment, but also the environment where people live, work and enjoy their leisure hours. Leisure is particularly important. On the Sussex coast at the present time we have a high level of unemployment, and tourism is vital to the economic recovery of our area.
      Here I pay tribute to an organisation which has already been mentioned in the debate—SCOPAC, the Standing Conference on Problems Associated with the Coastline, which is a consortium of local authorities covering the area from Worthing to Weymouth. I believe that it is the first such organisation to be created at member level; there are other organisations at officer level, but this is still the only one at member level. Its current chairman, Councillor David Birt, is chairman of the Arun district council and is one of my constituents.
      The organisation has many achievements to its credit. I shall mention just two. First, it has done some very important research into the transport of sediment. The tides in the English channel are ferocious and large quantities of sand and gravel are transported long distances. In Shoreham the port which used to exist in Elizabethan times is now nearly a mile from the sea. Secondly, SCOPAC has done a great deal of valuable work in producing a model format for coastal management plans for use by local authorities. Regrettably, however, SCOPAC is supported only by local authority funds. It has no formal recognition from Government and is not eligible for Government grants.
      Paragraph 20 of the Government's response to the Select Committee report states that the Government believe that the appropriate level for management planning is at the estuary level or along relatively short stretches of open coast. I doubt whether that approach is right and, in view of the excellent work done by SCOPAC, will the Minister reconsider the Government's position on this issue? Also, like many other hon. Members, I ask the Minister to examine carefully the co-ordination of Government Departments' work on coastal zones and perhaps to reduce the number of Departments with a finger in the pie.
      As for sea defences, I agree with the comments of my hon. Friend the Member for Blackpool, South (Mr. Hawkins). We have the same problem on the channel coast, especially in my constituency at Shoreham and Lancing. We must always be on our guard because the power of the sea is truly awesome and large sums of money must be spent to defend the land against it.
      I pay tribute to the work that the Government are already doing in my area. In the early 1980s, the Southern water authority spent about £500,000 on new groynes along 6 km of the foreshore of Shoreham beach, and since the formation of the National Rivers Authority in 1989, a further £741,000 has been invested in capital works, with

      1041
      £124,000 being spent on works at Lancing in this financial year. A further £160,700 has been allowed in this year's maintenance commitment for that particular frontage.
      I wish to draw the attention of the House to a small point but one which is important to the people involved. Under the Coast Protection Act 1949, local authorities may carry out coastal protection work, but I agree with other hon. Members who believe that there is far too much statutory consultation involved. I sometimes think that, after all the time and money spent on consultation, it is surprising that there is time or money left to do any work. Perhaps the Minister will bear that point in mind.
      In some areas where coastal protection work must be carried out, it will be found that fishermen are working there with fixed gear such as lobster pots. Although the council has statutory power of entry into such sea areas to carry out works and also to pay compensation, it can pay compensation only if it is satisfied by evidence—usually audited accounts—that financial loss has been suffered by the fishermen.
      It may or may not surprise the House to learn that some fishermen are unable or unwilling to produce audited accounts for that purpose. Some feel that unless a firm commitment is made to pay them compensation they are entitled to obstruct the execution of the work. Indeed, some even think that the Ministry of Agriculture, Fisheries and Food will assist them to do so. A licence must be issued by the Ministry of Agriculture, Fisheries and Food under part II of the Food and Environment Protection Act 1985, but such licences contain no reference to compensation. Could the parties involved have clearer guidance on the circumstances in which compensation will be paid and the eligibility for central Government funding of that compensation?
      In conclusion, I am very grateful for the work of the Select Committee on the Environment and to my hon. Friend the Member for Hertfordshire, West (Mr. Jones), its Chairman, for his clear and concise introduction to this debate.
      6.24 pm
      Mr. Chris Smith: The starting point for the debate must of course be a recognition of the fundamental importance of our coastline and marine environment which provides a unique landscape and habitat, an area of recreational value and a place in which people live and work. It is worth remembering that the potential threats to that marine and coastal environment are considerable.
      A survey conducted in April this year by the Royal Society for the Protection of Birds covering 126 estuaries around the United Kingdom coast found that there had been substantial changes since its equivalent survey in 1988. A total of 57 estuaries now face the threat of permanent damage compared with only 43 four years ago. The survey highlights the potential dangers to our marine environment.
      The Select Committee on the Environment did an excellent job in examining the important and threatened areas of our coastline. I am glad to take the opportunity to join other hon. Members in paying tribute to that Committee and to its former Chairman, under whose chairmanship I and the hon. Member for Hertfordshire,
      1042
      West (Mr. Jones) served for several happy years, and to welcome the hon. Gentleman to his important task in chairing it now.
      The Select Committee report contains a series of well considered, well worked out and important recommendations. In particular, the report identified the problem of incoherence in the way in which we look after and plan for our coastal zones. One and a half pages of the report consist of a list of various structures, agencies, organisations and levels of governmental, nongovernmental and local authority interest in the business of protecting our coastal zones. So long as there is such a densely complex system of protection, the protection itself will be inadequate. That is the central message of the Committee's report, which it was absolutely right to identify.
      Although encouraging in some respects, the Government's response has been inadequate. The Government are right to identify, for example, the need for environmental impact assessment in some aspects of coastal protection work. I shall deal with that issue in a moment because the Government do not go far enough. They are also right to note that some aspects of port activities will need to be brought into line with the European Community habitats directive and to recognise in some areas of coastline defence the importance of a strategy of managed or controlled retreat. Although some areas will require physical protection—a number have been identified today—there are other areas of our coastline where retreat is perhaps a better option.
      Many aspects of the Government's response to the Select Committee report are disappointing. I shall draw the House's attention to some of them. First, the Government fail to recognise the great importance of examining the whole coastal resource and the need to protect all of it, not first designated or especially important areas within it. For example, paragraph 15 of the Government's response reveals a danger of the Government establishing the principle of only partial coverage of the coastline in the preparation of management plans. If we have a strategy which looks only at portions of the coastline and not at the coastline as a whole—a point which was touched on by the hon. Member for Cornwall, North (Mr. Tyler)—if that is the Government's strategy, there is a danger that pressure will move from designated areas of the coastline to other areas which have not been designated.
      Secondly, there is undoubtedly a need for greater coherence in the Government's approach to coastal planning and protection. Witness after witness in the Select Committee emphasised the need for a common strategic approach to planning in the coastal zones, and if there are to be joint arrangements between different agencies and local authorities those arrangements must have a clear and coherent strategic aim.
      The Royal Town Planning Institute, in its comments on the Government's response to the Select Committee, puts the ball very firmly in the Government's court. It says:
      "The response to rationalising the activities of Government Departments and agencies"—
      from the Government—
      "is almost wholly negative."
      Referring to the Government, the institute say:
      "It points at more than one part of its response to the number of bodies dealing with similar activities, particularly pollution, research, coastal flooding and protection. As it expects local government to do, so should central government

      1043
      look critically at the cost-effectiveness of a number of bodies with similar duties and also consider the effects of a sectoral approach on those for whom the services are intended."
      The RTPI seems to me to have hit the nail on the head and there is a need for the Government to be more active in looking at the plethora of Government Departments, bodies and organisations with some degree of interest at present in protection of the coastline and to bring about a greater rationalisation. The very concept of coastal zone management as an integrated approach, a concept that sits at the heart of the Select Committee report, is one which I do not believe that the Government have taken on board—and they should.
      Thirdly, the Government need to improve their approach to environmental impact assessment for coastal development. Their response goes some way towards addressing that in relation to coastal protection works, but they do not insist on environmental impact assessments for a whole range of other coastal development matters-and they should.
      The Council for the Protection of Rural England, for example, proposed that environmental impact assessments should be required for, among other things, offshore oil and gas investigation work, marine dredging, coastal protection works, port and harbour activities currently falling within the scope of permitted development, renewable energy developments, large-scale tourist developments, camping and caravan sites, and fishing operations. Those are valid proposals and the Government should be looking much more attentively at them than they are.
      Fourthly, the Government do not do very much to overcome the division which exists in the planning system at present: the division of responsibility between the area onshore and the area offshore. The Select Committee recognised the importance, in habitat terms, of regarding the shore and the sea which adjoins the shore as being a whole in planning terms. The Select Committee's proposal that local planning authorities should be given planning powers which run out into the marine environment and do not just stop at the low water mark is a sensible proposal to which the Government should be giving a more positive response. The ecosystem does not end at the low water mark and the Government should accept that.
      Fifthly, the Government have not given a constructive response to the proposal that national policy formulation needs to be much clearer.
      Many speakers from both sides of the House have said to the Government that there is a need for a coastal unit to be established within the Department of the Environment and perhaps in due course brought into the environmental protection agency to ensure that we look at the needs of our coastal zone as a whole around the country and in a coherent way. It is vitally important that the Government take on board this proposal from the Select Committee and establish a national policy unit which can provide the sort of strategic overview on a national basis that we desperately need.
      Sixthly, the Government are being far too slow in the establishment and designation of marine nature reserves. I appreciate that they are embarking on the marine conservation area approach as an interim exercise, but it is important that they speed up the process of designating marine nature reserves. Had they done so, some of the
      1044
      difficulties in Cardigan Bay that my hon. Friend the Member for Denton and Reddish (Mr. Bennett) addressed might have been avoided.
      Seventhly, the Government have made some progress on the issue of aggregate and mineral working, but not enough. My hon. Friend the Member for Gower (Mr. Wardell) spoke trenchantly of the difficulties facing parts of his constituency as a result of mineral dredging. The Government need to take this problem more seriously than they have up to now. Moreover, alongside the problem of dredging, they also need to start addressing in a coherent way the problem of super-quarries which is beginning to emerge especially in parts of Scotland. We look forward to better and more stringent guidelines being proposed by the Government and I hope that they will get on with the process quickly.
      Eighthly, the Government have rejected the Select Committee proposal in paragraph 109 that pollution control should be brought under the aegis of a single agency, and that if and when the environmental protection agency becomes established that appears to be the obvious place in which to locate pollution control for areas of coastline. Unbelievably, however, the Government say in their response that
      "there is no justification for a single agency".
      The whole emphasis of the Select Committee report is that there is indeed justification for a single agency, and it is about time that the Government recognised that.
      Ninthly, this debate has been characterised by a remarkable degree of gentle and constructive criticism of the Government from both sides of the House. A number of hon. Members from both sides have put the argument that responsibility for coastal defences should be taken away from the Ministry of Agriculture, Fisheries and Food. That is long overdue. If the Department of the Environment had the courage to stand up for its own corner and say that it should be responsible, it would have the full support of the Opposition in so doing. We should be happy to join in transferring those responsibilities to a far more logical place than that at which they now rest.
      The report also addresses the issue of the Crown Estate Commissioners and the absurdity, which even the Commissioners accept, of their status as both landlord and planning authority. The Commissioners are placed in an invidious position by their dual status, and it is time that their planning and licence-giving functions were transferred, as the Select Committee proposes. The Government, however, want to adopt an evolutionary approach. The trouble with evolutionary approaches is that they tend not to lead anywhere. It is incumbent on the Government to take a lead and to relieve the Crown Estate Commissioners of their planning functions.
      The Government's response to the Select Committee reveals little sense of the long-term issues involving the possibilities of climate change, global warming and rising sea levels. They talk about some temporary changes, but they do not seem to take on board the possibility that we may face longer-term phenomena. That speaks volumes about the Government's lack of proper strategic vision. It is clear from the report what the Select Committee believes, which is also what hon. Members on both sides of the House have said in the debate—that the key necessity is a proper strategic method of dealing with the needs of the coastal zone. The Government have got some bits and pieces of the approach right, but I fear that they still have

      1045
      a long way to go. There is too little strategy and coherence in their approach. They need to think again, and I seriously urge them to do so.
      6.40 pm
      The Minister for the Environment and Countryside (Mr. David Maclean): Like the hon. Member for Islington, South and Finsbury (Mr. Smith), I am grateful to the Select Committee on the Environment and its new Chairman, my hon. Friend the Member for Hertfordshire, West (Mr. Jones), whom I warmly congratulate on his election to his post, for ensuring that the House has this opportunity to debate coastal zone protection and planning. I pay tribute, too, to my hon. Friend's illustrious predecessor, Sir Hugh Rossi, for his excellent chairmanship of the Select Committee.
      The Select Committee worked in the last Session to a tight timetable to cover what is a very complext subject, and the report which they produced was a valuable contribution to coastal policy. It was especially effective for its exhortation to all of us across Government to look at the whole picture on the coast, and not just particular sectoral concerns.
      The Committee's report was wide-ranging, covering the overall framework for coastal zone planning and management, development control, coastal defence, nature conservation, pollution and fishing and the links between all of these. The debate today has been similarly wide-ranging. I confess that I did not come fully briefed for the discussion on old fossils—who are not present in the Chamber.
      The Select Committee called for a national coastal strategy. The Government's response made it clear that, although we do not believe in a single all-embracing strategy for the coast—or, as my hon. Friend described it, a "cascade" of national, regional and local plans—we believe in clear statements of national policy which together add up to a coherent whole.
      Recent examples of such statements include policy on heritage coasts, and planning policy guidance providing a clear policy steer for development on the landward side of the coastal zone. That PPG—PPG20—makes it clear that development on the coast should be limited to that which genuinely needs to be located there, and guided towards areas that are already largely developed. The undeveloped coast should remain so, largely protected by conservation designations because of its high landscape and nature conservation value. The PPG discourages new development in coastal areas at risk from flooding, erosion and landslip, and it encourages close co-operation between local authorities and interested groups in developing plans for stretches of coast, especially estuaries.
      Guidance has already been issued on the response to sea level rise, and in December 1991 my right hon. Friend the Minister of Agriculture, Fisheries and Food announced his intention to develop a national flood and coastal defence strategy to provide a comprehensive policy framework which fully reflects environmental concerns. I welcome that, and work on it is now well under way.
      Other initiatives include major investment to improve coastal water quality; preparation for implementation of the EC habitats directives; a review of regulation below low water mark; and support for multi-agency estuary and
      1046
      coastal management plans. I assure the House that the review will be extensive and will cover the entire United Kingdom—Northern Ireland, Scotland and Wales, as well as England. We believe that those initiatives provide a sensible and coherent programme of action to address coastal issues.
      Our strategy has three basic strands. First, we need effective statutory protection for our most valuable coastal landscapes and marine and coastal habitats—often of international importance. Much of the coast is already designated and so protected from development through the planning system. We are building on that through designating special protection areas for birds and implementing the habitats directive. I reject any allegation that we are doing that slowly, or have a poor record. We are not slow, and we have a good record.
      Secondly, we need effective planning and management structures for coastal land, estuaries and inshore waters, not just for designated areas, but also for undesignated areas which nevertheless form part of our national coastal heritage. Active management is particularly important where there are many potentially conflicting uses, or where an area is of substantial recreational or natural value.
      Thirdly, we need a broader strategy for the health of the marine environment, which cannot be confined to any rigid site-based approach but which looks instead at broader issues such as pollution control, fisheries management and species protection.
      For the second strand—planning and management of the coast and of estuaries—our framework differs from that proposed by the Committee. The Committee, like many hon. Members who have spoken tonight, wants regional strategies. We want to make sure that management is at the appropriate level for the problem being addressed. That is not to say that we do not believe in a regional perspective here, but that can usefully be provided in the context of regional planning guidance and by regional studies of key issues such as sport and recreation. The coastal recreation strategy by the Southern Council for Sport and Recreation is a good example. But it is at the local level that conflicts between coastal users must be resolved.
      Regional coastal cells provide a useful basis for looking strategically at coastal defence against erosion and flooding. That is why my colleagues in MAFF welcomed the development of regional groups of coastal protection authorities and the National Rivers Authority, and are encouraging them to develop coastal defence strategies for their areas.
      However, we believe other issues—such as recreational management, nature conservation and interaction, for instance, with fishing and ports operations—are best managed more locally, for instance, around an estuary or along a heritage coast. That means that planning and management is local enough to allow effective consultation with interested groups, and discussion of practical issues. Local authorities can co-operate around an estuary to ensure consistent development plans, and a management approach that considers the estuary as a single ecological system and takes both land and water into account.
      That is our approach, and I commend it to the House. When we issued our response, English Nature said:
      "We are pleased by the commitment to support the existing informal coastal groups … and we believe that it is vital that the Government strongly encourages them to prepare coastal defence strategies for each cell … Other types

      1047
      of activity, for example recreational use and many types of development, are better co-ordinated at a more local scale. We are committed to developing such plans and are currently involved in preparing pilot plans for 13 English estuaries."
      Our commitment to sustainable management of our coasts is well established, and I believe that the framework that we have adopted provides a firm foundation for further progress.
      My hon. Friend the Member for Hertfordshire, West, my hon. Friend the Member for Shoreham (Mr. Stephen) and, indeed, the Select Committee argue that, to show their commitment to the coast, the Government should reorganise their bureaucracy and have a single coastal zone unit. We accept the need for a national overview of coastal issues. We have already gone a considerable way down the road to achieving this, with a standing interdepartmental group on coastal policy, which has now been established for well over a year. It has proved a valuable mechanism for discussion. It co-ordinated the Government's response to the Select Committee, and it is now taking forward work reviewing regulation and management below low water mark. The secretariat for this group is in my Department.
      It would be a mistake to go beyond this and to argue for a group or unit to take on substantial executive functions. It would not make sense in a complex, heavily populated country such as ours to have a Department for the coast. In many sectors—land use planning, pollution, flood defence and nature conservation—coastal issues are only one aspect of much larger issues. Management of the coast needs to be integrated with management of the rest of the land and of the sea. The coast is not a separate thing that can be hived off to one corner.
      My hon. Friend the Member for Hertfordshire, West, in his excellent introduction of the report, and other hon. Members, including the hon. Member for Islington, South and Finsbury (Mr. Smith), suggested that responsibility for coastal defence, and the management of coastal flooding and erosion, should be transferred from the Ministry of Agriculture to the Department of the Environment. We rejected that recommendation.
      The reason was simple. The Government do not accept that the present allocation of ministerial responsibilities results in any lessening of our commitment to take full account of environmental concerns in coastal defence policy. Environmental considerations are an integral part of decision-making on flood and coastal defence, as they are in other areas.
      My hon. Friend the Member for Blackpool, South (Mr. Hawkins) was worried about Blackpool's sea defences. I know that overall expenditure by the Ministry of Agriculture on flood defences has increased dramatically in recent years. However, the demand is practically unlimited. I will draw my hon. Friend's concerns in Blackpool to the attention of my right hon. Friend.
      I reject any charges of unnecessarily complicated bureaucracy. All the key players involved in flood defence, whether the Department of the Environment, Ministry of Agriculture, Fisheries and Food or local councils, know how the system works. I do not believe that there is unnecessary bureaucracy. I do not want flood defence to be transferred to my command. I see no point in that, and I do not especially want it to happen.
      1048
      It would not make any particular difference. Shuffling name plates on ministerial doors or putting policy into another Department does not remove the need for essential consultation with all the relevant key players.
      Mr. Tyler: Will the Minister give way?
      Mr. Maclean: No. I want to crack on. I have many points to answer, but I will give way at the end if there is time.
      My hon. Friend the Member for Hertfordshire, West said that the Ministry of Agriculture, Fisheries and Food's policy on coastal defence was too farmer-orientated. I am sorry to disagree with my hon. Friend, but I must point out that 85 per cent. of Ministry of Agriculture, Fisheries and Food funding goes to defences in urban areas, and rightly so. The announcement on coastal policy by my right hon. Friend on 2 December is conclusive proof that the Ministry of Agriculture, Fisheries and Food is working with natural coastal processes and is ready to consider managed retreat in rural coastal areas.
      I point out to the hon. Member for Wansbeck (Mr. Thompson) that we need to work with nature rather than against it when designing coastal defences—a point also made by the hon. Member for Denton and Reddish (Mr. Bennett). The Ministry of Agriculture, Fisheries and Food is encouraging authorities to adopt soft engineering solutions which are more in sympathy with natural processes. There is a clear presumption against disturbing natural coastal processes unless life or important natural or man-made assets are at risk.
      In addition, coastal defence authorities are now expected to consider the potential for managed retreat when assessing options for coastal defences in rural areas. The Ministry of Agriculture, Fisheries and Food intends to continue to work with English Nature and other interested organisations to explore the many practical questions of how this technique can be deployed to maintain and restore coastal habitat.
      My hon. Friend the Member for Hertfordshire, West asked about action at European level. The European Commission has not yet published any proposals for a Community strategy for integrated coastal zone management. However, we are devoting considerable effort across Government to implementation of the European Community habitats directive. The Government were in the lead in supporting the adoption of the directive, under which we are committed to species protection and to ensuring designation and effective protection for land and marine sites of Community importance.
      The hon. Member for Gower (Mr. Wardell) asked us to review the role of the Crown Estates Commissioners in controlling development generally, and not just marine aggregates dredging. As explained in the Government's response, the Crown Estates Commissioners' regulatory role over development is pretty limited: it is confined to marine aggregates and marine fish farming. The Commissioners' role in both areas is subject to considerable scrutiny. We believe that the best way in which to conduct a more general review is to look comprehensively at existing systems of development control and not only at the small element for which the Commissioners have responsibility.
      My hon. Friend the Member for Isle of Wight (Mr. Field) gave us a wonderful dissertation on underwater archaeology. He and other speakers have argued that the

      1049
      solution to coastal zone management is to extend the existing land use planning systems and other control systems out to sea. As hon. Members are aware, the Government have undertaken to address the issue in their review of regulation below the low water mark. We are currently working to prepare a discussion paper.
      We shall need to look at the existing systems for controlling development below the low water mark and to consider whether there are limitations in those systems which need to be remedied. We shall also need to look at questions such as the balance of advantage for different types of offshore development between decision-making at national and local level and the need for cost-effective involvement of environmental expertise. We must also consider the need for effective local and public involvement, which is terribly important.
      My hon. Friend the Member for Isle of Wight asked about the dumping of dredged material and about the environmental appraisal of such dumping. That issue is under review as part of the Government's review of regulation below the low water mark. I hope that that satisfies my hon. Friend.
      My hon. Friend the Member for Harwich (Mr. Sproat) made an elegant plea for us to save the Naze. I regret that so far it has not been possible to find a solution which has resulted in its complete protection. I know that my hon. Friend has pressed the case on behalf of his constituents at the highest levels, and I shall draw his comments tonight to the attention of my right hon. Friend the Minister of Agriculture, who has never been, and could never be, described as an old fossil.
      The hon. Member for Denton and Reddish was concerned about oil exploration, among other issues. The ones to which I have an immediate answer concern oil exploration. I shall write to him on the other couple of issues he raised. I can tell him that the Department of the Environment was consulted on the blocks recently offered for oil and gas licensing. The Government's adviser, the Joint Nature Conservation Committee, also gave advice on the implications for sea-birds.
      Government policy is to attach special conditions to exploration in sensitive areas to protect the needs of environmental interests, including a ban on drilling during seasons when seabirds may be affected. I shall scan the report of the debate carefully. My hon. Friend the Member for Shoreham raised points about compensation, and I shall write to him about them.
      1050
      I emphasise that the Government's response to the Select Committee report set out a substantial work programme for the better protection and planning of the coast. I shall not repeat that programme; I shall say merely that further opportunity for public debate on coastal issues will come when we publish our promised discussion paper—or papers—on regulation below the low water mark.
      I believe that, in our response and our policy, we have a clear framework for action. We have clear commitments to action. We are committed to ensuring that the principle of sustainable development is applied to our coast. I commend our approach to the House.
      6.58 pm
      Mr. Robert B. Jones: With leave of the House, I welcome the fact that so many hon. Members who are not members of the Select Committee have taken part in the debate. That speaks for itself, as does the degree of support that hon. Members of all parties have given to the conclusions that we reached.
      I have served on the Select Committee on the Environment for nine years. During that time, our conclusions have been rubbished from time to time by the Central Electricity Generating Board, Ministers and others. However, our reports have stood the test of time; I can think of no central recommendation, including the recommendation for the creation of the environmental protection agency, which has not been accepted in the end. The fact that we are making progress a little more slowly than I want does not rule out the acceptance of our recommendations in the end.
      I must correct my hon. Friend the Minister who, in an otherwise most interesting speech, implied that the Select Committee was in favour of a new Department of State to deal with coastal management. That is certainly not the case. Our aspiration was that that matter should be managed firmly and accountably within the Department of the Environment.
      We have had an interesting and excellent debate. It is, I think, one of the most important features of parliamentary government that we hold debates on estimates and Select Committee reports, and I am grateful to have had the opportunity to initiate this one.
      The debate was concluded, and the Question necessary to dispose of the proceedings was deferred, pursuant to paragraph (4) of Standing Order No. 52 (Consideration of estimates).

    Banking Co-ordination
    6.59 pm
    The Economic Secretary to the Treasury (Mr. Anthony Nelson): I beg to move,
    That the draft Banking Coordination (Second Council Directive) Regulations 1992, which were laid before this House on 17th November, be approved.
    The regulations, which give effect to the second banking directive and, in part, to the second consolidated supervision directive, represent a major new development in the framework for supervising banks in the Community and set the foundations for the single market in banking.
    As the regulations implement a Community obligation, they are to be made under the powers provided by the European Communities Act 1972. That Act permits regulations to he made by negative resolution. However, on a matter of such importance—a matter which I know is of considerable interest to a number of hon. Members—it is clearly right to lay the regulations in draft and seek the approval of both Houses before making them.
    The United Kingdom was in the forefront of those arguing for the adoption of the second banking directive, which offers opportunities for British banks and benefits for consumers throughout the Community. The financial services industry is, and always has been, one of the United Kingdom's key export earners, and the directive offers major opportunities for British banks and building societies that want to offer their services elsewhere in the Community. Rather than having to obtain separate authorisation from the authorities in each Community member state, banks will now be able to rely on their home state authorization—the so-called single passport—to conduct a wide range of banking and financial services, whether by establishing a branch in another member state or by providing cross-border services. The directive provides for the streamlining of supervision and the reduction of any barriers to entry that may exist in other member states.
    Banks from other member states will also be able to operate in the United Kingdom on the basis of their home state authorisation. The success of United Kingdom financial centres has been won as a result of, rather than in spite of, the openness of our financial markets, so the principle that underlies the second banking directive—that of a market without barriers—goes entirely in the right direction.
    The directive goes in the right direction for consumers, too. Banking is already, of course, an international market in many respects, but there may be scope for still more competition and diversity. The services and financial products that have been developed in one market may well catch the appetite of consumers in other parts of the Community. The aim of the second banking directive is to enhance the opportunities for banks to break into new markets, and if it succeeds in doing that, banks throughout the Community will be kept on their toes, which is clearly no bad thing.
    It is important that increased competition should not be achieved at the expense of standards of regulation. That concern was at the forefront of the Government's mind when the second banking directive was being negotiated. That is why it is so important that underpinning the single passport regime is an extensive body of common standards on the prudential criteria for authorising and supervising
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    banks. Some of that is in the second banking directive itself, and some in the second consolidated supervision directive, which the regulations also implement.
    Other important elements are the own funds and solvency ratio directives, which set detailed solvency rules for credit institutions and which have already been implemented in the United Kingdom. The process of refining common standards will be carried forward in two further—directives-one dealing with banks' large exposures, the other setting out capital adequacy rules to cover market risk, which are on the point of adoption in the EC.
    The harmonisation of prudential rules is a key element of the answer to those who express the concern that, in the wake of the BCCI experience, it is unwise to proceed with a framework for banking supervision that places such weight on the performance of other countries' supervisors. Quite apart from the fact that the whole second directive framework is about setting common basic standards, however, it is important to consider the positive benefits that flow from achieving a clear basis for assigning supervisory responsibility for internationally active banks. The BCCI case has shown clearly the difficulties that supervisors face in dealing with a complex international conglomerate with an extensive branch network in one country and its head office in another. Assigning full supervisory responsibility to the authority in the bank's home state, with host supervisors in a co-operating but clearly subordinate role, is clearly a sensible way of tackling such situations.
    The principle of home state supervision established by the second banking directive framework builds to a great extent on the framework that banking supervisors throughout the world have been developing over the years—mainly through the Basle forum—to deal with internationally active banks.
    Mr. A. J. Beith: What if the home state chosen by the bank were Luxembourg, bearing in mind the fact that, at one stage in the BCCI episode, Luxembourg said that it would prefer it if the Bank of England took over responsibility?
    Mr. Nelson: In practical terms, as I shall try to explain, much of the responsibility for supervision may be delegated to the host state bank. Indeed, important responsibilities will remain with the host state bank under the regulations. The right hon. Gentleman has put the key question. These extremely complex regulations enact two important directives and the question at the back of my mind is exactly the question that the right hon. Gentleman poses: will banks authorised in a country—in this case. a country within the European Community—whose supervisor may not subscribe to the highest standards, or may not have the resources to operate such standards, be able to operate here? If the right hon. Gentleman will allow me to make progress, I hope that he will obtain some reassurance from my remarks.
    Within the Community, the second banking directive takes the Basle principles to a new point by requiring the principle of mutual recognition of standards to be enshrined in national law.
    Thus, the Government remain of the view that the supervisory principles underlying the second banking directive remain valid in a post-BCCI world—indeed, that in many respects, they are part of the process of ensuring

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    that a bank could not in future develop as BCCI developed. That view is echoed in Sir Thomas Bingham's conclusions. Sir Thomas said that nothing in the history of BCCI called for the new Community regime to be substantially revised. Like Sir Thomas, however, we take the view that, within the framework, important issues of detail need to be looked at to ensure that all the lessons of the case are learnt.
    Four of the issues that Sir Thomas covered in his recommendations are particularly relevant here. First, he emphasised the importance of the principle that a bank's head office—the location of its mind and management—should be in the same place as its registered office. A recital to the second banking directive makes it clear that member states should require that.
    Secondly, Sir Thomas recommended that all supervisors should have powers to refuse authorisation, or to withdraw it once given, where banking groups are structured in such a way as to frustrate effective consolidated supervision.
    I am pleased to say that both those potential changes in Community legislation were discussed in outline at the Economic and Finance Council on 23 November, and received a broad welcome both from the Commission and from other member states. The Commission has undertaken to bring forward specific proposals with all possible speed.
    Thirdly, the Community needs to look again at the issue of supervisory confidentiality and, specifically, the exceptions to it—the so-called gateways—which enable supervisors to communicate as they need to with others engaged in regulating different aspects of the bank concerned, or with the banking and financial system more generally. Sir Thomas Bingham highlighted the issue of exchanges of information between Community supervisors and those in third countries, and I know that the Commission is keen to look at what can he done to facilitate co-operation and exchange of information in that regard.
    Action is also in hand which will meet the last of Sir Thomas Bingham's recommendations on the EC framework, which was that there should be agreement as soon as possible on a Community directive on deposit protection, putting it on a home state basis, to parallel supervision.
    The Government fully support that principle and a draft of such a directive is currently being discussed and considerable progress has been made under the United Kingdom presidency. The directive will introduce certain minimum requirements for deposit protection schemes and banks will have to make the protection afforded by their home state available to those who make deposits in their branches in any other member states.
    I want now to explain in more detail how the broad principles of the directive have been transposed into United Kingdom law by the regulations that we are debating.
    The regulations divide broadly into two main parts—the inward and the outward passports. Taking the inward passport first, the approach of the regulations is to ensure that the authorisation requirements under the Banking Act 1987, the Financial Services Act 1986, the Consumer Credit Act 1974, and the Insurance Companies
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    Act 1982 do not bite on incoming EC institutions in respect of the activities listed in the second banking directive which they are entitled to conduct by virtue of their home state passport.
    The regulations set out the categories of institutions which may have passport rights. These include not only the so-called credit institutions—the Community term for bank, defined as an institution which takes deposits and lends—but certain of their subsidiaries. The latter are subject to tight conditions, including a requirement that their parent credit institution holds 90 per cent. of the voting rights in the subsidiary and that they have a full parental guarantee.
    The activities liberalised by the directive are listed in the annex to it, which is produced as schedule 1 to these regulations. They range from the familiar banking activities of taking deposits and lending, through a variety of activities regulated under the Financial Services Act, such as dealing in equities or giving investment advice, and include also activities such as safe custody services for which United Kingdom law does not require authorisation.
    The precise scope of the activities listed in the directive does not correspond exactly with the coverage of existing United Kingdom regulatory legislation, so, for some activities outside the scope of the passport, incoming European institutions will continue to require authorisation under the Financial Services Act and Consumer Credit Act, as now. This is a complex and technical subject and further guidance on the intepretation of the activities listed in the annex, and their interaction with Financial Services Act and Consumer Credit Act activities, will be made available shortly to the institutions that will be affected.
    Mr. John Butterfill: What progress is being made on investor compensation schemes? I do not think that the matter has yet been finalised, but presumably it will be the subject of a subsequent directive.
    Mr. Nelson: Yes. I referred earlier to deposit protection. Investor protection is a separate matter and is some way behind. We have some way to go in making progress on deposit protection, top-up arrangements and various other important aspects, and we have even further to go on the investor compensation schemes. Some countries operate investor protection regimes and others do not. We, as my hon. Friend will know, have such a scheme, so investors here should be protected up to a certain level. That matter is being developed, but it is some way behind deposit protection.
    The United Kingdom regulators will be able to exercise powers of restriction and prohibition in relation to incoming institutions. That is the key point in answer to the right hon. Member for Berwick-upon-Tweed (Mr. Beith). It is important that, although supervision will vest with a home state authority, there will remain with the host state the ability to exercise certain powers of restriction and prohibition in relation to incoming institutions. I believe that that is set out in regulation 9.
    However, in recognition of the reduced role of the host state, the grounds on which they can exercise those powers are narrowed by the regulations. First, there is a specific responsibility for the host state, in co-operation with the home state, to supervise the liquidity of the branches on their territory.

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    In non-urgent cases the host state's prohibition and restriction powers in respect of liquidity of branches have to be exercised initially by approaching the home state and asking it to take action. However, the directive does provide for the host state to take immediate action in emergencies, and the regulations reflect that.
    The host state also retains the right to continue to collect statistical information from EC institutions—banks authorised elsewhere in the Community operating in Britain—in its territory and to require compliance with rules it has adopted in the interests of what the directive describes as "the general good". Prohibitions and restrictions can he imposed for failure to comply with those rules.
    The general good is an established concept in Community jurisprudence, the essential principles of which are that the rules should be non-discriminatory, should be proportionate to the ends at which it is directed, and should not duplicate equivalent provision in the home state.
    The bulk of the general good rules which will apply to incoming institutions in the United Kingdom consist of conduct of business rules under the Financial Services Act and Consumer Credit Act, rules on advertisements, and the requirement that institutions in the United Kingdom be covered by investor compensation or deposit protection arrangements. The latter will in due course fall away when compensation schemes are moved on to a home state basis. Incoming institutions which join self-regulating organisations will also be subject to their rules in relation to investment business.
    On the outward passport, the provisions affecting United Kingdom institutions mirror the provisions for incoming institutions in many respects, particularly as regards the procedures for obtaining the passport.
    One of the important concepts that the regulations introduce into the Banking Act is the new concept of a credit institution, which is the nearest the Community has to an agreed definition of a bank. In practice, all building societies and most institutions authorised under the Banking Act qualify as credit institutions. But for the handful of authorised institutions that are not credit institutions, either because they do not lend, or because the deposits they take are not from the public, we need to preserve the Banking Act as it is, which we have done by means of a saving provision in the regulations.
    The other important criterion to satisfy if United Kingdom banks and building societies are to be sure of benefiting from the passport is set out in article 18(1) of the directive which says that the passport is granted for all activities listed in the annex to the directive which are
    "covered by the credit institution's authorisation".
    In order to produce a regime which unambiguously delivers that, the regulations set out formal links between the different authorisations which banks may obtain from the different functional United Kingdom regulators for activities on the second banking directive list. The informal communications which already exist between United Kingdom regulators are, in the process, put on a statutory basis, as is the supervision exercised by the Bank and the Building Societies Commission over activities for which at present no specific authorisation requirement exists under United Kingdom law.
    We have also had to construct new arrangements to enable United Kingdom bank-owned financial institutions to make use of the article 18(2) passport under the
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    conditions set out in the directive. The regulations therefore set up a framework for the Bank and the Building Societies Commission to exercise supervisory powers over those institutions, to the extent that they wish to use the banking directive passport to operate in other member states.
    The regulations also make provision that is necessary to implement the EC second consolidated supervision directive. The purpose of that directive is to extend the range of circumstances in which supervision of a credit institution has to be conducted on a consolidated basis. Consolidated supervision means, in this context, that supervisors have to be satisfied about the solvency, large exposures and internal control systems not just of the credit institution in its own right, but when taken together with other credit institutions or financial businesses elsewhere in the same group structure. The aim of consolidation is to enable the risks to which the supervised bank is exposed to be properly assessed.
    The first consolidated supervision directive established the principle of consolidated supervision for banking groups, whose parent is a credit institution. The new directive goes beyond that, to require consolidation of financial holding companies where a financial institution has as its subsidiaries, either exclusively or mainly, banks or financial institutions, so long as there is at least one bank. The bulk of the directive will be implemented through revised Bank of England and Building Societies Commission prudential notes, to be issued shortly, but the regulations supplement that by providing the investigation powers that are necessary for other EC supervisors whose exercise of consolidated supervision requires them to investigate entities in the United Kingdom.
    The regulations also enable the Bank of England to assist other member states' authorities in those cases.
    The regulations that we are debating are, by arty standards, long and complex. Without wishing to sound patronising, I am grateful to the House for bearing with me while I go through, in some detail, what some might regard as rather tedious regulations. Others will know that they are extremely important regulations, which will directly affect our banking community, and millions of individual, industrial and corporate customers of banks. They will crucially affect our prospects of taking full advantage of the single market. I know that the House will understand why it was important to set out the regulations in some detail for the benefit of the industry and for hon. Members who take an interest.
    The drafting of the regulations has benefited greatly from the many helpful comments received during consultation with the institutions affected, the trade bodies that represent them, consumer bodies and other interested parties. They represent the first step in the process of turning the single market in banking into a practical reality.
    The next step is for institutions to take advantage of the opportunities that the process presents. Financial services is an industry where United Kingdom firms are exceptionally well placed to make the most of new markets abroad. In an age when businesses and individuals are becoming ever more financially sophisticated, the prospects of greater competition, innovation and choice will receive an enthusiastic welcome throughout the Community. It is for that reason that I am confident that the regime that the regulations usher in is the right way ahead, and I commend them to the House.
    7.21 pm
    Mr. Alistair Darling: The Minister should console himself with the fact that while he explained the regulations, which are indeed long and complicated, the Chamber has slowly filled. If another place that we are not allowed to mention has been cleared during the Minister's speech, I am sure that he will understand that it is because there is a narrow, if not important, interest in such matters.
    The directive will open up the European market in banking and financial services and therefore the principle is right, which is why we shall not oppose it. As the Minister said, Britain has a justifiable lead in the provision of banking and financial services in London and many other parts of the United Kingdom. The industry is a major employer and earner of foreign currency. None the less, substantial concerns remain, and I shall draw those to the attention of the House because unless action is taken serious problems may arise.
    The introduction of the European second banking directive will mean a dog's breakfast of regulations throughout Europe, leaving the investor and depositor wondering who to see and where to go when things go wrong in many cases. The directive may allow institutions to shop around for the poorest and least efficient system of regulation, just as the Bank of Credit and Commerce International was able to do. In many cases, the consumer will have no idea where a European bank or financial institution is regulated or what regulation means in each case. The consumer will not necessarily know which body is responsible for regulation in each country. In this country we have six main regulatory bodies. The consumer will not know what safeguards, if any, and compensation exist because the regulatory and compensation systems are different in each European Community member state.
    I am in favour of competition in banking services and the services provided by financial institutions, but for there to be competition the depositor or investor needs to be able to make an informed choice about what is on sale and what safeguards are available in the event of failure or complaint. The problem is that each EC member state has a different financial system. A bank in Germany is different from a bank in Britain. The regulatory systems are also different and there are different expectations and standards in each EC member state, let alone those countries which expect to join the EC.
    In Britain, we have a multitude of regulatory bodies and a continuing debate about what we need. It is necessary for us to draw attention to some of the problems in the United Kingdom so that we can better understand the potential for problems once the directive becomes operational on 1 January. It is regrettable that the Minister seems to have surrendered in the fight to improve City regulation, when he has not been in office for much more than six months. He said that the Government will not introduce legislation, which is vital if we are to regulate banking services in the 1990s and beyond. By telling the Financial Times on 4 December that the Government will not overhaul the system, which has some spectacular failures behind it, he is allowing the future of regulation to be dominated by producer group interests.
    Nowhere is that illustrated more clearly than in the debate surrounding the setting up of the Personal
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    Investment Authority, which has been dominated by producer group interests while those of the consumer have been left on the sidelines.
    Regulation must be as clear and straightforward as possible if it is to succeed. Above all, it must be respected by producer and consumer interests alike. The Government have a duty to give a lead, and they have conspicuously failed to do so. The debate has gone on long enough. It is time to stop the platitudes and to set up a system with clout and, above all, with respect.
    Mr. Butterfill: What grounds has the hon. Gentleman for those remarks about the Personal Investment Authority consultation? So far as I am aware, the Consumers Association has been active in making representations and has suggested that there should be greater consumer representation on the PIA. We are awaiting a report from the Office of Fair Trading, so what justification does the hon. Gentleman have for those extraordinary remarks?
    Mr. Darling: Every justification. If the hon. Gentleman considers reports in the specialist and the general press surrounding the setting up of the PIA, he will find that there was an unseemly squabble between vested interests and the industry. I know that the Consumers Association and many others have made representations and that some amendments have recently been made, but if the hon. Gentleman studies the proposed composition of the PIA board he will find that it is dominated by the producer groups. The argument turned on which interests should be represented on the board. Would it not have been far better to have a smaller board, with an overall view, rather than trying to produce a board which simply represented the various interests which had to be catered for, especially producer group interests?
    The Consumers Association has put forward its views, and many people have expressed concern. Even the Minister did so in his interview with the Financial Times last week. The debate surrounding the setting up of the PIA has been dominated by producer group interests, who are understandably concerned about the growing compensation claims made as a result of the failure of members of the Financial Intermediaries, Managers and Brokers Regulatory Association. I recollect that the hon. Member for Bournemouth, West (Mr. Butterfill) has some knowledge of those matters and an interest in the subject, and I understand why he intervened to say what he did. However, I am sure that he will accept that a casual look at the reports and discussions surrounding the setting up of the PIA will confirm my suspicions and those of many people who were involved. I was speaking to some of them today. The debate has been dominated by the interests of the producer groups, rather than by those of the people who will buy the products.
    Mr. Butterfill rose—
    Mr. Darling: I shall not give way as I do not wish to be dragged into a debate on the PIA. I hope that we shall return to that subject in the early part of next year, perhaps just after the referendum is conducted among would-be members. The hon. Gentleman may well catch your eye, Mr. Deputy Speaker, but I do not wish to get bogged down while discussing developments in Europe.
    I mentioned the need for proper regulation, and I can think of no better authority to quote than the present

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    Secretary of State for Social Security who, as we know, is keen on proper regulation of the markets. When the House debated a similar instrument in February 1989, the now Secretary of State for Social Security—then the Economic Secretary—said:
    "However, it is a mistake to suppose that a good regulatory regime will generally make banks authorised under it less competitive than those authorised under a weak regulatory regime. On the contrary, most customers would prefer to deal with banks which they know to be authorised and supervised by a strict and prudent regulator than banks authorised by a lax and incompetent regulator".
    I could not have put it better myself. Would that it were true. It is ironic that the then Economic Secretary should have gone on to say:
    "However, he"—
    the consumer—
    "will be guided in his judgment by the standards applied by the supervisory body. The expression 'as safe as the Bank of England' still quite rightly carries weight in people's minds. It lends an extra attraction to British banks".—[Official Report, 9 February 1989; Vol. 146, c. 1230–31.]
    I wonder if he knew that, even as he spoke, the Bank of England was propping up the BCCI and embarking on a course of action which would ultimately end in calamity. Perhaps the Economic Secretary of the time did not know what was happening, but the general point that he was making about the need for efficient and effective regulation was good and underpinned everything that I shall say tonight about the need for the same efficient and hard-hitting regulation, which is vital not only in this country but in Europe as a whole.
    Before dealing with the impact of the directive, I repeat what I said on 6 November, when the House last debated these issues on that occasion in connection with the Bingham report. Two actions are necessary to put the United Kingdom regulatory house in order. First, there must be changes to the banking supervision legislation in the wake of the BCCI disaster. The then Economic Secretary conceded that point.
    For example, we must prevent forum shopping. That is of direct relevance when discussing the instrument now before the House because there is a substantial risk that some banks or institutions may be tempted to forum shop. I appreciate that the directive provides that host and home countries should do their best to avoid doing that. It is an illustration of where the rules are not deficient but where the will and effective machinery are not present to ensure that it happens.
    I remind the House that what went wrong in respect of BCCI was not that the Bank of England did not have the power to regulate, but that it did not actually do it. So it is no good the Minister saying tonight that the directive provides machinery to ensure that people will not move around Europe looking for the least effective regulatory system. We must be sure that in each and every member state a regulatory regime is in place to ensure that it does not and cannot happen.
    As I said, we do not yet have that system in the United Kingdom, and our regulatory system is much better than that existing in some member states of the EC. If we cannot get this right ourselves, we are in no position to complain when other EC member states do not have an efficient system.
    The need for additional duties for auditors-which hon. Members in all parts of the House accept to be necessary—will, I hope, be implemented throughout the EC. We have seen in this country, in the case of Maxwell,
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    how comparatively easy it is to deceive auditors in one country. I wonder how much easier it would be for someone to deceive auditors if institutions are carrying on business in different EC states at the same time.
    The need to provide for a lead regulator is of crucial importance, and the right hon. Member for Berwick-upon-Tweed (Mr. Beith) drew attention to that. While the mechanism may in theory be there, many of us are concerned that in practice it may not be in place. There will he many cases of institutions using the directive even though they have their headquarters in one country but be substantially transacting their business in another. It is important to ensure that the regulators in both, or all, the countries concerned make sure that there is a lead regulator and that, at the end of the day, someone accepts responsibility.
    In discussing the Bingham report, we saw the difficulties which could arise when one country takes a considerable interest in those issues and there is one bank. In that case it was the Bank of England. We witnessed the difficulty involved in getting the different parts of that bank to focus on a growing problem. How much more important it is to ensure that we have a mechanism which will take account of the fact that institutions will get into trouble not just in one but in many member states, and probably in states which are not in the EC.
    Ms. Diane Abbott: My hon. Friend referred to the concern felt by many of us lest the directive lead to lowest common denominator regulations. Institutions may deliberately place themselves in a country such as Luxembourg, which has notoriously lax regulatory standards. As my hon. Friend said, a latent power is not enough. It is necessary to ensure that it is used to achieve proper regulatory standards.
    I am sure that people involved in financial services would like to hear the Minister explain how the Government intend to raise regulatory standards in countries such as Luxembourg. We on the Treasury and Civil Service Select Committee have heard from Bank of England officials how they are in discussions with Luxembourg monetary officials. As we have pointed out, however, discussions are not enough. Luxembourg has hundreds of banks and a handful of regulators. Unless there is an adequate system to raise standards, we shall continue to fear that lowest common denominator regulatory standards will apply, especially for the ordinary investor and depositor.
    Although it is not wholly relevant to today's debate, we must at some stage consider the whole question of financial regulation in this country and whether we have reached the point at which we should consider splitting the Bank of England's functions so that, as in other countries, we have a separate regulatory body regulating financial institutions.
    Mr. Darling: I do not know whether my hon. Friend was present for the debate on the Bingham report when too, said that the Government would have to examine the last point that she made in her intervention. We on these Benches are considering whether those functions should be split.
    My hon. Friend made an equally good point about Luxembourg and other countries. Had Switzerland decided to continue to move towards and then join the EC,

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    other problems might have been brought into sharper focus. Switzerland makes a virtue of the fact that some of its regulations, particularly the secrecy available in that country, are an attraction for people to bank there. If one day Switzerland joins the EC—I suspect that it will, though I do not know when—we shall then have to consider how the directive will work there.
    As I have said, there are different standards, expectations and requirements. I welcome the fact that the directive will be in force because without it there would be greater problems, but the Minister must explain what he intends to do to ensure that we go on to the logical next step, which is to ensure that, having got the framework in place, we have an efficient regulatory system in every EC member state. We may have the framework, but we do not have it in practice, and my hon. Friend the Member for Hackney, North and Stoke Newington (Ms. Abbott) was right to draw attention to that.
    I have been talking about the need to get our banking supervision in order. The logical next step is to end the dispute about the future of financial services regulation. I regret that, in his interview with the Financial Times last week, the Minister conceded more ground than he had to. We should build on what we have rather than scrap the whole system. It would be a mistake to tear everything down and try to return to the situation which prevailed before 1986.
    Some of our regulatory system works well, but some of it does not. The Securities and Investments Board should be without a direct regulatory role, though it should have overall responsibility for providing an actively policed system, preferably through two self-regulatory organisations. I would differentiate between the SROs which would deal with institutions—or at least with people who could be expected to be properly advised and thus have a degree of protection behind them—and the SROs which would deal with what one might call the retail end of the market. The differentiation relates to the product rather than to the institutions themselves. There would possibly have to be another SRO dealing with pension regulation. That is outside the scope of tonight's debate, though we shall have to return to that subject in view of the controversy.
    The Government must give a lead to ensure that the regulatory system works and is readily understood. The idea of a Personal Investment Authority is welcome, but I have grave doubts about what it would do, if it could be got off the ground, and the threats made by some institutions do not augur well for its future.
    Having put the United Kingdom's house in order, or at least by the end of the debate extracted a promise from the Minister that he will attempt to do that, I shall deal now with the problems in the EC, particularly those arising as a result of implementation of the directive. Is it possible for consumers to identify where each institution is regulated so that they know where they stand? I have in mind a simple notice on the front door saying where the regulator is. The Commission may decide that that is anticompetitive, but it seems to be exactly the assistance needed to ensure that there is adequate competition, so that anyone entering a bank or financial institution will know where it is regulated. If it says, "This organisation is regulated in Luxembourg" and the institution next door
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    says that it is regulated in the United Kingdom or Germany, the consumer can take that into account in deciding whether to proceed further.
    Many institutions in this country have British names and are well recognised but are owned by organisations and institutions based in other EC countries. For example, Cornhill Insurance, a well known company, is owned by a German company. Although the specialists and everyone in the House knew that, I doubt whether the customers of Cornhill knew it. I wonder how many customers of Sun Life know that a French company has a 26 per cent. holding in it. Those who invest and deposit are entitled to know who regulates a particular organisation.
    The passport system has substantial merit, but only if we know what that passport means. In evidence to the Treasury and Civil Service Select Committee, which appears in the Fourth Report on banking supervision prepared in conjunction with the collapse of BCCI in the 1991–92 Session, the British Bankers Association made the following useful observation:
    "there is a danger that the somewhat vague specifications of the duties"—
    contained in the draft directive—
    "of the host supervisor may generate an element of confusion and, thereby, in certain circumstances, allow gaps to occur in the overall scrutiny of an institution's activities".
    That point is well made and the Government must take account of it.
    It is also important to provide what is called, in City jargon, "a level playing field". I understand that the investment service directive has now been substantially agreed, but it is not to be implemented for about three years. If that is so, where does it leave the many institutions in this country which will not be covered by the banking directive but rely on the investment services directive to receive sufficient authorisation to trade in other EC countries?
    When discussing that point in the same debate to which I referred earlier, the then Economic Secretary to the Treasury, now the Secretary of State for Social Security, said:
    "But if the second banking directive were enacted before the investment services directive, continental banks offering investment services could be given an unfair headstart over the specialist firms. Fortunately, we have been reassured by the Commission's clear statement that its intention is for both directives to be implemented at the same time."—[Official Report, 9 February 1989; Vol. 146, c. 1232.]
    I do not believe that that has happened—if I am wrong, the Minister will tell me. I understand that the investment services directive is some three years away. Clearly, that will prejudice the operation of many institutions in this country which need their own directive to start trading in other EC member states. I hope that the Government will urge the Commission to do something about that.
    What will happen in cases where the United Kingdom presently regulates if it has to withdraw because the area is regulated by another EC country? How can we be sure that those areas where we no longer regulate because a passport has been obtained by an incoming company will be regulated by another EC country? How will depositors and investors be directed where to go? What happens if they go somewhere else? Many institutions will have their activities regulated partly in their home country and partly in their host country. What will happen to new countries admitted to the EC with no experience of banking supervision in a modern society? How are we to ascertain

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    where an activity in terms of the directive is carried out? For example, is a money-lending activity carried out where the agreement is made or where the money is passed over?
    Those matters may be crucial in the event of a dispute. How will the regulators know what they still need to regulate, for example, where an EC institution provides commodities futures business? Importantly, do the United Kingdom regulators have the resources to look after those problems? Although the Bank of England has had many successes, we know that it has had problems with BCCI. We also know that there are problems with the SIB's self-regulatory organisation. I doubt, for instance, that the Financial Intermediaries, Managers and Brokers Regulatory Association could possibly cope with those new obligations because it is already struggling. Is the Minister confident that this country, let alone other EC member states, has sufficient powers to deal with the problems facing us?
    How will prudential supervision be exercised with head offices in one state but much of the business in another? The Minister said that the structure exists to deal with that, but what will happen in practice? Is not that where the whole ethos of self-regulation breaks down? Self-regulation depends on people knowing the business and when to blow the whistle. It is difficult enough to do that in one city, let alone several EC countries. The idea that the industry will know what is going on in every corner of Europe and be able to give a nod to the regulator is patently ludicrous.
    The scope for abuse—for another BCCI, another home income plan failure or pension scandal—is immense unless there is active, efficient regulation within the United Kingdom and the EC. There is a substantial risk that the supervisory systems will be harmonised down to the most basic level, not up the highest level. If I am wrong, the Minister will tell us what he intends to do to ensure that that does not happen.
    The question of compensation is important. I am glad to hear that the deposit protection directive is under way, but sorry to hear that the investor protection measures are some way down the line. Schemes throughout the EC differ greatly. Here our investor compensation scheme under the Financial Services Act 1986 is not working well. Again, I cite the home income plan problem. However, if self-regulation is to continue, it is important that the compensation schemes work, because compensation is one of the best ways to ensure that self-regulation works.
    We shall continue to see banks and institutions with British names owned elsewhere in the EC. I hope that we shall see the same thing happening with British firms owning EC institutions. It is all to the good, provided that they are properly regulated. Legislation to set up a regulatory system with teeth is good for the consumer, efficient for the industry, and vital for the good name of the City. Good regulation is a good selling point and will ensure the sale of good quality products.
    We have a justifiable lead in providing banking and financial services and it is vital that the directive does not tempt a lowering of standards in the name of harmonisation. I cannot say that I am optimistic. Although the Minister is tempted to throw in the towel about the argument at home, I hope that the Government have the stomach to continue the fight for high standards in Europe. Above all, we need a clear statement of what the Government intend to do at the next stage to ensure that the framework in the directive is built upon, so that
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    the interests of investors and depositors, and the reputation of those institutions, are maintained at a high standard.
    7.48 pm
    Mr. Terence L. Higgins: I shall not detain the House for more than a few moments. We have a massive document before us and I could raise many points arising from its wording. However, there would he little point in doing so, because we must either take it or leave it. We have no way to amend the vast amount of wording, although much of it relates to other legislation to which the House has paid considerable attention in the past. That is not a satisfactory position. As we do not have time to examine the document in detail, I shall simply make one or two technical points.
    On page five the basis on which the regulations are made is said to be the fact that
    "the Treasury are a government department designated (a) for the purposes of section 2(2) of the European Communities Act 1972".
    I greatly welcome the fact that my hon. Friend the Minister has taken over responsibility for financial matters, because I always thought that the split between the Department of Trade and Industry and the Treasury was not a happy one. Various matters tend to fall, if I may use the expression, between the two stools.
    The regulations cover several matters relating to the Insurance Companies Act 1982 which I understand have not been transferred from the Department of Trade and Industry to my hon. Friend the Minister. The basis on which the order is made refers to the Treasury. I have forgotten why that Act refers to the Treasury when all other cases refer to the Secretary of State being a designated Minister. Suddenly, when we get to page 58 we find that, like the smile on the face of the Cheshire cat after it has departed, there is reference to a Secretary of State having power to deal with such matters. It is not clear why that does not appear at the beginning of the authority for making such regulations. Generally speaking, it does not seem to be a satisfactory way to proceed.
    My second point is that we are renowned for regularly implementing European Community directives by producing such regulations. One feels bound to say that other countries seem to be much slower at implementing directives. That can have a serious adverse affect on British companies in the interim period. I think that we should have a set rule that, whenever we have a specific directive to implement, we should be told in the clearest terms the extent to which other countries in the EC have already taken such action. Perhaps my hon. Friend can explain the position. In many instances I think that we go ahead of the game, which has an adverse effect on British companies.
    Given what I have said about the inability to amend such documents, I am worried that there is a tendency for regulations of this sort, which implement a particular directive, to be used to extend legislation on other matters beyond the strict scope of the directive. If that is so, it is done without our having the ability to amend it. I have a suspicion—I put it no higher than that—that some of the regulations are being used to make changes to our law which, on the strict interpretation of the directive, are not necessary, but which would otherwise need to be put before the House in a form of amendable legislation.
    Those are technical issues. None the less, in terms of the House getting a grip on what is happening, not merely in

    1065
    the European legislation, but in the powers that go beyond the requirements of European directives, the issues are important. I take the opportunity to bring those matters to the attention of the House. Perhaps the various bodies in the House could give further consideration to whether possible abuses of this sort—I am not saying that it is so in this case; my hon. Friend will tell me whether it is so—can be avoided.
    7.54 pm
    Mr. A. J. Beith: The final remark of the right hon. Member for Worthing (Mr. Higgins) echoed a theme which the Prime Minister took up on other aspects of Community legislation relating to the environment and health. Certainly, from my experience, it seems that there are times when those in the United Kingdom who should be implementing the regulations seem to use them to ride other hobby horses which go far beyond the original intention. It would be welcomed if the Government examined the matter generally.
    The Government should do something to put the genuine activities of the Community and the Commission, such as the single market, in their proper context and see them for what they are, not cause them to be complained about because of other things that have subsequently been added to them. That is a sensible suggestion which the Government may care to examine.
    Many people will be disappointed to learn that the second banking directive is not a directive to British banks to pass on interest rate reductions to their customers, to have a sensible long-term policy towards small business and to stop imposing charges on customers without telling them in advance that they are doing so.
    We must break the sad news to our constituents that the second banking directive is of a different character. Nevertheless, it is important to them because it is necessary to ensure that we have adequate banking supervision in the future and that banking and financial institutions and financial services can take advantage of the single market. Indeed, it is a field in which we would expect the United Kingdom to do well, with its considerable experience and expertise in financial services.
    The recent experience of the Bank of Credit and Commerce International case must cause us to examine with great care banking supervision and the dangers that might lie in a bank being supervised from a country that could not manage that supervision well. It is not a chauvinistic or nationalistic point. In that context, it must be said that the Bingham report revealed that the Bank of England showed many deficiencies in its supervision of BCCI. Therefore, we are not holding Britain up as an example of a country which has perfect banking supervision.
    The BCCI case also showed that Luxembourg was clearly nowhere near adequate to the task of being the lead regulator of the BCCI. The Luxembourg authorities became conscious of that fact, and drew the attention of other countries' regulators to it. At one stage the Luxembourg authorities would have welcomed the Bank of England, where so much more BCCI business was being done, taking on the responsibility of the regulator.
    The Minister dealt carefully with many aspects of the matter in his thoughtful and lucid remarks. He gave some
    1066
    reassurance, not least that the matter was actively in his mind and that he was seeking in various other ways to extend the available protection and improve banking supervision, which is deficient.
    I do not want to go into the details of the BCCI case because more discussions about it will take place. The Treasury Select Committee still has the matter in its sights and will have further discussions about it. The Committee has issued reports that bear on the matters which we are discussing tonight. The Committee expressed concern about the second banking directive in its fourth report, to which reference has already been made. The Committee also expressed anxiety about the assessment of regulations—how we will know that we can rely on the capacity of other countries as lead regulator and how they will know that they can rely on us.
    The absence of any real system to assess supervisory standards was the focus of specific comment by the Committee. The Committee said that there was clearly a need for some mechanism to assess supervisory standards. At present, all we have is the Basle committee. The matter is not the responsibility of that committee. It does not have that sort of locus, any formal machinery or any standing to judge the supervisory standards in member countries, let alone non-member countries. It is a matter of continuing concern which I hope the Government will keep actively in mind.
    The issue has been raised by other hon. Members, and I think that perhaps sufficient has been said to alert Ministers to the widespread concern. The report raises a question of how we will organise banking supervision in the United Kingdom in the future. The BCCI case has focused attention on banking supervision, and caused many of us to believe firmly that there is a case for separating banking supervision from the work of the Bank of England as monetary authority. I believe that the Bank should have independent responsibility in the conduct of monetary policy. In some ways that makes a much stronger case for separating those two areas. If anything, the United Kingdom has it the wrong way round. Perhaps the Bank should have been more accountable for its supervision of the banking system and less subject to accountability for monetary policy.
    I hope that the Government will continue to examine the arguments for a system such as the German one in which a separate institution has responsibility for banking supervision, but which draws on the experience and knowledge of the Bundesbank.
    There can be no effective system of monitoring and supervision that does not draw on the expertise which the central bank is bound to have. But there is a strong case for a separate focus of responsibility. Also, there is obviously a clear case, so long as the system remains in its present form, for a substantial reorganisation of the Bank of England, such as it has already begun. I must add that I remain concerned that there appears to have been no disciplinary action and no resignation and no one has moved jobs within the Bank of England following the BCCI case.
    I see the directive as an appropriate part of the moves towards a single market. But before the Commission becomes too excited about its successes in moving towards a single market, it should look at other matters on which progress seems to be slow. The hon. Member for Edinburgh, Central (Mr. Darling) mentioned the insurance market. I understand that the pensions fund

    1067
    directive has not yet been fully agreed. That is another area of financial services in which uncertainty remains and sufficient progress has not been made.
    The more that we move towards the single market, the more apparent it will become that it is difficult to operate a single market in financial services without a single currency. It will also become more apparent that the movement of capital, which is inherent in a free market in financial services, will make it difficult for national currencies to maintain their position.
    If institutions increasingly operate across national boundaries with free movement of capital and if that movement is further enhanced by the freedom of customers in each of the member countries to place their deposits with, or take their loans from, banks in other countries, the amount of capital flow across frontiers will become ever larger and will increasingly dwarf the reserves available to central banks to defend individual currencies. That reinforces my view that we must move to a single currency if we wish to operate a free market—which I do.
    I know from the speeches that the Minister made before he took up his ministerial post that I shall receive a sympathetic hearing from him. I do not wish to embarrass him unduly, but I hope that he is fighting his corner on the issue in government. The capital movements that are implicit in the single market in financial services, along with the effects that we have already seen of the removal of restrictions on capital movement, will become incompatible with the maintenance of national currencies at differentiated levels by traditional means.
    Increasing capital movements will make it that much more imperative that we stop talking about opting out of the single currency and dedicate ourselves to achieving the convergence conditions. I cannot understand why anyone is against the convergence conditions. They are supposed to be good for the economy in any case, so we should hardly argue about them.
    I see the directive as part of the process of development in Europe, which it is difficult for Britain not to be part of, still less stop. However, that does not stop me wishing to express anxieties about whether, when combined with other regulations under discussion, the directive will be sufficiently effective in protecting bank customers from experiences such as that which BCCI customers faced. There will never be another fraud like BCCI. It is a mistake to design one's system to suit the last fraud. But it certainly will not be the last banking fraud. Our system must be strong enough to be alert to and deal with potential fraud.
    8.3 pm
    Mr. John Butterfill: I congratulate my hon. Friend the Minister on the action that he has taken in bringing the directive before the House. It is true to say that the regulations amend some important legislation that we passed in the House after lengthy debate. I participated in scrutinising some of that legislation, such as the Banking Act 1987 and the Financial Services Act 1986.
    We must recognise that the financial services sector is important for the United Kingdom. The ability of our financial institutions to operate freely throughout the European Community is of vital national interest to us. There are immense opportunities for British business in that sector.
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    I pay tribute to the work done by the Minister and his colleagues in the Treasury in securing the directive. It is true that the restraints and controls in many other European countries are not so strong as in Britain, but I am reassured by the fact that those who operate in the United Kingdom under the terms of the directive will come under the control and supervision of the relevant supervisory authorities in the United Kingdom.
    The hon. Member for Edinburgh, Central (Mr. Darling) complained about investor compensation. He should remember that the United Kingdom is the only EC country which has in place an effective compensation scheme. The reason why we have not reached a conclusion on that is largely the inadequacy of the provisions in other member countries. The hon. Gentleman would be right to say that we must not drop our standards we must try to persuade other countries to conform to them. However. to denigrate our standards when by and large the Financial Services Act has worked well is an unfortunate line to take.
    Mr. Darling: The hon. Gentleman is wrong. There are investor compensation schemes in other EC countries. Admittedly, some of them are not very good—that was my point. I accept that we have such a scheme in Britain, but I am sure that the hon. Gentleman will accept that it is not without justifiable criticisms.
    Mr. Butterfill: I accept that our schemes are not yet perfect. They are being developed. They are self-regulatory regimes. That is infinitely preferable to a statutory form of regulation, which the Labour party views with some enthusiasm. Countries which have such regimes do not view them with quite the same enthusiasm. They look at ours with envy. Nevertheless, our schemes could be improved. I hope that the Personal Investment Authority will be established and will do its work in a much more efficient way than the present components of what will be the PIA. I have some doubts about whether that can be achieved without further legislation.
    It will probably be necessary to give the Securities and Investments Board the power to direct people into a particular self-regulatory organisation and get rid of the SIB's own regulatory organization—which is an unfortunate development. Not many of us anticipated the development of that organisation when we debated the Financial Services Act 1986.
    On balance, we can feel some satisfaction with the system that we have set in place in Britain. It is infinitely superior to that which exists elsewhere in the Community and in the world. Our byword must be to improve consistently on it, not simply to run it down. Therefore, I congratulate the Minister on the work that he has done on the directive. I wish him success in future discussions on other aspects of financial services.
    8.7 pm
    Mr. Nelson: With the leave of the House, I should like to respond to the debate. I thank all hon. Members for their contributions to the debate. It is an important subject, as all who spoke recognised. It directly affects the prospects, employment and profitability of the services offered by our banking and financial services community and industry in Europe. Several of the points that have been made in the debate are extremely cogent. They will

    1069
    certainly be taken on board by the Government. They are helpful to me in scrutinising future legislation and the implementation of other directives.
    The hon. Member for Edinburgh, Central (Mr. Darling) started and finished by talking about the separate but related issue of financial services regulation and supervision. He suggested that I had thrown in the towel at an early stage in my ministerial career on that issue. I hasten to assure him that the principles which lay behind many of the representations that I made as a Back-Bencher are alive and well in the Treasury. I am seeking as best I can, as I did then, to improve depositor and investor protection in Britain. However, given the collective wisdom of fellow Ministers, it is not always as easy to say or do certain things as it was on the Back Benches. I hope that I shall not "go native" too fast, because the matters involved are important, and not subjects of partisan difference.
    I think that I agreed with what I thought the hon. Gentleman was saying. I do not want to abandon the existing legislative structure; I see no great advantage in embarking on early, hasty and wholesale reform of our supervision of financial services. After all, such reform visits great uncertainty and great costs on the industry. Unless there is consensus on what is to replace the current arrangements, and a clear way forward which will deliver higher standards of investor protection, it is a foolhardy Government who embark on such a course without lengthy consideration and consultation.
    As I have suggested outside the House—I hope that we shall have further opportunities to debate these critical issues inside it—I believe that much can be done within the existing structure to beef up the system of supervision and regulation within the Financial Services Act. It would not be wise to toss aside legislation passed by the House of Commons, to undermine the authority of those who are trying to do a good job, and to embark on an uncertain course.
    Mr. Darling rose—
    Mr. Nelson: Let me make a point that relates to what the hon. Gentleman and others have said about compensation. There is a growing feeling in financial services and banking that there is a trade-off between the costs of supervision and regulation on the one hand, and the costs of paying compensation on the other. Many people would be content to pay for a high standard of supervision and regulation if they did not expect to have to pay increasing amounts of compensation, which this year has amounted to some £50 million.
    Mr. Darling: I wholeheartedly agree with what the Economic Secretary has said about compensation and the need for tough regulation. I also appreciate that, as a member of the Government, he is not an entirely free agent: as long as the Chancellor remains his boss, he may find that he is constrained. Does he accept, however, that—while there is much to be said for legislating in broad agreement with all the people who will be affected—unless the Government say that they are prepared to step in and take a lead, many people who do not want change and are happy for the present mess to continue will see what he has said as a sign that that can go on for much longer, perhaps for years, before the Government are driven to act? I urge
    1070
    the Economic Secretary to get a grip on the situation now, rather than waiting until another crisis turns up on our doorstep.
    Mr. Nelson: I hear what the hon. Gentleman says, but imperatives of a different order are also at work. There is, for instance, the liability that institutions and SROs are having to incur to raise the money among their authorised firms to pay for new orders of compensation: that in itself is driving the case for reforms. It is not really a question whether the Government are forthright or reluctant to bring about change: change is being forced on the system in any event. The City wanted self-regulation, and it now has a high degree of self-regulation; so it must now self-regulate.
    In the process of consultation over PIA, I look to the SROs and the firms involved to find a positive way forward. I am limited in what I can and should say about such matters at this stage, but that strikes me as a way forward that is on offer—a way that takes account of the representations that have been made, and the latest response to the consultation process. That reponse has pointed to a number of important changes that should give confidence to potential participants. I hope that a positive, constructive approach to the PIA proposals will be adopted.
    The hon. Member for Edinburgh, Central said that it was not enough for supervisors to have the powers: they must exercise those powers. That point was echoed by the right hon. Member for Berwick-upon-Tweed (Mr. Beith), and I think that it was the most critical observation of all. Even if we have the best possible system of supervision, if we do not have the right people and the willingness to exercise the powers concerned the system will be wasted. Similarly, a deficient system may work if good people are operating it. A perfect system can never be arrived at, but any system will involve problems. We can do much to improve resources, in terms of ability, numbers and the financial resources available to supervisors and regulators; we can build on the excellent work that has already been done.
    The hon. Member for Edinburgh, Central spoke of the duty placed on auditors to report. That duty was announced in response to Sir Thomas Bingham's report on BCCI. Rightly, it will be subject to consultation with the professional bodies; it is important that we get it right. The bodies concerned are adopting an extremely constructive approach, for which I am grateful. I also appreciate what the hon. Gentleman said about the common approach of hon. Members on both sides of the House to the need for a duty on auditors to report.
    The hon. Gentleman asked about notices on doors; he wanted to know whether people would be aware that a European institution was different from an authorised bank, and would know what sort of country was supervising that institution. Registers will be issued by the Bank of England and other institutions clearly stating the identity of the home country and the home supervisor. There will be procedures to ensure that misleading names are not used by companies passporting their services into other countries.
    It is not possible to go too far down that line, however: at the end of the day, we are aiming for a common market for these services. We are not trying to differentiate; the central objective must be common supervisory standards, and a universal reliance on the common application of

    1071
    those standards throughout member states. We would not want people to have to choose—hut there should be no need to choose the bank with which one deposits money according to the identity of its home supervisor.
    The hon. Gentleman asked whether there were gaps in supervision. I can tell him that memoranda of understanding are being drawn up between the various member states to ensure that no such gaps exist. He also asked what was happening about the investment services directive, on which common agreement has virtually been reached after a protracted negotiation period. Both the investment services directive and the capital adequacy directive—technical as they are—represent major strides for Britain in Europe. I believe that they will protect our main interests at home and in other member states, while ensuring common standards of protection for those who use the services involved. They will also give major opportunities to British firms that are moving into the rest of the European Community.
    We would have liked the investment services directive to come into force at the same time as the banking directives, as was originally planned, to give investment firms more generally the passport at the same time as the banks; but we saw no benefit in agreeing, at an early stage, an investment services directive that would restrict activities and damage markets. The United Kingdom and her allies were right to hold out in negotiations for the liberalising directive agreed by the EC Finance Ministers on 23 November.
    Many of the larger UK-based investment firms in competition with EC banks are already established in the member states in which they wish to operate. These firms may not need the ISD passport to continue to compete effectively. United Kingdom markets will in turn continue to be as open to EC and overseas investment firms as they are at present.
    The ISD will come into force on 1 January 1996. Although we might have preferred an earlier date, this is realistic, as implementation of the rules to underpin the directive will require considerable work by United Kingdom regulators and firms.
    The hon. Gentleman asked how new members of the European Community will comply with the regulations. Phased provisions enable countries acceding to the Community to adopt and translate their laws to comply with the Community's. This, like many other directives, will be an essential part of that process. We must not be prepared to extend the passport to countries that do not comply with the standards of supervision and the regulations.
    The hon. Gentleman asked whether we have enough resources. I think that we have adequate resources but could probably do with some more in the banking and investment sectors. I hope that we shall achieve consensus on the proposals for the financial services and banking sectors.
    The hon. Gentleman and others dwelt on the importance of adequate compensation. The Commission has proposed a working party on the depositor protection directive, which contains important, sensitive and costly issues for the banks to consider.
    My right hon.Friend the Member for Worthing (Mr. Higgins) made some extremely interesting points. However hard one tries, one can never prepare for all the questions that one is asked, and his point fell into that category. He said that it was not satisfactory that we could
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    not amend the regulations. I understand that, but, as I said earlier, they could have been subject to the negative resolution procedure. We brought them before the House for debate because we wanted to take on board the views expressed and to take account of them in implementing the regulations.
    As my right hon. Friend will know, the Treasury and the Department of Trade and Industry issued a consultation document on this matter. He asked why the Treasury is responsible for insurance, whereas the name of the Secretary of State appears later in the regulations. The European Communities Act 1972 gives the Treasury power to make provision in relation to credit institutions. The amendments to the Insurance Companies Act 1982 fall within that designation. The Secretary of State retains his responsibilities under that Act and, as my right hon. Friend pointed out, the regulations reflect that.
    My right hon. Friend asked an important question about what other member states are doing to implement the directive. I asked the same question of my officials, and the answer is that other member states are implementing it in the same way at about the same time.
    My right hon. Friend asked an interesting question about the changes in law beyond the scope of the directive that are unamendable. I hope that I can assure him that the scope of the regulations does not extend beyond what is provided for in the directive. That shows the value of bringing measures before the House and of giving hon. Members an opportunity to question whether what is being proposed is beyond the scope of the directive. The House must have the opportunity to revise, amend and vote on such measures.
    The right hon. Member for Berwick-upon-Tweed asked how we can rely on other supervisors. As I said in opening, this is the key question. Other supervisors will have to implement the same standards. As my right hon. Friend the Chancellor announced in response to the Bingham report, a peer group review process involving the G 10 supervisors committee and the EC banking advisory committee will ensure that the best ways forward are implemented and that supervisory standards are assessed.
    The Government and the Bank propose the establishment of peer group reviews under this process. Member states other than the United Kingdom will be responsible for accepting applications for authorisation from banks. They will have to comply with legislation under this directive. They will then be required to notify the Bank of England that a European institution wishes to passport its services into the United Kingdom and we shall have certain powers.
    I refer hon. Members to regulation 9, which sets out requirements on such things as liquidity and compliance with regulations. If they are not complied with, they can provide the basis for restriction or revocation, and action can be taken by the host state.
    The right hon. Gentleman mentioned the fascinating question of a split in central banking responsibilities, with supervision of banking being hived off from central banking functions. That point was echoed by the hon. Member for Hackney, North and Stoke Newington (Ms. Abbott). I referred to this at some length on 5 or 6 December in my speech on BCCI, in which I set out as clearly as I could the arguments for and against.
    I said that the Government are not minded to do that, but no doubt the legitimate debate on it will go on. On the basis of BCCI, Lord Justice Bingham found no case for

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    such a change, although many hon. Members will know that other EC members have such a separation of powers with a banking commission as well as a central bank. With the arrival of a European central bank or independent central banks within member states, there is often a more compelling case for the separation of such powers. As we do not have that, we have no intention of changing our present arrangements.
    I am most grateful for the long interest of my hon. Friend the Member for Bournemouth, West (Mr. Butterfill) in these issues. He emphasised the importance of banking and financial services to the United Kingdom economy and the great opportunities that will result from the introduction of the directive and the regulations. I wholeheartedly concur with him and pay tribute to the way in which, over many years, he has brought his experience and keen interest in investor and depositor protection to the attention of the House, to the benefit of the legislation that has been passed.
    We have seen today the fruition of contributions and efforts by many hon. Members over many years. We shall not get it absolutely right. Sadly, there will be failures and collapses in the future. We cannot devise a wholly fail-safe system, but we can improve the situation substantially. We can improve the opportunities for British business, banks and investment companies abroad to ensure not only their greater profitability, growth and employment for the future but, critically and above all, the highest standards of investor and depositor protection, which have always been the hallmarks of attracting funds to this country and which are why Britain—not only the City of London but Scotland and other parts of the country—remains the financial centre of Europe. We should be proud of that, and should be careful to enhance and protect it for the future. The regulations will bring about exactly that possibility.
    It is with much confidence and pleasure that I invite the House to agree the banking directive, which will be an enormous advantage and opportunity to these great industries.
    Question put and agreed to.
    Resolved,
    That the draft Banking Coordination (Second Council Directive) Regulations 1992, which were laid before this House on 17th November, be approved.

    Package Travel
    8.28 pm
    The Parliamentary Under-Secretary of State for Technology (Mr. Edward Leigh): I beg to move,
    That the draft Package Travel, Package Holidays and Package Tours Regulations 1992, which were laid before this House on 1st December, be approved.
    The regulations are intended to implement in United Kingdom law the EC directive of the same name. This is an important landmark in the development of consumer protection in this area.
    The directive and regulations have three main objectives. The first is to ensure that organisers and retailers of packages maintain proper professional standards in their dealings with their customers. The second is to require organisers and retailers to take full responsibility for the proper performance of their contract. The third is to ensure that organisers and, in some circumstances, retailers have security for the refund of any advance payments made by consumers, including the cost of repatriation in the event of insolvency of the organiser or retailer. It may be for the convenience of the House if I indicate very briefly how the regulations address these objectives.
    Regulations I to 3 deal with definitions and application. Basically, the regulations would apply only to packages sold or offered for sale after 31 December 1992, but the provisions regarding protection against insolvency affect all contracts in place on 31 December 1992 which remain to be performed in whole or in part. This means that organisers or retailers must on that date have security for all prepayments that they hold. It would clearly be unacceptable if a tour operator became insolvent at, say, the end of January, and those customers who had entered into contracts subsequent to 31 December were protected, while those who had entered into contracts before that date were not.
    Regulations 4 to 6 deal with requirements as to brochures. Brochures must not contain any misleading information, must contain—in so far as it is relevant to the package—at least the information contained in schedule 1 and, subject to certain qualification, will be binding on the organiser.
    Regulations 7 and 8 deal with information to be provided before the contract is concluded. This includes, for example, passport and visa requirements, details of travel arrangements, and the name, address and telephone number of the organiser, or a representative of him, whom the consumer can contact if necessary.
    Regulation 9 deals with the content of contracts. The contract must contain at least the elements spelt out in schedule 2, unless these are clearly irrelevant to the package in question, and the consumer must be given a copy of the contract in writing.
    Regulation 10 gives the consumer certain rights to transfer a booking.
    Regulation 11 deals with the important question of surcharges. Surcharges are permitted only under certain restricted circumstances: specifically, to deal with variations in the price of fuel, fluctuations in exchange rates or increases in certain dues and taxes.
    Mr. Malcolm Bruce: On surcharges, does the hon. Gentleman not think it a little odd that this statutory instrument is labelled "Consumer Protection" when most

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    consumers in this country wish to be protected from the existence of surcharges at all? He is legalising a practice that most people want to see abolished.
    Mr. Leigh: This is a very interesting point and it has been a difficult balance to strike. The package holiday industry is highly competitive and the view held by Government is that generally the consumer gets an extremely good deal. It would be possible, of course, for the Government to outlaw surcharges. If we were to do that, the only result for the general consumer would be to push up prices. I repeat that the consumer in this country generally gets a very fair deal and very good value holidays. We believe that we have struck the right balance. We do not believe that it is opportune to change long-standing practice in this country.
    In this case, therefore, we have gone beyond the strict requirements of the directive to provide that the organiser must absorb the first 2 per cent. of any increase. I hope that that will go some way to allay the concern expressed by the hon. Member for Gordon (Mr. Bruce). This mirrors the current requirements of the code of practice of the Association of British Travel Agents.
    Regulation 12 permits the consumer to withdraw from the contract without penalty if there is a significant alteration to an essential term of that contract, and regulation 13 spells out the consumer's rights in this situation and also in the event of cancellation by the organiser.
    Regulations 14 and 15 deal with the rights of the consumer while the contract is being performed. Under regulation 14. a duty is placed on the organiser to make alternative arrangements if a significant proportion of the services contracted for are not provided. It also provides the consumer with a right to compensation where appropriate and a right if necessary to be returned to his point of departure.
    Regulation 15 is important and makes the organiser, or possibly in certain circumstances the retailer, strictly liable for the performance of the contract. This means that it will no longer be open to the organiser to disclaim responsibility if, for example, a hotel is not of the standard, or does not offer the service, which has been promised. There are certain qualifications. For example, the organiser is not liable for a failure due to an event which he could not even with all due care have foreseen or forestalled, and liability other than for death or injury may be limited, so long as that limitation is reasonable.
    This brings me to regulations 16 to 22, which deal with security for prepayments and against the possible need for repatriation in the event of insolvency. I would like to take a moment or two to explain our approach to this very important provision in the directive.
    The first point to stress is that the number of organisers or establishments in the United Kingdom that offer packages is extremely large. There are no statistics, and any estimate can only be in the nature of an educated guess, but we believe that the total number is between 10,000 and 20,000, not counting the many people who organise packages on a voluntary basis. Many of those who offer packages are not tour operators at all, but hotels and similar establishments which offer a tourist service—perhaps golf, or fishing—in addition to accommodation. Among tour operators proper, the range varies from
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    the giants of the package travel trade to one-man—or, frequently, one-woman—companies exploiting some niche in the market.
    Faced with this diversity, the philosophy that we adopted was to offer the widest possible range of choice for meeting the requirements of the directive. These choices are spelt out in the regulations.
    Regulation 16 is a general provision and contains exceptions for packages covered by the existing air travel organisers licence system—which will not, of course, be affected by the regulations—or by arrangements in force in another member state. There are two particular points about this regulation which I would like to draw to the attention of the House. The first is that we have not provided how the requirement to have arrangements for repatriation should be met. This is because there are a great many possible ways of meeting this requirement, and it would have been over-prescriptive for us to try to list them all. The second is that we have provided that, for a period of three months following entry into force of the regulations, organisers will not have to have in place one of the specific forms of protection spelt out in regulations 17 to 21, though they will still be committing an offence if they do not have sufficient security to protect consumers if they became insolvent. This is because the interval between approval of these regulations and their date of entry into force is likely to be very short indeed, and we needed to give the very large number of operators who currently have no protection time to make appropriate arrangements.
    In addition to meeting the general requirements of regulation 16, organisers of packages will need to meet one or other of the alternative provisions set out in regulations 17 to 20 or, if they are not acting in the course of business, regulation 21. Regulations 17 and 18 provide for organisers who wish to follow the well-established bonding system which is already mandatory for holders of air travel organisers licences and is operated on a voluntary basis by the main trade associations in the industry. It is envisaged that most, if not all, of those trade associations will become bodies approved under the regulations by the Secretary of State as having bonding arrangements in place which will meet the requirements of the regulations.
    Regulation 19 offers an alternative to bonding in the form of insurance, and is designed primarily for those organisers who are either unable or do not choose to join one of the "approved bodies" provided for in regulations 17 and 18.
    Regulation 20 provides that organisers may, if they wish, meet the requirements of the directive by placing pre-payments in a trust account from which they can be withdrawn only on completion of the contract. This option is designed primarily for hotels and similar establishments, which take only a relatively small proportion of the cost of a package by way of pre-payment.
    Finally, regulation 21 makes special provision for the voluntary sector. The effect of this regulation is that an organiser not acting by way of business need ensure only that any payments that he receives are kept separate from his personal bank account so that they cannot he seized by his creditors in the event of his insolvency.
    I can pass over the remainder of the regulations very quickly. Regulation 22 deals with offences arising from breach of regulations 20 and 21. Regulation 23 calls up the enforcement schedule, regulation 24 provides a due

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    diligence defence against any breach of the regulations which carries criminal penalties, and regulation 25 makes rules regarding the liability in the case where a person commits an offence under the regulations as a result of an act or default committed by some other person. Regulation 26 deals with prosecution time limits. Regulation 27 provides that no contract shall be void or unenforceable, and no right of civil action shall arise, by reason only of the commission of an offence under the regulations, while regulation 28 provides that an organiser cannot escape his contractual requirements under regulation by making contracts subject to a law other than that of the United Kingdom.
    The regulations will for the first time provide a thorough and comprehensive framework for the protection of customers of packages. In most places, they follow closely on the provisions of the directive. They aim to strike a balance between the legitimate expectations of consumers and the need to ensure that competition is not restricted and that consumer choice is not reduced by overregulation.
    I stress that, in preparing the regulations, we have sought to place the minimum extra burden on industry consistent with proper implementation of the directive and proper protection for the consumer. It was not an easy balance to strike. Many people would have had us go further while others did not want us to go so far.
    Sir Michael Neubert: If, as he says, the Minister is anxious not to impose undue burdens on the industry, why has he sought to add additional requirements to those required by the directive which this measure enforces?
    Mr. Leigh: In fact, the additional requirements that we have added are very small. They deal with surcharges, a point with which I dealt in response to the hon. Member for Gordon. When I was responsible for consumer affairs, which have subsequently become the responsibility of my noble Friend Baroness Denton, I was determined to ensure that while we carried out the spirit of the directive—if we did not do so, we could have been taken to the European court—we did not want to impose any more burdens on British industry than was absolutely necessary. It is essential that the Department of Trade and Industry abides by that principle. We have been wholly loyal to the spirit of the directive and concerned to implement it properly in the United Kingdom, but we have also been concerned not to impose any unnecessary burdens on industry.
    I recognise that some aspects of the regulations are controversial. It would not have been possible to please everyone and we have not tried to do so. Nevertheless, I believe that we have got the balance about right and that the new regime which will be created by the regulations will bring valuable benefits to the consumer. I commend the regulations to the House.
    8.41 pm
    Mr. Nigel Griffiths: The Minister is not only at the Dispatch Box but in the dock. For three years the Government have refused Labour's pleas for better protection for holidaymakers. Now Ministers are being forced to take action by the European Commission,
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    but they have left it until the very last minute. They have conducted the minimum of consultation with business and others and have ignored critical representations by those who know far more than them—travel agencies, enforcement departments and the consumer movement.
    We have forced a debate on the Floor of the House because of widespread criticism of the Government's legislation: the Association of British Travel Agents has told the Minister that the legislation is unworkable; trading standards officers say that it is unenforceable; and the Consumers Association said in a letter:
    "These provisions are so flawed that the government will be actionable in the European court for failing to implement the Directive and adequately protect consumers."
    For three years, since the directive was published, the Government have dragged their feet and failed to introduce tough controls over rogue elephants in the travel trade. They have dragged their feet time and again and their inaction has allowed disreputable companies to print misleading brochures, to lie about holiday facilities available and to avoid paying any compensation for that, to cancel flights, to change arrival and departure times at will, to impose surcharges and, worst of all, to take customers' money without holding any insurance against insolvency.
    Tens of thousands of holidaymakers have been taken to the cleaners in the past year alone because the Government have refused to act until forced to do so by the European Community. The European Commission is now forcing them to introduce this measure by 1 January. However, the Government's proposals are so weak that some of the abuses that I have listed will continue virtually unabated. Because the measure is being introduced at the last possible minute, it is riddled with loopholes and is weaker than the current voluntary code of the Association of British Travel Agents. With 21 days to go, key sections of the travel industry have no time to implement the legislation. It is a recipe for chaos.
    Let us consider one key aspect of the measure—bonding, or insolvency insurance. Three years ago this month, the Minister's predecessor, the hon. Member for Mid-Worcestershire (Mr. Forth), said that the financial provisions were the guts of the measure. No wonder the current Minister skipped over that so quickly. He cannot find anyone outside the Government who believes that the bonding regulation will work.
    In a report dated 8 December, Keith Betton, speaking for ABTA, told the Minister:
    "The present Regulations will result in piecemeal protection for consumers without there being any guarantee of refund or repatriation where insurance or trust options are adopted by an organiser that subsequently fails … the government appears to have failed in its obligations to properly implement the Directive."
    That is a point I made earlier with reference to the Consumers Association.
    The Minister also knows the views of the people whom he wants to police the measure. Mr. Bob Wright, who chairs the key sub-committee of the Institute of Trading Standards Administration, told the Department of Trade and Industry:
    "The present draft regulations are seriously flawed and should be redrafted if they are to be meaningfully enforced".
    These seriously flawed enforcement powers are set out in paragraph 3(1) of schedule 3.
    Keith Hale, a senior executive officer of the Local Authorities Co-ordinating Body on Food and Trading Standards, which co-ordinates consumer enforcement on

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    the Government's behalf, said in his submission to the Minister that this measure gives enforcement officers powers to inspect bonding documentation only
    "when there are reasonable grounds for suspecting that an offence has been committed."
    He asks what grounds are likely to be considered reasonable and concludes:
    "The obvious answer is of course when a company goes to the wall … in other words officers will only be able to act when it is too late".
    That is the view of people whom the Minister expects to enforce the measure. That advice has been ignored by the Minister, by the Government and by his party. There are not enough enforcement officers to carry out checks on rogue travel companies. The Minister should know that trading standards officers are currently 10 per cent. understaffed and have more laws to enforce than ever.
    By ignoring the views of people in the travel business, the enforcement agencies and the consumer movement, the Government are leaving many travellers far worse off. By bonding without licensing, the Minister is giving thousands of consumers a false sense of security. Bonding without licensing will be unenforceable. The trade says that it will not work—the Minister says that it will. The enforcement officers say that it will not work the Minister says that it will. The consumer organisations say that it will not work—the Minister says that it will.
    Clearly, the Minister trusts no one else's judgment, but the fact is that no one trusts the Minister's judgment. The Minister has a track record and, because of that record, it is not difficult to understand why no one trusts his judgment. He is the Minister who received a letter from the Boston Conservative club which alerted him to the case of Land Travel, a travel company whose director failed illegally to file the books. The company ran at a £2 million loss, its auditors heavily qualified the accounts and the director had previously run a travel company which went bust. The Minister failed to take appropriate action and one year later the company went bust, leaving 40,000 people without their holidays and their money. Tonight he asks us to accept his assurances but not those of ABTA, the Consumers Association, LACOTS or trading standards officers.
    Under these regulations the bonds will be worthless in many cases. In spite of calls from ABTA and others for a licensing scheme, the Government refuse to license any travel companies. For non-ABTA members licensing is the best way to ensure that a bond is not worthless, but the Government refuse to license, in spite of being told that that is the only way of guaranteeing protection to consumers. ABTA, the trade body whose members provide 90 per cent. of holidays, already requires bonding and polices vigorously its own scheme. However, more than 1 million people travel with non-ABTA companies. From 1 January Arthur Daley companies will simply sign a certificate claiming to be bonded, but no one will be checking them. As the Minister knows, local government trading standards officers cannot undertake that work.
    So much for bonding. Let us look at other flies in this unsavoury ointment. There are several other flaws which disadvantage consumers. The Minister is prepared. as he has admitted, to allow surcharges to continue. I have never understood why, when a holiday is paid for in advance, the holidaymakers' payments should be given to the airline, bus company, hotel, or other suppliers of services at the
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    price agreed, and that when payment is made they can have that payment revised and additional demands made on them. In some circumstances, some of these surcharges amount to little short of extortion.
    Now the Government are proposing even weaker controls on surcharging than ABTA imposes on its members. The current ABTA scheme permits surcharges in some cases, but only after the company has absorbed 2 per cent. and only after every component of the cost increase has been written down and vetted by ABTA's inspectors.
    Mr. Malcolm Bruce: Does the hon. Member not also think that it should be borne in mind that in many cases companies that buy forward make excess profits from currency speculation and use of the money from the people who have paid for those holidays and in no circumstances and on no occasions is that excess profit shared with the customers?
    Mr. Griffiths: That is indeed the case and in 1988 I understand that 5 million holidaymakers in this country had their holidays subject to surcharge. It is important to realise that the Minister has ignored that in framing the regulations. He is permitting the trade to levy a surcharge on the basis of self-certifying that the rise has been properly incurred and that gives yet another opportunity to the unscrupulous trader to make a killing at the consumer's expense. I am reminded by that helpful interjection that it is also the case that when money is taken from cutomers in advance, often thousands of pounds a year in advance, no interest is paid on that and the travel agent and tour operator are able to make a profit on the interest. That has not been addressed at all by the Minister.
    When Holiday Which? conducted its last survey in 1991 it highlighted two further key complaints that the regulations fail to address properly—the cancellation and consolidation of holidays. According to Holiday Which?, one in five consumers last year had their holiday arrangements changed by companies after the booking was made. The Government intend to see that continue.
    Do the Government and the Minister think it fair that in the 1990s a family booking their annual holiday and paying in full and in advance should have it cancelled because the company has got its sums wrong? That is what he is permitting. Regulation 13 will allow travel companies unilaterally to cancel holidays without compensating, giving the excuse that the holiday was under-subscribed. In effect, the Minister is allowing companies to hold money for months on end, pocket the interest and, at the end of the day, cancel the holiday. It cannot be right that people's holiday plans should be ruined without their getting a penny in compensation.
    Can it be fair that the present high incidence of changing flight times and airports is allowed to continue? Hon. Members will know the stress that is caused to people when they have their flights switched from 7 am to 7 pm, not because of any unforeseen circumstances but, again, because the company has got its figures wrong. The last-minute nature of this legislation includes a new requirement on travel companies retrospectively to seek bonding for holidays that have already been booked and paid for, but the trade was told of that only in the past week or so. There is a fear that many smaller companies may falsify their bonds in desperation to comply with the

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    new regulations. However, the Government would not listen to me when I urged them to warn the trade in advance that all holidays booked this year for 1993 will have to comply with the new regulations. The Government show just how out of touch they are with the needs of business. There are further problems arising with people who make up their own packages and ask travel agents to book them. The Government have given no guarantee at all that people travelling hundreds of miles within the United Kingdom on package holidays from Shetland to Land's End will be taken home at no extra expense if the company they use collapses.
    With 21 days to go before the regulations become law, let me remind the Minister that ABTA says:
    "The association is of the view that the following areas remain inadequately addressed by the Government in spite of strong industry representations."
    It lists financial protection, then surcharges and then tailor-made travel arrangements, organisers' liability insurance and telephone bookings.
    In summary, Labour is raising tonight a number of grave concerns: the need to license all non-ABTA travel agents and tour operators to give protection from fraud. We need to tackle consolidation. For too long, customers have seen their travel arrangements changed late in the day and at considerable inconvenience, forcing them to hang around airports for hours. Compensation for cancellations has not been considered and that is wrong. Surcharges have not been properly addressed. The way the Government have handled this measure is deplorable. They are achieving none of the three objectives that the Minister outlined at the beginning of his speech. The Government have lost any respect they had in the travel business and any friends they had among consumers. They will bring in weaker consumer rights than ABTA provides, ineffective policing and chaos in the travel trade. Sadly, it is now too late for the Government to listen to those who know better. The victims of that arrogance and incompetence are the holidaymakers who continue to be duped by unscrupulous travel operators. This was the chance to put those operators out of business. What a pity that such an opportunity has been missed.
    9.1 pm
    Sir Anthony Grant: I shall not follow the somewhat political polemic of the hon. Member for Edinburgh, South (Mr. Griffiths). Nevertheless, I have a serious criticism of the regulations.
    I was interested to hear my right hon. Friend the Member for Worthing (Mr. Higgins) tell the Economic Secretary to the Treasury in our earlier debate that the House was discussing an affirmative resolution so it was not possible to amend it. The same seems to apply to the measure before us, but I should be interested to know whether the Parliamentary Under-Secretary of State for Technology will say to me what the Economic Secretary to the Treasury said to my right hon. Friend—that although the regulation cannot be amended there are certain curious ways of implementing it.
    I must declare an interest in that for many years I have had the honour of being an adviser to the Guild of Business Travel Agents—a body consisting of about 40 of the largest business travel agents in the country, responsible between them for nearly £3.5 billion in
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    turnover and for four out of every five business flights to and from the United Kingdom. Those companies employ more than 17,000 people.
    Mr. Nigel Griffiths: Will the hon. Gentleman tell the House how much he is paid for that service?
    Sir Anthony Grant: Not nearly enough.
    In the light of the Single European Act, the Guild of Business Travel Agents took the initiative of forming the Guild of European Business Travel Agents. About eight countries are involved. Perhaps the Minister will tell us when he winds up whether those other countries are implementing the directive properly and enforcing it.
    I emphasise that the guild is distinct from ABTA. I know that my hon. Friend the Member for Hertfordshire, South-West (Mr. Page) will talk about some of the problems involved if he manages to catch your eye, Mr. Deputy Speaker, and in discussions with him I have found that I entirely share his views on the matter. I shall therefore confine my remarks to business travel.
    The subject was last discussed in the House on 18 December 1989. I pointed out then that as a trading nation this country essentially depends on exports, so it is vital that we be able to move our business men around the world speedily and economically. That is more important now than ever. Yet the regulations will do nothing but harm to the business travel industry; in fact, they are not strictly relevant to it.
    For example, regulation 16 deals with:
    "sufficient evidence of security for the refund of money paid over and for the repatriation of the consumer in the event of insolvency."
    That is sensible in the case of poor Mrs. Snooks who is stranded somewhere in the Mediterranean. It is vital that she be recompensed and repatriated. But business travel involves people such as ICI employees moving all round the world. Such companies pay the travel agent in arrears anyway. They can repatriate their staff without any difficulty, and they do so.
    Much business travel involves incentive travel. Large companies such as ICI and Ford like to send their salesmen and other people abroad for incentive purposes. They instruct a large business travel agent to arrange the trip, but that agent will have nothing to do with the internal organisation, which is arranged by the large company.
    The best protection for corporate clients, who are the bulk of the clients of business travel agents, is vigorous competition. During the debate in December 1989 that point of view was well understood by my hon. Friend the present Parliamentary Under-Secretary of State for Schools, who was then the Minister responsible. He made his view clear:
    "It is true that business travel was never intended to be part of the directive",
    and said that he intended that
    "the final text of the directive—will have attached to it a minute statement"
    to the effect that the directive would not cover
    "'business trips which involve separate bookings of transport and hotel accommodation which do not constitute elements of a pre-arranged package, even though they are invoiced simultaneously'
    That is Community jargon for saying, broadly speaking, that business travel will not be within the directive's scope. I hope that that gives my hon. Friend the assurance that he seeks."—[Official Report, 18 December 1989; Vol. 164, c. 166–67.]

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    It was—but alas, those hopes were dashed because, due to a curious quirk of Community law, the European Court ruled that such a minute was ineffective to alter a directive. So the whole purpose was thereby frustrated and defeated.
    Following the ruling, I had meetings with the Minister and with his officials. We sought vigorously to find a solution, which everyone desired, which would exclude business travel from all the burdens. Unfortunately, none was discovered. We heard nothing further of the results of all the thinking which I assume went on among officials not only in the Department of Trade and Industry but in the Department of Transport. We were never told whether they had come to any conclusion or whether solutions could be found. That caused great uncertainty. It is ridiculous that all the regulations, important though no doubt they are, should apply to business travel. The only effect will be to pass costs on while not providing anything relevant to the vast bulk of business travel.
    One solution which I know was mulled over was that a way out would be to decide whether the business travel was allowable for tax purposes. That would be a suitable definition and a way to exclude such travel from the regulation, but we never heard from the Government whether that was workable or not.
    Unless the Minister, under this procedure, can express some hope for the business travel industry, I shall continue to believe that the directive is bad for the industry, bad for business travel, bad for exports and therefore bad for Britain.
    9.6 pm
    Mr. Alan Milburn: The hon. Member for Cambridgeshire, South-West (Sir A. Grant) could have added that the directive will be bad for consumers and not only for business travellers. This debate takes place against a background of increasing concern about the state of the travel industry, culminating in the Land Travel affair. That concern arises not only from the industry, which is welcome, but from consumers' organisations, from individual consumers and from enforcement officers.
    Recent collapses, most notably the collapse of Land Travel, have prompted some serious questions about the current inadequacies in the regulatory framework for the travel industry. Over the past few minutes, the debate has been dominated by the concerns of business travellers. The hon. Member for Cambridgeshire, South-West is no doubt right to say that there are serious concerns in that regard.
    It is as well to remember that the holiday industry also touches the vast majority of members of the public. Every year, millions of people pay large sums, usually in advance, for their annual holidays. Many of them pay not just throughout the year, but for many years, to be able to afford the largest chunk of consumer expenditure undertaken annually. The holiday industry is very important.
    Does the regulatory framework adopted by the Department of Trade and Industry deal with the consensus of concern that we have heard from the Association of British Travel Agents, from the Consumers Association, from my hon. Friend the Member for Edinburgh, South (Mr. Griffiths), from individual consumers, from the Liberal Democrats and from others? The answer is that it probably does not. The proposals are both too little and too late to deal with the majority of consumers' concerns.
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    I shall illustrate those rather sweeping remarks by the example of the recent collapse of a travel company in my constituency—Scotts Greys Travel Ltd. The Minister may be acquainted with the case because I recently wrote to the President of the Board of Trade about it. Scotts Greys was a well-established, Darlington-based company which had been trading for many years. It provided travel arrangements within Britain and abroad. The company collapsed in September, leaving many hundreds of holiday makers in Darlington and in the north-east not only short of an annual holiday, but desperately out of pocket to boot.
    I have been collecting some information about the sort of grievances that some of my constituents have about Scotts Greys. To date, I have been contacted by 218 people in and around Darlington who have lost out to the tune of £24,335—more than £100 per head—as a result of the company's collapse. Not a penny has been forthcoming in compensation, for reasons to which I shall allude in a moment.
    I will give the House some examples of the innocent victims of that collapse. Morag Williamson, who is running a campaign to ensure that compensation is paid to the victims, is herself a victim. She had arranged for a party of seven people to visit EuroDisney in Paris. She paid out well over £1,000. To date, Morag Williamson has seen neither EuroDisney nor a penny of her deposit back.
    Mrs. Grey, who is 81, has not had a holiday since her husband died eight years ago. She stands in marked contrast, perhaps, to some of the ICI executives to whom the hon. Member for Cambridgeshire, South-West paid so much attention in his speech. She arranged to take her sister, aged 85, to Blackpool. She paid a deposit of £28—perhaps not a large sum to hon. Members but a very large sum to an old-age pensioner with no other income. Mrs. Grey lost both her £28 and her holiday.
    For more than 12 years, Mrs. Denny regularly organised party bookings through Scotts Greys for her family, friends and work mates. She booked a holiday for a party of 26 people who, for many months, had been saving £10 a month for their trip to Belgium. Mrs. Denny paid out £900 the week before the company closed its doors to the public, and had the difficult task of informing her 25 friends that their holiday would not be happening.
    Those people are the innocent victims of the collapse of what appeared to be a well-established, credible local travel operator with a solid reputation. The company was not ABTA bonded, but it was a member of the Bus and Coach Council. As hon. Members may realise, the BCC operates a very good bonded scheme. Scotts Greys took advantage of its membership of the BCC, displaying the council's logo prominently on its letterhead and claiming its membership in advertising material. The company never once pointed out, however, that it was not a member of the BCC bonded scheme.
    I repeat that, to the majority of holidaymakers, the company appeared to be a reassuringly credible, well-established local operator. In fact, Scotts Greys resigned its membership of the BCC in July. Needless to say, it did not bother to tell any of its customers of that fact. No one—least of all the holidaymakers—knew that it had resigned.
    That was only one of a series of warning signs in connection with the company's standing. In fact, far from being a credible, financially secure and reputable company, it was in deep financial trouble. All the evidence

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    was there. The problem was that no one bothered to look—indeed, that no one was empowered to look—for that evidence, even though it was staring people in the face.
    I will give some of that evidence. My research has revealed that Scotts Greys consistently filed late accounts with Companies house. Hon. Members will know that every company has a duty to file accounts with Companies house within 10 months of the end of its financial year. The end of Scotts Greys' financial year coincided with the end of the calendar year, 31 December. Yet over the past six years not once did Scotts Greys manage to get its returns into Companies house on time. It filed eight, nine, three, three and three months late. Remarkably, in 1990, its performance improved and its returns were only eight days late.
    However, the last set of accounts contained a clear health warning from the company's auditors who said that the financial statements had been drawn up on a going concern basis on the assumption that the company would continue to receive the support of its bankers and other group members.
    Those right hon. and hon. Members who know a great deal more about accountancy than I do will realise that that was a serious health warning that the company was not a going concern and was in deep financial trouble. That was not surprising because during the previous 12 to 24 months the company had been disinvesting from its bus and coach fleet. It had been flogging off its assets. The December 1990 accounts showed that the company, rather like Land Travel, had rather more liabilities than assets.
    In addition, there was a final health warning that no one bothered to spot. In 1987, Scotts Greys took advantage of sections 247 and 248 of the Companies Act 1985 which allow small companies to file only the most rudimentary set of accounts. An unscrupulous company, such as Scotts Greys, is thus able to hide its financial dealings and financial ill health.
    Hon. Members will agree that there were any number of warning signs of Scotts Greys' vulnerability. Yet no one in Companies house even raised an eyebrow. Certainly no Minister or civil servant at the Department of Trade and Industry bothered to heed any of the warning signs which were clear to so many people. As a consequence, hundreds of people, not just in Darlington but throughout the north-east, lost their holidays and a great deal of money to boot.
    I have asked the President of the Board of Trade to conduct an investigation into this shambolic affair and, in particular, into the role of Companies house and his Department. It is not the first time that the right hon. Gentleman has been asked to conduct such an investigation. I hope that the victims of the Scotts Greys fiasco receive a better response than the victims of the Land Travel fiasco. The two have certain similarities.
    I have also asked the President of the Board of Trade to consider reviewing the Companies Act 1985. It is wrong that a company, purely on the basis of its size, can get away with filing only the most basic of financial information. Surely a consumer safeguard should be built into the Act to ensure that the companies trading with many members of the public as travel operators do should have to file fuller financial information than the Act requires.
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    Quite simply, the Department of Trade and Industry and Companies house are culpable, but none of that helps any of my constituents who, frankly, were fleeced by a company which was still taking money and bookings on the day it closed its doors to the public in Darlington. The company directors knew that it was going down the tubes. They had known it for months, possibly years, yet they unscrupulously filched from members of the public in the north-east and were allowed to get away with it.
    The Scotts Greys affair proves the need for regulation and for more effective and regular monitoring of the travel industry before a problem arises. The major problem with this measure is that it does not allow that. It will allow problems to be spotted once they have risen and once holidays and money have been lost, but not before.
    The regulatory framework is inadequate and the proposal will create a great deal of confusion in the public mind about whether a company is bonded, has insurance or is financially viable. The proposal allows too much room for the cowboys in the industry. Thankfully they are a small minority, but they can have a devastating effect on so many members of the public. The measure will allow the cowboys to bypass a system which remains so lax that it amounts to licensed theft.
    My hon. Friend the Member for Edinburgh, South alluded to the role of trading standards officers. I have here a letter from one officer, who says that, although they would like to be able to police the measure, they are under-resourced as there are 10 per cent. too few of them. However able or willing trading standards officers are, and however much expertise they have, they will be unable to monitor and police the system because the resources are not being made available for them to do so.
    In some ways, other proposals that the Minister and the Department are producing will only make matters worse. I understand that one proposal will allow even more small companies to file only the most basic financial information. Once again, more loopholes are being created which will ensure that proper regulation of the travel industry is not implemented. I am afraid that the result will be that yet more people will lose out.
    9.22 pm
    Mr. Richard Page: May I declare an interest, as I am a parliamentary adviser to the Association of British Travel Agents. In that capacity I have witnessed numerous discussions and debates during the past three years, as the Department of Trade and Industry has laboured to translate the aims of the directive into workable legislation.
    I disagree with the comments on consultation made by the hon. Member for Edinburgh, South (Mr. Griffiths), who led for the Opposition. Through the Minister, I should like to express my appreciation for the detailed way in which the travel industry and ABTA were consulted by Department officials when producing the legislation. Not everyone has got what they want, and everything has certainly not been translated into this regulation. The case for a full and statutory licensing authority has been argued, but the cost of setting up such a body seems to have been conveniently forgotten. I understand the Government's natural reluctance in that matter, and I wonder how much of the cost would be translated into a cost on each holiday if it ever came to pass.

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    There is no doubt that, despite the remarks of the hon. Member for Darlington (Mr. Milburn), the directive will provide an overall increase in protection for holidaymakers not already covered by booking through certain of the trade associations. Even so, some holidaymakers face loopholes through which they might still fall.
    It has correctly been said that many variables exist in relation to repatriation. I shall speak primarily about the costs and mechanisms of repatriation in the event of tour operator failure. That is made more important these days by the growing trend of long-haul holidays. No longer is it a question of dragging back a coachload of lager louts from Spain. We could easily be faced with a plane load of Himalayan hikers as a problem to resolve.
    We must feel concerned lest, when a tour operator fails, insurance policies do not provide a 24-hour repatriation service. It is not enough to require a client to finance his own repatriation, with only the prospect of possible reimbursement on his return. Many clients will not have sufficient funds and others will not have the knowledge of travel procedures to repatriate themselves. I should like to go into the matter in detail, but, because several hon. Members wish to take part in the debate, I shall truncate my remarks.
    I come to telephone bookings and the serious problem of late bookings. The regulations place an obligation on organisers and retailers to give the consumer information before a contract is made and about the communication of the contract. The consequences of failure to comply are criminal in regard to regulation 7 and civil in regard to regulation 9.
    The Minister will be aware that a vast amount of business is transacted by telephone, particularly in the travel industry. Indeed, some companies in the industry reckon that they do 90 per cent. of their business that way. That especially applies to business travel, and my hon. Friend the Member for Cambridgeshire, South-West (Sir A. Grant) raised an important point when he spoke of the possibility of the business traveller being caught by the directive. As we know, it was not the original intention to bring business travellers into the net.
    The Minister will appreciate that it will be difficult to comply with the directive in relation to late bookings. Will he give guidance on the period within which contractual details under regulation 9 need not be communicated in full before the contract is made where, for example, the booking is made very close to departure? Perhaps I might open the bidding by suggesting 14 days. Clarity, as ever, is vital to the industry and the consumer.
    I also am concerned, because it affects the whole business community, about the principle that anyone trading—I am thinking particularly, in connection with the directive, of those who are organizing—should be responsible for the services that are sold. Such an imposition of liability can be effective only if there is a legal requirement for organisers to insure themselves against liability. Under its code of conduct, ABTA now requires all its members to carry that liability insurance.
    Consider what might happen if an organiser is not obliged to take out insurance and does not do so. For example, if somebody went on holiday and had a serious injury, he would be left without a remedy if the organiser failed. I have raised that issue previously. I hope that avenues can be explored to see whether, at a later stage, the problem can he resolved, not only for the travel industry but for trading generally.
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    I shall not respond to the point made by the hon. Member for Edinburgh, South, who got much of the matter completely and utterly wrong, but shall simply ask for clarification. Will VAT increases be encompassed within regulation 11 so that, if the organiser wishes, he can pass on those increases?
    Mr. Nigel Griffiths: I invite the hon. Gentleman to give two or three examples of what was wrong.
    Mr. Page: With respect to the hon. Gentleman, several other hon. Members wish to participate in the debate and time is squeezing on. I am prepared to give the hon. Gentleman an education in the travel industry later.
    Surprisingly, I agree with the hon. Gentleman about the fact that an increase in the duties of trading standards officers in policing that directive will be considerable. I hope that they will be equal to the task. Hotels that provide activities will be brought into the scope of the directive. The size and volume of the task has not been adequately appreciated.
    People are apprehensive that the monitoring will. of practical necessity, be difficult. Some in the travel industry may not willingly comply, to the consumer's disadvantage. It may be necessary, at a later stage in the light of experience, to tighten up the monitoring of those travel agents and tour operators who are not covered by those other organisations.
    I realise that I have presented my comments in a staccato fashion, having distilled them from representations and views put to me by those in the travel industry. I hope that my hon. Friend the Minister will be able to respond in the short time left for his reply. I conclude on the same note on which I started, by paying tribute to those who have put so much effort into translating the directive's theory into operational practice.
    9.31 pm
    Mr. Malcolm Bruce: As the debate is short, I shall speak essentially about surcharges but shall raise a couple of other points at the outset.
    The position of Land Travel has already been mentioned, but it is pertinent that the House should know that my hon. Friend the Member for Liverpool, Mossley Hill (Mr. Alton) received today a letter from the Prime Minister. It says that not only was Companies house aware that the company was trading at£2.1 million adrift in terms of liabilities in relation to assets, but that Ministers were also aware of it and initially denied it. The letter confirms that Ministers were alerted to the problem by the hon. Member for Holland with Boston (Sir R. Body) but nevertheless took no action. That is a sad indictment of the Government's competence in failing to protect consumers.
    I have no doubt that there has been sustained and active consultation between the Department and ABTA, but it is important that Ministers understand that dealing with trade associations does not always mean that every corner of the trade is reached. For instance, my hon. Friend the Member for Orkney and Shetland (Mr. Wallace) has received correspondence from a company in his constituency, Shalder Coaches, which said that it learned of the regulations' implications late in the day and will have considerable difficulty in complying with them. It feels that, too often, Ministers concern themselves with

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    ensuring that the big operators know what is going on, while the small operators are left to struggle to catch up in due course.
    The public are greatly concerned about surcharges. Consumers view the practice with hostility and suspicion with good reason, because many of them have suffered what they can only describe as a "rip off" in the past. It is worth pointing out that companies can impose surcharges up to 30 days before departure. The fact that we are getting a 30-day ruling, as opposed to the 20-day ruling in the directive, is a small gesture, considering that we are legalising surcharges. I believe that the directive provided the opportunity to abolish surcharges.
    If, by countenance, the consumer wishes to cancel, the penalties imposed on him or her are much more disadvantageous than those that the companies impose on themselves. It is true that in the past few years the issue of surcharges has not been topical, but it will certainly be topical in the coming months.
    In the past few weeks, Conservative Members, at least from certain quarters, have been happy to trumpet the great choice of leaving the exchange rate mechanism and the freedom for the pound to float. Consumers will not always be entirely happy with the consequences of the floating of the pound because it will reintroduce perforce the surcharges that the directive will legalise. The simple question is: why on earth should we allow a trade to have such a legal benefit? What is the conceivable justification? I do not think that the Minister has made any case that I regard as sustainable, credible or justifiable. There are few other business sectors that would have the audacity to ask for a legal benefit, or expect it. Terms of trade are terms of trade.
    It is a very uneven contract between consumers, who have virtually no bargaining power, and large tour operators, who hold virtually all the trump cards. So that I am not misunderstood, it is right to say that millions of people in the United Kingdom take package holidays and in most cases such holidays offer good organisation and value for money. However, problems arise when things go wrong, and at that point the law must enter the fray and defend the interests of consumers.
    Tour operators get money many months in advance. Large operators almost universally buy forward. Therefore, they avoid the risk of losing money as a result of changes in fuel prices or exchange rates. They use the money that they can get their hands on in time. They buy competitively, and they can get good results. They can also benefit from accumulated interest from the use of their customers' money and playing successfully on the foreign exchange markets.
    The Minister is saying that those companies, having completely covered themselves against the losses, can nevertheless come within 30 days of departure and say, "Oh dear! The exchange rate has gone in the wrong direction and fuel charges have gone in the wrong direction. The fact that they have not affected our company one iota is irrelevant; we will surcharge you." That is a complete and absolute rip off. Tour companies make an excess profit for which no risk has been taken and no effort expended, and consumers should not be expected to pay for it.
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    When the boot is on the other foot and companies make substantial benefits when fuel charges fall, as they have done in the past, and when exchange rates move favourably, as they have done in the past, there is no obligation whatever to reduce the price of the holiday 30 days before departure and, indeed, give the consumer the benefit of a windfall spending money to take with him. It is an uneven contract. Frankly, I am appalled that Government Ministers have proposed to enshrine that as a legal justification for a trade. That trade may well have an established practice, but we should not be extending it; we should be stamping it out.
    The matter of the 2 per cent. absorption is marginal. A much more effective constraint to prevent companies from introducing surcharges gratuitously would be to allow an absolutely unconditional right of cancellation at any time that the surcharge is being imposed, with full compensation. In such circumstances, it would certainly concentrate the minds of those who run travel companies who would be unwilling to lose the risk of total business for the sake of 3, 4 or 5 per cent., especially when they had not incurred the loss. I know that Conservative Members will say that there will be enforcement provisions. However, it has already been said that it is not possible to enforce such provisions. It is not possible to investigate the detailed mix of surcharges that are being sustained by any one company. It will simply be an excuse for excess profiteering at the expense of consumers.
    It was stated in the House of Lords report that in 1988 companies imposed fuel surcharges of up to 20 per cent. In the case of a 737 aircraft, the extra cost was calculated at £2.85 per customer on the price of the package holiday. That is surely an amount which any tour operator could absorb. Indeed, Holiday Which? stated that the amount of money paid over in surcharges was the equivalent of the Brink's-Mat bullion robbery. Robbery is exactly what it was, particularly because fuel charges fell, yet surcharges were still imposed.
    A practice has recently developed of introducing second and third brochures with revised prices. Surely that is the way for the industry to move forward. If operators want to say that their prices have increased, those who contract later in the year can pay the higher price. But the price that people contract when they buy their holiday should not be alterable.
    To raise a constituency point. holidaymakers from the north of Scotland who go on package tours are effectively surcharged before they start because of the point at which they start. If they face surcharges, for example, as a result of currency changes, the charge is usually a percentage of the holiday price. A substantial part of the higher holiday price for leaving from Scotland is for flying costs across the United Kingdom and is nothing whatever to do with the exchange rate. So a percentage is not valid. There should be an absolute charge which relates to the real extra cost of the holiday. I do not see why people who live in the north of Scotland should pay more than people in London when the cost to the holiday operator is exactly the same. That point has not been addressed.
    The Minister could argue that the absence of surcharges could lead to higher costs. I suggest that that is not true. It would certainly not be true in a highly competitive market in which some of the conditions that I have suggested applied. Operators would know that if they

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    passed on surcharges that were not justified, other operators might not do so and they could lose business, especially if unconditional cancellation were allowed.
    Even if there was a marginal increase in price to take account of the insurance provision, most consumers would probably prefer that. They would then know exactly what they had paid and could budget for it. They would prefer that to knowing that they could face an extra £20, £30 or £40 per holiday 30 days before they departed-an arrangement which is unjustifiable.
    The debate is entitled on the Order Paper "Consumer protection". The regulations are the exact opposite. They are protection of the industry. They give operators the right to rip off consumers and make profits that they have not earned and to which they are not entitled. I urge the Government to think again. This summer surcharges will be imposed and complaints against the industry will increase. The Government will be responsible for failing to take action to protect the consumer in ways that the consumer would expect the Government to act. I assure all hon. Members that they will feel it in their post bags next year.
    9.43 pm
    Mr. Robert Banks: In a debate of one and a half hours, the Chair should have some discretion to limit the length of speeches so that those Members who wish to make a speech are able to do so.
    I welcome this measure to harmonise package holiday legislation within the European Community. I hope that my hon. Friend the Minister will explain exactly what other countries are doing to bring themselves into line with the measure, which is important. Everyone realises the significance of giving the consumer protection from companies that go bankrupt and leave them stranded on their holiday or with a lost deposit. The Association of British Travel Agents has done a good job historically in bringing to the notice of the public the consumer protection that it offers. It has been one of the pioneers in the business. I applaud it for that.
    I hope that Britain's lead in Europe was significant in framing the directive. I do not entirely agree with all aspects of it, but it is important that we take measures to protect the consumer. I regret that the industry has not given greater support to the directive and that a way has not been found to obtain its support.
    The important consideration is whether the measure will deliver the goods. I have a feeling that it will, but it may not be so good as some of the alternatives that were suggested by the industry, such as universal licensing and its own monitoring and bonding arrangements. That would be a good arrangement, but the costs would have to be examined carefully. I gather that the Government feel that consumers would find the cost difficult to bear.
    I am disappointed by the exclusion of package holidays within the United Kingdom. Many people take short-break holidays that cover travel and hotel accommodation, and I see no reason why they should not be protected automatically in exactly the same way as those who are travelling only 20 miles or so across the channel to France.
    Obviously, some people make bookings by telephone. One of the strictures of the directive is that failure to provide the person taking the order with the necessary information about the terms on which he is agreeing to the
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    holiday would constitute a criminal offence. I hope that some common sense can be brought into that. If someone picks up a telephone and makes a fairly short-notice booking with a tour operator, it is inevitable that he cannot provide all the necessary details before the booking is finalised.
    I think it perfectly fair for surcharges to be made, given the possibility of unusual developments. Everybody recognises that oil prices can go roaring up, for instance. Under the directive, the company has to bear the first 2 per cent. of increased costs before it can impose a surcharge, which I consider a fair arrangement. VAT can go up by 5 per cent., which could have a significant effect on some bookings.
    We are on the threshold of the industry's new year marketing effort. Many of the brochures will have been printed for the 1993 winter holidays, and the summer holidays that will follow; but they will not contain information that it is important for them to contain. I hope that the Minister will appreciate the difficulties that the industry will experience in complying with the regulations when it has already printed brochures but has not made them available to the public. I hope that he will turn a Nelsonian blind eye to any proceedings that may result!
    9.47 pm
    Mr. John Denham: It is noteworthy that every speaker has been critical of the Government's position, although the Government have had three years to work on it. I am not about to buck that trend.
    A number of references have been made to the collapse of Land Travel, the Bath-based company which cost 40,000 people their holidays last summer. Had I more time, I would refer to some of the several hundred of my constituents who have written to me from the south Hampshire area about Land Travel. In any case, the factors involved in its going bust are very clear. It was obvious to many people that it was going under. It was obvious to Price Waterhouse, the auditors, and the state of the company was drawn to the attention of Ministers by Conservative Members of Parliament and local Conservative clubs. Despite that, the company continued to trade. It took money from one of my constituents in April this year and it took more money in June and July, only to deprive that constituent of a holiday in August.
    Will this measure leave our constituents any better protected? Will it lead to better protection for one of my constituents who lost £275 on a trip to EuroDisney? She is unemployed and her husband has occasional casual work from an agency. They have lost their first holiday in six years. They are typical of the 40,000 people who lost their holidays through the collapse of Land Travel. Unscrupulous companies target their business on those least able to pay—people who, because they are most vulnerable, need most protection.
    The regulations amount to a system of self-policing, which will not be followed by companies such as Land Travel. The absence of a licensing requirement means that such companies will continue to exploit loopholes until they are caught, and people such as my constituents and those of other hon. Members will suffer.
    It is desperately sad that, despite having so long to prepare the legislation, the Government have failed

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    abysmally to protect our constituents. We are told that the obstacle is cost. What estimate have the Government made of the cost of licensing? I suspect that constituents who lost £275 or £500 would have accepted a slightly higher cost if they could have kept their holiday.
    9.50 pm
    Mr. Leigh: I am grateful to those hon. Members who have participated in the debate. Others such as my hon. Friend the Member for Isle of Wight (Mr. Field), who came to see me about the regulations, wished to participate but could not do so.
    I inform my hon. Friends the Members for Harrogate (Mr. Banks) and for Cambridgeshire, South-West (Sir A. Grant) that under Community law all member states are required to implement the provisions of the directive and must notify the Commission of measures adopted to do so. If a member state fails to implement, infraction proceedings may be taken. We shall keep a close eye on such matters.
    In a character istically forthright speech, the hon. Member for Edinburgh, South (Mr. Griffiths) accused us of minimum consultation. My hon. Friends have shown that that is not true. In July 1991, we consulted all ABTA members and members of other trade bodies, consumer groups and other interested parties, including operators who do not belong to trade associations. That meets the point made by the hon. Member for Gordon (Mr. Bruce).
    The main thrust of the attack of the hon. Member for Edinburgh, South was why we were not licensing operators. I can only repeat the point that I made earlier: the number of operators who would fall within the scope of the regulations would be significant. Many of the operators would be small and the unit cost of issuing each licence would be high, disregarding the costs of providing protection for repayments. That point was emphasised by my hon. Friend the Member for Hertfordshire, South-West (Mr. Page), and we acknowledge the expertise that he brings to these matters. At best, such a licensing procedure would increase cost to consumers; at worst, it would potentially drive small operators from the market and reduce consumer choice.
    Any licensing system would have to be paid for by the licensees; there can be no question of any Government money. We believe that more than 20,000 operators would need to be licensed, and the number could be even higher. It would be a massive, frighteningly expensive operation.
    Mr. Nigel Griffiths: How much does the Minister estimate that licensing would cost?
    Mr. Leigh: I have just said that there is no direct evidence of the number of operators, but there could be between 10,000 and 20,000. Any licensing system would have to be paid for by those operators. Many of them are small operators, and the costs would fall on them and ultimately on the consumer. It is impossible for a Minister to say how much it would cost, but if one accepts that there are more than 20,000 operators the cost would be high and it would fall on small operators.
    We acknowledge the expertise of my hon. Friend the Member for Cambridgeshire, South-West in relation to business travel and the contribution that business travel makes to the economy. Unfortunately, we cannot exempt
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    packages which satisfy the definition given in the directive. We must carry out the directive. Many arrangements made by business men are not pre-arranged and offered for sale or sold at an exclusive price, so they would not fall within the scope of the regulations.
    I will mention one point to my hon. Friend which I hope that he will welcome. The incentive travel industry was particularly concerned about absorption of the first 2 per cent. of any surcharge. As a result of the representations made to us by my hon. Friend and others, we have now modified this regulation so that it is only individual consumers, and not corporate consumers, who will benefit from this provision. I hope that this meets some of the objections and concerns of my hon. Friend.
    Another major thrust of the case put forward by the Opposition was a point made particularly by the hon. Members for Edinburgh, South and for Gordon. My hon. Friend the Member for Harrogate dealt in his speech with the problem of surcharges, but I have to reiterate the great difficulties that anybody seeking to prohibit surcharges would be under.
    When prices increase, tour operators can cut into their profit margins, take some form of insurance, or impose a surcharge. I accept that from the consumer's point of view the first is to be preferred, but I hope that the hon. Member for Gordon will accept that that may not always be possible. He recognised that the package travel industry is highly competitive and that costs are generally cut to the bone. A company's capacity to absorb a significant rise in prices which is outside its control is, therefore, likely to be limited.
    The other routes also have their costs. Insurance would involve a certain cost, whether it was done by conventional insurance or by building a margin into the price at which the tour was sold. Many tour operators therefore prefer to keep their initial price as low as possible and to cross the bridge of increased cost when they come to it by reserving the right to impose a surcharge if need be. This seems to be a matter of legitimate commercial choice, so long as customers are made fully aware of the terms of the contract they are entering.
    Regulation 11 places conditions on the circumstances in which an operator may surcharge, which is similar to the regulations which currently work well from the consumer's point of view.
    I shall deal now with a point made by my hon. Friend the Member for Hertfordshire. South-West on telephone bookings. There is nothing in the directive to stop telephone selling, last-minute or otherwise, which is a point that he raised. Except where the booking is last-minute, the customer must be given the terms of the contract before the contract is concluded, and the terms must include those specified in schedule 2 of the regulations. Often, however, the information can be given to the customer via the organiser's brochure, which he will have in his possession.
    Another point made by my hon. Friend the Member for Hertfordshire, South-West concerned repatriation. I agree with the comments that he made. We believe that the proper interpretation of this requirement of the directive is that repatriation arrangements should be made on the spot, not simply that the customer may reclaim the cost of repatriation after having made his own way home. The regulations mirror the wording of the directive. We have not defined in the regulations how the repatriation requirement is to he met because there are many ways in

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    which this could be done and we were anxious not to be over-prescriptive. Of course, failure to have proper arrangements for repatriation will he a criminal offence.
    Some of my hon. Friends raised the question whether repatriation arrangements would be needed for domestic packages. The directive does not define what is meant by repatriation and our regulations have not attempted to do so. It is the view of the Government, however, that the repatriation requirement does not extend to domestic packages. I can reassure my hon. Friend the Member for Harrogate, however, that this directive and its implementing regulations apply to domestic packages. A requirement for repatriation within the United Kingdom could be extremely burdensome. A very large number of weekend breaks of which travel forms a part would be caught by the regulations. To require them all, however short the distance travelled, to provide a back-up would be bureaucratic and in most cases unnecessary.
    Another point made by my hon. Friend the Member for Hertfordshire, South-West concerned compulsory liability insurance and why we have not made liability insurance compulsory for operators and retailers. We have given careful thought to what we know to be the strongly held view of much of the travel industry that liability insurance should be compulsory, but compulsory insurance would be an additional burden and, as such, undesirable on deregulation grounds. Whether to take out insurance will be a matter of commercial choice. Also, an enormous variety of organisations would he offering packages, many of them quite remote from the mainstream travel industry. It would be unreasonable to require them all to have liability insurance.
    The hon. Member for Edinburgh, South and other hon. Members said that all travel agents should be bonded. We believe that if an agent takes money on his own behalf and not on behalf of an organiser, the regulations require him to have protection for any prepayments taken. If the agent puts together a package himself, he would become an organiser and would thus need to have protection in place like any other organiser.
    This has been a difficult task for the Government. We have consulted widely, and I believe that it is a major measure of enormous importance to the consumer. We have had an excellent and fair-minded debate. Once again, the Government have shown that they are prepared to act for the consumer but not to load undue burdens on British business.
    It being one and a half hours after the motion was entered upon, MR. DEPUTY SPEAKER put the Question, pursuant to Order [4 December].
    Question agreed to.
    Resolved,
    That the draft Package Travel, Package Holidays and Package Tours Regulations 1992, which were laid before this House on 1st December, be approved.

    Package Travel

      ESTIMATES
      MR. DEPUTY SPEAKER, pursuant to paragraph ( 5 ) of Standing Order No. 52 (Consideration of estimates), put the deferred Question on Estimates, 1993–94 (Vote on Account) (Class VII).
      Question agreed to.
      Resolved,
      That a sum not exceeding £17,763,619,000 be granted to Her Majesty out of the Consolidated Fund, on account, for or towards defraying the charges for civil services, in Class VII, for the year ending on 31st March 1994, as set out in House of Commons Paper No. 232 of Session 1992–93.

      ESTIMATES
        ESTIMATES
        MR. DEPUTY SPEAKER then put the Questions which he was directed to put at that hour, pursuant to paragraph ( 1) of Standing Order No. 53 (Questions on voting of estimates, &c.) and Order [1 December].

        SUPPLEMENTARY ESTIMATES
        Resolved,
        That a further sum, not exceeding £4,384,141,000 be granted to Her Majesty out of the Consolidated Fund to complete or defray the charges for civil services for the year ending on 31st March 1993, as set out in House of Commons Paper No. 231 of Session 1992–93.

        ESTIMATES 1993–94 (VOTE ON ACCOUNT)
        Resolved, That a sum not exceeding £65,973,856,000 be granted to Her Majesty out of the Consolidated Fund, on account, for or towards defraying the charges for defence and civil services, in Classes Ito VI, VIII to XIX, X1X,A and XIX,B for the year ending on 31st March 1994, as set out in House of Commons papers Nos. 232, 233 and 234 of Session 1992–93.
        Bill ordered to be brought in upon the foregoing Resolutions by the Chairman of Ways and Means, Mr. Chancellor of the Exchequer, Mr. Michael Portillo, Mr. Stephen Dorrell, Sir John Cope and Mr. Anthony Nelson.

        CONSOLIDATED FUND BILL
        Mr. Stephen Dorrell accordingly presented a Bill to apply certain sums out of the Consolidated Fund to the service of the years ending on 31st March 1993 and 1994: And the same was read the First time; and ordered to be read a Second time tomorrow and to be printed. [Bill 96.]

    National Rivers Authority
    Motion made, and Question proposed, That this House do now adjourn.—[Mr. Nicholas Baker.]
    10.2 pm
    Mr. David Evans: This debate is about my constituents who, at the hands of successive water authorities—especially the National Rivers Authority—have been humiliated by a disgraceful lack of concern or action to alleviate their genuine fear for their lives through flooding.
    On 8 December I received a letter from Lord Crickhowell, the NRA chairman, which said:
    "I fully understand the anxieties of those who live in the area and their impatience to find a solution."
    How long would the House and you, Mr. Deputy Speaker, think that my constituents should wait before they can be charged with impatience—one month, three months, six months, one year, two years, 10 years, 20 years, 30 years or 60 years? My constituents have been waiting for some action since 1928.
    It is an old adage, but nevertheless true, that an Englishman's home is his castle. Furthermore, it is a saying which is fundamental to Conservative beliefs. As a Tory, I believe in the sanctity of property, and in property becoming an extension of an individual's personality. All my instincts tell me that it is property which gives an individual a stake in society. Those who have worked hard to buy their own property, or, indeed, those who rent it, have a right to expect that their households will be protected.
    If a house is burgled, the public expect the people involved to be caught and punished. If riots break out and a mob threatens to attack a house, the occupants have a right to expect the powers that be to repel that attack. Yet in my constituency, there are law-abiding families who have lived for more than 60 years under repeated threat of attack, of having their homes damaged and their valued possessions destroyed, and their repeated requests for action to the relevant authorities have gone unheeded for 64 years. It is a disgrace, and totally intolerable.
    This threat comes from our most insidious force, which is often not taken as seriously as it should be. One of our greatest natural assets has also become a home wrecker. I am talking about Britian's rivers. Flooding is not just property-destroying, it is soul-destroying. Years of saving, a lifetime of memories, can be swept away in a night's work. People therefore rightly look to the relevant authorities to offer protection.
    Tragically, as the residents of Warrengate road in my constituency know to their cost, the National Rivers Authority and its predecessors have not attended to a problem that has been with them for 64 years. They have negated their duty and almost their honour.
    Although the first serious flooding of Warrengate road took place in 1928, occurred again in 1936, and again in 1947, the position worsened dramatically in the early 1950s. I take hon. Members back to 1955, when "Rock Around the Clock" was the best-selling single in both America and Britain; Elvis was just 20; Attlee was still leader of the Labour party, and Winston Churchill was succeeded as Prime Minister by Anthony Eden. That was also the year in which the residents of Warrengate road yet again warned of the danger of flooding from the Mimmshall brook. Since then, this country has witnessed
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    11 general elections and had nine Prime Ministers, and still nothing has been done to alleviate the fears of my constituents.
    While the tide of history has ebbed and flowed, the water authorities have allowed the houses on that street to be flooded twice—first in 1979 and then three months ago in the early hours of Wednesday 23 September—despite the fact that, almost every year since 1955, residents wrote in the clearest terms of the threat to their homes.
    I shall quickly list them: January 1928, serious flooding; January 1936, serious flooding; March 1947, serious flooding; 1955; July 1958, flooding of the whole road; 1960, December 1965, 1975, 1977, 1978 and 1979, flooding to the road with flooding to 11 properties to a depth of 3ft, plus road flooding; 29 October 1987, flooding up to the doors of properties and road flooding to a depth of 3ft; 29 January 1988, flooding to the road to a depth of 3ft; 1990, flooding of the road to 3ft; 23 September 1992 flooding to 18 residential properties and four commercial properties to a depth of 4ft.
    Up to 1979, while not violating the housing in the street, heavy flooding occurred, and the level of the brook rose dangerously high; but nothing was done. After 1979, in response to the first disaster, some widening and a little dredging took place, but residents warned that the steps taken were not adequate to deal with the problem. Their warnings were ignored even when, in 1989, the brook flooded to the doorsills of Warrengate road.
    The flooding of the houses in 1979 was still regarded by the water authority as a once-in-50-years event, yet, as the residents repeatedly pointed out, the potential for flooding has increased rather than diminished. The surrounding area has been developed and urbanised, which has led to an enormous increase in the amount of surface water run-off which finds its way back into the brook. The development of the A 1 (M) has further added to the problem. Another disaster was just waiting to happen, and it did, in September this year.
    When faced with the dangers of flooding, Noah spent 40 days and 40 nights building an ark. Confronted by the same problem, the National Rivers Authority finally, after 64 years, conducted a feasibility study. The study was begun in 1991 and has still not been made public. Even the NRA chairman, Lord Crickhowell, received a copy of its conclusions only last Friday. That is a classic case of too little, too late.
    Reading the National Rivers Authority's literature, one would think that it was an organisation to rival the United Nations. Apparently, in the day it took up its duties,
    "it became the strongest environmental protection agency in Europe",
    and it is invested
    "with extensive powers and responsibilities by Parliament".
    More than half its manpower is involved in flood defence projects, and from its flood control rooms staff are supposed to keep a round-the-clock check on weather conditions and river levels. Staff interpret the information and give the emergency services early warning of possible flooding. Yet the authority ignored warnings dating back to 1928.
    This is not the case of a watchdog with no teeth, but rather a case of a watchdog which has curled up and gone to sleep by the fire. Indeed, until this year's flooding, letters from the residents to Lord Crickhowell went unanswered,

    1099
    or the answers were unacceptably delayed. Furthermore, the two-stage channel which was promised to alleviate the problem never materialised.
    Let us return to September. It is 4 am, and the homes of old-age pensioners, some of whom fought in two world wars, are flooded. The Minister's grandfather would know what those people gave him and the nation, yet here they are at 4 am. They survived the German blitz, yet now the National Rivers Authority is putting their lives in danger. Young children are terrified, and there are rowing boats and fire engines everywhere, all because of the incompetence of the NRA. Families and old-age pensioners will spend this Christmas in bed-and-breakfast accommodation, and all because, after 60 years, the authority cannot solve the problem—I hope that Lord Crickhowell hears about that.
    The right honourable Baron Crickhowell of Pont Esgob—that sounds like something that comes out of the water rather than someone who regulates water—wrote to me recently. The penultimate paragraph of his letter added insult to injury by saying:
    "I must, however, make it clear that it is a possibility that the study may be judged unacceptable on economic grounds to alleviate the flooding to only 16 properties."
    I have news for Lord Crickhowell: one property is too many.
    We are told that the scheme would cost £2 million. But think of the £1 billion stolen from the social security every year—or is it £2 billion? What about the new age travellers? Are we prepared to spend millions of pounds on them but not on my residents who fought in two world wars? Oh no, they are not considered worthy of having £2 million spent to look after their properties, which they have spent a lifetime buying and living in. It is a statement that fails to recognise the traumas suffered by the residents and it ignores the fact that they have been complaining since 1928.
    Furthermore, the letter contained a number of factual inaccuracies, not surprisingly, which did nothing to inspire confidence in my constituents. Lord Crickhowell got the name of his own chief engineer wrong. For his benefit, I can tell him that his name is Brian Izzard. Lord Crickhowell also noted that arrangements were in hand by the Countryside Commission to have trash removed from the swallow holes. In fact, the countryside management service organised a band of volunteers to carry out clearing work in March 1991.
    This case is a classic example of how a public authority has woefully failed in the execution of its duty. I am surprised by the tolerance exercised by my constituents. All they have ever wanted is for their homes to be protected from flooding, yet they have twice endured the disasters that they had predicted. On several occasions, they have held their breath and only by the grace of God have they escaped further flooding. If I were in their shoes, I would sue the water authority tomorrow. Let us get a writ out and let us get this Crickhowell man off his whatsit—
    Mr. Deputy Speaker (Mr. Michael Morris): Order. The hon. Gentleman is not allowed to speak of Members of another place in such derogatory tones. Perhaps he would like to rephrase his remark.
    Mr. Evans: I withdraw that remark, Mr. Deputy Speaker.
    1100
    If successful, public authorities can be awarded charter marks, can we consider conferring official black marks on organisations such as the NRA that fail to deliver the services for which they are responsible? The NRA calls itself the guardian of the water environment. It is a pity that it has failed to carry out its duties to my constituents. It is a pity that the chairman and his officials chose to ignore my constituents' plea for something to be done to protect their lives in September and in future.
    10.16 pm
    The Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mr. Nicholas Soames): I congratulate my hon. Friend the Member for Welwyn Hatfield North (Mr. Evans) on securing a debate on such a crucial matter in the interests of his constituents. He made a speech full of clarity and vigour, with all the force and candour for which he is rightly famed in the House. I fully understand that the question of flooding is of fundamental importance to him and to his constituents. I assure him that the Ministry of Agriculture, Fisheries and Food takes the issue very seriously. We have the deepest sympathy for those who have suffered damage, distress and inconvenience through the flooding.
    My hon. Friend was right in his views about the sanctity of private property and about the importance that ordinary constituents—those whom we represent—rightly attach to it.
    Flood defence is an important and sometimes controversial issue. In recent weeks, we have seen the serious effects that flooding can have in a number of areas of the country. Before commenting on the specific points raised by my hon. Friend, it may be helpful if I explain how flood defence matters are handled.
    The Ministry of Agriculture, Fisheries and Food has policy responsibility for the alleviation of flooding—whether by rivers or by the sea—and for the protection of the coastline against erosion. The Ministry sets broad national priorities and my hon. Friend will not be surprised to learn that these give greatest emphasis to the protection of life and hence, generally speaking, to the protection of urban areas.
    Secondly, the Ministry also makes substantial sums of grant aid available each year to the various local bodies that carry out flood and coastal defence capital works. In the current financial year, grant aid provision amounts to some £62 million. That grant aid covers, on average, about half the capital costs of the schemes, the remainder being raised locally and reimbursed through the revenue support grant. Thirdly, the Ministry gives guidance on the engineering, environmental and economic factors that bodies responsible for carrying out flood defence works should take into account.
    My hon. Friend, who has a detailed knowledge of these matters, will be aware that responsibility for the design, construction, maintenance and operation of flood defences in particular locations lies at local level. Schemes are undertaken by local authorities, by internal drainage boards or—in the case of our major rivers—by the National Rivers Authority. In the case of Mimmshall brook, to which my hon. Friend referred, responsibility for flood defence works rests with the N RA's Thames region.
    It is those local bodies that decide whether to put forward proposals for flood defence works to the Ministry for grant aid. Although the Ministry's regional engineers

    1101
    can and do give advice to the NRA and other local bodies on the need for works, the Ministry cannot direct an authority to undertake particular flood alleviation measures.
    In considering applications for grant aid, the Ministry expects the local flood defence authority concerned to have examined a wide range of options for tackling flooding at a particular site and to have compared those options with the implications of taking no action whatever. In effect, the "no action" scenario provides a benchmark against which the relative advantages and disadvantages of public investment to resist the forces of nature can be judged.
    Proposals for flood defence work are considered first by the Ministry's regional engineers for the relevant area, who have the necessary professional expertise. Essentially, there are three yardsticks against which all such proposals must be judged: planned schemes must of course be sound in engineering terms; they must be environmentally acceptable; and they must be economically worth while.
    Naturally, as I told my hon. Friend earlier, the protection of life remains the overriding priority. Subject to that imperative, it is essential that all proposed flood defence works should meet the three criteria that I have mentioned. The economic yardstick applied is that a scheme is regarded as economically worth while if the benefits flowing from it—for example, in terms of physical damage or other detriment avoided—are at least equal to, or greater than, the costs of undertaking the work.
    I hope that my hon. Friend, who holds strong and sensible views on financial prudence—stronger, almost, than those of any other Conservative Member—will agree that that is an essential safeguard to the interests of the taxpayer. The resources that the Government devote to flood and coastal defence, although very substantial, are of necessity finite. It is therefore right that expenditure should be focused primarily on areas of dense urban settlement, where the economic, social and environmental costs of flood damage are greatest.
    Even in such areas, schemes can generally only reduce the incidence of flooding; they cannot hope to prevent it altogether. Nevertheless, in the majority of such cases, the costs of carrying out flood defence will be comfortably outweighed by the resulting benefits, but in cases where the costs of a proposed scheme are in excess of the benefits that would accrue, the investment of public money cannot be justified unless there is imminent risk to life. The Ministry's financial support for flood warning schemes is, of course, a direct response to the need to avoid risk to life.
    I accept that it is very difficult to put precise figures on all the costs and benefits of particular schemes, and my hon. Friend made a very powerful case tonight. But the Ministry makes every effort to quantify so-called intangible benefits of schemes—for example, the social or environmental benefits to which my hon. Friend referred tonight—and to take account of them in its decision making, even where they cannot be quantified.
    I hope that my hon. Friend will agree that, although it may have been rather long-winded, it was worth my setting out at some length the principles to which my Department has to work.
    1102
    I come now to the particular problems of the residents of Warrengate road and the Mimmshall brook near North Mimms in my hon. Friend's constituency. As my hon. Friend said with such clarity and force, the area has a history of flooding problems, and that is probably an understatement. The resolution of those problems poses particular difficulties, of which my hon. Friend is well aware from his correspondence with the chairman of the NRA, Lord Crickhowell.
    Given the serious threat of recurrent flooding, along with the technical and other difficulties attending the possible solutions to it, the authority was right to embark upon a detailed study of the whole of the Mimmshall brook catchment. That thorough analysis was completed only in the last day or so, and my Department and my hon. Friend—I know because we spoke on the telephone about it—have received a copy of it.
    The Ministry's river and coastal engineers are carefully considering the NRA's study as a matter of urgency, but I hope that my hon. Friend will accept that I am truly not in a position tonight to tell him what conclusions they are likely to draw.
    However, I am aware that the report considers a wide range of possible options for dealing with my hon. Friend's constituents' serious problems, and that one of those at least appears to be broadly consistent with the rules to which the Ministry has to work and which I have outlined.
    My hon. Friend and I must look to the NRA in the first instance to consider the options that it has now identified locally and to present formal proposals to the Ministry in support of its preferred course of action. I can give my hon. Friend and his constituency my guarantee that any such proposals will be handled by the Ministry's engineers as a matter of the highest priority.
    In conclusion, I assure my hon. Friend and his constituents that we do not underestimate the grave seriousness of the problem that he has rightly brought to the Floor of the House tonight. As I have said, I fully appreciate the concerns of those affected and I, with my right hon. Friend the Minister, have expressed our deepest sympathy and concern for the care and safety of the residents in the light of the distress that they have endured.
    I hope that my hon. Friend will agree that the solution is not straightforward, black and white or easy. The engineering and economic complications involved must be fully addressed. I hope that he will agree that I have been entirely open about the procedures that we are obliged to follow.
    My Department is ready to act quickly to assess any formal proposal from the NRA when it comes. In doing so, we shall take into account the points that my hon. Friend has raised in reaching future decisions on this most difficult and distressing case.
    Once again, I congratulate my hon. Friend on securing this debate, and on representing his constituents' interests with vigour and clarity in a robust speech, which I greatly value, having had the opportunity to reply. I assure the House that we shall do everything that we can to assist my hon. Friend's constituents.
    Question put and agreed to.
    Adjourned accordingly at twenty-eight minutes past Ten o'clock.

HOME DEPARTMENT

  Prison Officers' Quarters
  Mr. Cox
  To ask the Secretary of State for the Home Department to what fund the sums received from the selling of prison officers' quarters have been placed; and if he will make a statement as to the use made of these sums.

  Mr. Peter Lloyd
  Receipts from the sale of prison officers' quarters are taken as appropriations in aid to defray the costs of the prison service. Any sums in excess of those authorised to be used in that way are paid into the Consolidated Fund.

  Terrorism
  Mr. Conway
  To ask the Secretary of State for the Home Department whether he will review the advice and financial assistance given in respect of public buildings damaged by terrorist action on mainland Britain following the IRA bombing of Shrewsbury castle.

  Mr. Kenneth Clarke
  Advice on the protective security of buildings is available from chief officers of police. In Great Britain, where insurance cover is available in respect of criminal damage to property, including damage caused by acts of terrorism, the Government do not provide any financial assistance.

  Metropolitan Police Commissioner
  Mr. Gordon Prentice
  To ask the Secretary of State for the Home Department what selection criteria are used in determining the appointment of the Commissioner of Police of the Metropolis.

  Mr. Charles Wardle
  When considering the suitability of senior police officers for the appointment, my right hon. and learned Friend had regard to the operational and managerial experience needed for leading the Metropolitan police service.

  Immigration Detention Centres
  Ms. Ruddock
  To ask the Secretary of State for the Home Department how many(a) suicides and (b) attempted suicides have occured at Harmondsworth immigration detention centre in each of the last 10 years.

  Mr. Charles Wardle
  One suicide has occurred in Harmondsworth detention centre over this period. It occurred in 1990.

  Records of incidents of self-injury by detainees which might amount to attempted suicide have been maintained only since 1986. The number of such incidents is as follows:
  734

  Number

  1986

  Nil

  1987

  4

  1988

  2

  1989

  1

  1990

  Nil

  1991

  Nil

  11992

  Nil

  1 To date.

  Ms. Ruddock
  To ask the Secretary of State for the Home Department what is the weekly cost of holding an immigration detainee at(a) Harmondsworth immigration detention centre and (b) Her Majesty's prison, Haslar.

  Mr. Charles Wardle
  The Harmondsworth detention centre is managed under contracts, and the costs involved are not disclosed on grounds of commercial confidentiality. The average net operating cost per inmate per week for all prison service establishments for the financial year to 31 March 1992 was £406, and it would be reasonable to assume that the cost of accommodating immigration detainees at Haslar is of a similar order.

  Ms. Ruddock
  To ask the Secretary of State for the Home Department how many deaths in custody have occurred at Harmondsworth immigration detention centre in each of the last 10 years; and if he will make a statement.

  Mr. Charles Wardle
  One death has occurred at Harmondsworth detention centre over this period. It occurred in 1990. A fire at the centre in 1989 resulted in the subsequent death in hospital of one detainee.

  Illegal Immigrants
  Mr. Alex Carlile
  To ask the Secretary of State for the Home Department if he will estimate how many illegal immigrants are working in the London area; and if he will make a statement.

  Mr. Charles Wardle
  Comprehensive information on the number of persons working in breach of the conditions imposed on their leave to enter or to remain in the United Kingdom is not available. In many cases it is not possible to determine whether a person is working illegally until he/she has been traced and interviewed.

  President-elect Clinton
  Mr. Kaufman
  To ask the Secretary of State for the Home Department for what purpose and at whose request officials of his Department examined Home Office files to ascertain whether President-elect Clinton had applied for United Kingdom citizenship.

  Mr. Tony Banks
  To ask the Secretary of State for the Home Department (1) what information was passed on by his Department during 1992 to journalists in respect of Mr. Bill Clinton's period of temporary residence in the United Kingdom; and if he will make a statement;

  (2) when a search was authorised of Home Office records in respect of Mr. Bill Clinton's period of study in the United Kingdom.

  Mr. Allen
  To ask the Secretary of State for the Home Department if he will make a statement on the checking of Home Office files for information on Governor Bill Clinton.
  735
  Mr. Winnick
  To ask the Secretary of State for the Home Department if he will make a statement on the reasons for the examination undertaken into his Department's records as to whether Mr. Bill Clinton had applied for United Kingdom citizenship while studying in Britain; by whom the investigation was authorised; on what dates the research was undertaken; what were the total costs of the work involved; and what was the result of the investigation regarding Mr. Clinton.

  Mr. Kenneth Clarke
  I refer the hon. Members to the reply I gave the hon. Member for Sedgefield (Mr. Blair) on 9 December, at columns 662–63, to which I have nothing to add.

  War Crimes
  Mr. Janner
  To ask the Secretary of State for the Home Department, pursuant to his answer to the hon. Member for Walsall, North (Mr. Winnick) of 30 November,Official Report, column 8, how many of the few records relating to the wartime Nazi occupation of the Channel islands that have been held by the Home Office on extended closure relate in any way to allegations of war crimes atrocities that may have been committed by (a) United Kingdom citizens and (b) non-United Kingdom citizens on the island of Alderney; and if he will make a statement.

  Mr. Kenneth Clarke
  Only seven files have been retained on extended closure under section 5(1) of the Public Records Act 1958. It has been the practice of successive Administrations not to disclose the contents of records which are so withheld from public release. The papers will, however, be made available to any official prosecuting authority investigating alleged war crimes.

  Mr. Janner
  To ask the Secretary of State for the Home Department, pursuant to his answer to the hon. Member for Walsall North (Mr. Winnick) of 30 November,Official Report, columns 7–8, how many records from the few records relating to the wartime Nazi occupation of the Channel islands that have been held by the Home Office on extended closure have been passed to prosecuting authorities in the United Kingdom or in Germany; and if he will make a statement.

  Mr. Jack
  None; but none has been requested. It is the policy of the Home Office that such records—whether open or closed—may be made available to any official prosecuting authority which requests them for the purposes of investigations or prosecutions concerning alleged war crimes.

  Police (Firearms)
  Mr. Tony Banks
  To ask the Secretary of State for the Home Department what discussions he has held with the Commissioner of Police of the Metropolis on the policy of stop and search exercises involving armed police officers; and if he will make a statement.

  Mr. Charles Wardle
  The exercise by the Metropolitan police of their statutory powers to stop vehicles and, if necessary, to search them is an operational matter and as such falls within the discretion of the Commissioner. So, too, does the decision when, and in what manner, armed police should be deployed in support of such operations.

  Remand Prisoners
  Mr. Michael
  To ask the Secretary of State for the Home Department what is the total number of persons currently held on remand in gaols in England and Wales; and if he will give a breakdown showing(a) the number of male and female remand prisoners, (b) the number in each over 18 years but under 21 years and (c) the number under the age of 18 years.

  Mr. Peter Lloyd
  [holding answer 1 December 1992]:The latest readily available information which includes the age breakdown requested relates to 30 June 1992 and is given in table 1.

  Table 1

  Estimated population of unsentenced prisoners in prison service establishments in England and Wales on 30 June 1992: by type of prisoner, sex and age group

  Type of prisoner and age group

  Number of persons

  Males

  Females

  Persons

  Untried:

  Under 18 years

  460

  5

  465

  18 to 20 years

  1,463

  30

  1,493

  Total under 21 years

  1,923

  35

  1,958

  21 years and over

  5,369

  231

  5,600

  Total all ages

  7,292

  266

  7,558

  Convicted unsentenced:

  Under 18 years

  139

  4

  143

  18 to 20 years

  599

  24

  623

  Total under 21 years

  738

  28

  766

  21 years and over

  1,170

  65

  1,235

  Total all ages

  1,908

  93

  2,001

  All unsentenced prisoners

  19,200

  1359

  19,559

  1 A further 142 males aged under 21,684 males aged 21 and over and 19 females aged 21 and over were held in police cells.

  Information excluding the under-18/aged 18 and under-21 breakdown is available for 31 October 1992; this is shown in table 2.

  Table 2

  Estimated population of unsentenced prisoners in prison service establishments in England and Wales on 31 October 1992: by type of prisoner, sex and age group

  Type of prisoner and age group

  Number of persons

  Males

  Females

  Persons

  Untried:

  Total under 21 years

  1,654

  35

  1,689

  21 years and over

  5,081

  232

  5,313

  Total all ages

  6,735

  267

  7,002

  Convicted unsentenced:

  Total under 21 years

  633

  20

  653

  21 years and over

  1,437

  71

  1,508

  Total all ages

  2,070

  91

  2,161

  All unsentenced prisoners

  18,805

  358

  19,163

  1 A further 132 males aged under 21 and 310 males aged 21 and over were held in police cells.

  Ammonium Nitrate Fertilisers
  Mr. Trimble
  To ask the Secretary of State for the Home Department which ammonium nitrate fertilisers banned from sale in Northern Ireland are on the market in England; and what is the maximum percentage of ammonium nitrate in fertilisers on sale in England.

  Mr. Soames
  I have been asked to reply.

  Ammonium nitrate fertilisers containing more than 79 per cent. ammonium nitrate are banned in Northern Ireland. Such fertilisers on sale in England may contain up to approximately 99 per cent. ammonium nitrate.

NORTHERN IRELAND

  Industrial Sites
  Mr. McGrady
  To ask the Secretary of State for Northern Ireland what progress has been made in obtaining land for industrial sites in Kilkeel in the constituency of South Down.

  Mr. Atkins
  The Industrial Development Board—IDB—has no plans to acquire land for industrial sites in Kilkeel, as industrially zoned land is already available in private ownership in the town.

  Mr. McGrady
  To ask the Secretary of State for Northern Ireland what progress has been made in obtaining land for industrial sites on the Ballydugan road, Downpatrick; and if he will make a statement.

  Mr. Atkins
  The IDB is in negotiation with Dunleath Estates to acquire a six-acre site at Ballydugan road, Downpatrick. It is hoped that agreement can be reached soon.

  Housing (Funding)
  Mr. John D. Taylor
  To ask the Secretary of State for Northern Ireland which housing associations submitted applications for funding for the purchase of empty homes by the closing date for applications on 30 November; and how many homes each of these housing associations submitted for consideration.

  Mr. Atkins
  The following 28 registered housing associations in Northern Ireland made application to purchase properties to rent under the Government's housing initiative announced in the Chancellor's autumn statement:

  Housing Association

  Number of Properties

  Ballynafeigh

  21

  Belfast Community

  4

  BIH

  81

  Botanic

  16

  Church of Ireland

  25

  Clonard

  28

  Connswater

  4

  Craigavon and District

  78

  Craigowen

  10

  Derry

  49

  Dungannon

  37

  Flax

  47

  Fold

  33

  Gosford

  30

  Grove

  1

  738

  Housing Association

  Number of Properties

  Larne and District

  34

  Malone

  18

  Newington

  13

  Oaklee

  14

  Open Door

  85

  RBL

  6

  Rural

  34

  Students

  76

  Tennent Street and District

  40

  Triangle

  5

  Ulidia

  46

  Willowfield

  28

  Woodvale and Shankill

  38

  Total

  901

  Surveys and. Consultants' Reports
  Mr. Beggs
  To ask the Secretary of State for Northern Ireland if he will publish details of all surveys and consultants' reports commissioned by Northern Ireland Electricity and the Department of Economic Development since 1985 and the cost to Northern Ireland Electricity and the Department of Economic Development of each survey or consultant's report.

  Mr. Atkins
  Information on surveys and consultants' reports commissioned by Northern Ireland Electricity since 1985 is not readily available in the form requested and could be compiled only at disproportionate cost.

  Information is not available on surveys and consultants' reports commissioned by the Department of Economic Development prior to 1988. Details of surveys and consultants' reports commissioned since then are as follows:

  Consultant

  Title of Survey/Report

  N. M. Rothschild/Coopers and Lybrand

  Feasibility Study of Privatisation of NIE

  Coopers and Lybrand

  Competition and Interconnection Study

  Review of NIE Performance Aims 1989/90

  Review of NIE Performance Aims 1990/91

  P. J. R. Management Organisation Consultants

  NIE Organisational Capability Review

  Ewbank Preece Ltd.

  Inspection of Generating Plant at Belfast West and Coolkeeragh

  Development of Power Station Site

  Touche Ross

  Advance Long Form Report Supplementary Privatisation Study

  Review of NI Capital Expenditure

  Details of fees paid to consultants are commercially confidential.

  Conductive Education
  Mr. Mallon
  To ask the Secretary of State for Northern Ireland what financial or administrative support has been offered by the Department of Education or the education
  739
  and library boards to the Conductive Therapy Primary School established in Dungannon; and if he will undertake to ensure that all suitable students requiring conductive education will have an opportunity to attend this school.

  Mr. Hanley
  None. The Department of Education understands that the Buddy Bear Trust is proposing to establish an independent school in Dungannon for children with motor disorders. Independent schools do not receive assistance from public funds, though they are required to comply with statutory procedures regarding registration. To date, no such application has been received. Education and library boards are responsible for identifying, assessing and determining the special educational provision for children with special educational needs. If a board considers that provision should be made other than at a grant-aided school, it is obliged to seek the Department's approval. In considering such a placement, the board and the Department would seek to establish that this best meets the child's special educational needs.

  Local Government Elections
  Mr. William Ross
  To ask the Secretary of State for Northern Ireland when he will announce the composition of district electoral areas for the local government elections in May 1993.

  Sir Patrick Mayhew
  I have today laid before Parliament the report of the District Electoral Areas Commissioner, Dr. Maurice Hayes, which contains his recommendations for the grouping of wards into district electoral areas for the purpose of local government elections in Northern Ireland. I have accepted the recommendations without modification and shall shortly bring forward for approval a draft Order in Council under section 38(1)(a) of the Northern Ireland Constitutional Act 1973 giving effect to the commissioner's recommendations.

ENVIRONMENT

  Energy Efficiency
  Mr. Colvin
  To ask the Secretary of State for the Environment when he last met the council of the Association for the Conservation of Energy; and if he will make a statement concerning the value he places upon the role of the association in the development of policies concerning the energy efficiency industry.

  Mr. Howard
  I refer my hon. Friend to the answer given on 26 November,Official Report, column 827.

  Business Rates
  Mr. Harvey
  To ask the Secretary of State for the Environment what steps he is taking to encourage local authorities to use their powers to reduce the burden of business rates in cases of hardship.

  Mr. Redwood
  Local authorities are able to offset 75 per cent. of the cost of granting hardship relief against the non-domestic rates pool. Guidance on the relief was issued to authorities in 1990, but discretion as to when, and whether, to use the powers lies entirely with them having regard to the interests of their community charge payers.

  Mr. Barry Field
  To ask the Secretary of State for the Environment what plans he has to introduce an incentive 740
  for local authorities to notify the Valuation Office of new non-domestic property in their area to ensure that rating lists are kept properly up to date.

  Mr. Redwood
  We have today laid regulations that will allow billing authorities to retain until the end of the year the benefit of any additional rates they collect when non-domestic property is improved or first included in the rating list. The new arrangements will apply from 1 April 1993. This will, I am sure, be a welcome incentive to local authorities.

  Housing
  Mr. Bell
  To ask the Secretary of State for the Environment what recent representations he has received regarding increasing the stock of rented accommodation; and if he will make a statement.

  Mr. Baldry
  I have received a number of representations from the National Federation of Housing Associations and others about the need to maintain output from the Housing Corporation's programme.

  My right hon. Friend the Chancellor of the Exchequer announced in his autumn statement plans to allocate around £6 billion to the Housing Corporation over three years from 1992–93. Over these years, housing associations will be able to provide considerably more than the 153,000 new social homes forecast in our election manifesto. Over the four years to 1995–96, the Government plan to provide £7·5 billion in support of the corporation's capital expenditure. In addition, we hope that associations will be able to attract a further £3 billion from the private sector.

  Mr. Bell
  To ask the Secretary of State for the Environment how many new housing association properties have been made available in(a) England and (b) Wales in each year since 1974.

  Mr. Baldry
  New housing for rent made available by housing associations in England and Wales since 1974–75, with subsidy from the Housing Corporation and Tai Cymru—from 1989–90—has been as follows:

  England

  Wales

  1974–75

  242

  4

  1975–76

  4,288

  105

  1976–77

  10,260

  355

  1977–78

  20,521

  644

  1978–79

  23,782

  1,057

  1979–80

  20,693

  1,534

  1980–81

  25,956

  1,173

  1981–82

  20,014

  2,328

  1982–83

  21,637

  2,115

  1983–84

  20,658

  1,535

  1984–85

  25,335

  1,487

  1985–86

  21,329

  1,520

  1986–87

  19,981

  1,424

  1987–88

  18,183

  1,767

  1988–89

  13,925

  1,662

  1989–90

  17,728

  2,442

  1990–91

  19,843

  3,060

  1991–92

  25,815

  3,548

  These figures include housing made newly available for rent when tenants take advantage of grants to help them to move into owner occupation.

  Mr. Bell
  To ask the Secretary of State for the Environment how many families were housed in
  741
  temporary bed-and-breakfast accommodation by local authorities in (a) England and (b) Wales in each year since 1985; and if he will make a statement.

  Mr. Baldry
  Estimates of the average number of households who were being dealt with under the homelessness provisions of the Housing Act 1985 and were temporarily placed in bed-and-breakfast accommodation in England are as follows:

  Averages for years ending September

  Households in bed and breakfast

  1985

  4,250

  1986

  6,350

  1987

  9,970

  1988

  11,240

  1989

  11,550

  1990

  11,960

  1991

  12,470

  1992

  11,880

  For information about Wales I refer the hon. Member to my right hon. Friend the Secretary of State for Wales.

  Mr. Bell
  To ask the Secretary of State for the Environment how much was spent by local authorities in(a) England and (b) Wales in each year since 1985 on the provision of temporary bed-and-breakfast family accommodation.

  Mr. Baldry
  The net cost to local authorities since 1985 of providing bed-and-breakfast accommodation in England was as follows:

  Net expenditure (£ million)

  1985–86

  33·9

  1986–87

  75·5

  1987–88

  104·5

  1988–89

  90·2

  1989–90

  72·6

  1990–91

  66·3

  For information about Welsh authorities I refer the hon. Member to my right hon. Friend the Secretary of State for Wales.

  London Residuary Body
  Mr. Tony Banks
  To ask the Secretary of State for the Environment, pursuant to his answer of 3 December,Official Report, column 295, for what period Mr. Wallace Mackenzie, Mr. Michael Roberts, Mr. Jack Wolkind and Sir Godfrey Taylor have been reappointed to the board of the London residuary body.

  Mr. Robin Squire
  Mr. Mackenzie, Mr. Roberts and Mr. Wolkind have not yet been reappointed. Sir Godfrey Taylor has been reappointed to serve until 31 March 1995 or until the winding up of the London residuary body, whichever is the sooner.

  Market-testing
  Mr. Wilshire
  To ask the Secretary of State for the Environment to which of those of his Department's activities due to be market-tested by 30 September 1993 742
  the Transfer of Undertakings (Protection of Employment) Regulations 1981 and the EC acquired rights directive 77/189/EEC will apply.

  Mr. Redwood
  [holding answer 9 December 1992]: It is too early to say whether the EC acquired rights directive 77/187 and the Transfer of Undertakings (Protection of Employment) Regulations 1981—TUPE—will apply to any of the Department's activities due to be market-tested before 30 September 1993. The nature, scope and terms and conditions for market-testing each activity will be carefully considered in a case-by-case basis by the Department's legal advisers to determine whether they amount simply to contracting-out, or involve the transfer of an undertaking or part of an undertaking to which the TUPE regulations will apply.

  Mr. Wilshire
  To ask the Secretary of State for the Environment if he will publish a timetable showing when he plans to market-test those activities listed for testing before 30 September 1993.

  Mr. Redwood
  [holding answer 9 December 1992]: Market-testing of the following activities, of which the main ones are listed under my Department in Cm 2101, is expected to have been completed by the end of September 1993:

  Accommodation Facilities Management

  Accountants

  Central Reprographics

  Conveyancing

  Design, Drawing and Print Services

  Economists

  Professional Property Services

  Registry Services

  Statistical Support Services

  Training

  Travel Services

  Workshops and Stores

  All these market-testing exercises are well under way and are proceeding as planned. The Department expects to invite tenders for these functions in the period February to June 1993 if they are shown to be viable areas for testing following the more detailed investigations into the scope for market-testing which are now under way.

  City Action
  Mr. Milburn
  To ask the Secretary of State for the Environment what were the budget allocations made to each city action team by his Department for each year from 1989–90(a) at current prices and (b) at 1989–90 prices.

  Mr. Robin Squire
  [holding answer 9 December 1992]: I refer the hon. Member to my answer of 23 June 1992, Official Report, column 132. The 1987–88 prices quoted can be converted into 1989–90 prices by multiplying by 1·143. For 1992–93 £4·0 million of the special budget was transferred to support city challenge round 1. Provisional allocation of the £4·4 million balance for 1992–93 is as follows:

  City Action Team

  Provisional Allocation £000

  Nottingham/Leicester/Derby

  500

  Liverpool

  500

  London

  900

  Tyne and Wear

  500

  Leeds/Bradford

  500

  743

  City Action Team

  Provisional Allocation £000

  Birmingham

  500

  Manchester/Salford

  500

  Cleveland

  500

  Total

  4,400

  Earth Summit
  Mr. Meacher
  To ask the Secretary of State for the Environment what action he has taken on the preparation of a national plan based on the forest principles agreed at the United Nations Conference on Environment and Development.

  Sir Hector Monro
  [holding answer 7 December]: I have been asked to reply.

  The guiding objective of the forest principles is to contribute to the management, conservation and sustainable development of forests and to provide for their multiple and complementary functions and uses. These principles already underlie the Government's forestry policy, the various elements of which were drawn together and published in a single statement in September 1991. This set the framework for the development of forestry in Britain.

  The Government have now started preparing their national plan for the implementation of the forest principles. This will be published before the end of 1993.

  Shrewsbury Castle (Bombing)
  Mr. Conway
  To ask the Secretary of State for the Environment what advice and assistance he has given to Shrewsbury and Atcham borough council following the IRA bombing in August of Shrewsbury castle.

  Mr. Kenneth Clarke
  I have been asked to reply.

  Advice on the protective security of buildings is available from chief officers of police. In Great Britain, where insurance cover is available in respect of criminal damage to property, including damage caused by acts of terrorism, the Government do not provide any financial assistance.

TRADE AND INDUSTRY

  East Sussex
  Mr. Bowden
  To ask the President of the Board of Trade what assistance is available to stimulate economic development and attract investment to(a) the borough of Brighton, (b) the coastal area between Hove and Hastings in East Sussex and (c) the county of East Sussex.

  Mr. Sainsbury
  Businesses in these areas have access to a wide range of assistance provided by my Department with the support of the Sussex training and enterprise council. DTI services include the enterprise initiative, offering expert advice on different aspects of business development, " Managing in the 90s" and other support providing grants for the development of innovative ideas and projects. Help for exporters is available from overseas trade services operated by the DTI. The Federation of 744
  Sussex Industries, local enterprise agencies and other local business support organizations deliver a wide range of business services to Sussex companies.

  My Department maintains regular contact with local authorities in East Sussex over economic development issues and inward investment opportunities.

  Wind-generated Electricity
  Mr. Alex Cathie
  To ask the President of the Board of Trade what proposals he has to increase the generation of wind-generated electricity in Wales; and if he will make a statement.

  Mr. Eggar
  Wind-generated electricity is being implemented in Wales with support from the non-fossil fuel obligation. Two wind farms have recently become operational with an installed capacity of 14·4 MW. A further five wind farms with an installed capacity of 46·4 MW are currently under construction and expected to be delivering electricity to the grid within the next six months.

  Post Office
  Mr. Welsh
  To ask the President of the Board of Trade what representations he has received on the future of Post Office services; and if he will make a statement.

  Mr. Leigh
  I have received a number of representations from interested parties and the general public on the future of Post Office services.

  I have held, or am due to hold, meetings with the following in connection with the review of the structure and organisation of the Post Office: the Post Office, the Post Office Users National Council, Union of Communication Workers, National Communications Union, Communications Managers Association, National Union of Civil and Public Servants, Post Office Unions Council, the National Federation of Sub-Postmasters, the Association of International Courier and Express Services, TNT Express (UK), DHL International (UK) Ltd., Securicor Omega Express, Britdoc, Mail Users Association, Direct Marketing Association, Periodical Publishers Association, British Printing Industries Federation, European Mail and Express Services Users Association.

  In addition, my officials and consultants appointed to advise the Government have met Business Post, Electronic Equipment Association, Mail Order Traders Association, BT, Girobank and other Government Departments.

  Mr. Welsh
  To ask the President of the Board of Trade when he intends to complete the review of the organisation and structure of the Post Office and to publish his recommendations.

  Mr. Leigh
  Work is continuing on the Post Office review. No date for completion has been set. The Government will announce their conclusions in due course.

  Mr. Welsh
  To ask the President of the Board of Trade what representations he has received on the Green Paper on the development of the single market for postal services; and if he will make a statement.

  Mr. Leigh
  I refer the hon. Gentleman to the answer given to my hon. Friend the Member for Gloucester (Mr. French) on 18 November,Official Report, column 226.
  745
  Mr. Hain
  To ask the President of the Board of Trade what reasons underlie the increase in the Post Office's negative external financial limit from 1992–93 to 1993–94; and if he will make a statement.

  Mr. Leigh
  At a time when there is very great pressure on the public sector borrowing requirement, it is reasonable that the Government should look for a higher level of return from the Post Office.

  Petroleum Engineering Directorate
  Mr. Robert Hughes
  To ask the President of the Board of Trade if he will publish the independent consultants' report into the transfer of the petroleum engineering directorate from London to Aberdeen.

  Mr. Eggar
  Decisions on this report will be announced as soon as possible. It is certainly my intention to publish it.

  Mineral Rights
  Mr. Gunnell
  To ask the President of the Board of Trade what will become of British Coal's mineral rights upon privatisation.

  Mr. Eggar
  Decisions on privatisation will have to take account of the coal review and the debate on the White Paper in the new year.

  Export Controls
  Mr. Hague
  To ask the President of the Board of Trade when he intends to update the Export of Goods (Control) Order 1991.

  Mr. Needham
  A revised Export of Goods (Control) Order has been made and sent today to the Joint Committee on Statutory Instruments and laid in the Library of both Houses. It will implement changes to export controls agreed in international forums and introduce a requirement for users of some open general export licences to register with the Department of Trade and Industry. It will come into force on 31 December 1992.

  Sales Promotions
  Mr. Nigel Griffiths
  To ask the President of the Board of Trade what steps he is taking to safeguard consumers by ensuring that offers of free flights from retailers and manufacturers as part of sales promotions are genuine.

  Mr. Leigh
  [holding answer 2 December 1992]: Sales promotions involving the offer of free flights are already subject to a number of controls, both statutory and voluntary.

  My Department takes the view that a false statement as to the provision of free flights could constitute an offence under the Trade Descriptions Act 1968 and a false statement that a service is free could constitute an offence under part III of the Consumer Protection Act 1987. Trading standards officers are responsible for enforcing the legislation.

  Under the voluntary system of controls in advertising and sales promotion, the codes of practice administered by the Advertising Standards Authority—ASA—require all sales promotion material to be legal, decent, honest and truthful. Where someone has reason to believe that a free-flight offer may not be genuine, he should take the matter up with the relevant authorities.
  746
  I do not consider that any additional controls over offers of free flights are necessary at the present time.

  Mr. Nigel Griffiths
  To ask the President of the Board of Trade if his inspectors will investigate current offers of free flights and report to him on(a) the supply of flights meeting the demand generated by the purchase and (b) the financial security of the firms responsible for providing the flights.

  Mr. Leigh
  [holding answer 2 December 1992]: No. Under the British code of sales promotion practice, promoters are required to take all reasonable steps to avoid disappointing the consumer. This includes ensuring that a reasonable estimate of the likely response to a promotion is made before consumers are invited to participate. The ASA regularly reminds advertisers that consumers should be able to understand without difficulty what offers consist of and any restrictions imposed on them.

  British Steel
  Mr. Austin Mitchell
  To ask the President of the Board of Trade what representations he has made to the American Government to secure the withdrawal of the anti-dumping tariff imposed on British Steel on 30 November.

  Mr. Sainsbury
  [holding answer 4 December 1992]: I am not aware of any anti-dumping tariff imposed on British Steel on 30 November.

  Motor Cycles
  Mr. Milburn
  To ask the President of the Board of Trade if he will list the makes and models of motor cycles of over 100 bhp currently sold in the United Kingdom, indicating the numbers of each model sold and the value of sales in the last year for which figures are available.

  Mr. Sainsbury
  [holding answer 7 December 1992]: The data requested about makes and models of motor bikes over 100 bhp is not collected either by the Government or the Motor Cycle Industry Association.

  Shipbuilding Industry
  Mr. Wareing
  To ask the President of the Board of Trade if he will seek European intervention fund assistance to resuscitate the British shipbuilding industry; and if he will make a statement.

  Mr. Eggar
  [holding answer 9 December 1992]: The shipbuilding intervention fund is already available to merchant shipbuilders in the United Kingdom. Our agreement with the European Commission forbids the provision of subsidy to those companies which were privatised as warship builders.

NATIONAL HERITAGE

  Television Licence Fee
  Mr. Madden
  To ask the Secretary of State for National Heritage, pursuant to his reply to the hon. Member for Bradford, West on 19 November 1992,Official Report, column 316, if he will increase the value of the reduction in television licence fee available for all registered blind people.
  747
  Mr. Brooke
  No.

  Windsor Castle
  Mr. Mackinlay
  To ask the Secretary of State for National Heritage, if he will list and give details of the vehicles belonging to the Windsor Castle fire brigade over the past three years, with the date of each vehicle's disposal and date and details of replacement.

  Mr. Brooke
  [holding answer 3 December 1992]: In November 1989, the Windsor Castle fire brigade retained three vehicles, a "Firefly", custom-built fire fighting vehicle originally purchased by the Property Services Agency but now the property of the royal household, and two Land-Rovers. One Land-Rover was replaced in February 1991 with a Ford Transit personnel carrier which was itself replaced in March 1992 by a Leyland DAF Crewbus. The other Land-Rover was 12 years old and withdrawn from service in November 1991. The vehicles currently in use by the castle fire brigade are the Firefly and the Leyland DAF Crewbus.

PRIME MINISTER

  Energy Policies
  Mr. Llew Smith
  To ask the Prime Minister what progress has been made in the development of(a) coal policy, (b) renewable energy policy, (c) nuclear research and development policy and (d) energy conservation policy in the European Community during the United Kingdom presidency of the European Council.

  The Prime Minister
  The Energy Council discussed European coal issues on 30 November, during which the Commission presented its new proposals on subsidies for coal mines. The Council agreed on the text of a decision intended to foster the development of new and renewable energy sources. The Council noted the progress officials had made in discussing a proposed directive designed to increase energy efficiency in buildings, industry and road vehicles. The Council had earlier adopoted a directive on energy labelling of appliances. Progress on nuclear R and D was satisfactory.

  Exchange Rate Mechanism
  Mr. Llew Smith
  To ask the Prime Minister what progress has been made in consolidation of the exchange rate mechanism during the United Kingdom presidency of the European Council.

  The Prime Minister
  Following the severe financial turbulence which affected a number of ERM currencies in the autumn, I called the European Council in Birmingham on 16 October. This decided that the mechanism should be analysed in the light of developments in capital markets and in the European and world monetary systems. The work was remitted to ECOFIN. Further strains have recently confirmed the need for this work.

  Sees and Titles
  Mr. Peter Bottomley
  To ask the Prime Minister (1) pursuant to his answer to the hon. Member for Eltham of 18 May,Official Report, column 5, whether the consultation of Church authorities includes the Catholic Bishops Conference of England and Wales;
  748
  (2) what changes he proposes to official recognition of territorial sees of the Roman Catholic Church in Scotland or, in so far as restrictions apply, in Northern Ireland;

  (3) when he expects to propose changes to official recognition of territorial sees and titles of the Roman Catholic Church in England and Wales.

  The Prime Minister
  Consultations with Church authorities and others about the official recognition of Roman Catholic territorial designations within the United Kingdom are making good progress but have not yet been completed. We shall be seeking the views of the relevant Roman Catholic authorities as part of that consultation.

  President de Klerk
  Mr. Redmond
  To ask the Prime Minister if he will place in the Library the documents he received from President de Klerk during the President's recent visit to the United Kingdom.

  The Prime Minister
  No, as the correspondence involves matters of national security.

  Civil List
  Mr. Alan Williams
  To ask the Prime Minister what is the time-lag between the annual payments into the civil list and the reinvestment of specified annuities to the Consolidated Fund.

  The Prime Minister
  If the right hon. Member is referring to Her Majesty's reimbursement of the Consolidated Fund for the section 3 annuities, refunds are normally made each November, for payments made during the course of the calendar year. The timing follows that of the first voluntary reimbursement by Her Majesty in November 1975.

  Mr. Alan Williams
  To ask the Prime Minister if interest on the early-years surpluses on the civil list under the current 10-year agreement is retained within the civil list.

  The Prime Minister
  Yes. Any surplus at the end of the 10-year period would be carried forward and taken account of in the settlement for the next period.

  Mr. Alan Williams
  To ask the Prime Minister what investments the royal trustees consider appropriate for the early-year surpluses on the civil list.

  The Prime Minister
  The surpluses are prudently invested in the United Kingdom from within a range approved by the royal trustees.

  Correspondence
  Mr. Winnick
  To ask the Prime Minister what is the policy adopted by Ministers if hon. and right hon. Members request that replies to letters concerning constituents abroad come from Ministers and not from chief executives or departmental heads of agencies.

  The Prime Minister
  The Government's policy on dealing with letters from hon. and right hon. Members on agency matters was most recently set out in the Government's reply to the Treasury and Civil Service Committee's 1990 report on the next steps initiative, Cm 1263, which said:
  749
  "It is for Ministers responsible for particular Agencies to respond in the way they consider most helpful and appropriate to inquiries raised by Members. Ministers will normally ask the Chief Executive to reply to letters which concern day-to-day operational matters delegated to the Agency."

  The fact that a Member's inquiry was made on behalf of a constituent who lived abroad would not in itself provide a reason to change this approach.

  Alois Brunner
  Mr. Winnick
  To ask the Prime Minister if he will discuss with his counterparts in the European Council a joint approach to the Syrian Government in support of Germany's request for the extradition of Alois Brunner for Nazi war crimes against humanity.

  The Prime Minister
  The case of Alois Brunner is not on the agenda for the European Council. Member states are aware of the continuing strength of feeling behind calls for his extradition. Most recently, Germany has made clear to Syria its own and wider European concerns on this matter.

SOCIAL SECURITY

  Pensions Ombudsman
  Mr. French
  To ask the Secretary of State for Social Security (1) what plans he has(a) to appoint additional pensions ombudsmen on a regional basis and (b) to increase the resources allocated to the present pensions ombudsman;

  (2) what plans he has to increase funding to the office of the pensions ombudsman.

  Miss Widdecombe
  We have no plans to appoint additional pensions ombudsmen. Resources are allocated to the pensions ombudsman taking account of projected workloads and costs. These are reviewed from time to time as part of the normal process of reviewing public expenditure.

  Disabled Employees
  Mr. Elletson
  To ask the Secretary of State for Social Security how many(a) physically disabled and (b) sensorily disabled people are employed in his Department; and what percentage they are of the total work force.

  Mr. Burt
  On 1 July 1992 the number of registered disabled staff employed in this Department was 1,484, which represented 1·7 per cent. of the total number of staff in post.

  Notes:

  1. Figures are not available for non-registered disabled staff.

  2. Full details of the breakdown of figures between physically and sensorily disabled staff are not available.

  Benefits Statistics
  Ms. Ruddock
  To ask the Secretary of State for Social Security if he will publish a table showing total spending on single payments in each year since 1985 and community care grants since 1988 in cash and real terms.

  Mr. Burt
  Details of community care grant expenditure in both cash and real terms are in the Library.

  Single payment expenditure is in the table.
  750

  £ million

  Total expenditure

  Real terms expenditure

  1985–86

  335

  504

  1986–87

  330

  481

  1987–88

  214

  296

  Note:

  Real terms figures have been calculated using the GDP deflator and may alter.

  Occupational Social Security Schemes
  Mr. Lidington
  To ask the Secretary of State for Social Security if he will make a statement about the implementation of schedule 5 to the Social Security Act 1989 and paragraph 7 of schedule 4 to the Social Security Act 1990.

  Miss Widdecombe
  These provisions were designed to give effect to EC directive 86/378 on equal treatment in occupational social security schemes which was due to be implemented by 1 January 1993. However the European Court of Justice held in the Barber case on 17 May 1990 that occupational pensions are pay and must be equal under article 119 of the EC treaty. This has left considerable areas of uncertainty, including questions as to the status of the directive and the validity of the derogations it would have allowed. We expect the Coloroll case, which is currently before the European Court of Justice, to begin to resolve some of these uncertainties. I have, therefore, decided not to bring schedule 5 to the 1989 Act into force with effect from 1 January 1993 but to introduce legislation, amended as necessary, when the uncertainties are resolved. I shall consider the implementsation of paragraph 7 of schedule 4 to the 1990 Act in the context of this legislation and of any consequential review of provisions relating to contracting out.

  Wages Councils
  Mr. Dobson
  To ask the Secretary of State for Social Security what estimates his Department have made of the increased entitlements to benefits which will result from the abolition of wages councils.

  Mr. Burt
  I refer the hon. Member to my reply to the hon. Member for Glasgow, Garscadden (Mr. Dewar) on 11 November, at column 817.

EDUCATION

  Primary Schools, Kent
  Mr. Bell
  To ask the Secretary of State for Education (1) how many children(a) under eight years and (b) eight to 11 years of age are in (i) local authority schools, (ii) independent schools and (iii) grant-maintained schools in each local education area in Kent;

  (2) how many places are available at the present time and how many places will be available at 1 April 1993 for children (a) under eight years and (b) eight to 11 years of age in (i) local authority schools, (ii) independent schools and (iii) grant-maintained schools in each local education area in Kent.

  Mr. Forth
  This information is not available centrally.

  Thomas Becket School, Knowsley
  Mr. O'Hara
  To ask the Secretary of State for Education if he will undertake an investigation of the drawing of the pupils of Thomas Becket school, Knowsley, into the debate on that school's opting out; and if he will make a statement.

  Mr. Forth
  My right hon. Friend has received no complaint about the drawing of pupils into the debate about grant-maintained status for Thomas Becket school.

  Grant-maintained Schools
  Mr. O'Hara
  To ask the Secretary of State for Education if he will introduce guidance for the conduct of ballots in respect of applications for grant-maintained schools under which head teachers or staff would be prohibited from suggesting to parents or pupils that a vote against grant-maintained status would involve(a) the loss of particular teachers' jobs or (b) difficulty for certain pupils in completing their GCSE and A-level courses.

  Mr. Forth
  My right hon. Friend issues, and from time to time updates, guidance on the overall conduct of ballots. In addition, the Department's letter of 3 November reminded local education authorities and other bodies, what in his view are the proper duties and responsibilities of the parties involved in the ballot process. We would expect representatives of LEAs and schools involved in ballots in respect of applications for grant-maintained status to act responsibly and professionally.

LORD CHANCELLOR'S DEPARTMENT

  Commercial Court
  Sir Thomas Arnold
  To ask the Parliamentary Secretary, Lord Chancellor's Department what steps are being taken to appoint an additional commercial judge to restore the full complement in the commercial court.

  Mr. John M. Taylor
  Mr. Justice Colman, who was yesterday appointed to the Queen's Bench Division of the High Court, has been nominated to be a judge of the commercial court.

AGRICULTURE, FISHERIES AND FOOD

  Hill Livestock Compensatory Allowances
  Mr. Liwyd
  To ask the Minister of Agriculture, Fisheries and Food if he will make a statement about the future of HLCA payments.

  Mr. Gummer
  United Kingdom Agriculture Ministers have completed the autumn review of economic conditions in the hills and uplands.

  The review has shown that the average net farm income of livestock producers in the United Kingdom's hill and upland areas is forecast to show a significant rise for the second year running. Specialist sheep farmers in Great Britain are seeing a large increase in their incomes as a result of the strong market for store lambs and increased returns from the ewe premium and the special supplement payable on ewes kept in the less-favoured areas—LFA.
  752
  Hill sheep farmers' receipts will be further boosted by an increase in the annual ewe premium of about £1·70 per ewe under the 1992 scheme as a consequence of the green pound devaluations which have already taken place. Although this will be partly offset by higher input costs, any further devaluations at the beginning of next year as a result of revised agrimonetary arrangements would provide an additional boost.

  As a consequence of these favourable developments, the rates of hill livestock compensatory allowances—HLCA—paid on sheep in the severely disadvantaged areas—SDA—of the LFA are considered to be greater than is necessary to compensate for the permanent natural handicaps of farming in those areas. These rates will accordingly be reduced by £2·25 to £6·50 per eligible ewe for hardy breed ewes and by £1·30 to £3·60 per ewe for other breeds in the SDA for the 1993 scheme.

  We will, however, be sustaining HLCA rates for breeding cows at their current levels of £63·30 per eligible cow in the SDA and £31·65 per cow in the disadvantaged areas. The rate payable on eligible ewes in those areas will be adjusted upwards to bring it into line with the EC rules. The precise rate will depend upon the value of the green pound on 1 January 1993 and we will announce it shortly thereafter.

  A statutory instrument giving effect to these new rates will be introduced early in the new year. Payments of claims will commence as quickly as possible thereafter.

  The environmental initiative for the LFA which I announced last February is being sustained. A new definition of overgrazing has been included in the HLCA regulations to enable problems of serious overgrazing to be tackled more effectively. We shall be seeking powers from Brussels during 1993 to apply similar rules to the ewe premium. All HLCA applicants have been sent a free copy of the code of good upland management. Thirteen new upland environmentally sensitive areas in the United Kingdom have been announced, a focus of which will be the protection and enhancement of heather moorland. In addition, I secured in the common agricultural policy reform package provision for a livestock extensification scheme which we would expect to use primarily to deal with overgrazing in the LFA.

  This series of measures is designed to tackle overgrazing in a cost-effective and equitable manner by focusing upon the areas where the problem occurs. The scaling of HLCAs remains a possible additional measure which we will keep under review.

  Milk
  Mr. Heald
  To ask the Minister of Agriculture, Fisheries and Food what measures his Department proposes to implement EC requirements concerning standardised milk and milk imports.

  Mr. Curry
  Following consultation with interested parties, the Government have today laid before Parliament regulations that will permit the production and sale of both standardised milk in England and Wales. Similar regulations are being made in Scotland and Northern Ireland. The Milk and Dairies (Standardisation and Importation) Regulations 1992, which will come into force on 1 January 1993, also implement single market measures relating to intra-Community trade in milk. They will remove the present requirement for checks to be made at the port of entry for milk entering England and Wales
  753
  from other member states and will allow such imports of raw and thermised milk provided they are heat treated before they are sold to consumers. Regulations to amend the milk marketing schemes in Great Britain to put standardised milk within the milk marketing board's monopoly buying powers have also been laid.

  Dietary Supplements
  Mrs. Wise
  To ask the Minister of Agriculture, Fisheries and Food whether he expects the forthcoming European directive on dietary supplements to include vitamin C in(a) tablet, (b) liquid or (c) powder form; and what steps are being taken by his Department to ensure that British consumers continue to have access to vitamin, mineral and other dietary supplements of their choice in those cases where no problems arising from self-overdosing have been recorded.

  Mr. Soames
  The discussion paper produced by the European Commission in advance of proposals for a directive did not deal in detail with individual vitamins. I have no further information on what the Commission may propose.

  Mrs. Wise
  To ask the Minister of Agriculture, Fisheries and Food what steps have been taken by his Department to seek to identify other member Governments of the European Community which will agree to adopt his Department's position in respect of the forthcoming European directive on dietary supplements.

  Mr. Soames
  We have established the broad views of other member states in discussion in Brussels and through bilateral contacts. We will seek to persuade others of the merits of the United Kingdom case as negotiations proceed.

  Mrs. Wise
  To ask the Minister of Agriculture, Fisheries and Food what recent representations he has received concerning the conclusions of the Denner report; and what consideration he is giving to those representations.

  Mr. Soames
  I have received 63 representations on the Denner report in total. These have been considered and were taken into account in shaping our proposal submitted to the Commission earlier this year.

  Mrs. Wise
  To ask the Minister of Agriculture, Fisheries and Food if he will make a statement on the current state of progress on the Denner report commissioned by his Department on dietary supplements.

  Mr. Soames
  Action on most of the recommendations in the Denner report is dependent on the introduction of Community legislation on dietary supplements. We are awaiting Commission proposals in this area.

  Disabled Employees
  Mr. Elletson
  To ask the Minister of Agriculture, Fisheries and Food how many(a) physically disabled and (b) sensorily disabled people are employed in his Department; and what percentage they are of the total work force.

  Mr. Curry
  Counting part-time staff as half units, MAFF and its agencies employ 138·5 registered disabled 754
  staff. These figures represent 1·4 per cent. of total staff but do not take into account staff with disabilities who have chosen not to register. Information to distinguish between staff with physical or sensory disabilities is not held centrally.

  Meat Inspections
  Mr. Robathan
  To ask the Minister of Agriculture, Fisheries and Food what assessment he has made of the extent of breakdown in hygiene in the food chain and the effect of replacing the current system of meat inspection by one of veterinary inspection.

  Mr. Soames
  The state veterinary service visits all licensed domestic slaughterhouses annually to check on compliance with existing meat hygiene legislation. Any hygiene problems noted during these visits are drawn to the attention of the local authority, which is currently responsible for enforcing the legislation.

  These monitoring visits demonstrate that standards of hygiene and inspection in the domestic slaughterhouses are in general lower than in export-approved abattoirs which are already operating to the EC standards and which handle about half the meat produced in this country. The Government therefore supported the single market fresh meat directive which requires all meat to be produced to common standards of hygiene and inspection. Most post-mortem inspection will continue to be done by qualified meat inspectors, working under the supervision of the Official Veterinary Surgeon. The Government consider that veterinary supervision of all slaughterhouses will lead to an improvement in the protection of human and animal health and animal welfare. In the longer term, the proposed national meat hygiene service will provide a consistent and cost-effective inspection service in this specialised sector of the food chain, to the benefit of consumers and of the meat industry.

  Sustainable Agriculture
  Mrs. Anne Campbell
  To ask the Minister of Agriculture, Fisheries and Food what assessment he has made of the standards and regulations which need to be defined for the United Kingdom and the EC in order to provide a basis for sustainable agriculture; and if he will make a statement.

  Mr. Curry
  "Promoting Sustainable Agriculture and Rural Development" is the title of one chapter of "Agenda 21" which was agreed at the Earth Summit in June. The United Kingdom's response to "Agenda 21" will be covered in a report to the Sustainable Development Commission which will be submitted by the end of 1993. The Department will be contributing to this report as appropriate.

  Poultry
  Mr. Harvey
  To ask the Minister of Agriculture, Fisheries and Food what assessment he has made of the effects of low-flying aircraft on poultry farming.

  Mr. Soames
  The Department has made no general assessment of the effects of low-flying aircraft on poultry farming. However, when requested we provide advice to the Ministry of Defence Claims Commission on the veterinary aspects of individual incidents.

  Tongues
  Mr. Conway
  To ask the Minister of Agriculture, Fisheries and Food what is his estimate of the job losses in the British ox tongue processing industry as a result of the EC ban on the importation into the Community of North American supplies.

  Mr. Curry
  There is no ban on the importation into the Community of North American ox tongues as such. The import into the European Community of products derived from animals which have been treated with growth promoting hormones is, however, banned. Accurate figures on the number of jobs lost in the British ox tongue processing industry directly as a result of the ban on the use of growth promoting hormones are not available. However, since the ban was introduced, the canning industry has reported a reduction of 280 jobs.

  Mr. Conway
  To ask the Minister of Agriculture, Fisheries and Food what representations he has made to the European Commission on the import of raw beef tongues from North America into the United Kingdom.

  Mr. Curry
  We strongly opposed the ban on growth promoting hormones throughout the Community when it was introduced in 1989. This included writing directly to the European Agriculture Commissioner on the impact that the ban would have on canners of tongues in the United Kingdom.

  General Agreement on Tariffs and Trade
  Mr. Ancram
  To ask the Minister of Agriculture, Fisheries and Food what assessment he has made of the effect the recent GATT agreement between the United States of America and the EC and the proposed reduction in export subsidies will have on cereal prices in the United Kingdom.

  Mr. Curry
  None. As the EC Commission has made clear, the agreement on agricultural issues reached with the United States in the context of the current GATT round is consistent with the reforms to common agricultural policy regimes agreed earlier this year.

  Mr. Ancram
  To ask the Minister of Agriculture, Fisheries and Food what assessment he has made of the effect the recent GATT agreement between the United States of America and the EC will have on exports of British cereal crops to non-EC countries.

  Mr. Curry
  None. As the EC Commission has made clear, the agreement on agricultural issues reached with the United States in the context of the current GATT round is consistent with the reforms to CAP regimes agreed earlier this year.

  Mr. Ancram
  To ask the Minister of Agriculture, Fisheries and Food what assessment he has made of the effect the recent GATT agreement between the United States of America and the EC will have on the percentage of land compulsorily set aside under the CAP.

  Mr. Curry
  The recent agreements between the United States and the EC on GATT agriculture questions pave the way for an overall agreement which will include restrictions on subsidised exports of cereals. The Commission does not consider that these restrictions 756
  should in themselves lead to any increase in the percentage of land set aside under the new arable arrangements adopted earlier this year as part of the CAP reform package.

  The agreements also provide for a separate oilseeds base area for the 1994 and subsequent harvests. The set-aside percentage for this base area will continue to be the same as for other crops covered by the new arable arrangements, subject to a minimum set-aside requirement of 10 per cent. The current requirement under the arable regime is 15 per cent.

  Animal Transport
  Mr. Bowden
  To ask the Minister of Agriculture, Fisheries and Food (1) what steps he plans to take to ensure that, as required by article 5·2 of the new EC directive on the protection of animals during transport (91/628/EEC), itineraries are drawn up for animal transport journeys exceeding 24 hours to ensure that the animals are rested and given food and water;

  (2) whether he will require his officials from 1 January 1993 to ensure that the animal welfare requirements of EC directive on the protection of animals during transport (91/628/EEC) have been taken into account before issuing health certificates under directive 90/425/EEC for animals being transported from the United Kingdom to other countries.

  Mr. Gummer
  [pursuant to the reply, 17 June 1992, c. 575]: EC directive 91/628 sets a framework of controls which are to be supplemented by additional Community rules. Commission proposals for these additional rules are still awaited and it is now clear that they will not be in place by 1 January 1993 when the directive is to be implemented. In this situation, the directive permits national measures to apply in the relevant areas pending implementation of the further Community rules.

  The draft order to implement the directive in Great Britain was circulated for consultation at a time when the prospects for further Community measures remained unclear. It will now be revised so that national measures in the relevant areas will continue to apply.

  The legislation will require animals beginning a journey in Great Britain to be rested, fed and watered after a maximum of 15 hours. Animals will also have to be fed and watered, as appropriate for the species, before the start of the journey. The current requirements for animals for export to be rested and inspected near the port will no longer apply, but there will be a requirement for inspection of export consignments at the place of origin by a veterinary surgeon. Where the directive lays down new requirements—for example, the requirement for the transport of animals and birds by air to comply with the International Air Transport Association live animals regulations—these will be applied. In areas where further Community rules are awaited, such as the design of vehicles, existing rules will continue to apply.

  The legislation will give powers to inspectors to prevent journeys if the requirements, including those relating to feeding and watering arrangements, are not met.

  Much concern has been expressed about further controls on animal transport. There have been fears that when the directive is implemented on 1 January 1993 much of our existing law could be removed. This will not happen. We will take full advantage of the provision in the directive for national rules to continue to apply pending

  757
  the adoption of further Community measures. I have discussed this matter in detail with the Royal Society for the Prevention of Cruelty to Animals and am delighted to have its full support for the steps we will be taking.

  The Government will continue to press for the outstanding issues to be resolved in the Community as soon as possible. In the meantime, the arrangements in the United Kingdom will provide a comprehensive system of controls to safeguard the welfare of animals in transport.

FOREIGN AND COMMONWEALTH AFFAIRS

  European Union Treaty
  Mr. Spearing
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will publish a table showing in respect of each lettered article of the treaty on European union, the relevant international, Community or domestic court having final jurisdiction in respect of the matters contained in, and interpretation of, each article.

  Mr. Lennox-Boyd
  Article L of the treaty on European union indicates that the European Court of Justice--ECJ—shall only have jurisdiction in respect of those provisions amending the existing treaties, as set out in articles G to I, the final provisions—articles L to S—and any conventions concluded between states under article K.3(2)(c) which expressly give jurisdiction to the ECJ. Any questions concerning the interpretation of the common provisions—articles A to F—the provisions on a common foreign and security policy—article J—and the provisions on co-operation in the fields of justice and home affairs—article K—will be decided in accordance with the principles of international law. The high contracting parties may refer any dispute to the International Court of Justice—either by special agreement or where the states concerned have accepted the ICJ's compulsory jurisdiction—or to ad hoc arbitration.

  Mullai Marimuthu
  Mr. Tony Banks
  To ask the Secretary of State for Foreign and Commonwealth Affairs what efforts are being made by his Department to ascertain the whereabouts and welfare of Mullai Marimuthu, off 67 Lund point, Stratford, E15, currently held against her will in Madurai, Tamil Nadu.

  Mr. Lennox-Boyd
  Mullai Marimuthu is staying at her uncle's house in Madurai. A consular officer had planned to visit Madurai on 10 December to meet the British community, including Marimuthu. However, all flights in Tamil Nadu have been cancelled because of current disturbances. A consular official will visit Madurai as soon as practicable.

  Falkland Islands
  Mr. Tony Banks
  To ask the Secretary of State for Foreign and Commonwealth Affairs what information he has of injuries caused to penguins in the Falkland Islands from the explosion of mines left over from the war.

  Mr. Lennox-Boyd
  We are not aware of any such incidents.

  Mr. Tony Banks
  To ask the Secretary of State for Foreign and Commonwealth Affairs what monitoring his 758
  Department undertakes of incidents of death and injury to wildlife in the Falklands caused by mines and other warlike devices left over from the war.

  Mr. Lennox-Boyd
  None. Injuries to wildlife caused by mines and other warlike devices are minimal. Most wildlife is too light to set off mines.

  Gross Domestic Product
  Dr. John Cunningham
  To ask the Secretary of State for Foreign and Commonwealth Affairs what is the latest available information on the gross domestic product per head, as a proportion of the net European Community gross domestic product per head of(a) Poland, (b) Hungary and (c) Czechoslovakia, showing both the actual and proportional figures.

  Mr. Lennox-Boyd
  The latest published information for—1990—is as follows:

  Gross domestic product per head (in US$)

  As percentage of EC gross domestic product per head

  European Community

  16,373

  —

  Poland

  1,700

  10·4

  Hungary

  2,780

  17·0

  Czechoslovakia

  3,140

  19·2

  Source: World Bank Atlas.

  Foreign Affairs Council
  Mr. Trend
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on the outcome of the Foreign Affairs Council held on 7 December.

  Mr. Hurd
  My right hon. Friend the Minister of State, Foreign and Commonwealth Office and I represented the United Kingdom at the Foreign Affairs Council on 7 December, with my hon. Friend the Minister of State, Ministry of Agriculture, Fisheries and Food for the discussion of the Uruguay round.

  I briefed European Community ministerial colleagues on plans for handling the European Council in Edinburgh. The Council of Ministers had a further discussion on the future financing of the Community. They focused mainly on internal policies and administration issues, which had not been fully discussed at the conclave of Foreign and Finance Ministers on 27 November.

  The Council noted that the essential elements of the Community's general framework for enlargement negotiations with applicants from the European Free Trade Association had been established. The Council agreed to forward the Norwegian application to the Commission for its opinion.

  The Council discussed the European economic area in the light of the negative vote in the Swiss referendum. The Council noted that, without Switzerland, the agreement would require modifications. It invited the Commission to make early contact with the European Free Trade Association countries and to report to the Council on 21 December.

  The Council discussed recent progress in the GATT Uruguay round negotiations, particularly on agriculture. It agreed that substantial results would be needed in the Geneva negotiations in non-agricultural areas as well.
  759
  Ministers discussed Commission proposals on Community trade instruments and important restrictions. The Council expressed concern over the handling by the United States Government of anti-dumping and countervailing duty cases affecting Community steel producers and asked the Commission to raise the matter with the United States authorities.

  The Council discussed a report on European Community relations with the former Yugoslav republic of Macedonia presented by Ambassador O'Neill, my personal representative on the question. Ministers issued a statement on Somalia, welcoming the adoption of United Nations Security Council resolution 794.

  In further preparation for the Edinburgh European Council, Ministers met separately on 8 December to discuss a possible solution to the Danish question, subsidiarity and openness. Ministers also discussed a Commission report on strengthening links with the countries of central and eastern Europe.

  Bosnia
  Mr. Ieuan Wyn Jones
  To ask the Secretary of State for Foreign and Commonwealth Affairs what evidence he has of the use of chemical weapons in warfare in the current fighting in Bosnia.

  Mr. Archie Hamilton
  I have been asked to reply.

  I refer the hon. Member to the answer I gave to the hon. Member for South Shields (Dr. Clark) on I December 1992, Official Report, column 164.

WALES

  Welsh Language
  Mr. William Ross
  To ask the Secretary of State for Wales how many people in Wales(a) speak the Welsh language and (b) are learning Welsh; what sums of Government money were spent on (i) teaching the language and (ii) otherwise promoting it during the current financial year; how much this represents per capita in Wales; how much per Welsh speaker and student; what were the figures five and 10 years ago; and what are his projections for the next three years.

  Sir Wyn Roberts
  Information from the 1991 census on the numbers of Welsh speakers will be published shortly by the Office of Population Censuses and Surveys in a monitor for Wales. I will then write to the hon. Gentleman and place a copy of my letter in the Library of the House. Information on the number of Welsh speakers five years ago is not available. The 1981 census recorded that out of a total population of 2,749,600 there were 503,500 Welsh speakers in Wales.

  Direct Welsh Office financial support for the Welsh language in 1992–93 amounts to £7·6 million. Comparable figures for 1982–83 and 1987–88 were £1·8 and £2·8 million respectively. My right hon. Friend intends to announce shortly our direct support in 1993–94. Details of local education authorities' expenditure on the language, and the number of learners, are not held centrally.

  Young Offenders (Cardiff Prison)
  Mr. Jon Owen Jones
  To ask the Secretary of State for Wales how many section 53 young offenders aged 16 years and under are currently placed in Cardiff prison.
  760
  Mr. Gwilym Jones
  None from Wales.

  Churches' National Homes Coalition
  Mr. Barry Jones
  To ask the Secretary of State for Wales what representations he has had from the Churches' National Homes Coalition; if he proposes to meet the Churches' National Homes Coalition; and if he will make a statement.

  Mr. Gwilym Jones
  None, directly; and neither I nor my right hon. Friend have any plans to meet the Churches' National Homes Coalition.

  Secure Unit
  Mr. Jon Owen Jones
  To ask the Secretary of State for Wales where the proposed secure unit for young offenders in south Wales will be sited; and if he will make a statement.

  Mr. Gwilym Jones
  The joint local authority/Welsh Office working party, set up to take forward the development of the proposed secure unit, is progressing this work as quickly as possible.

  Careers Service
  Mr. Barry Jones
  To ask the Secretary of State for Wales what representations he has had concerning the careers service.

  Sir Wyn Roberts
  I have received three letters about the careers service in the past 18 months.

  House Building
  Mr. Barry Jones
  To ask the Secretary of State for Wales what is his estimate of the number of houses to be built by(a) local authorities and (b) housing associations in Wales over the next five years; and if he will make a statement.

  Mr. Gwilym Jones
  My right hon. Friend will be announcing the results of the current public expenditure survey in due course.

  Youth Training
  Mr. Ieuan Wyn Jones
  To ask the Secretary of State for Wales if he will list the training and enterprise councils in Wales which have fulfilled their obligation of granting guaranteed youth training placements for all 16 to I7-year-olds.

  Sir Wyn Roberts
  It is not posssible to say that at a particular date all 16 and 17-year-olds have been allocated training placements because there is a stream of new entrants or re-entrants to the guarantee group. I am satisfied that all seven TECs in Wales are giving the highest priority to fulfilling their obligations under the youth training guarantee.

  Mr. Ieuan Wyn Jones
  To ask the Secretary of State for Wales what steps are currently taken by his Department to monitor the availability and quality of youth training placements within each training and enterprise council area in Wales.

  Sir Wyn Roberts
  Officials in the Department regularly monitor management information provided by TECs on
  761
  the numbers of young people seeking youth training placements and the number of placements available. TECs are also obliged through their operating agreement to have effective quality assurance systems to ensure that all TEC providers of training obtain and maintain the status of approved training organisations under the Secretary of State's published criteria or an alternative system approved by the Secretary of State, which is of equivalent or greater assurance and effectiveness.

  Community Care
  Mr. Ieuan Wyn Jones
  To ask the Secretary of State for Wales what steps are being undertaken by his Department to monitor the consultation work with disabled people undertaken by local authorities in preparing their draft community care plans.

  Mr. Gwilym Jones
  The Department has been closely reviewing with each county planning team the draft social care plans. Part of this review has involved consideration of the consultation process with a variety of interested parties including disabled people. Other consultations have taken place with the voluntary sector and user and carer interests. It is proposed that such consultations will continue within an annual cycle.

  Mr. Ieuan Wyn Jones
  To ask the Secretary of State for Wales if he will list the local authorities in Wales which have produced their community care plans in braille or on tape.

  Mr. Gwilym Jones
  Social care plans are, by their nature, very bulky working documents and are not targeted at the general public. However, local authorities are required to produce information for the public on the key elements of their social care plans—the range of services available, how to gain access to them, how to make complaints or suggestions, and avenues of redress—in a range of formats including writing, tape and braille. Welsh Office guidance, issued September 1990, on the preparation of social care plans refers to this requirement.

  Aston Hill, Clwyd
  Mr. Barry Jones
  To ask the Secretary of State for Wales (1) if he will make a statement on traffic blight on Aston hill, Clwyd;

  (2) if he will commission an urgent study of traffic queues on the A494 Aston hill, Clwyd.

  Sir Wyn Roberts
  An extensive traffic study of the north-east Clwyd area, a summary of which was sent to the hon. Gentleman in February 1992, identified the need to improve a number of sections of trunk road in the area to accommodate anticipated increases in traffic growth. On this basis, an improvement scheme for the A494 from the River Dee to Ewloe, including Aston hill, was introduced into the roads programme for Wales to alleviate traffic problems along this route.

  At the present time, essential maintenance works are being carried out on this very busy length of trunk road and much thought has been given to traffic management measures so as to minimise delays.

  Housing Estates (Crime)
  Mr. Barry Jones
  To ask the Secretary of State for Wales (1) what measures his Department operates to combat car crime on housing estates; and if he will make a statement;

  (2) what measures his Department operates to combat break-ins on housing estates; and if he will make a statement.

  Mr. Gwilym Jones
  Proposals for improving household security are eligible for consideration as crime prevention measures under the urban programme; any local authority in Wales may submit a bid. Projects which have received support recently include "Cardiff Safe and Secure" initiative, and improvements to the security of the communal areas of flats on the Sandfields estates in Port Talbot. Funds made available to victim support schemes have also on occasion been used to improve household security. In addition, under the Welsh Office elderly initiative scheme some £315,000 is being made available over a three-year period to support a project in Mid Glamorgan that is designed to improve the safety and well-being of senior citizens living in their own homes. In addition to providing improved door and window locks, and door viewers, the projects entails the provision of advice to the elderly on how to deal with bogus officials and confidence tricksters.

  In June last year my right hon. Friend was pleased to perform the launch of "Secured by Design" in Wales. This is a major initiative promoted by the police to encourage house builders to incorporate improved crime prevention features in houses when they are built.

  Security of council houses is a matter in the first instance for councils to address in assessing their priorities. It is open to tenants, subject to their landlords' permission, to make home security improvements.

  As concerns car crime, the Welsh Office has supported the introduction of vehicle watch, which is a major police initiative to combat theft of vehicles and articles from them. Also, consideration is currently being given to supporting projects under the urban programme which are designed to divert young people from becoming engaged in car crime.

  Urban Programme
  Mr. Barry Jones
  To ask the Secretary of State for Wales how much assistance under the urban programme(a) Alyn and Deeside and (b) Wrexham Maelor councils have received in each of the last five years.

  Mr. Gwilym Jones
  Urban programme allocations to Alyn and Deeside district council and Wrexham Maelor borough council for the last five years were:

  Alyn and Deeside £

  Wrexham Maelor £

  1988–89

  279,627

  487,641

  1989–90

  275,225

  520,842

  1990–91

  225,225

  776,511

  1991–92

  267,613

  1,450,853

  1992–93

  100,000

  599,559

  Total

  1,147,690

  3,835,406

  NHS (Competitive Tendering)
  Mr. Llew Smith
  To ask the Secretary of State for Wales what decisions he has taken in regard to contracting out national health service jobs in Wales.

  Mr. Gwilym Jones
  Competitive tendering of ancillary services in the NHS in Wales has led to improvements in the quality and delivery of service and to financial savings in excess of £4 million, thus releasing resources for direct patient care. The market testing of a much wider range of non-clinical services is actively being pursued by authorities, units and NHS trusts in accordance with the "Competing for Quality" White Paper. Decisions on the award of contracts are for local management. The applicability of the Transfer of undertakings (Protection of Employment) Regulations 1981 to NHS contracts is a particular issue which has been raised and the Department is seeking legal advice on whether current guidance should now be revised.

  Hospitals
  Ms. Primarolo
  To ask the Secretary of State for Wales what was the total number of hospitals in Wales in 1979, 1991 and 1992.

  Mr. Gwilym Jones
  There were 173 hospitals open in Wales as at 31 December 1979 and 145 as at 31 December 1991. The number has not changed since. In the same period, the numbers of in-patients, out-patients and day patients treated have increased significantly.

  Disabled Persons (Training)
  Mr. Ieuan Wyn Jones
  To ask the Secretary of State for Wales if he will list the training and enterprise councils in Wales which have appointed a board member with the specific remit of training provision for disabled people.

  Sir Wyn Roberts
  Appointments to the boards of TECs are made in line with guidelines issued by the Department. The particular responsibilities of individual directors is a matter, therefore, for the TEC concerned. This varies between TECs.

  All TECs in Wales have advisory groups that look at the training needs and provision for individuals with special training needs, including those with disabilities.

  Ambulance Service (Clwyd and Gwynedd)
  Mr. Barry Jones
  To ask the Secretary of State for Wales if he will make a statement on his plans for the ambulance service in Clwyd and Gwynedd.

  Mr. Gwilym Jones
  Arrangements for the statutory provision of ambulance services is a matter for the health authorities locally, which have recently decided to combine the existing Clwyd and Gwynedd ambulance services to form the North Wales ambulance service from 1 April 1993.

  My right hon. Friend has invited an application for NHS trust status from 1994 and the decision to so proceed is a matter for the service itself.

  Caravans
  Mr. Barry Jones
  To ask the Secretary of State for Wales (1) what measures he will take to assist people affected by the illegal parking of itinerants' caravans; and if he will make a statement;
  764
  (2) when he expects to make a statement concerning permanent caravan sites for itinerants.

  Mr. Gwilym Jones
  The Government's proposals for reform of the Caravan Sites Act 1968 and measures to tackle illegal camping were detailed in the consultation paper issued on 18 August. A statement will be made once all responses have been considered.

  Disabled Employees
  Mr. Elletson
  To ask the Secretary of State for Wales how many(a) physically disabled and (b) sensorily disabled people are employed in his Department; and what percentage they are of the total work force.

  Mr. David Hunt
  As at 1 July 1992, 38 members of staff in my Department had registered as disabled, representing 1·6 per cent. of all staff. My Department also employs several unregistered disabled people.

  Number of Registered Disabled Staff

  Percentage of Departmental Total

  Physically Disabled

  25

  1·0

  Sensorily Disabled

  13

  0·5

  Note: Part-time staff count as one unit.

  Percentages do not add to the total because of rounding.

  Valleys Initiative
  Mr. Hain
  To ask the Secretary of State for Wales if he will give percentage and actual figures for adult males(a) registered unemployed, (b) receiving supplementary benefit or income support and (c) economically inactive for each of the areas covered by the valleys initiative programme in October 1988 and October 1992 showing the percentage changes.

  Mr. David Hunt
  In October 1988 there were 23,328 unemployed males in the programme for the valleys area claiming benefit—15·9 per cent. of the work force. The figure for October 1992 was 25,954–18·5 per cent. of the work force. This represents an increase of 11·3 per cent. or 2·6 percentage points since October 1988. Male unemployment figures for individual districts which are wholly or partly within the valleys programme area were provided in my answer to the hon. Gentleman on 24 November, at columns 628–30.

  Information on the total number of males in the valleys area in receipt of supplementary benefit or income support is not available.

  Provisional 1991 population census estimates of economically inactive males in those districts that fall, at least in part, within the valleys programme boundary are given in the table. There are no valleys figures for 1988 or 1992.

  Economically inactive population, 19911 males aged 16–64 years

  District2

  Number

  Percentage of population

  Dinefwr

  2,565

  21·7

  Llanelli

  5,057

  22·6

  Blaenau Gwent

  5,465

  22·9

  Islwyn

  4,355

  20·6

  Torfaen

  5,258

  18·5

  Cynon Valley

  4,760

  23·8

  Merthyr Tydfil

  4,297

  23·8

  Ogwr

  7,964

  19·3

  765

  District2

  Number

  Percentage of population

  Rhondda

  6,116

  25·4

  Rhymney Valley

  7,418

  22·8

  Taff Ely

  5,753

  18·6

  Brecknock

  2,296

  18·0

  Lliw Valley

  3,873

  20·1

  Neath

  4,358

  21·6

  Port Talbot

  3,903

  24·7

  Swansea

  11,522

  20·7

  Source: Office of Population Censuses and Surveys.

  11991 data are extracted from the Census County Monitor Series CEN 91 CM.

  2District figures include areas outside the valleys programme boundary.

  Mr. Hain
  To ask the Secretary of State for Wales what was regional policy expenditure in the South Wales valleys initiative area for each of the years 1988–89, 1989–90, 1990–91 and 1991–92(a) in total and broken down into, (b) regional selective assistance, (c) regional development grant and (d) regional enterprise grant.

  Mr. David Hunt
  The information requested is as follows:

  £million

  1988–89

  1989–90

  1990–91

  1991–92

  Regional Selective Assistance

  11·6

  8·2

  7·1

  13·0

  Regional Development Grants

  17·2

  7·7

  6·9

  2·8

  Regional Enterprise Grants

  0·1

  0·2

  0·5

  0·3

  Total

  28·9

  16·1

  14·5

  16·1

  Unemployment
  Mr. Alex Carlile
  To ask the Secretary of State for Wales what proposals he has to alleviate unemployment in Wales.

  Mr. David Hunt
  The Welsh Office, along with the development agencies and training and enterprise councils, already have in place very successful initiatives designed to encourage enterprise, create new jobs and safeguard existing ones. Regional selective assistance alone has been highly successful; with offers of assistance since 1979 forecast to safeguard over 53,000 jobs and to create almost 114,000 new jobs in Wales.

  Four Crosses Creamery
  Mr. Alex Carlile
  To ask the Secretary of State for Wales if he will make a statement regarding the closing of the Four Crosses creamery in mid-Wales.

  Mr. David Hunt
  The closure of the Four Crosses creamery was a matter for the commercial judgment of Dairy Crest. I shall continue to do whatever I can to attract new investment to all parts of Wales and to that end will make available financial support as appropriate to assist individual projects.

NATIONAL FINANCE

  Working Mothers
  Mr.Clelland
  To ask the Chancellor of the Exchequer what assessment he has made of the impact of his taxation policies on working mothers.

  Sir John Cope
  The reduction in income tax rates since has benefited all earners, male and female.

  Manufacturing Industry
  Mr. Pawsey
  To ask the Chancellor of the Exchequer what further action he intends to take to assist manufacturing industry.

  Mr. Portillo
  Manufacturing industry is best assisted by the conditions we have created of low inflation and low interest rates, as well as by a competitive exchange rate.

  Single Market
  Mr. Trimble
  To ask the Chancellor of the Exchequer whether he will make a statement on the arrangements for recovering VAT on exports after the implementation of the single market.

  Sir John Cope
  There will be no change for exports to countries outside the Community. VAT registered traders can also zero-rate sales to VAT registered traders in other Community countries. In such cases, evidence will be required of removal to other member states such as carriers' consignment notes or shipping documents. If a VAT registered customer collects the goods, the seller should get the customer to sign for the goods, give his or her VAT number and various other particulars, such as destination address of the goods.

  Visitors from outside the EC will continue to be able to purchase goods from high street shops and reclaim VAT when they export them from the EC.

  Housing Expenditure
  Mr. Simon Hughes
  To ask the Chancellor of the Exchequer what percentage of the additional money allocated to housing expenditure in the autumn statement he estimates will have been spent by 1 January 1993.

  Mr. Portillo
  I am confident that the full £750 million, announced in the autumn statement as a boost to the housing market, will be spent by the end of this financial year. The amount that is spent by 1 January 1993 will depend, for example, on how quickly housing associations can complete the legal formalities on their purchases.

  Value Added Tax
  Miss Lestor
  To ask the Chancellor of the Exchequer if he will exempt from value added tax all shoes and clothing bought for school children.

  Sir John Cope
  No. We agreed with other European partners in 1977 that, while we may retain those zero rates currently in force, subject to their being for clearly defined social reasons and for the benefit of the final consumer, we may neither widen their scope nor introduce new ones. Under the rates directive of 19 October 1992 the Government secured their retention.
  767
  Mr. Hain
  To ask the Chancellor of the Exchequer how many small businesses are not registered for VAT; and how many enterprises are registered.

  Sir John Cope
  Customs only has information concerning the number of businesses registered for VAT. At 30 November 1992 it was 1,643,679.

  Mr. Hinchliffe
  To ask the Chancellor of the Exchequer if he will make a statement on value added tax on domiciliary care provision.

  Sir John Cope
  I cannot add to the answers I gave to the hon. Member on this subject on 18 November 1992, at columns 234–35.

  Consumer Debt
  Mr. Alton
  To ask the Chancellor of the Exchequer what is the present level of consumer debt; and what was the comparable level of debt in 1982.

  Mr. Nelson
  The level of consumer debt outstanding at 30 September this year was £53 billion. The best estimate for the end of 1982 is £16 billion in 1982 prices, although changes in coverage mean that the figures are not strictly comparable.

  Small Businesses
  Mr. Butterfill
  To ask the Chancellor of the Exchequer which measures in the autumn statement were designed to help small businesses.

  Mr. Portillo
  The measures in the autumn statement were designed to rebuild confidence and to strengthen the economy and small businesses will benefit from these measures.

  European Community (Contribution)
  Mr. Milligan
  To ask the Chancellor of the Exchequer whether he will apply for moneys in the proposed EC cohesion fund to reduce Britain's net contribution to the EC budget.

  Sir John Cope
  The cohesion fund envisaged in the Maastricht treaty will be a structural fund for member states with a per capita gross national product less than 90 per cent. of the Community average. Purchasing power parities are used to calculate the relative wealth for these funds. On that basis, the United Kingdom would not therefore qualify for any assistance from the cohesion fund.

  Capital Projects (Private Sector Investment)
  Mr. Thomason
  To ask the Chancellor of the Exchequer when he will make a further announcement about encouraging private sector involvement in capital projects.

  Mr. Portillo
  In order to encourage the private sector to bring forward proposals, we released our guidance provided to Government Departments on implementing the initiative announced in the autumn statement.

  Mr. Ancram
  To ask the Chancellor of the Exchequer if he will take further steps to promote private sector investments in public sector projects.
  768
  Mr. Lamont
  I announced some important changes in the use of privately raised finance in the autumn statement.

  Bloodstock Industry
  Mr. Kirkwood
  To ask the Chancellor of the Exchequer what further representations he has received about the effect of value added tax rates on the bloodstock industry; and if he will make a statement.

  Sir John Cope
  A wide range of representations continue to be received about VAT and bloodstock and the introduction of the single market. We are working hard with industry representatives to ensure that they are fully aware of the new VAT arrangements so that no one is unnecessarily disadvantaged by them. Officials stand ready to consider any proposals from the industry to ease the potential problems they face.

  Economy
  Ms. Abbott
  To ask the Chancellor of the Exchequer what recent representations he has received from the CBI concerning the health of the British economy.

  Mr. Portillo
  My right hon. Friend the Chancellor of the Exchequer and I have frequent contact with representatives of industry, including the CBI, and pay close attention to their views on the economy. We have taken careful note of their concerns and proposals as well as the broad welcome given to the autumn statement.

  Interest Rates
  Mr. Nigel Evans
  To ask the Chancellor of the Exchequer what is the current bank interest rate in each EC country.

  Mr. Nelson
  Three-month market interest rates in EC countries were as follows at close of business on 3 December.

  3 December (per cent.)

  United Kingdom

  7·2

  Germany

  8·9

  France

  10·8

  Italy

  14·7

  Spain

  16·0

  Netherlands

  8·9

  Belgium

  8·9

  Denmark

  18·8

  Ireland

  20·0

  Greece

  24·5

  Portugal

  19·1

  Wage Settlements
  Mr. Cran
  To ask the Chancellor of the Exchequer what representations he has received from the Confederation of British Industry on the need for moderate and affordable wage settlements.

  Mr. Nelson
  My right hon. Friend has met representatives of the CBI on a number of occasions to discuss a variety of economic matters.

  Credit Card Debt
  Mr. Bill Michie
  To ask the Chancellor of the Exchequer if he will make a statement on the confidentiality of credit card debts and the rate of interest demanded.

  Mr. Nelson
  The legal principle that a banker owes a duty of confidentiality to his customer and should not disclose to any third party information about a customer's personal affairs—the "Tournier" rules—was established by a legal case in 1924. In addition, the Data Protection Act 1984 requires that data should be collected fairly and lawfully; held only for for specified purposes; not disclosed other than in accordance with those purposes; and held in conditions of appropriate security to prevent unauthorised access. The interest rates charged by credit card companies are a matter for their own commercial judgment.

  World Economy
  Mr. Garnier
  To ask the Chancellor of the Exchequer what assessment he has made on the effect of the world economy of the linking by certain countries in south-east Asia of their own currencies to the United States dollar; and what action he proposes to take.

  Mr. Nelson
  The Treasury makes regular assessments of recent developments and prospects for the world economy. A forecast of the world economy was published at the time of the autumn statement.

  VAT Collection Office
  Mr. French
  To ask the Chancellor of the Exchequer what plans he has to review customer service in the VAT collection office.

  Sir John Cope
  It is intended to conduct at least two customer surveys during 1993, one specially for the VAT central unit, and a more general one covering the VAT business including services provided by local VAT offices. Some local offices are carrying out separate surveys to review and improve the service they provide.

  In addition, quality service indicators define standards for customer service at all levels within Customs and Excise and they are reviewed regularly.

  Pools Industry
  Mr. Kilfoyle
  To ask the Chancellor of the Exchequer how much accrued in tax to the Treasury in 1991–92 from the pools industry.

  Sir John Cope
  Revenue from pools betting duty in 1991–92 was £319·5 million.

  VAT Returns
  Mr. French
  To ask the Chancellor of the Exchequer what formula is adopted when deciding the penalty for late payment of VAT returns.

  Sir John Cope
  Under the Finance Act 1985 liability to default surcharge arises where a taxpayer persistently fails to render a return or pay any VAT due on time. After two defaults have occurred within twelve months, a third default within 12 months of the second results in a liability to a surcharge of 5 per cent. of the unpaid tax. The level 770
  of surcharge increases for subsequent defaults, but cannot exceed 20 per cent. for defaults incurred after 1 April 1992. The maximum surcharge was previously 30 per cent.

  Council Tax
  Mr. Gordon Prentice
  To ask the Chancellor of the Exchequer what was(a) the total cost of the valuation of properties in (i) Pendle and (ii) Lancashire for the purposes of introducing the council tax and ( b) the cost per property in (i) Pendle and (ii) Lancashire.

  Mr. Nelson
  The total cost of the valuation banding of domestic properties was £63,045 in Pendle and £1,105,833 in Lancashire. The average valuation banding cost per property was £1·76 in Pendle and £1·90 in Lancashire.

  Bank Accounts
  Mr. Skinner
  To ask the Chancellor of the Exchequer if he will investigate the qualifications laid down by the major banks regarding the ability of young people aged between 16 and 22 years to open bank accounts; and if he will make a statement.

  Mr. Nelson
  I have no plans to investigate this issue. The principles that banks will follow when allowing people to open accounts, and when providing credit to young people, are set out in the code of banking practice which was published in December 1991.

  Treasury Income
  Mr. Canavan
  To ask the Chancellor of the Exchequer what has been the total income to the Treasury since May 1979 from (a) privatisation and(b) North sea oil revenues.

  Mr. Nelson
  Between 1979–80 and 1992–93, privatisation proceeds are expected to amount to £50 billion, and North sea oil revenues to £72 billion.

  Bankruptcy
  Mr. Morgan
  To ask the Chancellor of the Exchequer if he will make it his policy to avoid placing small firms into bankruptcy for unpaid VAT or income tax, where the Government's legal and administrative costs of so doing are expected to be greater than the assessed likely recovery of moneys; and if he will make a statement.

  Sir John Cope
  [holding answer 4 December 1992]: In all cases, civil recovery through the courts is only taken as a last resort. Where a VAT registered taxpayer has ceased trading and the tax debt is not expected to increase, Customs policy is that legal action should only be taken where there is a prospect of recovering sufficient tax to make this action cost effective.

  However, for those VAT-registered taxpayers who continue in business but fail to meet their VAT liability and where all other options for payment have been explored without success, Customs has no recourse other than to take legal action in order to prevent the VAT debt from increasing.

  Inland Revenue policy is to take bankruptcy proceedings only as a last resort when all other attempts to encourage payment of tax debts have failed. The Revenue does, however, have to consider its duty to the Exchequer, employees who have had tax deducted from their wages and to the general body of taxpayers who pay their tax on time.

  House Prices
  Mr. Milburn
  To ask the Chancellor of the Exchequer what has been the percentage change in regional house price to earnings ratios in each region between the most recent quarter in 1992 for which information is available and the corresponding quarter of 1991.

  Mr. Nelson
  The latest published information on regional average earnings is for April 1992. The information requested, relating to the second quarter of 1992 and the corresponding quarter of 1991, is in the table:

  Average house price to earnings ratio

  Quarter 2 1991

  Quarter 2 1992

  Percentage change

  Region

  United Kingdom

  4·12

  3·87

  -6·1

  North

  3·28

  3·38

  + 3·0

  Yorkshire and Humberside

  3·92

  3·66

  -6·6

  East Midlands

  4·09

  3·76

  -8·1

  East Anglia

  4·23

  3·79

  -10·4

  South East

  Greater London

  4·50

  4·01

  -10·9

  Rest of South East

  5·02

  4·53

  -9·8

  South West

  4·53

  4·10

  -9·5

  West Midlands

  4·31

  3·95

  -8·4

  North West

  3·74

  3·77

  + 0·8

  England

  4·25

  3·95

  -7·1

  Wales

  3·49

  3·52

  + 0·9

  Scotland

  3·46

  3·36

  -2·9

  Northern Ireland

  2·59

  2·63

  + 1·5

  Mortgage Interest Tax Relief
  Mr. Milburn
  To ask the Chancellor of the Exchequer what has been the cost of mortgage interest relief at source payments in each region in each year since 1979–80 and as a proportion of the total MIRAS payments for that year.

  Mr. Dorrell
  The available information is given in my 772
  reply to the hon. Member for Angus, East (Mr. Welsh) on 17 June 1992, Official Report, columns 537–38.

  Personal Debt
  Mr. Milburn
  To ask the Chancellor of the Exchequer what percentage of personal disposable income was made up of personal sector debt in each region in each year since 1987.

  Mr. Nelson
  [holding answer 9 December 1992]: The information is not available.

  Autumn Statement
  Mr. Hargreaves
  To ask the Chancellor of the Exchequer what reaction he has received from business organisations to his autumn statement.

  Mr. Portillo
  I refer my hon. Friend to the answer I gave earlier today to my hon. Friend the hon. Member for Tiverton (Mrs. Browning).

  Ministers (Personal Matters)
  Mr. Hoyle
  To ask the Chancellor of the Exchequer under what guidelines the Treasury press office responds to inquiries about personal matters concerning Ministers; how many such inquiries were received by the Treasury press office on 13 April 1991; what action was taken; and if he will make a statement.

  Mr. Nelson
  The Treasury press office responds to inquiries about personal matters concerning Ministers by seeking guidance from the Ministers in question, and then taking follow-up action as appropriate. A large number of such inquiries were received on 13 April 1991. As my right hon. Friend the Chancellor has already explained, the nature of the allegations made on that evening made it necessary for him to issue an immediate press statement, based on legal advice, and for related inquiries to be handled by the solicitors.

HEALTH

  In-patient Waiting Lists
  Ms. Glenda Jackson
  To ask the Secretary of State for Health if she will publish her plans for reducing in-patient waiting lists in London before implementation of the Tomlinson report.

  Dr. Mawhinney
  The report notes that significant progress has been made in reducing waiting times in London. In the year to 31 March 1992, the total number of patients waiting in inner London fell by nearly 10 per cent.

  We shall ensure that the proposals arising from the report continue this trend.

  Travellers Abroad
  Dr. Lynne Jones
  To ask the Secretary of State for Health (1) what steps Her Majesty's Government took to alert British travellers to Malta about the outbreak of gastro-enteritis in Malta between December 1991 and January 1992;

  (2) what is her policy with regard to alerting British holiday makers about epidemics in major overseas holiday destinations.

  Dr. Mawhinney
  When an outbreak of an infectious disease comes to the attention of the Department any action must take account of the nature of the disease, the number of cases, the certainty of the diagnosis and the strength of any connection with one site or area.

  In December 1991 the Department received a report of an outbreak of gastro-enteritis which affected individuals staying in a particular hotel in Malta. As we had no evidence of a more widespread or ongoing problem, it was not appropriate to issue specific advice to travellers to Malta at that time.

  General health advice to travellers is contained in a leaflet issued by the Department, T4 "Health Advice for Travellers", copies are available in the Library. If more specific advice is needed, action may include addition of a special message to the DH "Health Advice for Travellers" on the Prestel network, and similarly by the travel advice unit of the Foreign and Commonwealth Office, which is received by many travel agents; issuing a press statement; alerting the Association of British Travel Agents (ABTA) which will then relay the information to travel agents; or, in the case of a major outbreak which makes travel to a destination unwise, the Chief Medical Officer would consider issuing a public warning.

  Septic Arthritis
  Mr. Pope
  To ask the Secretary of State for Health how many registered cases of septic arthritis there have been in the United Kingdom over the last five years broken down by district health authority; and if she will make a statement.

  Mr. Sackville
  Information on registrations of this condition are not held centrally. The table shows the estimated number of cases of septic arthritis treated in national health service hospitals in each regional health authority in England for the last five available years. The numbers of treatments are too small to make reliable estimates at district level.
  774

  Septic arthritis—discharges and deaths/hospital episodes

  1982

  1983

  1984

  1985

  1989–90

  Northern

  100

  90

  160

  100

  96

  Yorkshire

  90

  110

  70

  110

  96

  Trent

  200

  180

  160

  190

  208

  East Anglia

  60

  130

  100

  30

  60

  North West Thames

  60

  40

  80

  60

  64

  North East Thames

  80

  50

  30

  110

  108

  South East Thames

  130

  140

  100

  90

  128

  South West Thames

  70

  80

  30

  60

  88

  Wessex

  60

  80

  100

  50

  100

  Oxford

  70

  40

  80

  100

  64

  South Western

  90

  70

  140

  80

  68

  West Midlands

  230

  280

  230

  120

  224

  Mersey

  90

  90

  110

  40

  64

  North Western

  80

  200

  110

  130

  164

  SHAs

  0

  0

  20

  10

  12

  Totals

  1,410

  1,580

  1,520

  1,280

  1,544

  Sources: 1982–85 Hospital In-Patient Enquiry (HIPE).

  1989–90 Hospital Episode System (HES).

  "Who Cares?"
  Mrs. Golding
  To ask the Secretary of State for Health what contribution her Department made to the "World in Action" programme, "Who Cares?" broadcast on 30 November.

  Mr. Yeo
  None.

  Care Leavers
  Mrs. Golding
  To ask the Secretary of State for Health if she will now review local authority support for young care leavers.

  Mr. Yeo
  We are monitoring how local authorities are exercising their powers and duties under the Children Act 1989. A report will be presented to Parliament in the new year.

  Disabled Employees
  Mr. Elletson
  To ask the Secretary of State for Health how many(a) physically disabled and (b) sensorily disabled people are employed in her Department; and what percentage they are of the total work force.

  Mr. Sackville
  At 7 December 1992, the latest figures available, the Department employed 74 people who were registered disabled, of whom 37–0·7 per cent. of the work force—are known to have physical disabilities and 13–0·3 per cent.—to have sensory disabilities. In addition, a number of staff have a disability but are not registered disabled.

  Child Care Facilities
  Mr. Harvey
  To ask the Secretary of State for Health what steps she will take to give further encouragement to employers to provide child care facilities for employees' children.

  Mr. Yeo
  It is for employers to consider the business case for providing a child care service, to help recruit, retain and support the career development of the work force.

  The new review duty, introduced by the Children Act 1989, provides a legislative framework for local child care

  775
  plans, which involve all local interests, including employers and parents, in looking at the existing child care services and identifying priorities for future expansion.

  The Department of Health is spending £1½ million over three years starting in 1992–93 to pump prime expansion of child care services for school age children. The Employment Department is planning to spend up to £45 million over three years starting in 1993–94 through training and enterprise councils in promoting child care for school age children.

  Community Care
  Mr. Cox
  To ask the Secretary of State for Health what steps she is taking to ensure that users of community care provisions are enabled to have a genuine choice of services after April.

  Mr. Yeo
  My right hon. Friend the Secretary of State intends to issue a statutory direction requiring local authorities to place someone assessed as needing residential care into the accommodation of their choice, subject to practical conditions such as cost, availability and suitability. The statutory direction will also make it clear that authorities should use their discretion in a way which respects users' wishes when arranging the provision of any community care service.

  Mr. Bowden
  To ask the Secretary of State for Health when her Department will issue the guidance referred to in paragraph 3.31 of the policy guidance, "Community Care in the Next Decade and Beyond", on the power of local authorities to make discretionary charges for welfare services under section 17 of the Health and Social Services and Social Security Adjudications Act 1983.

  Mr. Yeo
  We intend to issue guidance before April 1993.

  Private Ambulance Services
  Mr. Blunkett
  To ask the Secretary of State for Health what representations her Department has received in the last five years on the regulation of private ambulance services; and if she will make a statement.

  Mr. Sackville
  We have, from time to time, received letters from hon. Members and from the public. In each case the response has been that private ambulance services and their staff are not subject to any specific statute or regulation. It is for the prospective purchaser of private ambulance services to satisfy themselves that operators are competent to provide the required service.

  Dr. Kypros Loucas
  Mr. Blunkett
  To ask the Secretary of State for Health (1) what plans she has to investigate allegations of professional misconduct by Dr. Kypros Loucas while he was working at Horton hospital in Epson, Surrey, and the circumstances in which he was appointed to the post; and if she will make a statement;

  (2) what plans she has to review the powers available to the Mental Health Act Commission; and if she will make a statement;

  (3) when her Department first became aware of the Mental Health Act Commission's concerns over possible breaches of the Mental Health Act 1983 by Dr. Kypros
  776
  Loucas while he was employed at Broadmoor hospital; what representations her Department received from the commission on Dr. Loucas's activities at Broadmoor hospital; and if she will make a statement;

  (4) what plans she has to review the effectiveness of the Mental Health Act 1983 following reports by the Mental Health Act Commission on the treatment of patients at Broadmoor hospital.

  Ms. Lynne
  To ask the Secretary of State for Health (1) how many past Secretaries of State were approached through their private offices about Dr. Kypros Loucas and his treatment of psychiatric patients;

  (2) if she will now set up an independent inquiry into the activities of Dr. Kypros Loucas with a view to publishing a report;

  (3) to how many internal Department of Health inquiries Dr. Kypros Loucas consultant psychiatrist has been subject;

  (4) what action has been taken against Dr. Kypros Loucas following the Mental Health Act Commission's reports to her Department.

  Mr. Yeo
  The Mental Health Act Commission first expressed concern to the Department about compliance by Dr. Loucas with part IV of the Mental Health Act in 1985. This and subsequent reports by the commission were followed up by the Department with local management at Broadmoor hospital and with the local hospital board. Ministers were involved as necessary and the commission was kept fully informed of the action being taken, which concluded with Dr. Loucas's early retirement from Broadmoor in 1989. In that year the commission stated in its third biennial report:"the Department of Health has remedied the situation in a way which fully satisfied the Commission's insistent call for official action".

  It is not clear that the reported events demonstrate an inadequacy in the Mental Health Act 1983 or in the powers of the Mental Health Act Commission, but we are ready to consider any proposals for changes in this area. We do not believe that a general inquiry into these matters would serve a useful purpose, but we are considering whether any steps need to be taken on particular issues raised.

  The decision to employ Dr. Loucas at Horton hospital was taken by the Riverside health authority. We have received a copy from the authority of the report of its internal inquiry into the death of a patient at Horton in 1990 and we are considering urgently whether this calls for any further action.

  Questions relating to the professional conduct and competence of doctors are for the General Medical Council to consider. We have drawn the council's attention to the allegations about Dr. Loucas and will do all that we can to assist any investigation that it may decide to undertake.

  Medical Manpower Standing Advisory Committee
  Mr. Alexander
  To ask the Secretary of State for Health when she expects the Medical Manpower Standing Advisory Committee to make its first report.

  Dr. Mawhinney
  I am pleased to announce that the Medical Manpower Standing Advisory Committee has completed its first report. It is published today and copies have been placed in the Library.
  777
  Long-term manpower planning is an important issue for health care and it is not too soon to be thinking about the manpower requirements for the next century. We are grateful to Professor Campbell, the chairman, and to the members of the committee for their consideration of a wide range of issues. We will be studying their recommendations very carefully.

  Sunderland Health Authority
  Mr. Mullin
  To ask the Secretary of State for Health how many(a) administrative, (b) nursing and (c) other staff were employed by Sunderland health authority in 1987 and 1991.

  Dr. Mawhinney
  The figures, where available, are given in the table.

  Whole-lime equivalent

  1987

  1991

  Administrative and clerical

  618·4

  1—

  Nursing and midwifery

  2,609·4

  2,656·4

  Other professional

  449·5

  494·7

  Other non-professional

  1,103·9

  1—

  1 Not available (for DHA).

  Notes:

  1. Excludes medical and dental staff.

  2. Includes agency nurses.

  Source: Non-medical Manpower Census.

  4. 1991 figures for administrative and clerical and other nonprofessional staff are not available centrally for Sunderland district health authority.

  Bradford Hospitals Trust
  Mr. Madden
  To ask the Secretary of State for Health what representations she has received from the Bradford hospitals trust to approve the closure of Bradford royal infirmary, Woodlands and Bierley hospitals; and if she will make a statement.

  Dr. Mawhinney
  I have received no such representations.

  Tobacco
  Mr. Bowis
  To ask the Secretary of State for Health what will be the dimensions of the warning notices required by section 4 of the Children and Young Persons (Protection from Tobacco) Act 1991.

  Dr. Mawhinney
  In the light of consultation on the draft regulations, we shall shortly be making regulations which will provide that the notice for display at premises where tobacco is sold is to be not less than 297 mm x 420 mm (A3), and the lettering is to be not less than 36 mm high. The notice to be affixed to cigarette vending machines is to be not less than 60 mm x 100 mm, and the lettering not less than 6 mm high.

TRANSPORT

  Transport Council
  Mr. Dunn
  To ask the Secretary of State for Transport what was the result of the Transport Council held in Brussels on 7 and 8 December.

  Mr. MacGregor
  The Transport Council met in Brussels on 7 and 8 December. There was constructive 778
  discussion of a very full agenda on aviation, maritime and inland transport issues. On the outstanding measures needed for completion of the single market in transport, full agreement was reached on the regulation on airport slot allocation, thus completing the single market in aviation; and good progress was made on the liberalisation of road haulage cabotage. This will be discussed further at an additional special Transport Council on 21 December. There was also unanimous agreement on a directive to ensure better information when dangerous and polluting goods are carried into and out of Community sea ports.

  Airport Slot Allocation

  The Council agreed a regulation on airport slot allocation to come into force early in 1993. It will put into place a fair and uniform system for allocating slots at Community airports. The regulation will provide preferential treatment for new entrants on intra-Community routes, and also introduces stricter penalties on airlines that fail to use their slots. The Council will review the operation of the regulation after three years. The completion of the single market in aviation will assist air travellers across Europe by promoting competition and choice.

  Aviation External Relations

  Useful preliminary discussions took place on the Commission's communication on aviation external relations. There was general agreement that a case-by-case examination will be needed before the Community negotiates collectively with any third country. The forthcoming Danish presidency agreed to take this forward.

  Air Traffic Control Issues

  The Council emphasised the importance of cooperation by the Commission with Eurocontrol and the European Civil Aviation Conference (ECAC). It called for the adoption as soon as possible of the Commission's proposal for a directive on standards for air traffic management (ATM) equipment and systems. It encouraged the Commission to ensure the continuation of the EU RET research programme and to make provisions for research to support the development of the future ATM system for Europe, in close co-operation with ECAC and Eurocontrol.

  State Aids Resolution

  The presidency proposed a draft resolution urging tighter control of state aids in the single market for transport, to which we have attached great importance. This is a matter which lies within the Commission's competence, and the resolution was supported by the Commission. There was support from most member states. But there were objections in principle from certain member states so it was not possible to adopt the resolution. I am hopeful that the matter will be pursued by the Danish presidency.

  Road haulage fiscal harmonisation and cabotage

  Further discussions took place on these linked and difficult issues. Good progress was made, but without conclusion. In view of the importance and urgency of these items the Council agreed to adjourn and resume discussions at a further meeting on 21 December, in order to reach agreement before the end of the year because the current transitional scheme runs out on 1 January 1993.

  Inland waterways

  Agreement was reached on a Commission mandate on the opening of negotiations with Danubian countries on inland waterways.
  779
  Transit wth Slovenia

  The Commission reported on the negotiations for a Community transit agreement with Slovenia. The Council was not satisfied that an agreement could yet be initialled.

  EC tranport infrastructure funding

  The draft regulation to succeed the current infrastructure funding regulation had already received political agreement at the October Council. The December Council confirmed this and agreed to re-consult the European Parliament given the considerable differences between this text and the Commission's original proposal.

  Dangerous goods at sea

  We succeeded in getting unanimous agreement, after three years of Council deliberation, for a directive concerning the carriage of dangerous or polluting goods at sea. This will allow the Community to set in hand a practical scheme compatible with international law, to achieve a better flow of information about the carriage of dangerous and polluting goods into and out of Community ports.

  Positive measures for shipping

  The Council discussed ways of improving the competitiveness of Community fleets to guide the Commission's future work in this area. Three points were made in particular: state aids should not be mandatory; and there was widespread concern that aids distort competition, especially in some countries which could not afford to grant them, and that manning arrangements should be kept as flexible as possible.

  Maritime external relations

  The Council agreed the presidency paper which encourages the Commission to produce a strategy and working arrangements for Community action on external relations for shipping.

  Maritime safety

  There was a useful general discussion on the Community's approach to maritime safety during which the United Kingdom emphasised the importance of achieving the right standards on ferry stability.

  Shipping liberalisation

  The Commission presented a report which shows that some member states are not complying fully with their obligations under the regulation liberalising shipping between member states and third countries.

  White Paper

  Commissioner Van Miert presented the wide-ranging Commission White Paper "The Future Development of the Common Transport Policy". The Danish presidency will take forward discussion of the paper.

  Rail Freight
  Mr. Nicholls
  To ask the Secretary of State for Transport if he will take the legislative or other steps necessary to place an immediate moratorium on the rates British Rail charges to its freight customers as part of the preparations for privatisation of British Rail's freight operations.

  Mr. Freeman
  The rates British Rail charges to freight customers are not matters that the Government can control. The Government intend to bring forward legislation under which a regulator would be appointed to supervise track charges to railway operators.

  Nuclear Material
  Ms. Walley
  To ask the Secretary of State for Transport what plans he has to introduce legislation to enforce the British Railways Board "List of Dangerous Goods Class 7: radioactive material", 1977 edition.

  Mr. Freeman
  This issue is under consideration by the Department as part of the safety regime to be put in place following the privatisation of British Rail.

  Ms. Walley
  To ask the Secretary of State for Transport what recent changes have been made to the Chicago convention to cover the air freight of nuclear material.

  Mr. Norris
  None. Annex 18 to the convention already lays down provisions for the safe transport by air of dangerous goods, including radioactive material.

  Ms. Walley
  To ask the Secretary of State for Transport what information his Department has regarding accidents involving(a) air transport, (b) sea or water course transport, (c) road transport and (d) rail transport of nuclear materials in the European Community since 1979.

  Mr. Norris
  Details of accidents in the United Kingdom and their radiological consequences are given in National Radiological Protection Board reports M206, M230 and M310, commissioned jointly by the Department of Transport and the Health and Safety Executive.

  The Department does not hold details of accidents in other member states of the European Community.

  Ms. Walley
  To ask the Secretary of State for Transport what petitions he has received in his position as President of the European Council of Transport Ministers relating to the risks associated with the transportation of radioactive materials; and if he will make a statement.

  Mr. MacGregor
  No such petitions have been received.

  Ms. Walley
  To ask the Secretary of State for Transport if he will list all published and unpublished reports, commissioned and retained by his Department on the safety and the security of the transport of nuclear materials, and place in the Library those not otherwise available.

  Mr. Kenneth Carlisle
  The following safety studies have been commissioned by the Department:Radiation exposure from the normal movement of irradiated fuel elements by road and rail from Magnox power stations: March 1983
  Review of the radiological consequence resulting from accidents and incidents during transportation in and from the United Kingdom: December 1984
  Derived limits for surface contamination of transport packages: February 1987
  The radiological impact of releases from a Magnox fuel flask damages by a hypothetical fire in the summit tunnel: December 1988
  Review of the radiological consequences resulting from accidents and incidents involving the transport of radioactive materials in the United Kingdom from 1964 to 1988: March 1990
  Radiological impact of the normal transport of radioactive materials by air: March 1990
  Transport of radioactive materials between the United Kingdom mainland and gas and oil platforms in the North sea: March 1990
  Radiological consequences resulting from accidents and incidents involving the transport of radioactive materials in the United Kingdom—1989 review: July 1990

  781
  Radiological consequences resulting from accidents and incidents involving the transport of radioactive materials in the United Kingdom—1990 review: July 1991

  All the above studies were carried out by the National Radiological Protection Board.

  In addition, the Department of Energy commissioned a confidential security study in 1980 on the consequences of a terrorist attack on an irradiated fuel flask.

  I will place in the Library copies of the listed safety reports that are not already there.

  Ms. Walley
  To ask the Secretary of State for Transport if he will list those United Kingdom ports which have been used for the transportation of separated plutonium since January 1989.

  Mr. Norris
  Radioactive material transported in approved packages may be moved through any port. Consignors are under no regulatory obligation to give this information to the Department.

  Ms. Walley
  To ask the Secretary of State for Transport what proportion of the research undertaken at his Department's Road Research Laboratory since its inception has been devoted to safety assessment of the transportation of nuclear materials by road.

  Mr. Kenneth Carlisle
  None: such research is the responsibility of the consignors.

  Ms. Walley
  To ask the Secretary of State for Transport what information on the import and export of plutonium port authorities are required to provide to his Department.

  Mr. Norris
  None.

  Ms. Walley
  To ask the Secretary of State for Transport what discussions he or his officials have had with the European Transport Commissioner or his officials on the import and export of nuclear materials into(a) the European Community and (b) the United Kingdom.

  Mr. MacGregor
  None.

  Ms. Walley
  To ask the Secretary of State for Transport what recent discussions he has had with his German counterparts in regard to the air freighting of plutonium fuel from Germany to Scotland; and if he will make a statement.

  Mr. Norris
  No discussions have taken place.

  Ms. Walley
  To ask the Secretary of State for Transport what categories of information relating to the transport of plutonium it is his Department's practice not to publish.

  Mr. Kenneth Carlisle
  It is a decision for the consignors whether or not to publish operational details of plutonium transport.

  Ms. Walley
  To ask the Secretary of State for Transport on what occasions his Department has proposed a preference since June 1986 on the optimum mode of transport for plutonium.

  Mr. Kenneth Carlisle
  No such preferences have been expressed.

  Ms. Walley
  To ask the Secretary of State for Transport what consideration the Health and Safety Executive has given since 1991 over the transportation of(a) plutonium, (b) uranium, (c) spent nuclear fuel and (d) nuclear waste; and if he will make a statement.
  782
  Mr. Kenneth Carlisle
  The safe transport of radioactive material is a matter for the Department of Transport.

  Road Salting
  Mr. Simon Hughes
  To ask the Secretary of State for Transport what monitoring and evaluation Her Majesty's Government have carried out of alternatives to the use of salt for de-icing of roads and pathways; and if he will make a statement.

  Mr. Kenneth Carlisle
  The Department has commissioned the Transport Research Laboratory to conduct research into alternative de-icing chemicals—including salt with corrosion inhibitors.

  The research project has the objective of assessing he performance of alternative de-icing chemicals in relation to their effectiveness as a de-icer, corrosive effect on steels and concrete, skid resistance properties, contamination of the environment, handling and storage characteristics and cost effectiveness.

  The project has already assessed five principle alternative de-icers, comprising: calcium chloride, calcium magnesium acetate, urea, glycol and potassium acetate. The original project has been extended to allow completion of research on corrosion inhibitors following an American study on salt additives—commissioned by the United States strategic highways research program. An interim report is scheduled for the end of this month, with a final report due in June 1993.

  Mr. Simon Hughes
  To ask the Secretary of State for Transport what information his Department has on the affect of salt used during cold weather on(a) trees, (b) grass verges and (c) concrete; what research his Department has commissioned or carried out on these matters; and if he will make a statement.

  Mr. Kenneth Carlisle
  The latest information available to the Department about the effects of de-icing salt on trees and other vegetation is contained in the Forestry Commission bulletin "De-icing Salt Damage to Trees and Shrubs", which was published in 1991. It was commissioned by the Department of the Environment and compiled in consultation with the Department of Transport's environment branch, with reference to earlier Transport and Road Research Laboratory studies on roadside vegetation and the DOT's winter maintenance statement of service and code of practice.

  The Forestry Commission is now following up with a survey of salt damage to roadside trees in London, which is partially sponsored by the Department of Transport. A preliminary report has been issued and the final report is due for publication later this month and will be considered by my Department.

  The Transport Research Laboratory is also currently carrying out research on alternative de-icing chemicals, as described in my reply to the hon. Member's earlier question today.

  Mr. Simon Hughes
  To ask the Secretary of State for Transport if he will estimate for each of the next 10 years how much will be spent on repairing existing motorway carriages and bridges; if he will estimate what proportion of this expenditure he expects to be attributable partly or wholly to salt penetration; and if he will make a statement.

  Mr. Kenneth Carlisle
  The amounts to be spent on repairing trunk motorway carriageways and bridges will
  783
  depend on the funds available and the continuous reappraisal of priorities for maintenance, renewal and reconstruction in the light of the latest survey and inspection data.

  There is no evidence that carriageway repairs will be required as a consequence of salt penetration, but the Department currently estimates that about £700 million will need to be spent over the 10 years from 1993–94 onwards for preventive treatment and repair of concrete bridges on motorways and all-purpose trunk roads to deal with problems associated with salt penetration. This figure could vary depending on the solutions adopted.

  The work is being carried out as part of a strategic 15-year bridge rehabilitation programme which is being planned and programmed to ensure that work is carried out at the appropriate time to produce the most cost-effective solutions, and which includes assessment and strengthening of older bridges to current standards as well as work to safeguard bridges against deterioration.

  Driver and Vehicle Licensing Agency
  Mr. Redmond
  To ask the Secretary of State for Transport if he will list by grade, the number of staff employed by DVLA, Swansea.

  Mr. Kenneth Carlisle
  The number of staff employed at DVLA, Swansea, on 30 November 1992 was as follows:

  Number

  Grade 3

  1

  Grade 5

  3

  Senior medical officer

  1

  Grade 6

  6

  Medical officer

  9

  Grade 7

  24

  Senior executive officer

  37

  Higher executive officer

  117

  Executive officer

  250

  Administrative officer

  797

  Administrative assistant

  1,548

  Support, secretarial and technical

  288

  Total

  3,081

  Red Route
  Lady Olga Maitland
  To ask the Secretary of State for Transport what has been the change in the rate of accidents on the pilot red route since its inception; and what are the figures for comparable routes in adjacent London boroughs.

  Mr. Norris
  Casualties in the pilot corridor have fallen by some 17 per cent. in the 18 months since the start of the scheme, compared with the equivalent period leading up to the launch in January 1991. The latest figures for the boroughs through which the pilot route runs show an average reduction of about 7 per cent.

  Airports
  Mr. Haselhurst
  To ask the Secretary of State for Transport if he will make a statement on the progress made in the work of the RUCATSE—runway capacity in the south-east—working group on runway capacity in the south-east.

  Mr. Norris
  The RUCATSE working group has made good progress in its study of the wider implications of the 784
  provision of additional runway capacity to serve the south-east. Starting from the 10 sites identified by the Civil Aviation Authority in its report CAP570, four—Bristol/ Filton, Bristol/Lulsgate, Bournemouth and Southampton—were judged unlikely to make a substantial contribution to meeting demand and were therefore remitted for further consideration by the group's regional airports sub-group. Further work is being undertaken to assess the contribution that Lydd and Manston could make; and Gatwick, Heathrow, Luton and Stansted are now subject to a detailed examination, covering the notional runway alignments identified in CAP570 and others, environmental impacts, noise and surface access issues. In addition, the promoters of an off-shore airport in the Thames estuary—Marinair—have made a presentation to RUCATSE and have undertaken to do some further detailed work. It is intended that a report on Marinair will be submitted to me in parallel with the final RUCATSE report.

  RUCATSE hopes to complete its work by next summer in the form of a report which can be expected to set out the advantages and disadvantages of development at a number of sites. I intend to publish the report as soon as it is ready and at that stage there will be a full public consultation on the group's findings. It will ultimately be for promoters rather than Government to make specific proposals, which would in turn be subject to the normal planning processes.

  Ship Design
  Mr. Lidlington
  To ask the Secretary of State for Transport when the Government expects to publish its response to the report "Safety Aspects of Ship Design" from the House of Lords Select Committee on Science and Technology.

  Mr. Norris
  The Government response to the Select Committee on Science and Technology's report was published today. Copies of the response have been placed in the Libraries.

  Vehicle Testing Stations
  Mr. Betts
  To ask the Secretary of State for Transport what information he has about the current performance of vehicle testing stations; and what criteria he uses to evaluate their performance.

  Mr. Kenneth Carlisle
  My right hon. Friend monitors the performance of the vehicle inspectorate against financial and service quality targets quarterly. The performance of individual testing stations is a management matter for the chief executive.

  Minicabs
  Mr. Alex Carlile
  To ask the Secretary of State for Transport what proposals he has to enforce registration and training upon minicabs in London; if he will set a national vocational qualification to achieve this; and if he will make a statement.

  Mr. Norris
  I am currently considering the future structure of the minicab trade in London in the light of a working party report on the safety of users of taxis and minicabs in London which was presented to me in July. In
  785
  the course of my review, I have met with a range of organisations whose views I am taking fully into account. I hope to make an announcement shortly.

  Severn Bridge
  Mr. Alex Carlile
  To ask the Secretary of State for Transport how many hours delay have been reported on the Severn bridge since 15 November due to repair work; and if he will make a statement.

  Mr. Kenneth Carlisle
  Emergency repairs to the anti-skid surfacing made it necessary to restrict westbound traffic to one lane only from the afternoon of 30 November until early morning on 4 December. Delays of up to two hours at peak times were reported. There were much shorter delays on 5 December when a lane was again closed for the work to be completed.

  There have been no other delays to traffic due to repair work during the period in question.

  Mr. Alex Carlile
  To ask the Secretary of State for Transport if he will bring forward proposals whereby tolls on the Severn bridge will be suspended while travellers are delayed due to road closures because of repairs; and if he will make a statement.

  Mr. Kenneth Carlisle
  The Severn Bridges Act 1992 allows the concessionaire, at his discretion, to suspend tolls. We have no plans to seek amendments to the relevant provisions. Recent repairs to the bridge took less than one week to complete.

  Mr. Alex Carlile
  To ask the Secretary of State for Transport if he will introduce proposals to amend the Severn Bridges Act 1992 in respect of the level of tolls.

  Mr. Kenneth Carlisle
  No. The toll levels in the Act were fully debated in Parliament. The current tolls are contributing directly to the provision of the much needed second Severn bridge.

SCOTLAND

  School Inspections
  Mr. McFall
  To ask the Secretary of State for Scotland if he will list the number and dates of Her Majesty's inspectorate school inspections in each primary and secondary school in Scotland over the last 10 years.

  Lord James Douglas-Hamilton
  The information is extensive. A copy of it has been placed in the Library. It refers only to inspections of primary and secondary schools which led to published reports since publication started in 1983. The lists do not include inspections of nursery, special or independent schools, colleges of further education or colleges of education which led to published reports within the same period; nor do they include the further inspections conducted 12 to 18 months after each full inspection to follow up the recommendations contained in the published report. In addition, visits have taken place on a regular basis to educational institutions for a range of other purposes including follow-up to specific inquiries, gathering evidence for published reports on various aspects of learning and teaching, monitoring implementation of curricular advice, and the incorporation of further education colleges.

  Cunninghame District Council
  Mr. Wilson
  To ask the Secretary of State for Scotland if he will compensate Cunninghame district council because of the error in calculating the authority's non-domestic rate income for 1991–92.

  Mr. Lang
  Yes. I propose to make an ex-gratia payment of £250,000 to Cunninghame district council towards the additional interest costs which it has incurred, pending an adjustment of revenue support grant, as a result of the fact that, in estimating the council's non-domestic rate income in respect of 1991–92, my Department used incorrect rateable valuation data. The council has accepted my offer of this payment.

  Parliamentary approval to this new expenditure will be sought in a supplementary estimate for the revenue support grants, Scotland vote—class XV, vote 20. Pending that approval, this urgent expenditure will be met by a repayable advance from the Contingencies Fund.

  Local Government Finance
  Mr. Gallie
  To ask the Secretary of State for Scotland if he will announce the 1993–94 grant-aided expenditure figures for each Scottish local authority.

  Mr. Lang
  The GAE figure for each local authority for 1993–94 is set out in the table. Each authority's allocation of the GAE total has been determined having regard to the client group methodology which is agreed with the Convention of Scottish Local Authorities in the distribution committee of the working party on local government finance. The table excludes figures for urban programme GAE which is not allocated to individual authorities. The addition of this amount—£63·255 million brings—the GAE total to the previously announced sum of £5,086·4 million.

  Regions and Islands

  GAE 1993–94 (£000s)

  Borders

  94,642

  Central

  220,101

  Dumfries and Galloway

  131,903

  Fife

  279,251

  Grampian

  405,795

  Highland

  203,988

  Lothian

  575,445

  Strathclyde

  1,960,221

  Tayside

  331,039

  Orkney

  27,022

  Shetland

  26,237

  Western Isles

  43,041

  Total

  4,298,686

  GAE 1993–94

  Districts

  (£000s)

  Berwick

  2,135

  Ettrick and Lauderdale.

  3,809

  Roxburgh

  4,035

  Tweeddale

  1,692

  Clackmannan

  7,318

  Falkirk

  18,537

  Stirling

  12,845

  Annandale and Eskdale

  4,161

  Nithsdale

  6,763

  Stewartry

  2,772

  Wigtown

  3,669

  Dunfermline

  17,764

  787

  Districts

  (£000s)

  Kirkcaldy

  20,941

  North East Fife

  9,672

  Aberdeen

  28,435

  Banff and Buchan

  11,680

  Gordon

  10,543

  Kincardine and Deeside

  6,810

  Moray

  11,660

  Badenoch and Strathspey

  1,377

  Caithness

  3,123

  Inverness

  7,305

  Lochaber

  2,464

  Nairn

  1,173

  Ross and Cromarty

  6,598

  Skye and Lochalsh

  1,645

  Sutherland

  1,940

  East Lothian

  11,995

  Edinburgh

  62,245

  Midlothian

  10,876

  West Lothian

  20,574

  Argyll and Bute

  10,466

  Bearsden and Milngavie

  5,258

  Clydebank

  5,648

  Clydesdale

  8,363

  Cumbernauld and Kilsyth

  8,373

  Cumnock and Doon Valley

  5,883

  Cunninghame

  19,397

  Dumbarton

  10,233

  East Kilbride

  10,982

  Eastwood

  7,413

  Glasgow

  129,058

  Hamilton

  14,373

  Inverclyde

  12,355

  Kilmarnock and Loudoun

  10,857

  Kyle and Carrick

  15,688

  Monklands

  15,299

  Motherwell

  20,158

  Renfrew

  29,716

  Strathkelvin

  11,615

  Angus

  12,783

  Dundee

  26,153

  Perth and Kinross

  17,836

  Total

  724,459

  All Scotland Total

  5,023,145

  Conifers (River Pollution)
  Mr. Alex Carlile
  To ask the Secretary of State for Scotland if he will make a statement regarding the recent finding of a committee of the Forestry Commission on a link between conifer trees and river acidification.

  Sir Hector Monro
  [holding answer 7 December]: None of the Forestry Commission's committees has made a recent finding of this kind.

  An expert workshop jointly sponsored by the Forestry Commission and the Department of the Environment concluded in June 1990 that the primary cause of surface water acidification was the deposition of airborne sulphur and nitrogen pollutants, but that there was also an association between trees and acidification resulting from the effectiveness of trees in scavenging these airborne pollutants. Whether the latter phenomenon would result in increased surface water acidification depended, however, on the sensitivity of the geology and soil in any given catchment area.

  The members of the Forestry Commission's north Scotland regional advisory committee recently considered this and other scientific evidence presented to them in the course of considering planting grant applications over which objections had been raised on environmental
  788
  grounds. They advised the commissioners that, in their opinion, there was sufficient doubt about the effect that tree planting on the specific sites concerned would have on surface water acidification as to prevent their recommending that the applications should be approved at this stage. In the light of this advice, the Forestry Commissioners have decided to delay taking a decision on these applications pending further monitoring of the sensitivity of the sites to further acid inputs from the atmosphere.

  Health Spending
  Mrs. Fyfe
  To ask the Secretary of State for Scotland how much of the planned spending on health for 1993–94 will be spent on promotion of health.

  Mr. Stewart
  [holding answer 8 December]: The responsibility for allocating resources to health promotion rests with health boards.

  In addition, the Health Education Board for Scotland received resources totalling £6·441 million in 1992–93. The board will shortly be informed of its allocation for 1993–94.

  Mrs. Fyfe
  To ask the Secretary of State for Scotland how much he expects to save on the 1993–94 health budget from the 1·5 per cent. ceiling on health workers' pay increases.

  Mr. Stewart
  [holding answer 8 December]: There will be no saving on the 1993–94 budget for the national health service in Scotland as a consequence of the ceiling of 1·5 per cent. on pay increases for national health service staff. The effect of this ceiling will be to free resources for direct patient services and investment in new hospitals and clinics.

  Mrs. Fyfe
  To ask the Secretary of State for Scotland how much of the planned provision for health in 1993–94 will be spent on implementing the patients charter.

  Mr. Stewart
  [holding answer 8 December]: My right hon. Friend the Prime Minister made it clear on launching the citizens charter that charters would be taken forward within existing resources. Thus there is no earmarked budget within resources for health in 1993–94 for the continued implementation of the patients charter: all parts of the national health service in Scotland will deploy their allocated resources to develop services in accordance with charter principles.

  Mrs. Fyfe
  To ask the Secretary of State for Scotland if he will publish a breakdown of the planned £744 per head spending on health in Scotland, showing how much will be allocated to(a) introduction of trust status for those units which have successfully applied, (b) management and administration of trusts, implementation of the patients charter and (c) promotion of health and illness prevention.

  Mr. Stewart
  [holding answer 8 December]: It is not possible to provide the analysis requested.

  Hospital Beds
  Mr. Blunkett
  To ask the Secretary of State for Scotland if he will list for every health authority(a) the total number of hospital beds and (b) the number of acute hospital beds as at March 1991.
  789
  Mr. Stewart
  [holding answer 8 December]: The information requested is shown in the table. The table shows information on bed complement. This is the number of beds approved by health boards. Beds in day bed units, borrowed beds and temporary beds are excluded.

  NHS—bed complement; all and acute hospital beds; by health board of treatment; as at 31 March 1991

  Bed complement

  All specialties

  Acute specialties

  SCOTLAND

  52,738

  16,538

  Argyll and Clyde

  4,130

  1,282

  Ayrshire and Arran

  2,937

  1,104

  Borders

  939

  352

  Dumfries and Galloway

  1,407

  451

  Fife

  3,006

  806

  Forth Valley

  2,871

  641

  Grampian

  5,149

  1,419

  Greater Glasgow

  12,667

  3,978

  Highland

  1,885

  717

  Lanarkshire

  4,938

  1,578

  Lothian

  7,633

  2,374

  Orkney

  155

  61

  Shetland

  148

  51

  Tayside

  4,651

  1,636

  Western Isles

  222

  88

  Health Service Trusts
  Mrs. Fyfe
  To ask the Secretary of State for Scotland how much of the planned provision for health in 1993–94 will be spent on the introduction of trusts.

  Mr. Stewart
  [holding answer 8 December]: Spending in 1993–94 on the introduction of trusts will depend on the number of expressions of interest in trust status and the number of applications which are subsequently approved.

  Abortion
  Ms. Janet Anderson
  To ask the Secretary of State for Scotland how many NHS hospitals in Scotland providing day-care abortion services are offering early medical abortion services in the first nine weeks of pregnancy with mifepristone and prostaglandin.

  Mr. Stewart
  [holding answer 9 December]: From April to December 1991, five hospitals performed early medical abortions in the first nine weeks of pregnancy with mifepristone, and with or without prostaglandin.

  Forestry Commission Land
  Mr. Nigel Griffiths
  To ask the Secretary of State for Scotland if he will list the Forestry Commission lands in Scotland already sold for which no access agreements have been concluded.

  Sir Hector Monro
  [holding answer 25 November]: The information is as follows:

  Region

  Name of Woodland

  Area (Hectares)

  Strathclyde

  Carrick (part)

  68

  Dumfries and Galloway

  Springkell (part)

  19

  Dumfries and Galloway

  Dromore

  86

  This list does not include those woodlands which were sold before the arrangements for securing continued public
  790
  access to Forestry Commission woodlands after sale were introduced in October 1991, nor those sales which were too far advanced at that time to be included for consideration under those arrangements.

EMPLOYMENT

  Wages Councils
  Ms. Quin
  To ask the Secretary of State for Employment if she will place in the Library a copy of the research commissioned by her Department on the effect of the abolition of wages councils.

  Mr. Michael Forsyth
  There has been no recent research into the effects of abolition of wages councils. However, in the early 1980s the Department published research into six councils, five of which were abolished by Labour, and copies will be placed in the Library, as soon as this can be arranged.

  Mr. Alex Carlile
  To ask the Secretary of State for Employment what representations she has received from people in Wales regarding the abolition of wages councils; and if she will make a statement.

  Mr. Michael Forsyth
  There is no separate information available about representations received from people in different parts of Great Britain.

  Disabled Trainees
  Mr. Ieuan Wyn Jones
  To ask the Secretary of State for Employment if she will make it her policy to ring-fence money for training and enterprise councils to secure specialist equipment to assist disabled trainees with their placements.

  Mr. Michael Forsyth
  The funding arrangements between the Employment Department and TECs take into account the higher costs incurred in providing support arrangements, for example, specialist equipment.

  My right hon. Friend the Secretary of State has no plans to change these arrangements which give TECs the flexibility to meet the needs of individual providers and trainees as they arise.

  Mr. Ieuan Wyn Jones
  To ask the Secretary of State for Employment if she will make it her policy to instruct training and enterprise councils to give guaranteed training placements to all unemployed disabled people.

  Mr. Michael Forsyth
  Under employment training, people with disabilities who are unemployed qualify for places regardless of the length of their unemployment and are included in the aim group. People with disabilities will have a priority for places in training for work, to be introduced in April 1993. Under youth training, the Government extend their guarantee of a place to those young people who are aged over 18 years who were not previously able to join the programme because of disability or ill-health, or who had to leave the programme for the same reasons and are seeking re-entry.

  Mr. Ieuan Wyn Jones
  To ask the Secretary of State for Employment if she will instruct training and enterprise councils to undertake local needs surveys on an annual basis in order to ascertain numbers of disabled potential trainees.
  791
  Mr. Michael Forsyth
  Training and enterprise councils (TECs) are required to assess the training needs of their local area each year in consultation with other local interests including the Employmnent Service. My right hon. Friend the Secretary of State ensures that, in particular, the needs of people with disabilities are taken into account before a TEC's annual business plan is agreed.

  Disabled Employees
  Mr. Elletson
  To ask the Secretary of State for Employment how many(a) physically disabled and (b) sensorily disabled people are employed in her Department; and what percentage they are of the total work force.

  Mr. Michael Forsyth
  Information is not available in the form requested, but 1,964 registered disabled people—3·3 per cent. of the total work force—were employed in July 1992, the latest date for which figures are available. The Department also employs other people with disabilities who have chosen not to register.

  Training and Enterprise Councils
  Mr. Betts
  To ask the Secretary of State for Employment what unspent revenues TECs had at the end of 1991–92; and what percentage of their overall budget this represented.

  Mr. McLoughlin
  My right hon. Friend the Secretary of State is unable to respond on behalf of my right hon. Friends the Secretaries of State for Scotland and for Wales, who now have responsibility for the delivery of programmes in those areas.

  TECs in England are required, under the operating agreement, to produce audited accounts within four months of the end of the financial year.

  These accounts reveal the total operating surplus as at the end of the financial year and on a cumulative basis; however, this information is not published as a percentage of the overall budget.

  The accounts for the financial year ending 31 March 1992 are now in the public domain and available from individual TECs.

  The need for this information on an aggregated basis has been recognised and the format of the Employment Department appropriation account for 1993–94 onwards has been amended to take this into account.

  Trade Unions
  Mr. Ottaway
  To ask the Secretary of State for Employment if she will make a statement about the future of the schemes which subsidise trade union ballots and training for trade union officials.

  Mrs. Gillian Shephard
  I have reviewed the operation of the trade union ballot funding scheme, which allows unions to reclaim certain costs associated with secret postal ballots, and the trade union education and training grant, which supports training for trade union officials and representatives.

  The ballot funding scheme was set up in 1980 to encourage the voluntary practice of secret balloting at a time when there were no statutory requirements for unions to ballot their members before calling strikes or when electing their leaders. Since then, there have been major changes in industrial relations law and practice.
  792
  Secret ballots of union members on the major issues affecting their interests are now generally accepted and in the most important respects are required by law. The scheme now operates largely as a public subsidy for ballots which unions are required to carry out to meet their obligations under the law. The Government therefore believe that the time has come to bring the scheme to an end.

  The trade union education and training grant was first paid in 1976 and has subsequently been renewed on an annual basis. It was intended to provide training for union officials to ensure that they were well qualified to carry out their collective bargaining duties, with a view to improving industrial relations and reducing strikes. Industrial relations have improved greatly, and strikes are now at their lowest level since records began. At the same time, fewer than 50 per cent. of employees now have their pay determined, directly or indirectly, by negotiations between employers and trade unions. More and more employees negotiate their pay directly with their employer on an individual basis, taking account of performance and skills. In these circumstances, the Government believe that there is now no justification for continuing to support this training from public funds.

  However, I have decided against immediate abolition of these schemes. Funding for both schemes will therefore be phased out over three years to allow trade unions time to find alternative sources of finance for these activities.

  In 1993–94, the Government will meet the cost of 75 per cent. of each qualifying claim under the ballot funding scheme, and the trade union education and training grant will be set at 75 per cent. of the 1992–93 per capita figure. In 1994–95 these levels of support will be reduced to 50 per cent. and in 1995–96 they will be reduced to 25 per cent. Both schemes will cease to operate from 1 April 1996.

DEFENCE

  Used Tyres and Waste Oil
  Mr. Jopling
  To ask the Secretary of State for Defence if he will list those defence establishments which make a practice of disposing of used tyres and waste oil by burning into the atmosphere; what effect he estimates this practice has on the environment; and what steps he intends to take to eliminate this practice.

  Mr. Aitken
  Used tyres and work oil are disposed of not by burning but in accordance with the duty of core requirements relating to waste embodied in the Environmental Protection Act 1990 (EPA), through contracts with appropriately qualified contractors. The only exceptions to this policy are small amounts of both materials which may be burnt during fire-fighting training. This is carried out under strictly controlled conditions and is permitted under the exemptions granted to my Department from the statutory nuisance provisions of the EPA.

  Reactor Cores
  Mr. Llew Smith
  To ask the Secretary of State for Defence if, pursuant to his reply to the hon. Member for Leyton (Mr. Cohen)Official Report, 27 November, column 895, he will set out the route used to transport the nuclear core from Rosyth to Sellafield.
  793
  Mr. Aitken
  For security reasons, it is not our practice to comment on the routes used in the movement of nuclear submarine reactor cores.

  Channel Islands (War Records)
  Mr. Janner
  To ask the Secretary of State for Defence how many records from the small number of files relating to the wartime Nazi occupation of the Channel islands that have been held by his Department on extended closure have been passed to prosecuting authorities in the United Kingdom or in Germany; and if he will make a statement.

  Mr. Archie Hamilton
  It has been the practice of the Ministry of Defence to make all papers, whether open or closed, available to any official prosecuting authority investigating alleged war crimes.

  Mr. Janner
  To ask the Secretary of State for Defence how many of the small number of files relating to the wartime Nazi occupation of the Channel islands, that have been held by the Ministry of Defence on extended closure, relate in any way to allegations of war crimes or atrocities that may have been committed by(a) United Kingdom citizens and (b) non-United Kingdom citizens on the island of Alderney; and if he will make a statement.

  Mr. Archie Hamilton
  The small number of papers relating to the wartime Nazi occupation of the Channel islands still held by my Department remain properly closed under the provisions of section 5(1) of the Public Records Acts of 1958 and 1967.

  It has been the practice of successive Governments not to disclose the contents of records which are so withheld from public release, but the papers will be made available to any official prosecuting authority investigating alleged war crimes.

  Royal Naval Stores Depot, Eaglescliffe
  Mr. Brazier
  To ask the Secretary of State for Defence if a decision has been taken on the proposal to relocate 182 Ministry of Defence headquarters' posts from the royal naval stores depot at Eaglescliffe in Cleveland.

  Mr. Archie Hamilton
  My Department has consulted very thoroughly on the proposal to colocate 182 headquarters posts currently at Eaglescliffe with the integrated headquarters of the new Naval Support Command in the Bath region. During the course of the consultation process I visited the establishment to see the facilities there and to hear the views of management, staff 794
  and trade unions. I have studied very carefully' the helpful comments and views expressed by them, hon. Members and others. I have concluded that the proposal to move these posts in 1995–96, which is expected to produce net savings around £12 million over 10 years, represents the best value for money for the taxpayer as well as producing real operational benefits. Discussions will now take place with the trades unions on implementation of the moves in 1995–96. The royal naval stores depot itself will not be affected.

  Redundancies
  Dr. Goodson-Wickes
  To ask the Secretary of State for Defence what is the current position on redundancies in the(a) Royal Navy, (b) Army and (c) Royal Air Force; and if he will make a further statement.

  Mr. Archie Hamilton
  I announced the second phase of the Royal Navy's redundancy programme in my answer to my hon. Friend the Member for Wimbledon (Dr. Goodson-Wickes) on 3 June 1992,Official Report, columns 568–69. A total of 436 officers and 836 ratings have now been selected for redundancy. The vast majority are volunteers although, regrettably, it has been necessary to select 69 officers and 80 ratings who did not put their names forward. All individuals have been notified and will leave between 1 April and 30 November 1993. The need for a third phase is under careful consideration.

  For the Army, as foreshadowed in my answer to my hon. Friend the Member for Beckenham (Mr. Merchant) on 8 July 1992, Official Report, column 185, a total of 1,311 officers and 5,150 soldiers will he selected for redundancy in 1993–94. I am pleased to say that all the 5,150 soldiers to be selected have volunteered for redundancy. Almost 60 per cent. of the officers will also be volunteers, but it will unfortunately be necessary to select 623 officers for compulsory redundancy. All those declared redundant will be notified on 25 February 1993. The size of the third phase for 1994–95 will be considered in due course.

  The first tranche of the RAF redundancy scheme that I announced in my answer to my hon. Friend the Member for Spelthorne (Mr. Wilshire) on 22 May 1992, Official Report, column 292, was oversubscribed by applicants and no compulsory redundancies are necessary to meet the full target of 750 places in 1993–94. In addition, some 210 individuals who also volunteered for redundancy have indicated their willingness to leave before 31 March 1993. The size of the second tranche of the scheme in 1994–95 will be reviewed next year in the light of the latest manpower forecasts.

Preamble
The House met at three of the clock (Prayers having been read earlier at the Judicial Sitting by the Lord Bishop of Peterborough.) The LORD CHANCELLOR on the Woolsack.

Kosovo
Lord Renfrew of Kaimsthorn Lord Renfrew of Kaimsthorn asked Her Majesty's Government:
Whether they will consider supporting the claims of the majority for the independence of Kosovo in the light of the possibility that Serbian forces might initiate a policy of "ethnic cleansing".
The Minister of State, Foreign and Commonwealth Office (Baroness Chalker of Wallasey): My Lords, we fully support the efforts of the special group on Kosovo established at the international conference on the former Yugoslavia to broker a political settlement in Kosovo based on genuine autonomy.
Lord Renfrew of Kaimsthorn: My Lords, I thank the Minister for that very positive and encouraging Answer. Does she agree that if this unpleasant practice of ethnic cleansing is applied in Kosovo, it is likely that other nations, such as Turkey, will be drawn into the conflict? They will be reluctant to see fellow Moslems or indeed fellow human beings subjected to such vicious and obscene persecution. Do Her Majesty's Government have clear proposals to discourage such an eventuality?
Baroness Chalker of Wallasey: My Lords, all ethnic cleansing, wherever it occurs, is totally against the wishes of everyone. I believe that the Security Council resolution, establishing a commission to analyse the war crimes, will be able to take the perpetrators of ethnic cleansing and hold them individually responsible for their actions. I fully accept what my noble friend said about the danger of spreading the matter. We are taking all possible action to try to prevent that.
Baroness Blackstone: My Lords, can the Minister tell the House whether the CSCE delegation which has recently been in Kosovo has reported its findings? Can she also inform the House of when the CSCE next intends to discuss the issue?
Baroness Chalker of Wallasey: My Lords, to my knowledge it has not yet reported its findings. I believe that there is to be a further meeting next week.
The Earl of Lauderdale: My Lords, does my noble friend agree that the premature recognition of Bosnia contributed substantially to the deterioration of the situation? May I hope that we shall be very cautious in this regard?
Baroness Chalker of Wallasey: My Lords, if there is one thing we have all learned since this tragedy began in the former Yugoslavia it is that recognition of one part after another of the former Yugoslavia seems to have been an engine to break down the whole
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situation. It is right, I believe, that we keep the London Conference machinery working for peace and the prevention of tragedy in all parts of the former Yugoslavia.
Lord Finsberg: My Lords, does my noble friend agree that what has happened so far in Kosovo with the beginning of cleansing and what has happened in the rest of the former Yugoslavia show how very sad it is that the CSCE has been utterly powerless? Does she believe that the world will be able to drive the Serbs out of the territory that they have illegally and so brutally obtained?
Baroness Chalker of Wallasey: My Lords, my noble friend is a little over-critical of CSCE. In Kosovo it has established a long-term resident monitoring presence with the aim of promoting a dialogue between the authorities concerned and the representatives of the local populations. It will also collect information on human rights violations and promote solutions. However, I understand the frustration felt by many Members. We need to work very carefully through every possible aspect of the London Conference to prevent the conflict spreading.
Earl Jellicoe: My Lords, having twice in recent months visited Albania and discussed these matters with Albanian Ministers and that country's able President, may I voice my very real fear that the present situation in Kosovo contains within it the seeds not only of another civil war, perhaps imminent, but also of another major Balkan conflagration which could well spread outside the Balkans? Given those circumstances, can my noble friend say first what progress has been made in stationing European Community monitors around the frontiers of Kosovo, including the Albanian frontier? Secondly, bearing in mind her reply to the Question of my noble friend Lord Renfrew, what representations, if any, have Her Majesty's Government recently made to Belgrade about the restoration in Kosovo of real autonomy, an autonomy that obtained under Tito?
Baroness Chalker of Wallasey: My Lords, my noble friend has asked a number of complicated interlinked questions. The EC monitoring mission operations are being extended. We are currently in negotiation for an extension to Albania and, indeed, along the borders that he mentioned. It is of great regret that the Kosovars are not participating in the elections to be held later this month. Sadly they have forfeited the right to field Kosovar candidates. We understand why but they could still vote in the federal elections. I believe that Kosovo has to have representation, even if its long-term aim may be to have genuine autonomy with full human rights. That is what we are pressing the Serbian authorities to grant to the Kosovars. I hope that in the meantime they may be persuaded to accept something short of full independence.
Lord Ennals: My Lords, may I bring the Minister back to the question put by my noble friend Lady Blackstone; namely, the role of the CSCE? In view of the fact that it has now made the very important appointment of a commissioner for national

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minorities, Max Van der Stoel, a former Netherlands Foreign Minister, might it not be the case that that appointment and the CSCE may be more appropriate to deal with some of these problems than the European Community which, in my view, is not equipped for such a role?
Baroness Chalker of Wallasey: My Lords, I understand the noble Lord's wish to see the CSCE further involved. I believe that with the long-term resident monitoring presence there is a chance to do more in that regard. It may in some ways be better equipped but not in all.
Lord Campbell of Alloway: My Lords, does my noble friend the Minister agree that such a terrible thing as ethnic cleansing, for example, is not a war crime as such but a crime against humanity? Does she further agree that investigation is one thing: it is another to set up an international court under the aegis of the United Nations with jurisdiction to try? What has been done towards setting up such a court? If it were set up, how would the persons to be tried be arrested and transported for trial and how would the penalties be enforced? It is a problem which one can talk about. But what can one do about it?
Baroness Chalker of Wallasey: My Lords, Security Council Resolution 780 established an impartial commission to analyse the information on war crimes. Although there is no intention of preparing cases for prosecution, it is intended to assist the UN Secretary General. We have for a long time pressed with our European partners for the International Law Commission to be given a mandate to draft a statute for an international criminal court. I believe that that is the route we should take. I cannot answer all the detailed questions which my noble friend put because many of them depend upon the way in which the mandate is drafted.
Lord Plumb: My Lords, what action is the Security Council taking in respect of the siege of Sarajevo?
Baroness Chalker of Wallasey: My Lords, the Security Council met yesterday and issued a statement which I shall place in the Library of the House. The Security Council strongly condemned the attacks on Sarajevo and the other attacks in Bosnia. It demanded an immediate cessation of the attacks and of all actions aimed at impeding the distribution of humanitarian assistance and forcing the inhabitants to leave the city. The Security Council further stated that if such attacks and actions continue it will consider as soon as possible further measures against those who commit or support them in order to ensure the security of UNPROFOR and of the international relief workers, the ability of UNPROFOR to fulfil its mandate and compliance with the council's relevant resolutions.
Lord Mackie of Benshie: My Lords, what grounds does the Minister have for believing that the Serbians will pay any more attention to the signals sent by the United Nations, Europe and the CSCE than they have hitherto?
Baroness Chalker of Wallasey: My Lords, we continue to work with those Serbs who appear to understand that what is happening in Bosnia is wrong. We shall do so while that is necessary.

Summer Time
3.12 p.m.
Lord Ezra Lord Ezra asked Her Majesty's Government:
Whether, in view of the launch of the single European market at the beginning of 1993 and the opening of the Channel Tunnel towards the end of that year, they will expedite their review of the desirability of adopting Central European time.
The Minister of State, Home Office (Earl Ferrers): My Lords, the European Commission is reviewing its position on Summer Time. We shall bring forward our proposals when the approach of the Commission is clear.
Lord Ezra: My Lords, does the Minister recall that his noble friend Lord Astor gave almost the same indication in a debate on 14th July; namely, that the Commission was conducting an early review of the matter? Has there been a further delay? If so are the Government prepared to use their Presidency of the Community to speed up the inquiry? In view of the developments referred to in my Question there is an obvious relevance in our linking up with Central European Time. Therefore, will the Government give a declaration of intent subject to suitable proposals being made?
Earl Ferrers: My Lords, I am glad that my noble friend Lord Astor gave a similar reply. It shows that there is at least consistency in government. I do not believe that the review has been delayed. Negotiations with the European Commission on a directive for the dates of Summer Time from 1995 are expected to begin in the middle of next year. The noble Lord asked whether the Government would use their Presidency of the Commission to expedite matters. I fancy that there are pressing issues of a more substantial nature with which the Commission must deal than the altering of summer time arrangements. As regards our intention, I believe that we should wait for the review of the Commission.
Lord Hailsham of Saint Marylebone: My Lords, does my noble friend agree that the actual motions of time depend more on the degrees of longitude and the sun than on the particular convenience of persons who live at different degrees of longitude?
Earl Ferrers: My Lords, the whole subject is one of beastly and foul complexity to which one must address one's mind from time to time. One of the points involved is that made by my noble and learned friend. I am sure that he is right but I would rather not pursue it.
Lord Strabolgi: My Lords, in contrast to what the noble and learned Lord said, are the Government aware that in this country an extra hour in the evening would result in additional participation in leisure

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activities, much more employment and greatly increased revenues for the tourist and leisure industries?
Earl Ferrers: My Lords, that is one of the arguments for one side of the equation and it must be taken into account.
Lord Winstanley: My Lords, does the Minister recall our experiment with British Standard Time, which was introduced by my noble friend Lord Jenkins of Hillhead when he was Home Secretary? That illustrated the advantages of a greatly increased amount of communication time between businesses in Britain and Europe. Would that not be added to by the single market? Is it not also a fact that the previous experiment was halted as the result of a conspiracy between the Daily Express and the BBC, which hourly reported children being mown down in the streets by traffic while ignoring the fact that more children are taken to school in the morning than are collected in the afternoon and that just as many are injured in accidents in the afternoon as in the morning?
Earl Ferrers: My Lords, I find it difficult to disagree with the noble Lord, Lord Winstanley, or to agree with him. He made a number of points all of which were pertinent. However, I do not believe that the Daily Express and the BBC, powerful though they are, altered the dates and times at which we change Summer Time.
Lord Monson: My Lords, does the Minister agree that Britain is by no means alone in this respect because more than one-third of the countries in the Community do not adhere to Central European Time? They are the United Kingdom, the Republic of Ireland, Portugal, Greece and the Canary Islands, which are part of Spain. Does the Minister also agree that the United States, Canada and Australia each have up to five time zones which they link successfully in their single markets?
Earl Ferrers: My Lords, I am sure that the latter part of the noble Lord's question is correct. However, as regards the number of countries within the European Community which have different time scales, that is one of the problems which the Commission is addressing in order to ascertain what commonality there may be. It may bump up with the very problem which the noble Lord puts forward.
Lord Bruce of Donington: My Lords, will the Minister give prime regard to the convenience of the United Kingdom in these matters? Is he aware that, as regards the statement in the Question about the launch of the Single European Market on 1st January, 75 per cent. of the single market has been in operation for 20 years and opinions are still divided as to the benefits which have been derived from that?
Earl Ferrers: My Lords, the noble Lord asked whether we shall take into account the fact that the United Kingdom's convenience is the most important. That may well be so but the difficulty is in knowing
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what the United Kingdom wishes. Everyone has different views, as your Lordships have demonstrated today.
Lord Elton: My Lords, before we decide whether we want Central European Time should we not decide where the centre of Europe is, and do we know?
Earl Ferrers: My Lords, the answers must be yes and no. Your Lordships can choose which questions they refer to.
Lord Vinson: My Lords, does my noble friend agree that the present arrangements sorely disadvantage many elderly people, who are frightened to go out after dark and who are in effect curfewed at sundown? The extra hour which the proposed changes would bring would greatly emancipate and improve their lives.
Earl Ferrers: My Lords, that may be one of the advantages of such a change.

Wave Power
3.20 p.m.
Lord Campbell of Croy Lord Campbell of Croy asked Her Majesty's Government:
When the inquiry into the potential for producing energy for the United Kingdom from wave power at sea is expected to be completed.
The Parliamentary Under-Secretary of State, Department of Trade and Industry (Baroness Denton of Wakefield): My Lords, the Government's review of wave energy into the potential for producing energy from wave power is in preparation, and we expect it to be published by the end of the year.
Lord Campbell of Croy: My Lords, I am grateful for that reply from my noble friend. Is it correct that, because of the passage of time, the inquiry is now being conducted by only one person? If support is needed by that person, will my noble friend make sure that it is forthcoming because waves offer a promising future without the need for disturbance or nuisance on land?
Baroness Denton of Wakefield: My Lords, I am pleased to repeat to my noble friend Lord Campbell of Croy that the report is shortly to be published. He rightly points out that the review of wave energy has been conducted largely by Tom Thorpe of the Energy Technology Support Unit, but in recent months Mr. Thorpe has been assisted by independent consultants. Most of the delay has been caused by the complexities of the problems and the desire to ensure that every potential is examined.
Lord Donoughue: My Lords, given the great potential benefits of wave power —it is clean and does not involve the hazards of waste disposal or decommissioning and does not involve the burning of a primary fuel—and bearing in mind that the coasts of Scotland and Cornwall alone could provide half the energy demand of this country, will the Minister accept that on this side of the House we shall scrutinize

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that report very carefully? We trust that it heralds the end of the apparent hostility of the Minister's department to expenditure on research in that area.
Baroness Denton of Wakefield: My Lords, I should not expect other than that noble Lords opposite would scrutinise carefully any reports that we publish. There is no bias against wave power. That is a myth on the part of noble Lords opposite. The Government have spent money, and wave power will be taken fully into account when considering our renewable strategy.
Lord Mackie of Benshie: My Lords, originally the noble Baroness said that the report would be published before the end of the year and then she said that it would be published shortly. In my experience the word "shortly" in Government replies can often mean years. Will the noble Baroness clarify her reply?
Baroness Denton of Wakefield: My Lords, on this occasion I am pleased to say that the report will be published before the end of the year.
Lord Campbell of Croy: My Lords, can my noble friend give the House any news of the inquiry into renewables in general, which was initiated by the Department of Energy before it was absorbed into the DTI?
Baroness Denton of Wakefield: My Lords, the report of the renewable energy advisable group, which is now chaired by Dr. Martin Holdgate, is expected to be published shortly.
Lord Williams of Elvel: My Lords, will the noble Baroness confirm to the House that before privatisation the Central Electricity Generating Board carried out an extensive survey and research into wave power and off shore energy? Will she confirm also that at that time the CEGB said that, although the economics were not right, nevertheless there was a potential for providing 100 per cent. of the United Kingdom's energy requirement? That figure is produced in the report by a committee of your Lordships' House. Will the noble Baroness say what extra evidence is available to this inquiry which was not available to the CEGB at the time?
Baroness Denton of Wakefield: My Lords, the answer to the noble Lord, Lord Williams, is the question: when? The amount of work to be done and the report due to be published before the end of the year will establish clearly that every project in that area is in its development stage. When those projects have moved beyond the development stage we shall be able to form a better view of what they will contribute.

Gibraltar Airport
3.25 p.m.
Lord Merrivale Lord Merrivale asked Her Majesty's Government:
To what extent Gibraltar is affected by Council Regulation No. 2408/92 (the third air liberalization package) and to what extent this regulation diminishes the effect of the 1987 airport agreement.
The Minister of State, Department of Transport (The Earl of Caithness): My Lords, Council Regulation 2408/92 provides that Community air carriers shall be entitled to operate services between virtually all Community airports. As with the two preceding Community market access regulations, Gibraltar Airport is suspended from the provisions of this regulation pending implementation of the 1987 airport agreement. International air services to Gibraltar will, therefore, continue to rest on bilateral agreements rather than EC legislation.
The 1987 airport agreement is essentially concerned with practical arrangements for the management of the airport. The EC regulation does not affect this.
Lord Merrivale: My Lords, I thank the Minister for that Answer. Is it not a fact that both the 1987 joint agreement and this council regulation refer to greater co-operation over the use of Gibraltar Airport, while Spain, in effect, wants joint control, believes the agreement to be a temporary arrangement and argues that the airport is on occupied territory? Does not the agreement appear to be somewhat unworkable on the basis of co-operation, bearing in mind also that certain European Community measures surpass it?
The Earl of Caithness: My Lords, the difference between my noble friend and the Government on this matter is the interpretation of the 1987 Gibraltar Airport agreement. My noble friend said that the purpose of the agreement is to give joint control over the airport, which is on disputed territory. I contest that interpretation of the agreement. I believe that it provides for consultation with the Spaniards, which is very different.
Lord Clinton-Davis: My Lords, perhaps I may support the Minister on that point as one who participated in the debates in the Council of Ministers on the issue. Is it not a fact that, had it not been for compromise on all sides, the benefits of the 1987 agreement and that which has persisted through to this very day in relation to air services could not have been procured?
The Earl of Caithness: My Lords, it is rare to have the support of the noble Lord and I welcome it on this occasion. He is right that without this we should not have been able to make the progress that we have in Europe as regards air services and liberalisation. I hope that accord will be reached soon on the 1987 airport agreement.
Lord Boyd-Carpenter: My Lords, will my noble friend indicate what action Her Majesty's Government are taking to clear up this situation inasmuch as the functioning of that very interesting airport is being handicapped by the attitudes of Spain in particular?
The Earl of Caithness: My Lords, the United Kingdom Government are not taking action. The Gibraltar Government are taking action in some respects on EC legislation through the European Court of Justice which I believe my noble friend

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knows about. We hope that Gibraltar will implement the airport agreement because we believe that that will be to the benefit of Gibraltar.
Lord Merrivale: My Lords, in view of the Gibraltar Government's attitude—and I believe it to be the right attitude—regarding the 1987 agreement, will the Government consider a revision of the agreement on the basis of Community requirements, treating Gibraltar Airport as a Community airport?
The Earl of Caithness: My Lords, that is an interesting idea. Of course one needs at least two sides to participate in an agreement. Although we might look upon my noble friend's idea with favour, we should have to consult the Spanish Government to reach an agreement. However, I shall certainly put that matter to my right honourable friend.

Business of the House
3.28 p.m.
The Lord Privy Seal (Lord Wakeham): My Lords, I beg to move the Motion standing in my name on the Order Paper.
Moved, That Standing Order 38 (Arrangement of the Order Paper) be dispensed with on Monday next to allow the Motion in the name of the Lord Moran to be taken after the Motion in the name of the Baroness Blatch.—(Lord Wakeham.)
On Question, Motion agreed to.

Crown Proceedings (Armed Forces) Bill [H.L.]
Report received.

Criminal Justice Bill [H.L.]
3.30 p.m.
Read a third time.
Clause 18 [Offences in connection with laundering money from drug trafficking]:
Lord Williams of Mostyn Lord Williams of Mostyn moved Amendment No. 1:
Page 16, line 34, leave out ("suspects") and insert ("believes").
The noble Lord said: My Lords, the amendments to which I am speaking relate to Clauses 18, 26 and 28, and the point is a single one. It is that a person should not be liable to be found guilty of a crime punishable by five years' imprisonment or unlimited fine merely upon the basis of a failure to report a suspicion of unlawful behaviour by others. That proposition is elementary. If the clause is enacted without amendment, we shall be close to totalitarianism.
The amendment is intended to be helpful. It is modest. It is offered in the spirit that the Bill would be improved if amended as we suggest. If one looks at similar legislation such as the Theft Act 1968 one sees that it is an offence to handle stolen goods knowing or believing those goods to have been stolen. Every day, in every Crown Court throughout this country, juries
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are directed by judges that knowledge or belief of the stolen quality of the goods is required and that suspicion will not do.
If the clauses are unamended, the crime enacted will derive solely from a failure to disclose mere suspicion. In ancient Japan, it used to be an offence to be in possession of dangerous thoughts. If the amendment is not accepted, we shall have made it an offence to be in possession of undisclosed suspicion. That is of no practical utility in the administration of the criminal law. It will not assist to achieve the end which we all desire; namely, to stamp out drug trafficking. It is another example of ill-considered legislation which will be of no practical benefit but which will have significant disadvantages.
As Clause 18 presently stands, the verb "suspects" is not even qualified by the word "reasonably". The result will be that if a prospective defendant has a bare suspicion that illegal behaviour has gone on, in the sense of laundering money from drug trafficking, it will be a criminal offence —I repeat—punishable by five years' imprisonment or an unlimited fine, if that person does not disclose that bare, mere suspicion to a constable as soon as reasonably practicable. That is the point of the amendment. I repeat, if I may, that it is moved in a spirit of wanting to improve the Bill. The new offence created, if the amendment is not carried, is not needed, justified or of any practical utility. I beg to move.
Lord Wigoder: My Lords, I support Amendments Nos. 1 and 2 which raise, in a sense, a point similar to those contained in Amendments Nos. 3 and 4, but there are special considerations with regard to Amendments Nos. 1 or 2 which require our careful attention. It is not, at common law in this country, an offence to fail to disclose information about other people's criminal activities. It may be criticisable morally, but it is not a criminal offence to fail to disclose such activities.
There are a few statutes in which an exception to that rule is made, because, no doubt, it is felt in the public interest that the criminal activities involved are so serious that it should be made a criminal offence for people to fail to disclose their knowledge of them. There may be other statutes that deal with the point. I do not know. I am aware of two. I raise the point because it has not been adequately answered by the Minister. The two statutes are, first, this Bill which deals not with drug trafficking but with the laundering of money obtained from drug trafficking, which is a stage removed. The other statute that deals with the matter is the Prevention of Terrorism (Temporary Provisions) Act 1989 which deals with the obligation placed upon people to disclose information about terrorist activities.
No one, I suppose, could for one minute dispute that terrorist activities may be of such vast importance to the community that it is important in the public interest that there should be an obligation upon every citizen to disclose any information obtained, and that he should be criminally liable if he fails to disclose that information. That is hardly on a par with obtaining

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information about the laundering of money obtained from drug trafficking, and yet that is the statute that we are now considering.
The Bill requires a standard of proof, where the information is merely about the laundering of drug trafficking money, of "believes" or "suspects". The far more serious case of citizens who have information, or think that they have information, about terrorist offences is dealt with in the words:
"A person is guilty of an offence if he has information which he knows or believes might be of material assistance … and fails without reasonable excuse to disclose that information".
The standard of proof is far more rigorous where terrorist information is concerned than where information about the laundering of money obtained from drug trafficking is concerned. That appears to be totally illogical. The public of this country are entitled to look at our statute law and compare the one with another and say, "Yes, this appears to make sense. This is consistent", or, alternatively, "This is totally ridiculous". It is totally ridiculous to say of people who may have information about terrorist activities that they can be convicted on the higher standard of proof only—that they should have known or believed —whereas, if it happens to be something of much less consequence, however important it might be, such as the laundering of drug trafficking money, it suffices to say that that person should have suspected that information and failed to disclose it. The two statutes are clearly inconsistent. I venture to suggest that the prevention of terrorism legislation retains the right standard and that this Bill should be amended to come into line with it.
Lord Hailsham of Saint Marylebone: My Lords, I happen to take exactly the opposite point of view from the noble Lords, Lord Williams and Lord Wigoder. All thoroughly bad political reasoning depends either upon a false analogy or a false premise. This amendment is an example of both defects. The first defect is that there is some analogy between the handling of stolen goods and the offence proposed in the Bill as it stands. There is no such analogy. Clearly, it is right, and always has been right, that the offence of handling stolen goods is dependent upon belief or knowledge or the closing of one's eyes deliberately to the danger that the goods are stolen.
The other fault—the false premise—is that the offence consists of failing to disclose a bare suspicion. That is just a false premise. The offence consists in failing to disclose information or other matter on which a suspicion is based; in other words, not a bare suspicion. The question which the House has to ask itself is quite a different one; whether a responsible citizen of any kind who in the course of his business acquires the suspicion on some information or other matter fails to disclose the information or other matter on which the suspicion is based. That seems to be a self-answering question. It is the duty of a responsible citizen to disclose that to the proper quarters. I would like to see the Bill stay as it stands.
Lord Campbell of Alloway: My Lords, I accept wholly the spirit in which this amendment is put
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forward. I also accept that it raises a difficult question on which there are countervailing arguments. But I come down on the side of retaining the Bill as it stands without feeling uncomfortable about supporting some form of totalitarian regime. I take the point of the noble Lord, Lord Wigoder, on his analogy, but I would seek to deal with that shortly at a later stage.
The form of the amendment is important in this context. It is two-pronged. It leaves out "suspects" and inserts "belief". It is accepted that "belief' imports the mental element of conviction which is absent in "suspicion". Other than in an exceptional case, mental state—what the accused knew, believed, suspected or intended—is a matter of inference to be drawn from the facts of the case. The test is not objective, such as what the reasonable man would have known, believed, suspected or intended. It is true that it is a heavy burden for the Crown to establish beyond all reasonable doubt on criminal standards that the accused knew; a lesser burden to prove that he suspected.
Turning to the first limb of the amendment, if the accused believed, surely he reaches a state of conviction not materially different from knowledge. Without indulging in metaphysics or a study of case law, suffice it to say that for all practical intents and purposes in the circumstances of any particular case it is difficult for a judge when directing a jury to distinguish between knowledge on the one hand and belief on the other.
Perhaps I may now turn to the second limb of the amendment, which is perhaps the main question: whether "suspects" should be deleted, a matter on which my noble and learned friend Lord Hailsham has made, your Lordships may think, some telling observations.
It is important to observe that no amendment has been tabled to delete "suspect" and insert "believe" in Section 26C, it being an adequate situation apparently that the accused should establish on the balance of probabilities (the civil burden) that he did not know or suspect. Why then should it be otherwise for the Crown under Section 26B where it has to establish knowledge or suspicion beyond all reasonable doubt, the criminal burden of proof?
One has to put the amendment in the context of the Bill as a whole and in particular of Sections 26B and 26C. Amendments Nos. 1, 2 and 3 are concerned with failure to disclose knowledge or suspicion of drug money laundering under Section 26B, whereas Amendment No. 4 is concerned with concealing or transferring proceeds of criminal conduct generally (it is a general application) and not limited to drug-related criminal conduct.
In all those cases it has to be conceded that the burden of proof rests on the Crown to establish its case beyond reasonable doubt. Even as regards Section 26B it still remains on the Crown to show that the accused had no reasonable excuse for nondisclosure under subsection (3).
Coming to the analogy points of the noble Lord, Lord Wigoder, is it really right to draw on these analogies? Surely suspicion of money laundering from drug trafficking which is not disclosed for no

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reasonable excuse should be a criminal offence. I made these notes long before I had the advantage of hearing what my noble and learned friend Lord Hailsham had to say. I wholly agree with him. It should be a criminal offence in the situation which exists in the United Kingdom today and which is likely to persist and some even think to intensify. For these reasons, on balance, I would hope that my noble friend the Minister will not accept the amendment, although I accept that it is well intentioned and there are two sides to the argument.
3.45 p.m.
Lord Monson: My Lords, as a layman I gladly support the first four amendments. Although the arguments for Amendment No. 4 are slightly different and stronger than those for the first three, I shall speak to them all now as shortly I have to catch a train to Edinburgh and I may not be around by the time the House reaches Amendment No. 4.
Here we have new crimes where people can be sent to prison not for sins of commission, if sins they be, but for sins of omission. No evidence of criminal intent is required by the Bill as it stands. People can be sent to prison for between five and 14 years, depending on the section in question, merely for being careless, absent-minded, too trusting, naive or for being the kind of person who is too embarrassed to kick up a fuss over what might be an extremely slight suspicion. These amendments would make it a little less likely that people would be sent to prison unjustly in the moral sense even if not in the legal sense.
Lord Bridge of Harwich: My Lords, I shall be brief. Surely the very essence of the offence created by the new Section 26B which Clause 18 introduces is a failure to disclose information which does give rise in the mind of the defendant to a suspicion of drug money laundering. As my noble and learned friend Lord Hailsham has pointed out, it is a matter which is about 100 miles away from the offence of receiving stolen goods.
The offence is subject to three very important safeguards as a complete protection from prosecution for a failure to disclose any information which is covered by legal professional privilege. It is a full defence if one has a reasonable excuse for failing to disclose the relevant information. Most important of all, if a suspicion is aroused in the mind of an employee, all he is required to do is to report the matter up the chain to one of his superiors. That is subsection (5) of the new Section 26B.
In those circumstances, the typical case calling for a prosecution under this clause will be that of a relatively junior official in a bank or some other financial institution who handles a financial transaction which reeks of drug money laundering and does nothing about it. Can your Lordships not picture the cross-examination of the defendant when he is giving evidence? He may be asked, "Did you not suspect that the transaction was tainted with drug money laundering?" He may answer, "Yes, of course, I suspected that it might be." "What did you do about it?" "I did nothing about it. It was not for me to
322
investigate the matter." "Surely, you must have believed that this was a drug money laundering transaction?" "No, I certainly did not believe it—suspect, yes; believe, no."
If this amendment were to be carried and I was the trial judge summing up in such a case, after reminding the jury of this passage in the cross-examination of the defendant I would say, "Members of the jury, if you think that it may be true that the defendant was telling the truth in those answers, then you must acquit him. It is only if you are satisfied so as to be sure that he is lying that you may convict him. You must be satisfied beyond reasonable doubt before you can convict him that his state of mind amounted not merely to "suspicion", but to 'belief.'" In the face of that direction, in 999 cases out of 1,000 the jury would be loyal to the judge's direction and would acquit. That is why I propose to vote against the amendment.
Lord Ackner: My Lords, I entirely agree with and support all that my noble and learned friend Lord Bridge of Harwich said. I wish to make only two points. First, having regard to the strength of language used by the noble Lord, Lord Williams of Mostyn, in proposing the amendment, one would have thought that the word "suspect" was not in any way used in legislation—or certainly not in this sort of legislation. The very word "suspect" is to be found in Section 24 of the Drug Trafficking Offences Act 1986 which deals with assisting another to retain the benefit of drug trafficking. It is used again in Section 14 of the Criminal Justice (International Co-operation) Act 1990, which deals with concealing or transferring the proceeds of drug trafficking. It would therefore be surprising to find that the lesser obligation on the defendant was to be found in this Bill, which is designed to make the life of the drug money launderer more difficult than at present.
Secondly, the noble Lord, Lord Williams, made the point that there is no reference to "reasonable". If the words were "had reasonable grounds to suspect", the burden would be less for the prosecution to discharge. The test then would be an entirely objective one—not what he, the defendant, suspected, but what a reasonable man would suspect. So, far from there being a complaint on that basis, this is very much in favour of the defence.
Earl Ferrers: My Lords, I am bound to say that after the speeches of the noble and learned Lord, Lord Bridge, and the noble and learned Lord, Lord Ackner, I feel that there is little that I can reasonably add. I shall not, however, take the advantage of sitting down immediately because it might be a good idea if I might put the Government's point of view.
The noble Lord, Lord Williams of Mostyn, said that this was a helpful, modest little amendment. It is also a particularly persistent one because it has appeared twice before and, rather like the rotten penny, it rolls up again on Third Reading.
The noble and learned Lord, Lord Ackner, was absolutely right when he said that the whole purpose of the Bill is to try to make life more difficult for the drug money launderer and those who traffick in this

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kind of thing. As both he and the noble and learned Lord, Lord Bridge said, there are perfectly adequate and full safeguards for any defendant.
Perhaps I may give just one example of the kind of situation with which we are dealing. A bank employee might suspect that the next-door cashier was involved in money laundering. As the Bill is drafted, if that employee suspects that another person is involved in drug money laundering, he must report his suspicions to his line manager. If the amendment were to be accepted, it would mean that only if that employee knows or believes that the other person is involved in drug trafficking must he report it to his line manager. If he just suspects, he need not do so.
The reason for the new offence created by Clause 18 of failing to report knowledge or suspicions of money laundering is to ensure that the police are given every possible opportunity to collect information about money laundering and to investigate suspicious transactions. If suspicions are not reported, the ability of the police to tackle money launderers and therefore to tackle drug traffickers effectively will be severely hampered. I find it hard to believe that the noble Lords who tabled these amendments really intend that it should be a defence for a bank employee, who is charged with an offence under this clause, to say that he only suspected the cashier next to him was engaged in money laundering. The fact that the clerk could not say that he believed that he was money laundering although he jolly well suspected that he was would get him off. Worse than that, the police would have been denied the opportunity of investigating something suspicious—and, after all, that is what the police are always doing. That is what they are skilled at and that is what they are professional at. It is much better for the police to investigate something suspicious than to rely on employees to check out their suspicions first and then determine whether they are tantamount to belief.
Perhaps I may remind your Lordships that employees have a very straightforward way of acting on a suspicion. It is specifically recognised in this clause. It enables them to protect themselves from any risk of prosecution, and at the same time ensure that any facts which might indicate money laundering reach the enforcement authorities whose job it is to investigate them. Employees may report up the line to their supervisor, in accordance with subsection (5). That is what we hope they will do.
Our defences against money laundering and drug trafficking —which depend on a steady flow of information—will be seriously weakened if the incentive to report suspicions is reduced, as it would be if your Lordships were to approve these amendments. The employees of financial institutions already make disclosures to the enforcement authorities on the basis of suspicions in order to protect themselves and their employers from liability to prosecution under Section 24 of the Drug Trafficking Offences Act 1986. Clause 18 simply builds on that existing incentive to report suspicions, albeit with greater force.
I find it hard to agree with the noble Lord, Lord
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Wigoder, who said at Report stage that Section 24 of the Drug Trafficking Offences Act was a less relevant precedent than certain provisions in anti-terrorist legislation. Section 24 of the 1986 Drug Trafficking Offences Act is, in effect, the parent of Clause 18. We are introducing Clause 18 as a supplement to it, especially to ensure that our legislation exactly conforms to the terms of the European Community directive. That is one of the purposes of the Bill.
Perhaps I may quote from Article 7 of the European directive. It states that member states shall ensure that credit and financial institutions refrain from carrying out transactions which they know or suspect to be related to money laundering. If we are to comply with the terms of the directive I venture to suggest to your Lordships that we really must use the test of "knowledge or suspicion" which appears in Article 7. If we fail to do that, it will mean that we shall be unable to meet our obligations under the directive, apart from the fact that it will weaken our defences against laundering. I therefore hope that, even if the noble Lord, Lord Williams of Mostyn, finds it difficult to accept the other arguments of which I have tried to persuade him on about three occasions, he will accept this one. If we do not use those words, we are not complying in full with the directive.
The noble Lord, Lord Wigoder, referred to the position on terrorism. He said that it is totally ridiculous that terrorism should be dealt with on the higher standards of knowledge or belief but money laundering on the lower standard of suspicion. I respectfully suggest to the noble Lord that there is a world of difference between that section about terrorism and the clause under discussion. Section 18 of the Prevention of Terrorism Act applies to everyone, but Clause 18 of the Bill concerns only those who come across suspicion in the course of trade, employment and so forth.
When the Prevention of Terrorism Act was drawn up it was decided that it would be unreasonable to expect everyone, particularly those who are living in Northern Ireland where terrorist activity is unfortunately rife, to report every activity of their friends, their family or their neighbours which they felt might be suspicious but which nevertheless fell short of a belief that they had been involved in a matter of terrorism. Suspicions about money laundering which are covered in Clause 18 are different because they only apply to those in the work context. That is reasonable and fair. Suspicion was agreed to be the right test when the anti-money laundering legislation was first introduced in 1986. I suggest to your Lordships that it is still the right test.
4 p.m.
Lord Williams of Mostyn: My Lords, the noble and learned Lord, Lord Hailsham of Saint Marylebone, accused me of incorrect analysis. He was supported in that suggestion on the basis that handling stolen goods was 100 miles away from the question presently being discussed. There is no incorrect analysis. The mere physical handling of stolen goods is no crime. It depends on the specific mental element—knowledge or belief that the goods were stolen. Similarly, a failure

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to disclose information of itself is not the offence. It is information which is known or suspected to be of relevance.
The amendment for which we contend is simply that there should be knowledge or belief before the sanction of the criminal law falls. The noble Earl, Lord Ferrers, spoke of the bank clerk and the teller at the adjacent desk. The words are wider than that:
"information, or … knowledge or suspicion",
which comes to a prospective defendant,
"in the course of his trade, profession, business or employment".
Those are wide words.
The noble Earl spoke of a disincentive to report suspicions. There is no disincentive in a well-run organisation. There is no disincentive to the moral obligation. What we simply suggest, with great respect, is that one should not base criminal liability with penal sanctions on the basis of a bare suspicion that information is in the mind which ought to be disclosed as being relevant to drug money laundering. That is why the analysis, though faulty, is faulty elsewhere and not with us. In the circumstances we are of the view that we should test the opinion of the House.
4.4 p.m.
On Question, Whether the said amendment (No. 1) shall be agreed to?
Their Lordships divided: Contents, 66; Not-Contents, 149.

Division No. 1

CONTENTS

Addington, L.

Listowel, E.

Airedale, L.

Llewelyn-Davies of Hastoe, B

Ardwick, L.

McIntosh of Haringey, L.

Aylestone, L.

Mackie of Benshie, L.

Beaumont of Whitley, L.

McNair, L.

Blackstone, B.

Mallalieu, B.

Bonham-Carter, L.

Merlyn-Rees, L.

Broadbridge, L.

Milner of Leeds, L.

Bruce of Donington, L.

Molloy, L.

Callaghan of Cardiff, L.

Monson, L.

Carter, L.

Morris of Castle Morris, L.

Clinton-Davis, L.

Morris of Kenwood, L.

Cocks of Hartcliffe, L.

Mulley, L.

David, B.

Nicol, B.

Dean of Beswick, L.

Perry of Walton, L.

Donaldson of Kingsbridge, L.

Portland, E.

Ennals, L.

Prys-Davies, L.

Falkland, V.

Rea, L.

Fisher of Rednal, B.

Redesdale, L.

Gallacher, L. [Teller.]

Richard, L.

Geraint, L.

Ritchie of Dundee, L.

Gladwyn, L.

Seear, B.

Glenamara, L.

Serota, B.

Graham of Edmonton, L. [Teller.]

Strabolgi, L.

Thomson of Monifieth, L.

Hampton, L.

Tordoff, L.

Harris of Greenwich, L.

Turner of Camden, B.

Hilton of Eggardon, B.

Underhill, L.

Holme of Cheltenham, L.

Varley, L.

Jeger, B.

White, B.

Jenkins of Hillhead, L.

Wigoder, L.

Jenkins of Putney, L.

Williams of Elvel, L.

John-Mackie, L.

Williams of Mostyn, L.

Kilbracken, L.

NOT-CONTENTS

Ackner, L.

Alexander of Tunis, E.

Addison, V.

Alport, L.

Ailsa, M.

Annan, L.

Aldington, L.

Astor, V.

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Banbury of Southam, L.

Long, V.

Belhaven and Stenton, L.

MacAndrew, L.

Bessborough, E.

Mackay of Clashfern, L.

Birdwood, L.

Macleod of Borve, B.

Boardman, L.

Manchester, D.

Bolton, L.

Mancroft, L.

Borthwick, L.

Marlesford, L.

Boyd-Carpenter, L.

Merrivale, L.

Brabazon of Tara, L.

Mersey, V.

Braine of Wheatley, L.

Monk Bretton, L.

Bridge of Harwich, L.

Montagu of Beaulieu, L.

Brightman, L.

Morris, L.

Butterworth, L.

Mottistone, L.

Cadman, L.

Mountevans, L.

Caithness, E.

Munster, E.

Campbell of Alloway, L.

Murton of Lindisfarne, L.

Campbell of Croy, L.

Nathan, L.

Carnegy of Lour, B.

Nelson, E.

Carnock, L.

Norfolk, D.

Chelmsford, V.

Norrie, L.

Clark of Kempston, L

O'Cathain, B.

Cockfield, L.

Orr-Ewing, L.

Coleraine, L.

Oxfuird, V.

Colnbrook, L.

Park of Monmouth, B.

Constantine of Stanmore, L.

Parkinson, L.

Cox, B.

Pender, L.

Cranborne, V.

Platt of Writtle, B.

Crickhowell, L.

Plumb, L.

Cross, V.

Plummer of St. Marylebone, L.

Cullen of Ashbourne, L.

Porritt, L.

Dacre of Glanton, L.

Rankeillour, L.

Denham, L.

Rayleigh, L.

Downshire, M.

Reay, L.

Eccles of Moulton, B.

Renton, L.

Effingham, E.

Renwick, L.

Ellenborough, L.

Rodger of Earlsferry, L.

Elles, B.

Rugby, L.

Elliot of Harwood, B.

St. Davids, V.

Elliott of Morpeth, L.

Saint Oswald, L.

Elphinstone, L.

Sandys, L.

Elton, L.

Savile, L.

Faithfull, B.

Selborne, E.

Ferrers, E.

Shaughnessy, L.

Finsberg, L.

Shrewsbury, E.

Fraser of Kilmorack, L.

Simon of Glaisdale, L.

Gainford, L.

Soulsby of Swaffham Prior, L.

Gisborough, L.

Spens, L.

Glenarthur, L.

Stanley of Alderley, L.

Goschen, V.

Stewartby, L.

Hailsham of Saint Marylebone, L.

Strathcarron, L.

Strathclyde, L.

Halsbury, E.

Strathcona and Mount Royal, L.

Hankey, L.

Hanworth, V.

Strathmore and Kinghorne, E. [Teller.]

Harrowby, E.

Harvington, L.

Sudeley, L.

Hayter, L.

Swansea, L.

Hemphill, L.

Swinfen, L.

Henley, L.

Terrington, L.

Hesketh, L. [Teller.]

Teviot, L.

Hooper, B.

Thomas of Gwydir, L.

Hothfield, L.

Thurlow, L.

Howe, E.

Trumpington, B.

Hylton-Foster, B.

Ullswater, V.

Ilchester, E.

Vaux of Harrowden, L.

Ingrow, L.

Vivian, L.

Ironside, L.

Wade of Chorlton, L.

Jenkin of Roding, L.

Wakeham, L.

Joseph, L.

Waterford, M.

Kimberley, E.

Westwood, L.

Kinnaird, L.

Wilson of Langside, L.

Lauderdale, E.

Wise, L.

Resolved in the negative, and amendment disagreed to accordingly.
4.12 p.m.
[Amendment No. 2 not moved.]
Clause 26 [Assisting another to retain the benefit of criminal conduct]:
[Amendment No. 3 not moved.]
Clause 28 [Concealing or transferring proceeds of criminal conduct]:
[Amendment No. 4 not moved.]
Clause 33 [Meaning of "inside information"]:
Lord Spens Lord Spens moved Amendment No. 5:
Page 34, line 36, leave out ("significant").
The noble Lord said: My Lords, Amendment No. 5 deals with Clause 33(d). Essentially it is a clause based on a false premise, to borrow a phrase from the noble and learned Lord, Lord Hailsham. I have never understood why the premise is allowed to exist. The false premise is that there is some mysterious linkage between information, or the lack of it, and the price of a security in the market place. It is a premise which has dogged me for the past five years and it needs to be examined.
Any merchant banker will explain that there have been days when he has been summoned by chairmen of client companies to explain why it is that after the publication of good results his share price has gone down. It is something that few company chairmen understand if they are not in the market place. But the Stock Exchange does not work on the basis of today's time; it works on the basis of future time. In other words, it deals in expectation. If the expectation is not satisfied then it is perfectly possible for the share price to go down. That explanation seems to be understood by few people outside the stock market.
As a banker who has been involved in writing prospectuses, offer documents, rights issue documents and all sorts of issue documents—over the past 30 years I have probably written more than 300—it is a relatively simple point of view to take regarding price sensitive information, which is the easier way of defining it. Price sensitive information is information which ordinarily would have been disclosed in a prospectus, had a prospectus been about to be written. That is probably as good a definition as any that exists.
I suspect that by using that definition there has been a dramatic shift in the burden of proof. I know from my experience how that dramatic shift in the burden of proof can have a serious effect. It is not generally known but the allegations against the defendants in the Guinness trials were based on market support allegations. The implication was that the price had been moved, or at least had not gone down. In the last four weeks of that bid the price went up by some 20 per cent. and that was used to demonstrate that the huge alleged market support operation had had some significant effect.
In practice that is not exactly what happened. On 14th March 1986 the noble Lord, Lord Lawson, introduced his Budget, which contained two material facts. One was a cut in the rate of income tax by 1 per cent. and the other was no increase in excise duty on alcohol. The effect of that budget was to move the share price of all the brewery stocks upwards by similar amounts. Whitbreads, Bass Charringtons, and Allied Breweries all moved in that direction over the same period of time.
That led to an argument over what exactly a false
328
market was. There is a Stock Exchange definition of a false market, which I shall read because it is important in the context of what I am about to say. The Stock Exchange definition is contained within the rule book for all members and reads:
"A 'false market' is defined as a market in which a movement of the price of a share is brought about or sought to be brought about by contrived factors, whether by the operation of buyers and sellers acting in collaboration with each other or otherwise, calculated to create a movement of price which is not justified by assets, earnings or prospects".
In order to make the charges stick, that specific problem had to be dealt with. It was dealt with by Mr. Justice Henry in the following way. On day 91 of the first Guinness trial he said,
"If it stopped after the third line, it would seem [to] me to be quite a good definition. The whole seven lines seem to me to be a rather bad definition … it seems to me to be, as a definition of a false market, a nonsense. If it ended after the third line, I could understand it".
He finalises his conclusions by saying,
"But the law has its own definition of the false market and it is not this definition".
Therefore, for many years the Stock Exchange has been operating on a definition of a false market that simply is not recognised by the law. For that mistake four people went to prison and were fined in excess of £11 million; so the phrase that we are discussing has an important effect.
The reason the difficulties arise is because of the word "significant". "Significant" is a qualifying adjective—one of the bugbears of the law. Again, I can illustrate the problem by what happened to me. There were some 300 days of court appearances in the Guinness trial; approximately 10 per cent. of those were taken up in discussions on various qualifying adjectives. The biggest problem that arose was in relation to the adjectives in Sections 151 and 153 dealing with "purpose". Section 153 contains the remarkable sequence of phrases, "for the purpose", "principal purpose" and "larger purpose" all in the same sentence. That is really quite an achievement.
The Lord Chancellor has just published his consultative paper on long criminal trials which is essentially about the Guinness trials. He talks about delay and costs in that paper and I do not know where he gets his figures from. All I can say is that of the 30 days involved in discussing qualifying adjectives of various kinds, 15 days were spent dealing with specific qualifying adjectives. Those 15 days were at a cost to me of £5,000 a day and a cost to everyone involved of £750,000. That is the price we pay for inserting a word which has no meaning.
The equivalent word in the Guinness trials, and one very often used, was "material"—the disclosure of a material fact. It was the second leg which was the principal target of the allegations. Perhaps I may tell the House what Mr. Justice Henry said about the word "material", because it is interesting in relation to the word "significant."
"The word 'material' is not defined in the Act".
That is the in the Prevention of Fraud (Investments) Act 1958.
"It is an ordinary English word. I would define it simply as a fact of such significance as might reasonably affect a shareholder's decision whether to assent the Guinness offer."

329
Setting out that test with the help of the ordinary dictionary definition, I believe myself to be saying substantially the same as Section 146 of the Financial Services Act 1986 when dealing with a comparable problem. The section states that,
"all such information as investors and their professional advisers would reasonably require, and reasonably expect to find there, for the purpose of making an informed assessment of [it]".
That definition is probably as near as one will get to the price sensitive definition that I have just given about prospectuses.
As to the word "significant", the noble Earl, Lord Caithness, said last week:
"The question then turned to what constitutes a significant effect on the price of securities. That will depend on the facts". [Official Report, 3/12/92; col. 1501.]
If it is to depend on the facts, may we have a statement from the Government that that is the case? I can tell the House exactly what happens. The moment we say that, the prosecution will simply say, "This is a significant movement, a significant effect on the price." The defence is then left to disprove it. The judge will rule—because he has to rule, otherwise he does not have a trial—on whether or not the facts are capable of being interpreted by a jury as significant. So we are left with the dictionary definitions on which Mr. Justice Henry fell back. The Concise Oxford Dictionary definition reads:
"significant: having a meaning; expressive; suggestive; with pregnant or secret sense; inviting attention; noteworthy; of considerable amount or effect or importance; not insignificant or negligible".
The Shorter Oxford Dictionary, which is in two volumes, states in volume II:
"significant: full of meaning or import; important; notable; signifying something; expressive or indicative of something; something which conveys or expresses a meaning [like] a sign, symbol, indication".
That is very little help, I suspect, to any jury, even if those dictionaries were available.
What does it all mean? We do not need the word "significant". It is perfectly clear what price-sensitive information is. If we take the word out, it will do something to restore the balance in the clause. If the word remains in the Bill, any defence would be quite capable of demonstrating that there never had been any significant effect, whatever "significant" may mean. A great deal of time will be wasted and very little achieved. I beg to move that the word be omitted.
Lord Clark of Kempston: My Lords, I wish to ask my noble friend to resist the amendment because the word "sigificant" attached to insider dealing is only proved when the value of the security increases. Whoever is the insider, a director or whoever, he has inside knowledge. If the word "significant" is omitted, many directors of companies will have information about the cash flow, about prospects and what the sales forecasts are. That in itself cannot be considered to be "significant". The word "significant" only becomes important when a share price increases and people who have inside knowledge make a profit from it.
I wonder whether the noble Lord, Lord Spens, realises that if his amendment were accepted, the provision would not read well. The wording of the
330
amendment should have been to leave out "a significant" and insert the word "an", because one cannot have "a effect".
Lord Simon of Glaisdale: My Lords, I doubt very much that it makes any difference whether or not the word "significant" is in the Bill. There is a fundamental axiom of the law which is practically always expressed in Latin but which means that the law takes no account of insignificant matters. I am generally against putting unnecessary words in a Bill, but this is just one word and it would save argument. Therefore, I hope that the noble Earl will resist the amendment. It seems on balance that it is better that the word "significant" should remain in the Bill.
The Earl of Caithness: My Lords, this amendment, moved by the noble Lord, Lord Spens, is not, in the words of my noble friend Lord Ferrers when he dealt with the first amendment, a "rotten penny". This one has not come back. It comes to your Lordships for the first time at a Third Reading debate.
The prohibitions in Part IV apply to someone who possesses information which is likely to have a significant effect on the price of securities. The requirement, which has a counterpart in our existing legislation, serves to ensure that the prohibitions on insider dealing apply to major matters such as impending takeover bids, forthcoming profits and dividend announcements which are out of line with expectations. These are the stuff of insider dealing as it is commonly understood. These are the stuff to which the prohibitions should apply.
The amendment seeks to cast the net wider. It would, in the words of the noble Lord, Lord Spens, delete the qualifying adjective. It would bring within the ambit of the legislation dealing where someone possessed information that was likely to have any effect on the price of securities.
One possible consequence of adopting such an approach would be that there were many technical breaches of the law because of dealings by people who possessed information likely to have only a trivial effect on the price of securities. That would not be satisfactory; it would either lead to a host of prosecutions where there is no real mischief or the law would fall into disrepute.
A second and in many ways more serious possible consequence of the amendment could follow. It is likely to inhibit important and legitimate communication between a company and investment analysts and fund managers. It is generally agreed that these contacts can play a useful role in enabling analysts and fund managers to obtain a better understanding of the company and its management. It is also accepted that significantly price sensitive information should not be disclosed at such meetings and indeed the effect of the Bill as it stands is to prohibit this. It would, however, be very difficult for such meetings to take place if the insider dealing prohibitions were extended to apply to information which was likely to have any effect on the price of securities as the amendment proposes: the risk of disclosing "inside information" would he too great. It is likely therefore that broadening the law in the way

331
proposed by the amendment would effectively stop the dialogue between companies and investors and analysts.
I put it to the House that the effect of this amendment would be not to increase the number of real villains caught within the ambit of the legislation but it would put at risk important and legitimate activities. I shall read with care what the noble Lord, Lord Spens, had to say on this matter because much of what he said was detailed and needs examination. However, I felt we were right to advise the House that this amendment ought to be resisted and I received support on that from my noble friend Lord Clark and the noble and learned Lord, Lord Simon of Glaisdale.
4.30 p.m.
Lord Spens: My Lords, I am grateful to the noble Earl, Lord Caithness, for that reply. However, he referred to something that I am not at all sure is at present covered by the law of the land; that is, a price movement outside expectations. I have just demon-strated that that has been overruled by the courts, so there is no such thing as an expectation in that regard.
As regards the noble Earl's second point, on inside information and the problems that people who deal in shares may have, I have this to say. For many years we have all been conscious of this problem. Way back at the very start of my career it was made clear to me that in a corporate finance department, where there is always inside information, any dealings in stocks and shares would lay one open to accusation. The burden of proof had already shifted to people having to prove that they did not know, for example, that ICI was about to make a bid, even though that knowledge was available in the department. There are many people who do not own shares and who do not deal in shares but who are open to such allegations. I imagine the same provision would apply to fund managers and analysts, although I do not think that is the case. There can be no harm in a situation where all inside information and all price sensitive information renders it possible that any dealing in shares can be exposed as criminal. The simple answer is not to deal. However, having listened to what the noble Earl said, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
An amendment (privilege) made.
Earl Ferrers: My Lords, I beg to move that the Bill do now pass.
We have come to the end of an important Bill. I am grateful to all noble Lords who have contributed to our debates, in particular to those noble Lords who have extended our vocabulary and imagination by the use of exotic new words, such as "flabbergastee", or new questions such as "tippee or not tippee"? We are grateful to the noble Lord, Lord Wigoder, for that, as it were, extra-curricular intellectual stimulation. I suspect—although I dare say the noble Lord, Lord Williams of Mostyn, and the noble Baroness, Lady Mallalieu, would prefer me to know or believe—that your Lordships are glad that one of the main results of your Lordships' characteristically meticulous scrutiny
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is that we have decided that "tippee is not tippee". The noble Lord, Lord Airedale's man in the street will at least rejoice in that, even if he finds, on the balance of probabilities, that the standard of proof applicable to civil proceedings remains to him, the man in the street, incomprehensible, and even if to lawyers it is as clear as daylight.
I am particularly grateful to the noble Lords, Lord Airedale, Lord Wigoder and Lord Harris of Greenwich, and to the noble Baroness, Lady Mallalieu, all of whom left their distinctive mark on Part I by persuading the Government—and their apparently intransigent Minister, as the noble Baroness, Lady Mallalieu, will recall—to consider, and to accept, proposals which they put forward. These changes have smoothed away some of the problem areas and have made the Bill somewhat easier to understand. The man in the street will be grateful for that, too.
I was also grateful to your Lordships for the support given to the general thrust of Parts II and III of the Bill, which deal with confiscation of the proceeds of drugs and other crime, and with money laundering. I am glad that your Lordships decided, after some fairly detailed discussions on a number of occasions, not to dilute the pretty tough regime which is proposed in the Bill.
Part II of the Bill is aimed at those people who make vast profits from supplying drugs to others, and am grateful to your Lordships for the support given to the principle of being tough on drug traffickers and of curtailing their financial incentive.
Although Ministers rarely admit it, I was glad for the amendments to Parts II and III which were tabled by some of your Lordships. They enabled me to explain more fully the need for Part II and III and the Government's intentions. Part IV of the Bill brings law on insider dealing into agreement with the European Community directive on the subject, and I am most grateful to my noble friend Lord Caithness for having taken the heat of the debates on that very technical part of the Bill. It was here that the word "tippee" was finally tipped out of the Bill. I am also grateful to many other noble Lords who have contributed to these often technical discussions.
The provisions in this Bill, when they are implemented, will significantly increase the powers which are available to deal with those who take part in so-called white collar crime, and with those who participate in the world-wide traffic in drugs, spreading misery and profiting from human dependency. With your Lordships' help, this Bill, I think, strikes a proper balance between the demands of justice and fairness, and the need to provide our law enforcement authorities with adequate powers to tackle the threats to society which are posed by drug traffickers, money launderers, insider dealers and fraudsters.
Moved, That the Bill do now pass.—(Earl Ferrers.)
Baroness Mallalieu: My Lords, from these Benches I thank the noble Earl for being somewhat less intransigent than, at stages in this Bill, I have accused him of being. I also thank other noble Lords who have

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contributed to the Bill, in particular the noble Lord, Lord Williams of Mostyn. They have contributed to some significant improvements in the Bill.
On Second Reading I was concerned that Part I of the Bill was incomprehensible to anyone but a lawyer, and even then contained a number of possible interpretations. I should like to think that the noble Earl has agreed to amendments which have made things rather better in that respect. I am bound to say that there are some areas which may need to be examined closely in another place, in particular the provisions in the final part of the Bill in relation to insider dealing. In his heart of hearts the noble Earl will appreciate that those provisions may need further clarification. However, I am most grateful to him for the courtesy with which he has responded to the amendments raised from this side of the House.
Lord Wigoder: My Lords, as regards Parts I, II and III of the Bill, those of us in all parts of the House who have any kind of legal qualifications have en-deavoured to assist by making various contributions. We have been very much aided by noble Lords who do not have legal experience and whose contributions are perhaps all the more important for that reason.
I am sure that all of us will join in saying how grateful we are to the noble Earl, Lord Ferrers, for the patient and careful way he has listened to amendments being proposed, for the detailed consideration he has given to them and for the sympathetic way in which he has responded. I wish that I could say the same about the noble Earl, Lord Caithness. I cannot, because, for practical purposes, he has had almost no amendments to respond to and practically no contributions to deal with.
I exempt at once from that observation the noble Lord, Lord Mottistone, who has enabled us to learn of the CBI's views on various aspects of the Bill, but I have an uneasy feeling that the House may not have done itself justice in its consideration of Part IV—the insider trading part—of this important Bill. It is a highly technical subject on which the legislation in the past few years has repeatedly caused difficulties through its wording. It is crucial that the net that is cast by the clauses in that part of the Bill should be neither so wide as to sweep up people who should never be included at all, nor so narrow as to enable people who should be included to escape its provisions.
It is very much a matter for the expertise of Members of your Lordships' House who have vast experience in the worlds of financial services, insurance, banking and, indeed, commerce and industry generally. I am sad to see that, from the end of the Second Reading stage until today, not one contribution was made, as I understand it, by any of your Lordships with that skill and ability. Had that been so, we might perhaps have produced a rather better Part IV of the Bill than now exists.
Curiously, too, there has been a singular shortage of written contributions from bodies outside the House. I received a short submission from a firm of City solicitors just as the Bill began its Second Reading. There was then a deathly silence until an hour or two before Report stage when it was far too
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late to do anything. I received a detailed submission from the Group of 100, which, as your Lordships will know, is a rather informal gathering of the finance directors of the top British companies, expressing collectively their serious reservations about not only the wording but some of the substance of the provisions in Part IV of the Bill. I had no alternative but to suggest to them that they might care to take their points to another place and have the matter debated there. I should not want the absence of discussion of Part IV of the Bill to lead the Government to think that Part IV is therefore absolutely word-perfect and will not be challenged in any way when the Bill reaches another place.
I reiterate my gratitude to the noble Earl for the way in which he has handled this matter. I and my colleagues look forward to following the progress of the Bill in another place in due course.
Lord Mottistone: My Lords, I sympathise greatly with the comments of the noble Lord, Lord Wigoder, but I should particularly like to thank my noble friend Lord Caithness for the great care that he took in dealing with the relatively few amendments that were produced for us to consider. I thought that he did an excellent job in trying to clarify the situation and I hope that the meetings that I know will take place between his department and those people who are involved will develop matters speedily enough for them to be included in the Bill before it leaves Parliament altogether.
The problem that has to be overcome—and people like the noble Lord, Lord Spens, can perhaps help us give the matter greater prominence—is that those in the City do not understand that your Lordships have such an important contribution to make in sorting out legislation. They need to understand how and when to go about making representations. It is only the really experienced bodies of trade associations and the like that get going fast enough to tell us what they want. The City is particularly ill-informed in this matter. I repeatedly invited the CBI to obtain more information, but one did not have much time. It is rather a pity that, as the noble Lord, Lord Wigoder, said, this House, with its great expertise in all these fields, could not have been used to greater effect. However, that does not mean to say that my noble friend Lord Caithness did not do a jolly good job.
On Question, Bill passed, and sent to the Commons.

Agriculture Bill [H.L.]
4.45 p.m.
The Parliamentary Secretary, Ministry of Agriculture, Fisheries and Food (Earl Howe): My Lords, I beg to move that the House do now again resolve itself into Committee on this Bill.
Moved, That the House do now again resolve itself into Committee.—(Earl Howe.)
On Question, Motion agreed to.
House in Committee accordingly.
[LORD STRABOLGI in the Chair.]
Clause 22 [Application of sections 23 to 43]:
Lord Stanley of Alderley Lord Stanley of Alderley moved Amendment No. 25B:
Page 12, line 41, at beginning insert:
("Subject to subsection (2A) below").
The noble Lord said: In moving this amendment I shall speak also to Amendment No. 26.
Lord Carter: Does the noble Lord not mean Amendment No. 26A?
Lord Stanley of Alderley: I am sorry, yes. Before I start perhaps I should declare an interest in that I have been a potato producer for a little over 38 years.
The purpose of the amendment is to ask the Government whether they will insist on the six conditions numbered (a) to (f) in Amendment No. 26A before they agree to any EC regulation on potatoes. Unless my noble friend can give the Committee some idea as to how the Government will deal with the EC regulation on potatoes, made public, I think, last week, I suggest that we are wasting our time dealing with this part of the Bill. Not for the first time I feel that Parliament is a Brussels poodle. The six conditions mentioned in the amendment have been put forward by COPA/COGECA. I heard yesterday that they are supported by the Netherlands, Germany and Belgium and I understand that France, Spain and Italy are likely to take a similar view.
The regulation is to go before the Council of Ministers next week, so there is considerable urgency for the British Government to take a view. I hope that the Committee is as anxious as I am that the Government take a firm line on this useless bit of Brussels bureaucracy.
The draft Brussels regulation would, first, prevent any flexibility. Subsidiarity is ruled out. That will prevent individual states being able to deal with their particular problems. Britain has a totally different marketing problem and climate from, say, Spain or Greece. I do not think that I need spell that out in more detail. Secondly, the regulation will lead to chaotic and fluctuating markets. Thirdly, the scheme will need funding. If subsidiarity was allowed and Great Britain was permitted its own potato marketing scheme, there would be no demand on the taxpayer. Fourthly, the scheme is inconsistent with the CAP reforms which, for better or worse, simply propose quotas and restrictions. The scheme will therefore cause chaos, not just for potato growers, but for other interacting crops, which include cereal crops.
I doubt whether I need to persuade any Member of the Committee that the CAP has become bad for farmers and for consumers. I therefore hope that the Committee will be prepared to strengthen the Government's hand in resisting this latest nonsense emanating from Brussels and will support the principle, if not the detail, of the amendment. I beg to move.
Lord Carter: I am pleased to add my name to the amendment. I strongly support it from this side of the House on two grounds; first, the uncertainty in the industry; and, secondly, subsidiarity. The Bill is causing uncertainty in the milk industry and will continue to do so until the various schemes are worked out. There is great uncertainty in the animal sector.
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There is a new regime to be dealt with, including the matter of set-aside, and there are also the problems of the GATT settlement.
The European Community is determined to control production in all agricultural areas except potatoes, which is the most cyclical crop outside the market garden sector. There is great uncertainty at the moment which will be increased by the broad catch-all provisions that are proposed by the Government in Clause 22, where it is stated that the scheme can be wound up at the whim of a Minister.
The present system works reasonably well as far as potatoes are concerned. It does not work perfectly but it works as well as can be expected in relation to a crop with the cyclical characteristics of potatoes. The attempt to introduce the new regime is a classic example of the endemic disease of the bureaucrats: "Do not sit there, do something". The Bill introduces a fortuitous uncertainty into a desperately uncertain situation in farming, the most uncertain that we have faced in our farming lifetimes, in relation to a crop that is notoriously subject to substantial swings in price, unless there is some attempt to manage the market.
The Government must be pinned down as to when they are going to do something about subsidiarity rather than talking about it. A good working definition of subsidiarity would be: if it works, leave it alone. The Potato Marketing Board circulated a very useful document to all growers entitled The Potato Marketing Scheme and the Proposed EC Regime. The document points out:
"'Our Farming Future' states that a lightweight EC regime for potatoes would have no place for acreage quota controls or support buying functions as at present operated by the Potato Marketing board. The PMB believes that whilst these will not form part of a draft regime for application throughout the EC, nevertheless they can be retained within Great Britain if this is negotiated by the Government under the principle of subsidiarity. Informal discussions with Commission officials suggest that they do not see abolition of the British system as central to their objectives, provided it does not conflict with the principles of the Single European Act".
That is a good working definition of subsidiarity: if it works, leave it alone. If the Government must interfere, they should introduce measures that improve existing structures and not wantonly destroy them, as will happen under the proposed regime. There should not be any worsening of national structures. The matters set out in paragraphs (a) to (f) are essential functions and they should form part of any proposals for a future scheme.
The scheme has been unanimously rejected by COPA/COGECA. The rush to get the Bill through is extraordinary. The draft proposal was produced on 24th November and all responses to the document had to reach the department by 7th December. That demonstrates an extraordinary rush to introduce a regime that will have the most marked effect on a major crop. A period of 14 days was allowed to industry to formulate a response. We know that other member states are very worried about the situation and they expect severe disruption of the market if the regime is introduced.

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The present scheme works well. There is a substantial attempt being made to manage the market through CAP reform for all of the combinable crops and many livestock products, so why can that not be the position with regard to potatoes? I urge the Minister to think again. We would welcome a firm assurance that the Government will not rush into a decision before December 31st in order to pay obeisance to the single market. We know that the Government are desperate to produce something as the outcome of their presidency of the European Community but I hope that the potato grower will not be sacrificed in this rush to judgment. If the Government use their presidency of the Council of Ministers to do so and thereby produce a collapse in growers' confidence, they will have much to answer for.
Lord Mackie of Benshie: I support the amendment. The Minister should tell us what he thinks about the proposed regime. He knows that we do not think much of it but it is necessary that he should give us a full explanation of the Government's thinking because it is relevant to this amendment and other amendments. If the Minister assures us that he thinks little of it, then it would give us a certain amount of confidence.
The present scheme has worked. This year we have experienced an extraordinarily good crop. There have been very bad prices but, taken as a whole, there has been a stability in the market here that has not been evident on the Continent. I look forward to hearing the Minister before I say anything else.
Lord Plumb: I have some sympathy with the amendment. For more than 20 years we have been members of the European Community. There is a regime for the majority of agricultural commodities within the Community but there has never been a regime for potatoes. For that reason it is strange that we should be trying to rush a scheme through in indecent haste in a matter of weeks before there has been consultation at all levels with the producers and the consumers.
We are attempting to move away from the Agriculture Act 1947. I had the privilege, which was sometimes doubtful, of trying to maximise the function of the Agriculture Act 1947 for more than 10 years while I was President of the National Farmers Union. Part of that Act relates to the statutory powers of various marketing boards. The instruments that they have been operating have maintained some stability throughout their lives, although from time to time they have had to deal with volatile situations. Potatoes either suffer or gain from the vagaries of the weather, which affect quality and yield. That is a matter that does not have to be spelt out to potato growers this year. The buying programme that has been operated by the board has not always been perfect, but both producer and consumer have benefited from the more stable market that has been created.
We must try to maintain stability in the market place. We continue to contribute to the generic promotion of the crop and to fund research and
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development. If there is to be a successor scheme to the Potato Marketing Board, then we must ensure that the statistical needs of the industry are met.
Clauses 48 and 49 would have the effect of terminating price support guarantees for potatoes and wool. Can the Minister assure us that the services that are required by the industry will be maintained by a successor to the Potato Marketing Board? Can he also assure us that the proposals will be compatible with whatever may emerge from the European Community?
The question of subsidiarity is extremely important in this context. The clearest definition I thought I had heard was given some little time ago by the Foreign Secretary when he said that subsidiarity meant less interference from Brussels. If that is the definition, let us take time to prepare a scheme that is meaningful. It has already been said by my noble friend Lord Stanley and by the noble Lord, Lord Carter, that organisations in Europe are opposed to the so-called proposals. I can assure the Committee that I and others who work in the European Parliament will also oppose the proposals. Frankly, they do not add up to what I consider to be a sensible regime.
I support the amendment on the basis that we look for a successor and one that will not only provide stability but can restore a little bit of confidence. That may be lost if we go bull-headed into a scheme which at the moment is ill-conceived, ill-timed and inappropriate to deal with a major crop such as potatoes.
5 p.m.
Lord Monk Bretton: I am an agriculturalist though I do not grow potatoes. Therefore I am slightly, but not altogether, disinterested. I should like to say a few words in support of the amendment moved by my noble friend Lord Stanley of Alderley. Let us not have an EC regime which will be too weak and lead to fluctuations in the market even worse than all those who grow potatoes have already experienced.
I fear that this may prove to be an unmitigated disaster for United Kingdom growers and, more than likely, a number of Continental growers. We could find that the public here are slowly weaned off fresh potatoes onto powdered potato products which would have to be reconstituted. No doubt they would be buying those products through supermarkets; they would more than likely be imported products to boot. All of that could also be to the detriment of our balance of payments.
Lord Geraint: There is concern among potato growers especially in the west part of Wales where Pembrokeshire growers are well known for their early crop. Noble Lords on both sides are keen to have an assurance from the Minister today that this well developed industry in many parts of Britain will be cared for.
I have been told that this year potato growers in Pembrokeshire have had their worst year for a decade or so because they have had to compete with third country imports. Those who are concerned with the production of early potatoes for the home market

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every year find that now and again the market collapses suddenly when third country imports come into Britain. I wonder what assurances the Minister can give to the West Wales early potato growers. If he is to do away with the present scheme, will it be better or worse for those growers? We are all aware that other sectors of industry are being clobbered at the present time, and it is a great pity that the potato growers of Pembrokeshire and other parts of Britain will be clobbered as well.
Baroness Carnegy of Lour: As I said at Second Reading, until recently I had a financial interest in the growing of seed potatoes in Angus in Scotland. I do not know whether the amendment is the right one to put into the Bill but I am sure that the discussion that has just taken place is the right discussion at this moment.
The scheme suggested for Europe proposes an enormous change in the structure of the market in Europe. It sweeps away the current regimes in a number of member states and leaves the whole system to market forces, without anything else being put in their place. I hope that the Minister will convey to his right honourable friend Mr. Gummer the importance of making sure that in Edinburgh during the coming weekend nothing hasty is done about the scheme until it has been thoroughly examined by all member states, because the change would be a very important one and of doubtful merit.
Lord Elphinstone: I am an ex-potato grower. I have no particular axe to grind in this matter but I should like to take up the question of uncertainty in the industry. The potato industry is one that requires very substantial working capital. It is vital that potato growers are able to take a long-term view; otherwise the provision of such working capital becomes impossible. I urge the Minister to bear in mind that any uncertainty created by these and other proposals will inevitably damage the industry in the long term.
Earl Howe: This amendment would lay down conditions to be met before the Government could revoke the potato marketing scheme. The conditions relate to the content of the EC's proposals on the regulation of the market in potatoes. Only one of the conditions—that relating to third country imports—is included in the current proposals.
The effect of the amendment would be that unless we were able to achieve a whole raft of changes to the Commission's proposals we should not be able to revoke the potato marketing scheme under the terms of the Bill. There are some—many of whom are here this afternoon—who would welcome that outcome, or so they might think. However, if the regime came into force as drafted the potato marketing scheme would still have to be revoked but we would have to use the provisions of Section 2(2) of the European Communities Act to do so. That course of action would not allow for the transfer of the board's assets to a successor body or bodies. The effect would be that the board's valuable work in R&D and market promotion would have to come to an end.
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Although not provided for in the proposed regime, those functions should not be difficult to continue on a national basis if our experience in other sectors such as horticulture is anything to go by. That is the reason why, as my noble friend will know, the Bill provides for the setting up of a successor body or bodies to the board which could perform many of the valuable functions to which he has referred.
The day after the Second Reading debate (24th November) the European Commission printed its proposals for a Council regulation on the common organisation of the market in potatoes. It may be helpful to summarise what the proposals comprise. First, there is provision for the encouragement of producer groups, marketing all the produce of their members and co-operating in production and marketing, and of associations of such groups. These would be recognised by member states, which would make them eligible for regressive grants not to exceed 5 per cent. initially of their production value over the first five years after recognition. Those grants would qualify for reimbursement from FEOGA at a rate to be determined by the Commission. Existing groups would qualify only in respect of the expense involved in merging with other groups. Aid would be paid either under this regulation or under the terms of the existing regulation on producer groups (No. 1360/78).
Secondly, there are provisions for third country trade, including a facility for import licensing and the ability to take "appropriate measures" in the face of market disruption. No details are given of the way in which any of those measures are to be applied. That is to be decided in management committee.
The Commission stated that under the regime there could be no national measures such as quotas or intervention. Those are two main aspects of our potato marketing scheme. However, the proposals provide for transitional arrangements if the introduction of the new system would give rise to substantial difficulties.
The proposals are to be discussed at the Agriculture Council next week. Noble Lords have asked what the Government's negotiating position will be. Our aim will be to ensure four things: first, a level playing field across Europe for potato production; secondly, that the UK industry can meet all the needs of the market; thirdly, that the UK industry can contribute to the export drive; and fourthly, that decisions are based clearly on the best scientific and technical knowledge available. I am, of course, unable to foresee the outcome of these discussions.
In the meantime, a wide range of organisations in the industry and consumer groups are being consulted on the proposals. If the regime is not proceeded with we shall still keep the potato marketing scheme under review in the normal programme of reviews of non-departmental public bodies. I repeat that our aim is for the UK industry to meet all the needs of the market and to contribute to the export drive.
This amendment would not prevent the revocation of the potato marketing scheme if the EC proposals were to go through as drafted or in any way short of the provisions suggested by my noble friend. It would merely serve to ensure that much of the valuable work

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done by the potato marketing board could not continue. Therefore, I hope my noble friend will agree that we ought to discard the amendment on those grounds, but that what I have said is helpful.
Baroness Carnegy of Lour: My noble friend says that the Government intend to insist on a level playing field across Europe for potato marketing—which is doubtless a very laudable ambition—but does that include allowance for climatic differences in Europe? The difference between, for example, the north of the United Kingdom and the south of the United Kingdom for growing seed potatoes is very considerable. The difference between the north of the United Kingdom and the Mediterranean is even greater. Would climatic conditions be included in the consideration of a level playing field?
Earl Howe: All factors would be taken into account. It depends what my noble friend is driving at and what she would like to see come out of that consideration. I am sure that that is one of the factors that will play a part. My noble friend referred to the Scottish seed potato market. It is interesting that the market for Scottish seed potatoes in Great Britain is diminishing on two counts: first, because of the importation of potatoes in processed form; and secondly, because of Dutch penetration of the market. Seed imports have gone up from 9,000 tonnes in 1981 to over 30,000 tonnes in 1990. Seed exports from the United Kingdom have fallen from 114,000 tonnes to just above 60,000 tonnes in the same period. Those facts do not support the contention that the present arrangements are the most suitable for a thriving domestic seed potato industry.
Lord Mackie of Benshie: I thank the Minister for painting as gloomy a picture as I have heard for some time. As I understand it, the basis of the scheme is to give grants to producer groups, and very little else. I understand also that the basis on which the Minister is going in to bat for us is that of a level playing field. It is easy to get a level playing field when everyone is equally disadvantaged. That appears to be the case, in that there will be no provision for the control of the market in this very volatile crop and no provision for the control of the acreage. Therefore, the playing field may be level, but it will be a bad playing field for the British grower to play on.
He also said, that we can supply the market. There has never been any difficulty in supplying the market. The difficulty has been in getting a profit out of growing potatoes in that sort of market. Export and scientific research are the other two conditions. It is not a great programme for the support of British farming and the British potato grower. I think it makes this amendment and the conditions in it all the more necessary.
The potato industry is a very volatile one. The noble Lord, Lord Plumb, who is more experienced both in the practical area and in the politics of farming than anyone else, laid down very clearly that the present scheme has snags. It is not always perfect. It cannot cope, and give everyone profit, with an enormously successful year for quantity and for
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quality; but it has provided a reasonable background. The consumer in this country has never gone short of a potato for his lunch or his dinner, at quite reasonable prices from the farm, however high they may have gone in the supermarket, so I do not see that the Minister has given any real assurance that this amendment is unnecessary. The amendment appears to me to be very necessary in view of what he said.
5.15 p.m.
Earl Howe: The noble Lord regretted my reference to the level playing field. The noble Lord, Lord Carter, referred in his speech to subsidiarity. He suggested that if it works, leave it alone. A situation in which a potato grower here has to pay £850 a hectare to grow potatoes if he has not been allocated a quota is one which puts him at an obvious disadvantage with his continental competitor, who can grow potatoes without any penalty whatsoever.
Let us look at the UK as a potato producing country. The noble Lord, Lord Mackie, was quite right to say that we consume a great many potatoes. In fact, the UK consumption of potatoes is the highest in Europe. But processed potatoes, which is the single largest growth sector of the market, are being supplied increasingly by imports. In 1980, 114,000 tonnes were imported. In 1990, 524,000 tonnes were imported. That represents a potential of 14,200 hectares of farmland lost to potato production in this country. That is why this country is losing out under the present scheme. There are those who suggest that the present scheme creates stability of price in the UK. The fact is that UK prices fluctuate as much as prices in other Community countries, especially Holland; so that suggestion does not stand up either. Altogether, I do not believe that the noble Lord, or indeed other noble Lords, have demonstrated that their faith in the present system is justified.
Lord Mackie of Benshie: The noble Lord might well have said that the grower in this country only has to pay £850 per hectare if he wants to grow more than his quota. He does not have to pay that on every single acre he grows.
Earl Howe: The point I was trying to make was that there is plenty of scope for us to grow more of our own requirements. The penalty for doing so is £850 per hectare because the potato growers are not able to exceed their quota and the Dutch are stealing a march on us.
Lord Carter: There are a number of interesting points in the Minister's reply which I am sure the noble Lord, Lord Stanley, will wish to take into account when he decides what to do with the amendment. The point about the quota is a dangerous one: making a comparison between countries. After all, if we started on milk quota and dealt with the differences in the treatment of price, value and taxation throughout the Community, we would find no such thing as a level playing field. In Italy it does not even exist. So the point made by the noble Lord about the difference between this country and Holland

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in the case of the potato quota (which in effect is a contribution by growers to a market equalisation fund) is a dangerous one.
The Minister's rejection of the amendment was disappointing. It was based largely on technical grounds relating to the scheme. The Minister knows that the amendment had to be drafted in response to the EC regime. We wish to probe the Government's reaction to the regime, which we found disappointing. I had hoped that the Minister would have better grounds for rejecting the amendment.
He mentioned the wide consultation which the Government propose. However, he did not deal with my point that the document was published on 24th November and responses were required by the department by 7th December.
Earl Howe: I apologise for not covering that point. The timetable which the noble Lord gave was correct. We asked for replies by 7th December but in practice we are considering late applications. The point is that we were aware that the issue would be raised in the Agriculture Council and we needed to have replies at an early date.
Lord Carter: That is extraordinary. There have been 14 days for consultation about a regime which, if there is no objection from other member states, the Government are prepared to rush through before the end of December. I believe that everyone in the Committee will be amazed by that answer. What is the timetable? We have no chance to return to the Bill until the Report stage towards the end of January. Is the Minister really telling us that when his right honourable friend, who is president of the Council of Ministers, meets with other members of the Council next week he will be prepared to push through the scheme if there is sufficient agreement?
Earl Howe: I cannot say how the discussions will go next week. There is no question of our pushing anything through. Unanimity is required, as the noble Lord knows, for a measure of this kind to be adopted. It remains to be seen how enthusiastically the proposals will be received by other member states, and that we do not know as yet.
Lord Mackie of Benshie: The Minister said that there was a great opportunity for us to reduce imports and to grow the extra potatoes for processing in this country. I can tell him exactly what the new scheme will do. It will halve the price of potatoes. We in this country will be producing more for the market and the continent will be producing the same amount. Without some restriction of acreage the price will be dropped even further. However, it will not drop one penny to the consumer of a packet of crisps.
Earl Howe: I do not believe that one point follows from the other. The noble Lord will have to do better than that in his argument. My noble friend Lady Carnegy spoke of the differences in climate. In terms of climate and freedom from disease the UK has a comparative advantage for the growing of potatoes, in particular in Scotland which has ideal climatic
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conditions. UK growers can therefore expect to benefit from a level playing field provided they are not held back by quotas as their competitors are not.
Baroness Carnegy of Lour: I am sure that my noble friend knows that while there is an advantage in being at a northern latitude as regards problems of disease in potatoes there is also the problem that the great difference in climate causes production to go up and down like a yo-yo from year to year. We in the United Kingdom have to contend with that element which does not exist in other countries in the Community.
Amendment No. 26A suggests in paragraph (a) that one condition for abolishing our marketing scheme is that member states should be able to make such arrangements as may be considered appropriate to manage areas devoted to potato production. Is it likely that the European Community will agree that member states can manage their potato marketing internally so as to manage it against one another?
Earl Howe: I stand to be corrected by my noble friend Lord Stanley as to what he intended by the provision. I understood him to refer to quota areas. I do not see much likelihood of that. It would be an extremely difficult, uphill struggle to persuade the other 11 member states to accept measures of the kind which we presently adopt.
The Earl of Perth: I must again declare an interest as a potato grower. It appears that the noble Lord, Lord Stanley, other Members of the Committee and the Government have the same purpose. We are told by the noble Earl, Lord Howe, that the amendments as drafted will not work and will cause difficulty. Will the Minister help us by saying that he will take into account the worries that have been expressed today so that on Report we can reach a common end? I believe that we all have the same aim in mind; that is, to protect the potato growers in so far as it is appropriate. We are told that the amendment does not work. Will the Minister go further and say that by the Report stage he will have considered our worries in order to ascertain whether he can incorporate them in any action that he may take?
Earl Howe: I am grateful to the noble Earl, who makes an important point. I should have said that all the comments made in the debate will be taken into account in our negotiations in Brussels. We have had extensive discussions with the Potato Marketing Board and those are continuing. I am grateful to the noble Earl. I am sure that by the time we reach Report we shall be on more certain ground as regards the approach adopted by other member states in the EC. Doubtless I shall be able to report on the outcome of the forthcoming Agriculture Council.
Lord Stanley of Alderley: I shall leave the question of the future role of the Potato Marketing Board to my next amendment. I thank my noble friend for spelling out the four conditions which the Government intend to press in securing a potato scheme. As I see it, however, those four conditions are not compatible with the European Community regime that has been put forward. I hope that he will confirm

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that the Government are to resist the scheme. If he is prepared to do so I might answer his question about the meaning of paragraph (a) in my Amendment No. 26A.
My noble friend has got the wrong end of the stick as regards quotas. As a grower I have always considered the payment of a quota an insurance benefit and an aid for research. The board has done that most successfully. Of course it makes mistakes but my noble friend must admit that sometimes he too makes mistakes. I am sure that I should be the first to criticise the board.
I thank all Members of the Committee for their contribution to the debate. I was struck most by the question of the rush, which was raised by almost all Members. The scheme has been produced in the most almighty hurry. It is totally wrong; it is rubbish. Every Member has said that it will not achieve its aims. It will make the present situation worse, particularly in the bad years. I hope that my noble friend will tell my right honourable friend to resist the measure most strongly. I was particularly pleased to hear that my noble friend Lord Plumb does not like the scheme and that the other place in which he works does not like it either. That gives me a certain amount of confidence.
At present, I shall leave the matter. It goes without saying that I speak for myself. Although I am much in favour of a united Europe and a common market, I am totally disillusioned by the quantity of bureaucrat-ic rubbish which is churned out—and on this occasion rushed out—by Brussels. It makes all members of the European common market look complete fools. One begins to say that one does not want that common market at all. I am sure that my noble friend would not wish me to take that view.
I wish this European regulation all the evil that I possibly can. I hope that it gets no further than the paper on which it is written. As regards the amendment, I admit that it was drafted in a hurry yesterday morning following a series of telephone calls. Therefore, I fully accept that it is defective. I agree with my noble friend that it would not achieve what I want to achieve; that is, that this European Commission regulation should not rule our lives in Great Britain. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
5.30 p.m.
Lord Stanley of Alderley Lord Stanley of Alderley moved Amendment No. 26:
Page 12, line 45, at end insert:
("(2) In deciding whether it is necessary or expedient that the Potato Marketing Scheme should be brought to an end, in the light of any EC regulations on the common organisation of the market in potatoes or otherwise as the case may be, the Minister and the Secretaries of State shall have regard to the need for arrangements which match marketing conditions in Great Britain.").
The noble Lord said: I may repeat a few questions which my noble friend has answered. If I do that, it is not because I was not listening but because I may not have understood him.
The purpose of the amendment is to try to discover what the Government intend to do to ensure a healthy and profitable potato industry. When I use the words "potato industry", I mean growers as well as processors. As has been mentioned by the noble Lord, Lord Carter, growers have had a terrifying year. I have been a grower for 38 years and this has been one of the worst that I have experienced. To have the marketing side thrown into confusion by this scheme is pouring salt into the wounds.
I wish to ask two specific questions to which I hope I shall receive specific answers. If the European Commission does not instigate a scheme for potatoes, will the Government allow the Potato Marketing Board to continue in its present form with its present powers? I do not believe that that question has been answered.
Secondly, can my noble friend tell me whether the recently proposed scheme put forward by the Commission for a common potato regime means that the United Kingdom cannot continue with its present scheme? I understood the Minister to say that we cannot, but perhaps he will confirm that.
Thirdly, if the European Commission puts forward a common potato scheme, will the Government ensure that the United Kingdom can have its own complementary scheme? I know that that has been partly covered but I should like specific answers to those specific questions. If I do not receive an answer "yes" to my last question, I must follow up the matter on Report. It is very much loaded with the horrible problem of subsidiarity. I beg to move.
Lord Carter: Again, we are pleased to support the amendment, which is essential. I shall not repeat all the arguments used on the previous amendment as regards the EC regime. However, the drafting of Clause 22 is a piece of government sleight of hand. The general theme running throughout our discussions was that there might be an EC regime which would mean that the Government would have to wind up the Potato Marketing Board. The amendment ties the changes in the marketing scheme to the introduction of an EC regime. Clause 22 merely states that this part of the Act will apply if Ministers feel that,
"it is necessary or expedient".
The amendment of the noble Lord, Lord Stanley, has picked up the words "necessary or expedient".
It would be extremely helpful if the Minister could tell us for what it is necessary and to whom it is expedient. That catch-all phrase runs throughout this enabling Bill and the Government must be much clearer about what they mean by "necessary or expedient". At least the amendment attempts to tie down the end of the marketing scheme in the light of EC regulations and also in the light of marketing conditions in this country. If the scheme must come to an end, the inclusion of this amendment will be an improvement on the clause as drafted.
We believe that, if the scheme must come to an end, the matter must be restricted to EC legislation, if that ever sees the light of day. Clearly, from what has been said on the last amendment, we all hope that it will not. Only then can the marketing conditions in this country be taken fully into account.
Lord Mackie of Benshie: I shall not detain the Committee except to say that the principle of the amendment ties in with the Government's condition of a level playing field for any new marketing scheme.
Lord Renton: I have a great deal of sympathy for the merits of the amendment but one needs to bear in mind that the Government appear to have contem-plated that the Potato Marketing Scheme, as we have had it for a long time, could be brought to an end irrespective of what happens in the European Community. If that is so, it should be made abundantly plain.
It is perhaps not unreasonable for the Government to wish to have the best of both worlds; that is, have the opportunity—indeed, it would then become a necessity—to bring the present scheme to an end if something in the common agricultural policy is agreed to which would clearly replace the present scheme.
Therefore, I have a great deal of sympathy for this amendment. I should like to hear something specific from the Government as to the exact effect of Clause 22 as it stands alone, even when read with subsequent clauses.
I make one comment about the drafting of Amendment No. 26. I do not believe that it fulfils sufficiently strongly the intention of my noble friend Lord Stanley of Alderley. The crux of the matter is whether the word "match" achieves what he wants it to achieve. I invite attention to the last lines of the amendment, which state:
"the Minister and the Secretaries of State shall have regard to the need for arrangements which match marketing conditions in Great Britain".
I believe that the word "match" is too flexible and broad. I hope that my noble friend wishes to tie down the Government. I do not claim to be a master of English—I am only a rusty old lawyer—but I suggest that we want arrangements which are consistent with marketing conditions which have prevailed in Britain. The provision could be made clearer and stronger. It would be better to replace the word "match", which is rather ambiguous, with the word "reflect" so that the amendment would read:
"arrangements which reflect marketing conditions in Great Britain".
The amendment raises a very interesting and important matter. I shall try to keep an open mind on it until I have heard what my noble friend Lord Howe has to say.
Earl Howe: The first thing I would say to my noble friend is that should Ministers decide to revoke the potato marketing scheme, other than in the light of an EC regime, they would of course consider the marketing conditions in Great Britain before certifying that the scheme should be brought to an end and would wish to ensure that the decision to bring it to an end was in the best interests of the industry as a whole. I hardly think that my noble friend needs such a reassurance, but for the record I am happy to give it.
Where I find difficulty with the amendment, as worded, is that it could present Ministers with conflicting obligations. Some of the potato industry might well wish for the retention of a body resembling the PMB to manage the market as now. But an EC
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regime might very well preclude such arrangements. Indeed, the EC proposals as we now have them are incompatible with the UK quota system, and there is certainly no guarantee that an EC regime will conform to the sort of arrangements that producers favour. Should the current EC proposals be adopted, I am sure that my noble friend knows that they would take precedence over national arrangements. It would not therefore be appropriate to impose upon Ministers a requirement to have regard to marketing conditions in Great Britain if the shape of the regime is not within their discretion.
My noble friend Lord Stanley asked three questions. He asked me to confirm that under the proposed EC scheme the UK cannot run a national scheme in addition. I believe that I have already answered that question. He also asked me whether, if the EC does not instigate a scheme, the Government will allow the PMB, or a successor body, to run one. I answered that in part when we discussed the previous amendment. We shall keep under review the worth and effectiveness of the PMB, in the light of the considerations that I have enumerated. In that consideration we shall wish to ensure that the board is still serving the best interests of the industry as a whole. That is something we do as a matter of course, and shall continue to do. That should come as no surprise.
The noble Lord, Lord Carter, asked me about the words "necessary or expedient". That term is well tried in legislation. It does not mean that Ministers can act on a whim. They would wish to consider the interests of registered producers, potato processors and retailers and of the UK as a whole, of which competition law is a part. The general public interest is just one of the considerations that they would take into account. I note that an amendment to that effect follows this one.
To decide whether it was expedient to revoke a scheme would involve considering whether the scheme continued to serve the purposes for which it was originally intended and whether the interests of the potato industry, in the broadest sense, were still served by it. Equally, Ministers might decide that it was necessary—that is to say, legally necessary—to revoke the scheme. In that context, they would have to take into account any obligations under an EC regime.
I hope that what I have said is helpful and that my noble friend will be reassured by the first part of my reply. He may wish to reflect upon the second part.
Lord Geraint: I am sure that the Minister realises by now that a great deal of anxiety is felt on all sides of the Committee about the future role of the PMB. At this late stage, is he willing for the PMB to hold a referendum or poll to see whether its members are in favour of doing away with the present system? I am talking about the PMB and its statutory powers.
Earl Howe: Producers who are members of the PMB already have the power under the Agricultural Marketing Act 1958 to call for a poll if they so choose. It is entirely up to them to do so.
5.45 p.m.
Lord Renton: Before my noble friend Lord Stanley replies, will my noble friend the Minister be so kind as to make clear the Government's decision on a point that I raised. Clause 22 as it stands would enable the potato marketing scheme to be got rid of, even though there is no question of our entering into a scheme within the CAP. It would seem from the wording of Clause 22 that the Government envisage that possibility. Will my noble friend confirm that they do? If it be the fact that only a scheme within the CAP would cause the PMB to be brought to an end, then the Bill should make that clear. My noble friend Lord Stanley of Alderley mentioned subsidiarity. We are going to enter into a phase in the development of the European Community in which every major new policy will have to be considered in the light of the principle of no subsidiarity. Have the Government considered whether a new potato marketing scheme within the CAP will be considered in the light of subsidiarity and rejected if it were found to be less favourable to our own potato growers than is the present scheme?
Earl Howe: My noble friend asks—if I paraphrase him correctly—whether the Government envisage circumstances in which they would wish to bring the potato marketing scheme to an end, other than in the context of an EC regime. As I have repeatedly said, we have taken no decision to bring the potato marketing scheme to an end. There are various considerations which will weigh heavily upon us in the weeks and months ahead. I enumerated some of those in answer to the noble Lord, Lord Mackie, on the previous amendment. It is by no means evident to us that the present scheme has all the virtues and advantages that some Members of the Committee think.
However, we take account of the consultation with interested parties that we continue to hold, particularly with the PMB. I can say only that it is a matter that we are keeping under review. No decisions have been taken. The point of having the provision in the Bill is that the Bill was a convenient opportunity to insert enabling powers in legislation. It is not every week that we have an Agriculture Bill. It was a convenient place in which to insert the provision in view of the likelihood of the EC being about to come forward with proposals. I am sure that my noble friend will understand that now that it has come forward with proposals, it is doubly important that the powers exist.
Lord Renton: I am sorry to press this point, but it is important. It could turn out to be of major importance in practice. Will the new scheme put forward by the EC, which my noble friend has mentioned, be considered by the Government in the light of the principle that there be no subsidiarity?
Earl Howe: The word "subsidiarity" could mislead us in the context of the CAP. It has little place in a single market. Definitions of the word vary. Where we live within a common regime, as all 12 member states do under the CAP, there is little room for subsidiarity other than in minor matters.
Lord Mackie of Benshie: If, as we hope, the present proposals of the Commission are sunk without trace, will the Minister be happy to continue with the Potato Marketing Board as it operates at present?
Earl Howe: The noble Lord and several others are determined to lead me up a path. I have said that no decisions have been taken. We still have an open mind. We are reviewing the situation and shall continue to do so. If Ministers decide that the time has come when the potato marketing scheme no longer serves the interests of the industry, then doubtless they will wish to look at the provisions of Clause 22. I stress that no decision has been taken at the present time.
Lord Carter: If the Government are determined to consult as widely as they can before they decide whether the winding up of the scheme is necessary or expedient, can the Minister say why there is not a consultation clause to go with Clause 22? There is very good consultation as regards Clause 25 which is about the transfer scheme for the successor body. There is nothing about any consultation in helping the Minister to decide what is necessary or expedient when deciding whether to wind up the scheme.
Earl Howe: We are consulting very widely at the moment. We have regular contact with the potato industry. We take it that the Potato Marketing Board, as a democratic body, is in touch with its members and that what we get in the way of response and feedback from the board represents the views of producers.
Lord Carter: I admit that even as a farmer the potato industry is wider than the producers. Is the Minister saying that he will not object if we return at Report stage with a consultation clause to strengthen Clause 22?
Earl Howe: We can doubtless discuss the merits of a consultation clause on Report. If at that time the EC regime is on the table, I am afraid that consultation will count for little. I am willing to discuss the matter at Report stage.
Lord Boyd-Carpenter: Will my noble friend clear up something which he said a moment ago and which disturbed me? Did he say that in agricultural matters, right across the spectrum, the views of the Commission must always prevail notwithstanding the greater importance that has been given in recent months to the doctrine of subsidiarity and the discussions that are going on in Edinburgh at this moment?
Earl Howe: I remind my noble friend that the common agricultural policy has been with us for many years—
Lord Boyd-Carpenter: It is a disaster.
Earl Howe: My noble friend says that it is a disaster. We live with it and in many ways we benefit from it. It is a common marketing regime for agricultural and horticultural produce throughout the EC. There is little room for subsidiarity in that policy. I can think of one example; namely, the regime concerning set aside. It is up to member states to

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decide the conditions to attach to the set aside regime that are appropriate to their own country. That is where subsidiarity certainly has a place. But in a single market there is very little room for it.
Lord Stanley of Alderley: I admire my noble friend's honesty. I do not believe that I have heard any Minister explain so clearly what subsidiarity does or does not mean. I am not being sarcastic when I say to my noble friend that I am enormously grateful to him. While on the subject of subsidiarity, perhaps I may point out that I asked a parliamentary Question a few weeks' ago about changing the counting of our ewes from 14-day periods to 42-day periods, which would be much easier. The answer was that we are not allowed to do so under the Treaty of Rome. If one cannot do that, what can one do? I am grateful to my noble friend for spelling out the matter.
I hope that arising from what Members of the Committee, and in particular, the noble Lord, Lord Geraint, have said, my noble friend will be seized of the state of uncertainty in the industry. It is terrifying —the worst thing that we could have. We badly need certainty. I was delighted to hear my noble friend Lord Renton say that my amendment was too wishy-washy. The Bill is extraordinary. My noble friend Lord Mottistone is not advocating a free market, and now my noble friend is saying that I am being too wishy-washy. He normally complains that I am too hard going. I agree with him. The Bill does not give us a good guide. I would like to put in a much harder tone in order to know where we are going. I ask my noble friend to try to return at Report stage with very firm ideas as to where we are going as regards the Potato Marketing Board.
I am most grateful for my noble friend's remarks. He did not answer my questions exactly as I put them. I believe that he could not, and that that is the truth of the matter, because he is tied down by subsidiarity. I shall certainly read Hansard. I have nice long train journeys during which I can think about what he said. I shall consider what to do at Report stage in order to see whether we can produce some amendment which gives growers and the farming industry—I am not worried about the Government—a guide as to where we are going. Meanwhile, I hope that at Christmas my noble friend receives a book on subsidiarity so that he is even more explicit afterwards. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 26A not moved.]
Baroness Carnegy of Lour Baroness Carnegy of Lour moved Amendment No. 27:
Leave out Clause 22 and insert the following new clause:
("Application of sections 23 to 43
.—(1) If the Minister of Agriculture, Fisheries and Food, the Secretary of State for Scotland and the Secretary of State for Wales are of the opinion that it is in the public interest that the Potato Marketing Scheme should be brought to an end they may acting jointly by order provide that the following provisions of this Part of this Act shall apply.
(2) No order shall be made under this section unless a draft of it has been laid before, and approved by a resolution of, each House of Parliament.").
The noble Baroness said: This amendment is grouped with Amendment No. 35, tabled by my noble friend Lord Stanley, which is almost identical to the second part of my amendment. The amendments which we have just discussed have been about what kind of European potato scheme might emerge from current discussions and how any scheme might affect this Bill. From my point of view this is also a probing amendment. It has been tabled after discussion with the Potato Marketing Board. I am glad that the noble Lords, Lord Carter and Lord Gallacher, have added their names to the amendment. It goes wider than the clause which it seeks to replace.
The amendment is concerned with all the circumstances that the Government should be required to take into account before deciding to bring to an end the present potato marketing scheme. Most importantly, the amendment also insists that the proposed change should be properly discussed by Members of both Houses of Parliament before it is or is not accepted.
Clause 22 as it stands simply states that Ministers can make an order to abolish the present Potato Marketing Board if it appears to them that it is necessary or expedient to do so. It is understandable why the Government have worded the clause briefly and simply. The Agriculture Marketing Act 1958, which, under Clause 40 of the Bill, will no longer apply to potatoes, sets out in considerable detail the conditions which must prevail if a marketing scheme is to be revoked. Those conditions have become out of date and most are not really relevant at this moment.
Is the new clause an adequate replacement? My noble friend has explained what he means by necessary or expedient. I believe that Members of the Committee all know from experience that governments can find things which are necessary or expedient in all kinds of strange circumstances. They could find it necessary or expedient to abolish the potato marketing scheme just because they do not like the way the board is behaving or because the European Community scheme appears over the horizon, as at present, although it is still a long way from securing agreement among member states.
It seems to me that what is important is that, European scheme or no European scheme, all the circumstances affecting the public should be taken into account before any change is made: the effect of the change on the variety of potatoes in the shops, their quality and availability at home and for export and the effect on our extremely important seed potato industry, not to mention the effect on the farming industry generally.
My amendment replaces necessity and expediency as the criteria for Ministers deciding to wind up the present potato marketing scheme with the need to make that decision "in the public interest". That more all-embracing phrase is taken from the 1985 legislation. It seems better to define the breadth of consideration that is required. Even more importantly, my amendment insists that, once Ministers have decided to end the potato marketing scheme, the order should be properly discussed and the decision finally made by both Houses of Parliament. As I understand

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it, the affirmative resolution procedure is permissible under Clause 53, and I have chosen to call for that procedure in this new clause.
I was unsuccessful the other day in trying to persuade my noble friend Lord Howe that full parliamentary discussion was appropriate—indeed, that any parliamentary discussion was appropriate —for the proposals for a new voluntary milk marketing co-operative under Part I of the Bill. I submit that the situation that we are dealing with now in Clause 22 is very different. This order will be for a simple decision—whether to revoke the potato marketing scheme or not—but because potatoes are a basic food on almost everybody's shopping list, the effect of the change will be widespread. Such a decision might or might not appear "necessary or expedient". However, it would certainly be a matter of public interest and it seems to me that it should and could be properly discussed by Parliament.
I shall listen carefully to what my noble friend the Minister says about the amendment. If he feels able to accept it, I shall of course be delighted, but if not, I hope that he will take on board the arguments and perhaps consider tabling his own amendment to Clause 22 at a later stage. In doing so he may feel, particularly after the summit in Edinburgh, that he could incorporate elements of the amendments that we have already discussed this afternoon.
In my view, the public interest is crucial in this matter—and so is parliamentary discussion before acceptance. Neither should be omitted from the Bill as they are now. I beg to move.
6 p.m.
Lord Gallacher: We strongly support the amendment which the noble Baroness, Lady Carnegy of Lour, has moved very ably, as is her custom. I listened to the discussion on the preceding amendments with great interest. As we were told on Second Reading, this is an enabling Bill—and nowhere is it more enabling than in the manner in which it proposes to get rid of the Potato Marketing Board. I am firmly convinced in my own mind that the possibility of a Community regime is convenient for the Government and will probably be the reason given for the abolition of the board.
However, I am equally convinced that even if no regime were in prospect the days of the Potato Marketing Board are numbered. I ask myself: what is the justification for that? I can come up with only one justification—that Ministers in the Ministry of Agriculture, Fisheries and Food have to find a scapegoat for the adverse balance of payments which Britain is running in food and drink with the other member states of the European Community and that the Potato Marketing Board is within their grasp, ready willing and able, and is certainly about to suffer an early death.
That being so, I think that in all humility the Minister can hardly refuse Parliament the opportunity which is asked for in subsection (2) of the amendment —namely, for an affirmative resolution to be passed by Parliament before the board disappears. I sincerely
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hope that the Minister will not find it in his heart to refuse such a plea in the light of the fate which awaits the Potato Marketing Board.
Lord Elphinstone: I, too, support the amendment. When discussing the potato production industry we must bear in mind that it is a very much bigger and more important part of our nation's primary production than is often realised. The net retail value of potatoes and potato products amounts to almost £3 billion annually. It is very far from being the dog-and-stick industry that it is sometimes considered. Indeed, many jobs are dependent upon it.
The present structure of the industry and the massive investment that it requires are based upon the existence of the Potato Marketing Board with its area quotas. The Bill as it stands enables that structure to be changed by, effectively, the stroke of three ministerial pens. That may well be at some future time when circumstances are fairly different from those of today. It is therefore important for the actual abolition of the potato marketing scheme to be subject to the comment of both Houses, as has been suggested. Therefore, I support the amendment and urge my noble friend Lord Howe to give it consideration.
The Earl of Perth: I, too, support the amendment and especially subsection (2). Earlier today the Minister twice said that the Government wish to work in the best interests of the industry as a whole. I think that I have quoted him correctly. I am perfectly ready to accept that—I think that we all are—but if that is the case, I can see no reason why he is not prepared (or perhaps he is prepared; I very much hope so) to accept the affirmative resolution, which is proposed not only in this amendment but in Amendment No. 35 also. I beg the Minister to give us that assurance even if he finds for one reason or another that the first subsection of the amendment would be better otherwise phrased.
Lord Simon of Glaisdale: I beg to follow my noble friend Lord Perth and all the other speakers in so far as these amendments raise the question of an affirmative resolution in preference to a negative one. One can rehearse quite briefly why the affirmative resolution procedure is the more effective by way of parliamentary control. The Minister introduces the regulations under the affirmative resolution and does not merely reply at the end of a rather ragged debate, having the last word.
Moreover, there is another very important advantage. Although it is frequently made use of in your Lordships' House, the negative resolution is often obviated in the other place because time runs out before it can be debated. In that sense, the negative resolution procedure is really only a one-Chamber procedure—a procedure of your Lordships' House.
The distinctions between the two—the criteria—have been perfectly well laid down by the Joint Select Committee on Delegated Legislation of 1971–72, of which the late Lord Brooke of Cumnor was the chairman. He was a very experienced chairman and it was a very powerful committee. The committee said:

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"It should be the affirmative resolution procedure if the regulation is going to make a substantial difference to the law".
It must be obvious, going no further, from the speeches the Committee has already heard, that any such regulation as is in question here is going to have a substantial effect on the law. The committee went on to say:
"No doubt 'substantial' might be a matter for argument".
The committee said that what it meant by "substantial" was what was not trivial, what was not tidying up or what was not consequential. The noble Earl has to answer whether the regulations which are in question here can be stigmatised as trivial, tidying up or consequential. It must be quite obvious from what the Committee has already heard from experienced speakers that that cannot be done.
I desire to add only two points. These stipulations as to parliamentary control cannot really be considered in isolation in this Bill. One of the matters that has to be considered is the extraordinary provision in the Statutory Sick Pay Act as it was introduced. That had a Henry VIII clause; one which actually allowed the Minister by regulation to alter the charge on the employer and thereby to alter the charge on public funds. When the Bill was introduced that was subject only to the negative resolution procedure. The Government very quickly conceded in the other place that it should be subject to the affirmative resolution procedure but they nevertheless tried to stand by the Henry VIII clause. Your Lordships would have none of it and on a Division the Government were defeated.
That is the further background, but there is an immediate circumstance in this Session. This is the third Bill with a blanket negative resolution procedure applying throughout. The first was the Judicial Pensions and Retirement Bill. In it there were two Henry VIII clauses—it is true that they were not very important ones—that were going to be governed by the blanket negative resolution procedure.
The other was the Criminal Justice Bill, which was before your Lordships earlier today. There again a blanket negative resolution procedure was laid down in the regulation-making clause which was almost identical except that it was differently ordered to the one in this Bill. That was really serious because there was a Henry VIII clause—your Lordships will scarcely credit this—which allowed the Minister in effect to add a new criminal offence to the calendar and also gave him power to remove a criminal offence. The provision was subject only to the negative resolution procedure.
That was naturally objected to at Second Reading and the noble Earl, Lord Ferrers, in charge of the Bill very quickly conceded at the outset of the Committee stage that that should be the affirmative resolution procedure, as of course it ought to have been seen from the outset that it should be. What we are seeing is in effect a formulaic clause dealing with regulations, each provision of which comes up on the computer in the parliamentary draftsman's office and which prescribes blanket negative resolution procedures. It is
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most inappropriate in this Bill, particularly as regards Clause 22. I very much hope that the noble Earl in charge of the Bill will accept the amendment.
6.15 p.m.
Lord Renton: The speech which the noble and learned Lord has just made enables me to be quite brief. I wish to add a few words on the importance of the potato marketing scheme and reinforce the argument that if we are to get rid of it it must be done by the affirmative resolution procedure and not by the negative procedure as is at present provided by the Bill.
The growing of potatoes in three different parts of the kingdom which I shall mention is of fundamental importance to farming in those parts. Potatoes that probably play a more important part, and year after year a more consistent part, in the farming calendar than any other crop. The three areas I have in mind are, first, south-west England, and perhaps in this connection I may mention the Channel Islands, for early potatoes. For main crop potatoes I think particularly of the growers in the Fens, in my old constituency of Huntingdonshire. Another part of the country where potato growing is of fundamental importance is in those parts of the Highlands where seed potatoes are grown.
It would be a great shock to the potato growers in those parts of the country if this matter were simply to be slipped through on the negative resolution procedure. It is vital and an expression of democracy that the affirmative resolution procedure should apply. We should be grateful to the noble and learned Lord for raising the matter with the thoroughness that he did.
Lord Monk Bretton: I agree that the affirmative procedure is the right one here and is well justified. I rise to say this particularly because when we were dealing with milk I argued the other way. I still feel that I was justified in doing that, even though after what the noble and learned Lord, Lord Simon of Glaisdale, has just said I am beginning to wonder whether that was quite right. There is a big difference in this case because the matter of milk has been discussed for a long time—there have been soundings among producers and so forth for two or three years —whereas this matter of potatoes seems suddenly to have come up with very much less discussion.
Lord Mackie of Benshie: I rise quickly to support my noble neighbour because if I did not I would be in severe trouble. This is a very good and essential amendment. I trust that the Minister will be able to refute the severe allegations made by the noble Lord, Lord Gallacher.
Earl Howe: My noble friend Lady Carnegy seeks with Amendment No. 27 to do two things: to redefine the grounds on which Ministers could take a decision to end the potato marketing scheme and to subject that decision to scrutiny by both Houses of Parliament under the affirmative resolution procedure.
Should Ministers decide to end the potato marketing scheme that decision would not be taken

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lightly. The Bill empowers Ministers to certify that the scheme should be brought to an end if it appears to them necessary or expedient to do so. I do not believe that my noble friend took on board the assurances I gave in the last amendment. Those words do not mean that Ministers can act without firm reasons. I repeat, Ministers will wish to consider the interests of registered producers, of potato processors, of retailers and of the UK industry as a whole. The key consideration would be whether the scheme continued to serve the purposes for which it was originally intended. The general public interest is only one of the considerations that they would take into account.
As I explained, the word "necessary" has a largely legal force. The legal obligations of an EC regime would be an example in that context. Therefore in most circumstances it would not do merely to require Ministers to consider the public interest when coming to their decision.
Turning to the appropriate parliamentary procedure for ending the scheme, I find myself in some difficulty as I must disagree with the noble and learned Lord, Lord Simon, to whom this Chamber always listens with great attention. He said that the order-making provisions in the Bill were subject to a blanket negative resolution procedure. He is not correct in regard to the order-making powers in Clause 22. That is an order without parliamentary procedure; the order is simply placed in the Library of the House and is not subject to either negative or affirmative resolution.
Lord Carter: Perhaps I may interrupt to ask the noble Earl whether he finds the fact that the order is to be placed in the Library an improvement.
Earl Howe: I ask the noble Lord to bear with me and I shall explain.
I wonder whether my noble friend has not gone a little overboard in seeking to correct what she sees as a deficiency in the Bill. As we have said, there is a strong chance that the introduction of an EC potato regime will create an obligation to abolish the UK scheme. I said at Second Reading, and I feel this equally in the light of arguments presented today, that some form of parliamentary scrutiny should be allowed for in respect of any order made under Section 22.
Lord Simon of Glaisdale: Will the noble Earl say what he means by "some form"? Does he mean merely the negative resolution procedure? Every noble Lord who has spoken has said that that is insufficient.
Earl Howe: I am coming to that.I believe that the negative resolution procedure is appropriate as it should provide a sufficient opportunity to debate the order over and above the debates on the Bill. Accordingly, unless I am prevented from doing so, I propose to table an amendment at a later stage to meet the undertaking that I gave at Second Reading.
The negative resolution procedure would not only be consistent with the procedure adopted for many measures taken under the terms of Section 2(2) of the European Communities Act; despite the general observations of the noble and learned Lord, Lord
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Simon, to whom we listen with great respect, it would also be no impediment whatever to a debate in either House should Ministers decide to revoke the potato marketing scheme for reasons other than an EC obligation.
After an order is made, should there be one, the board has plenty of time in which to consider whether to put forward proposals for a transfer scheme. Equally, Parliament has plenty of time in which to accept the ministerial line or decide upon a debate. For the life of me I cannot see what extra advantage the affirmative resolution procedure gives us in that context.
The noble and learned Lord, Lord Simon, prayed in aid a number of examples. He specifically referred to instances where there was a substantial difference in the law. He defined "substantial" as not trivial, tidying up or consequential. He is perfectly correct. But he failed to make clear that those substantial differences are typically ones which embrace measures whose principles have not been the subject of prior parliamentary debate in any shape or form. In the light of our discussions this afternoon I hardly think that that applies. He also correctly referred to cases where increases in taxation may be in prospect. With great respect, I suggest to him that that is not relevant to this clause in the Bill.
The Government will continue to keep the potato marketing scheme under review, as we have undertaken to do in Our Farming Future. However, I must emphasise that the potato marketing scheme was designed to meet the needs of the 1930s. We need to be sure that our arrangements can now meet the needs of the 1990s to enable our industry to compete in Europe and to provide the quality, variety and value that will encourage our processors and supermarkets to source their supplies from home-grown potatoes.
I appreciate the anxieties expressed by my noble friend and other noble Lords that the House should have the opportunity to discuss the ending of the potato marketing scheme should that prove necessary at a later date. Negative resolution procedure would provide that opportunity and I ask the Committee to reject the amendment on the basis of my assurance. Equally, in the light of what I have said, and in particular my undertaking to table an amendment to provide for a negative resolution, I hope that my noble friend will be content to withdraw the amendment.
Lord Renton: Before my noble friend sits down I wonder whether he has borne in mind that over the past 40 years there has been a different attitude towards the negative and affirmative procedures, especially in another place. Unfortunately, in your Lordships' House we do not give great prominence to debates on either affirmative or negative resolutions —not as much as they do in another place on affirmative resolutions.
Those who, like myself, served for many years in another place remember well that one had to table a Prayer on a negative resolution in order to initiate a debate at all. Such Prayers were nearly always taken at the end of a day's business before the half-hour adjournment debate which finally concluded the day. If the Government were obliged to table an order for

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affirmative resolution on an important point, it could often become the main business of the day, or at any rate be taken quite early in the day. Therefore the Minister's assurance that the negative resolution procedure would be enough, with deep respect to him, is simply not a reflection of parliamentary practice.
Lord Mackie of Benshie: I notice that the noble Earl did not refute the suggestion made by the noble Lord, Lord Gallacher. He has given the show away. What the Government want is to grow another half a million tonnes of potatoes in this country in the vain hope that it will replace the imports, instead of which it will drive the price down and ruin a great many people.
The Earl of Perth: We heard from the noble Lords, Lord Elphinstone and Lord Renton, of the enormous importance of the potato industry. It helps employment, it helps the farmer and in every way it justifies the affirmative rather than the negative procedure. I hope that the noble Earl will reconsider his undertaking merely to give us a negative resolution and table an amendment which allows an affirmative one. I say that quite apart from the legal angle on which we have heard so eloquently from the noble and learned Lord, Lord Simon. It is to be found not only in the amendment of the noble Baroness, Lady Carnegy, but also in Amendment No. 35, which shows that there is a general wish in the Committee that we should not have a negative but an affirmative resolution.
Baroness Carnegy of Lour: I thank all noble Lords who joined in this important discussion. I was interested that the Minister defines the public interest in a rather narrow way. I am less experienced than many Members of the Committee, though perhaps as experienced on the matter as the Minister himself. But it seems to me that, if it does not already have it, "public interest" should have a wider sense.
The important point in the discussion is that we should be quite sure that Clause 22 contains a wide enough definition of what has to be taken into account. I hope that my noble friend will consider this matter and discuss it with his right honourable friend to see whether he is satisfied that the clause is wide enough.
The discussion on negative or affirmative resolution has been heard many times in the House. I am grateful to the noble and learned Lord, Lord Simon of Glaisdale, for taking the trouble to come along and join the discussion and to my noble friend Lord Renton who is also experienced in these matters.
The Government should think carefully about the point. I do not wish to divide the Committee on the matter now because I want the Government to reflect on the first part of the amendment. If anyone wishes to divide, I suggest that my noble friend Lord Stanley should move his amendment and the Committee could divide on it. I believe it would be much better for the Minister to go away and consider what two experienced Members of the Committee have said on the point. The Minister should discuss it with his right honourable friend and perhaps reconsider it, once the
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roar and dust of Edinburgh have died down. For my part, I thank the Committee and beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 22 agreed to.
Clauses 23 to 25 agreed to.
6.30 p.m.
Schedule 3 [Qualifying transfer scheme]:
Baroness Carnegy of Lour Baroness Carnegy of Lour moved Amendment No. 28:
Page 39, line 35, at end insert:
("(c) a society formed for the purpose of giving effect to the scheme and registered under the Industrial and Provident Societies Act 1965;
(d) a company registered under the Companies Act 1985 which has not carried on business and whose Memorandum of Association empowers it to carry on (inter alia) the activities assigned to it by the Scheme; and
(e) a company registered under that Act which was a subsidiary of the Board immediately before the day on which subsection (1) of section 23 of this Act comes into force.").
The noble Baroness said: This again is a probing amendment. I recognise that it addresses complicated issues and that the solution I propose to the problem may not be correct. I have also discussed Amendment No. 28 with the Potato Marketing Board. I find that the board fears that the functions which could be carried out by what is termed in the Bill as a qualifying "successor body" are too narrow in scope. The board is concerned particularly that functions such as control and maintenance of standards could be an important activity in the future.
The board also tells me that it would not wish to put at risk the link between its research station at Sutton Bridge and the packing station there. The latter is run on highly commercial lines and enables experimental work on matters such as the handling and storage of potatoes to be carried out under real rather than laboratory conditions. I do not need to tell Members of the Committee who are experienced in these matters that the storage and handling of potatoes is very important indeed. The trading surplus from the packing station's operation goes to defray the cost of research and development work carried out there.
The board, I understand, has been advised that it cannot be guaranteed that a development council, under the 1947 Act, would have the power to carry out that commercial activity. If that were so, many of the practical benefits and all the financial benefits of the close links between the research activities and the packing station would be lost.
The board has persuaded me that the options for the form of a successor body should be widened along the lines of those proposed for the milk marketing arrangements. That is what the amendment does. I point out that the requirement for any transfer scheme to be approved by Ministers would remain unchanged, so that the Ministers would still retain ultimate control over any future decision.
I believe this to be an important amendment. I shall again listen carefully to what other Members of the Committee, particularly the Minister, have to say. I beg to move.
Lord Carter: I was pleased to add my name to the amendment and I support it. I do not intend to repeat any of the arguments made by the noble Baroness, but this gives me the opportunity to raise a point on which it would be helpful for the Minister to reply.
The amendment adds a clause on page 39, after paragraph 7(2) (b), which will become new paragraph 7(2) (c). When the Minister replies, will he deal with the point on sub-paragraph (2)? At the moment all the Government see in the Bill as successor bodies is a development council. We all understand what that can do. Paragraph 7(2) (b) states:
"any other body corporate formed solely for the purpose of carrying out functions of a kind which could be assigned to such a council".
One can understand the functions which could be carried out by a body corporate which would be similar to those of a development council. But presumably one could not have a body corporate which would have the levy-making powers which one would have for the development councils under the 1947 Act. Perhaps the Minister could clarify the point, either now or in writing to me. It seems odd, and I wonder what action the Government are considering there. Why do we want a body to carry out the functions of a council, presumably without the levy-making powers of the council?
Earl Howe: As my noble friend explained, the amendment would allow the undertaking of the PMB to be transferred to a commercially trading successor body. I have to say that that is not our intention. We do not wish to find ourselves with a potato equivalent of a milk marketing co-operative, possibly holding a dominant market position. I am sure that my noble friend will understand that.
I understand the PMB's anxieties about the status of its Sutton Bridge research station, which is one of the main points at issue here. But the amendment does not meet those anxieties because it is too wide and could open the board to unforeseen tax liabilities. We shall meet the PMB to explore its anxieties and if there prove to be any difficulties on the research station, as the provision stands, we shall consider what, if any, amendment is desirable. Should there be a problem we shall, if necessary, come back to the House at a later stage.
The noble Lord, Lord Carter, asked a specific question about a similar body, the body corporate, set up to carry out functions similar to those which might be assigned to a development council. That body would be voluntary, but I agree with the noble Lord that no statutory levy would be possible with such a body.
My noble friend Lady Carnegy has highlighted a potential difficulty which has come to light only relatively recently. I trust that she will be content at this stage to withdraw the amendment in the light of what I have said.
Baroness Carnegy of Lour: I thank my noble friend for his reply. It is good news that he will discuss the point with the marketing board. It is important and we must not put the research station and the other operations at risk. I take his point that the Government do not wish to widen the scope of the successor body so much that it can take on many other operations. That is not the purpose of the Bill. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Schedule 3 agreed to.
Clauses 26 to 32 agreed to.
Schedule 4 agreed to.
Clauses 33 to 35 agreed to.
Clause 36 [Power to poll registered producers]:
Lord Carter Lord Carter moved Amendment No. 29:
Page 18, line 37, leave out ("may") and insert ("shall").
The noble Lord said: In moving Amendment No. 29, I wish to speak also to Amendments Nos. 30 and 31. It may surprise the Committee when I say I believe we shall have a fairly short discussion on this group of amendments. We had a good discussion about the pros and the cons of producer polls on Tuesday and I certainly do not wish to repeat all those arguments this evening. It is obvious that the Government believe that, by including Clause 36 in the Bill, there should be a poll of producers and they should be asked their opinion in the case of the transfer scheme to succeed the Potato Marketing Board. One could ask: if potatoes, why not milk? But the purpose of the amendments is to ask why the permissive power for a poll should be introduced. Clause 36(1) states:
"The Board may carry out a poll".
To strengthen that provision, subsection (2) gives the power to ignore the poll anyway. We do not think that that conveys the stiffening of resolution that the Government should adopt in this area. It would be interesting to find out the Government's thinking on this matter and why they have included this provision in the way they have. Amendment No. 30 suggests removing subsection (2) completely. Subsection (2) states in effect that, having carried out a poll, one may then completely ignore it. That provision seems a little odd. We are certainly prepared to go along with Amendment No. 31, standing in the name of the noble Lord, Lord Stanley, and others, which uses the words,
"have regard to the result of the poll".
Perhaps the Committee recalls that I used those words on Tuesday. I explained then that the phrase "have regard to" offers a good precedent. It means that one cannot ignore a measure completely but one need not slavishly follow it, rather in the same way the Government treat their election promises. However, unlike in the case of the milk boards, the Government have introduced a provision for a poll of potato growers but, it seems to us, have rather damned the provision by faint-hearted drafting. These amendments are intended to stiffen the Government's resolution. If the Minister cannot accept the amendments as drafted, I urge him at least to indicate that the Government are prepared to strengthen the commitment to a producer poll in the Bill. I beg to move.
Lord Renton: I wish to support what the noble Lord, Lord Carter, has said on this. The potato marketing scheme, although of course in the general public interest, is in the particular interests of the growers of potatoes. That a poll should be taken in order to ascertain what their interests are—because that is what the result of a poll will show—and then can be completely ignored, as it could be under the Bill, is to me unthinkable. The amendments, taken together, are quite frankly very moderate. Amendment No. 31 is the one which is truly operative and that merely states that the board shall,
"have regard to the result of the poll".
I cannot imagine the Government opposing such a sensible suggestion.
6.45 p.m.
Earl Howe: I have listened carefully to the noble Lord, Lord Carter, and other noble Lords. I feel I can say at the outset that their wish for producers to be in a position to call for a poll if they choose to as regards the ending of the potato marketing scheme is something I have absolutely no quarrel with. However, they can already do so under the terms of the Agricultural Marketing Act 1958. They do not need this Bill to do it. The point about Clause 36 is that it gives the power to the board itself to hold a poll if it wishes to do so, and not just a poll about the ending of the scheme but a poll about what is to succeed it. The provision for an orderly succession is not available under the Agricultural Marketing Act, or indeed the European Communities Act. This Bill provides for it.
The noble Lord, Lord Carter, suggested that not only should the board be obliged to poll producers, but that it should also be bound by the results of the poll. On the first point, I must put it to the noble Lord that the idea of an obligatory poll has a severe practical objection; namely, that it could put the Potato Marketing Board to considerable, and I would say unwarranted, expense. It would be required to poll producers as to whether they wished the board to consider making an application for a transfer scheme and, if they decided to proceed, they would have to poll again on the principles of the proposed scheme. If they then decided to withdraw that scheme, they would be required to poll again before submitting a different transfer scheme. That really would be a nonsense.
I fully understand the concern behind the amendment but I think it is much better for us to leave it to the Potato Marketing Board to decide how and when to consult its producers. Clause 25(1) requires the Board to satisfy the Ministers that it has,
"taken reasonable steps to bring the principles or—
a transfer scheme—
"to the attention of registered producers".
That surely meets the central point of concern. There is no question of producers not knowing what is going on. A poll of course, is one means of bringing the scheme to their attention, but there are less cumbersome and equally effective ways in which the board might advise growers of its intentions, such as by means of letters, media announcements or producer meetings.
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I remind the noble Lord that all but three of the board members are elected by producers and they keep very closely in touch with them. I think there is a limit to the extent to which Parliament should prescribe to a democratically run body how it should order its business.
I now turn to the suggestion that the board should be bound by the result of any poll, as proposed by Amendment No. 30. Were this amendment to be accepted, the Committee would be telling the members of the Potato Marketing Board that it does not trust them to represent the interests of the registered producers who elect those members. I cannot really believe that the noble Lord, Lord Carter, wishes to convey that kind of message to the PMB. It is inconceivable that producers' views will be ignored. Indeed, as I have said, Clause 25(1) (a) and (3) (b) place an obligation on Ministers to ensure that potato producers know about any proposals and that their interests have been taken account of.
If a poll of producers has been taken, as the Bill allows for, the board would need good reasons to override the conclusion of that poll. But, that such an element of discretion should be provided for ought not to be in doubt, not only because the number of respondents in the poll might in the board's view be too small to be representative of producers generally —I believe that matter should be left to its discretion —but also to allow for the imposition of an EC potato regime. A negative vote from producers in the face of an EC regime would not preserve the board but would cause it to be wound up with no successor to take its place. That cannot be what this Committee wants. I hope the noble Lord, Lord Carter, will think again about these amendments and withdraw them.
I wish to speak briefly to the amendment tabled by my noble friend Lord Stanley and the noble Lord, Lord Geraint. If the amendment were accepted, it would not make any material difference to the effect of Clause 36(2) because as drafted the clause states that the PMB should not be constrained by the result of any poll when deciding on whether to take action under Clause 24. If it chooses to have a poll, it can safely be assumed that it will have regard to the result in forming its decision, even if it does not decide to follow it. With great respect to my noble friend, I do not think that his amendment carries any material force as regards the Bill.
Lord Renton: We shall have to consider what my noble friend has said. He has put before us quite a complicated argument which is worthy of consideration before we finally take any decisions on this matter. However, I hope that he will bear in mind that the powers given under the agricultural marketing Acts with regard to the holding of inquiries and polls relate to the past and the present, but we are legislating for the future. I respectfully suggest that anything in the agricultural marketing Acts which may have a bearing on the future of the potato marketing scheme might have to be amended by the Bill. I do not think that there is any amendment at the moment.
Furthermore, the Minister says that the Potato Marketing Board is a democratically run body. That is what we want it to be when this vital decision is

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made as to the future of potato growing in this country. In order for it to be a democratically run body when the present scheme is brought to an end and a new scheme deeply affecting the future of potato growers is introduced, we must make sure that democracy is given a chance and that the board is required to consult the growers and must have regard to the interests of the growers as expressed in the poll. However, for the whole matter to be made optional on the part of the board and for it to be able to disregard the result of the poll—that is really what the provision comes to—far from making it a democratically run affair, makes it completely undemocratic. I therefore hope that my noble friend and his colleagues in the department will bear in mind that important point also.
Lord Carter: I was a little puzzled by the reference in the Minister's reply to the 1958 Act. As I understand it, that poll will be concerned with the future of the potato marketing scheme itself whereas the poll that we are discussing now concerns only the transfer scheme. The Government have already made it clear that, if they exercise their powers, they will revoke the potato marketing scheme. This simply concerns the successor body that will follow it.
Earl Howe: The poll, should the board choose to have one, could be on both matters.
Lord Carter: Unless I have misread it, the Bill refers to Clause 24. The poll concerns the level of support as regards the making of any application under Clause 24 which refers to the transfer scheme. Am I wrong there? Section 23 revokes the potato marketing scheme and this poll concerns only the successor body and the transfer of its property, rights and liabilities. However, we shall leave that point.
The disadvantages of a poll listed so very powerfully by the Minister make me wonder why the Government have included the Clause in the Bill. On the question of the level of support, Clause 36(1) speaks of a poll carried out in such manner as the board thinks fit, so, when it laid down the rules of the poll, it could indicate that it would not be bound by a poll of less than a certain percentage of producers.
I am not convinced by the Minister's arguments about ignoring "have regard to" and preferring "shall not constrain". I believe that everyone in the Committee will agree that "have regard to" would be a considerable improvement. Perhaps the Minister wishes to deal with the point that I made earlier.
Earl Howe: My voices tell me that I was correct in what I said; namely, that there could be first, a poll on whether the board should be wound up and, secondly, on whether there should be a scheme.
Lord Carter: I shall have to read the Bill with care, but, as I read it, the poll applies only to Clause 24 —the transfer scheme. We shall have to read Hansard and perhaps discuss the matter further. I think that the wording "have regard to" would be much better than "shall not constrain". I believe that other Committee
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Members agree, but, in the light of the discussion that we obviously need about the meaning of the poll. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 30 and 31 not moved.]
Clause 36 agreed to.
Clause 37 to 43 agreed to.
Clause 44 [Grants]:
Lord Mancroft Lord Mancroft moved Amendment No. 32:
Page 20, line 40. at end insert:
("(aa) wild game meat,").
The noble Lord said: I ask the Committee to put hot potatoes aside for a moment and turn its mind to the problems of the wild game meat industry. Although the Chamber is not exactly bursting at the seams and Members are not fighting each other in the aisles to take part in the debate, I ask the Committee to think carefully about the matter because it is an increasing and important part of the rural economy.
If I may remind the Committee, Clause 44 empowers Ministers to make a scheme for the payment of grants for the marketing of agricultural produce or other produce specified by them in an order. Previously, applications to MAFF for grant aid to establish a game marketing scheme have not been accepted because game is not considered to he agricultural produce. Under the Bill, Ministers will by order be able to specify game as produce eligible to receive grant aid for its marketing.
This is therefore a very gentle probing amendment using a very blunt probe. Its purpose is to see whether Ministers are prepared to consider paying grants for the marketing of game. If they are, the amendment is, strictly speaking, unnecessary as they may specify game meat by order. However, if they are not, we may need the amendment to make sure that that can happen.
As noble Lords will know, the amendment refers to wild game meat. In this context, we mean meat from game birds such as pheasant, grouse, woodcock and partridge, hares and rabbits, and, although venison is not strictly game, the amendment also includes deer. The amendment does not include farmed game.
As the Committee probably knows, wild game meat is par excellence a "green" product. It is in the truest sense of the word free-range and it is produced in an environmentally friendly manner. All game meat is very lean, so it is a health food. As the Committee will know, it is delicious to eat, providing a tasty and welcome alternative to the normal fare of chicken, beef, pork and lamb. Also, very importantly, it is relatively cheap.
At present, government policy lays great emphasis on diversification and on encouraging alternative uses of farm land. Many of those uses are far from environmentally friendly—industrial use of buildings, "equiculture", barn conversions and even golf courses. By contrast, the growth of shooting has both provided farmers with alternative income, apart from recreation, and made a huge contribution to the conservation of the British countryside. In 1978 a Countryside Commission study indicated that farmers with an acknowledged interest in game shooting spent

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on average 25 per cent. more on landscape improvement than those with no sporting involvement.
Well over half a million people shoot game. In other words, they are the slaughterers of the industry. The volume of game shot virtually doubled in the seven years between 1983 and 1990. The total value of the bag in 1990 was £35.2 million. On average, nearly half of the produce was sold. The wholesale value of actual sales was £16.7 million. The largest wild game meat product is pheasants. A high proportion—60 per cent.—are sold, with a total wholesale valuation in 1990 of £10.2 million. On the fair assumption that 90 per cent. of pheasants sold in the United Kingdom are exported, the wholesale value of game bird exports is estimated to be in the region of £9 million.
In other words, there has been some success in the marketing of game and the Committee will be delighted to know that several supermarket chains now sell oven-ready fresh or frozen grouse, partridge, woodcock and pheasant as well as venison, which is good news for all of us. Safeway and Sainsbury now produce a free pamphlet on how to cook those delicious delicacies, although I am unable to tell your Lordships whether or not this evening is late closing.
Game is no longer regarded as the food of the privileged few, and food retailers are showing an increasing interest in it. There is an abundant supply of British pheasants during the shooting season, but for some reason imports of game have risen, partly due to the inadequate marketing and distribution by the UK industry. There is a need to develop an orderly and profitable marketing strategy to benefit all parties in the supply chain from the game farmer to the consumer, possibly by creating a game marketing board.
The shooting sports organisations have taken the lead, with support from all sectors of the industry, in commissioning a feasibility study by professional marketing consultants into game meat marketing. That initiative has been welcomed by Food From Britain. However, the Ministry of Agriculture is unable to grant aid to the study on the ground that game is reared primarily for sport, even though most of it goes for food use afterwards. Existing legislation would not permit it.
In the same way, my noble friend Baroness Trumpington confirmed in a letter to the chairman of the Game Conservancy in March of this year that the Ministry of Agriculture's farm diversification grant scheme could not support the cost of developing a marketing strategy for shot game. To extend the scheme would require new statutory instruments in order to present it to Parliament. Grants for marketing and processing agricultural produce under European Community regulations have also been restricted to farmed game and venison.
In summary, I can say that improved marketing of game would produce benefits for consumers, producers, farmers and the balance of payments. Shooting provides an important alternative source of income to farmers and makes a major contribution to conservation of the countryside. There is a strong case
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for the Government to provide financial support for a marketing scheme for game, surely the most British of foods.
Lord Carter: We look forward with interest to the Minister's response to the idea of a game marketing board. I do not hunt, shoot or fish, but I happily consume the products of those who do. This seems to be a sensible amendment, if the Minister can confirm that the grants can be extended.
I would be sceptical if the grants were used to subsidise the wages of latter-day Mellors—referring of course to the Mellors of D.H. Lawrence and not to the Member for Putney. If the grants were restricted to improve marketing, the amendment would be a sensible addition to the Bill.
Earl Howe: My noble friend has explained, while I was salivating, that the amendment would add wild game meat to the range of produce that is specifically identified in Clause 44 as being eligible to be considered for inclusion in any scheme which Ministers may decide to make under the powers of that clause. He will be pleased to know that the amendment is unnecessary.
The clause makes provision for any scheme to be made in relation to the produce of agriculture, horticulture, fish farming and anything derived from such produce. It contains in subsection (2) (c) provision for Ministers, by order, to extend that range of produce to other activities which are not agricultural or horticultural in nature, or where there is doubt as to whether they would be regarded as such under existing legislation.
If at some future date Ministers decide to make a scheme under the powers in Clause 44, and they decide that such a scheme should apply to wild game meat, they would then invoke the powers in subsection 2(c) to make such an order.
Excluding wild game meat from the face of the Bill does not in the least imply that it is inherently ineligible for inclusion in a group marketing grant scheme or that there is any bias against considering it for a scheme. If we were to accept the amendment then we should no doubt be inundated with requests for other produce to be included on the face of the Bill. Therefore, this is one of those instances where secondary legislation is the appropriate vehicle for extending the range of eligible produce, as set out on the face of the Bill. I hope that my noble friend will be content with those assurances.
Lord Mancroft: I thank the noble Lord, Lord Carter, for his support. I suspect that it would not need any encouragement from him to ensure that any noble Lords who employ gamekeepers make sure that they are not called Mellors.
I appreciate that others may wish other products to appear on the face of the Bill. I note the Minister's comments about the powers held by his right honourable friend in Clause 2(c). I hope that means his right honourable friend will be prepared to look favourably upon such requests at some stage in the future. I will read with care and attention what the Minister said. I beg leave to withdraw the amendment.

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Amendment, by leave, withdrawn.
Clause 44 agreed to.
Clauses 45 to 47 agreed to.
Clause 48 [Wool guarantee]:
Lord Gallacher Lord Gallacher moved Amendment No. 33:
Page 23, line 15, leave out ("1993") and insert ("1995").
The noble Lord said: We move from potatoes and game meat to wool. In moving Amendment No. 33 I shall speak to Amendment No. 34, with which it is grouped.
The amendment standing in my name and that of my noble friends Lord Carter and Lord Geraint seeks to retain the wool guarantee for two more years until 1995. We regard that extension of time as being necessary because of the collapse in world prices for wool since 1990. Under the proposals in the Bill, which are somewhat severe, we are advised that the price would halve from next May.
The British Wool Marketing Board, whose other responsibilities are to continue under the Bill, needs time to adjust to new financial conditions, especially if it is to continue its present work for farmers and the wool market in general. The board has to accept fleeces of varying quality and amounts and has to find markets for those fleeces, which is a difficult job when surpluses worldwide make the market more competitive.
In addition, there is the existence of the multi-fibre arrangement for which the Department of Trade and Industry is responsible. That arrangement impacts on the market for wool and, therefore, makes conditions more difficult for wool to be used as a commodity in the manufacture of textiles.
We are advised that even a slight increase in current market prices would significantly reduce the Government's commitment. Conversely, the absence of any guarantee in over supply conditions is likely to further depress market prices.
We accept the statement in the guide to the subject matter and content of the Bill that the present arrangement is very costly and in 1991–92 amounted to nearly £40 million. I was advised recently that trade press reports have indicated that there is a strong possibility, in the review of hill livestock compensatory allowances, of a cut of £20 million, which is equal to 20 per cent. of the present allowances. Part 4, paragraph 29, of that guide, having given the cost of withdrawing the current guarantee, states that sheep farmers will continue to receive very substantial Government support through ewe premium and hill livestock compensatory allowances. If the press reports of the impending cut are correct, then hill livestock farmers are certainly facing a very bleak prospect. If one adds to that the possibility of a reduction in the guaranteed price for wool, their difficulties are significantly increased.
In the light of that situation the Minister should look sympathetically at the modest extension of two years that the amendment proposes. If it is still argued that it is a cost beyond reason and one which must in present circumstances be reduced or even done away with—which is the point of the Bill—many of us, looking at European Community expenditure on
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commodity regimes like tobacco (to which the United Kingdom Government contribute a significant amount as their share of the total cost) will be asking ourselves why those costs are obligatory whereas this very necessary and desirable guarantee to the Wool Marketing Board has to be reduced in such a dramatic and serious way. In all the circumstances I hope that the Minister will consider this sympathetically. I beg to move.
Lord Borthwick: I gather that the Wool Marketing Board is being abolished and that the main grading centres will go too. That is much more important. I do not know whether any Members of the Committee remember what happened in the old days. All sorts of wool was put into a sack and the local boys came along and trampled upon it. When tradesmen, manufacturers and so on came along, they had to buy 10 big sacks, pull out of them the particular skins they wanted, chuck the rest back and send it to auction. It was a waste of time and a terrific waste of money and good hides. By that time they were all mixed up. That was all stopped and grading started. After grading began in Britain it started in Australia and New Zealand. It is now almost worldwide. If the board is done away with, we will have no control centre here for grading. I should like to know what is going to happen. Will we be left with some control for the grading of wool in order that it can be sold?
7.15 p.m.
Lord Geraint: Once again I declare an interest. I happen to be a hill farmer producing a little wool on the slopes of Plynlimon. I had the great honour and privilege of representing Wales on the British Wool Marketing Board for 21 years from 1966 to 1987. I was vice-chairman of that board for 11 years from 1972 to 1983. We had the duty to look after the interests of approximately 100,000 wool producers in Britain. I enjoyed my stay at the board and the responsibility given to me and others to look after the interests of the sheepmen of this country. But here I am today very disappointed indeed that the Government will do away with the guaranteed price system for wool.
We have also been discussing the future of two other boards, the Milk Marketing Board and the Potato Marketing Board. It seems to me that the Government of the day are hell bent on taking away the statutory powers of those two boards, but for some unknown reason they are leaving the statutory powers of the British Wool Marketing Board as they are. Perhaps the Minister will explain. During the past 10 or 15 years we have been told so many times that the British Wool Marketing Board, with its statutory powers, is safe and here to stay—for the very simple reason that nobody within the Community has been interested in dismantling it, since wool has been classified as an industrial raw material and not an agricultural product. I would say that that is the main reason why the board has held on to its statutory powers.
It was the Government—nothing to do with the EC —who made the unilateral decision to do away with

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the guaranteed price. If I remember correctly, the Minister made the announcement in 1988–89. The whole of that sector of the agricultural industry which produced wool and lamb was disappointed. The effect will be disastrous. It will save the Government of the day approximately £26 million or £30 million in a period of 12 months. But what effect will it have on the industry, especially young people? I say with respect to noble Lords on both sides of the House that very little has been said about the future of the young men farming our land, especially those farming hill land.
Before I make a plea on behalf of the young farmers of this country let me say that today I read an article which is very interesting for those who live in England —not Wales or even Scotland. The information, sent to me by the Farmers' Union of Wales, states:
"A recent survey in rural areas of England had shown that 39 per cent. of parishes had no permanent shop; 40 per cent. had no post office; 51 per cent. had no school; 29 per cent. had no village hall; and 73 per cent. had no daily bus service".
That does not augur very well for the young farmers of this country who are very keen to follow in the footsteps of their fathers. How do the Government of the day, in particular the Minister, believe that these young people are to enter the industry if their income is to be slashed year in year out because of government policy? I wonder whether the Ministers concerned have contacted young farmers to discuss future trends in the agricultural industry and policy-making to make sure that their aspirations are fulfilled. Without them the countryside will be much poorer and many more people will leave the hills. I say to the Minister and to the Government of the day that empty farmhouses will be the tombstones of this Government's policy in the nineties unless they change course. That is indeed a sad state of affairs as we look forward to the next century. I urge the Minister to give serious consideration to the amendment. Two years' grace for the wool board and a guaranteed price system will be a step in the right direction. I hope that there will be a review after that period.
The noble Lord, Lord Gallacher, referred to rumours about the hill land compensatory allowance. I go a little further and read from yesterday's Farming News. It is up to the Minister to say whether the rumour referred to by Mr. Richard Saunders in that publication is genuine:
"Leaked correspondence between Minister John Gummer and the Chief Secretary at the Treasury Michael Portillo reveals that in order to achieve the £20 million cut in spending demanded by the Treasury for 1993–94, the Minister has proposed a cut in HLCAs for hardy sheep in severely disadvantaged areas from £8.75 to £6.60 (a 26 per cent. drop) and for other sheep in SDAs a cut from £4.90 to £3.60, (a 11.2 per cent. drop). For sheep in disadvantaged areas the payment would actually increase from £2.45 to £2.67 because otherwise it would be below the lowest level permitted by the EC".
Perhaps the Minister will confirm whether or not that is true. If it is, the income of those hill farmers in the sheep sector of the industry will be cut by £40 to £50 million next year. That is not a very good policy to pursue.
Noble Lords are very keen that the environment should be preserved in hill areas of Britain. I am afraid that that is not to be. I have said on many occasions that, although one may blame the Milk Marketing
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Board, the Potato Marketing Board and the wool board, for the past 50 years the standard of living has been reasonable in the hills, in the lowlands and within the farming fraternity; but not I am afraid in the free market of the 1990s, especially in the hill areas of Britain, unless the Minister will concede the request of many Members of the Committee that another two years' grace should be given to the guaranteed price system for all. I hope that the Minister will respond favourably to our request.
Lord Stanley of Alderley: I support the amendment but I should declare an interest in so far as I keep sheep. I believe that the noble Lord, Lord Carter, will confirm—he runs a costing business—that the sheep industry is possibly showing the worst returns of all, not excepting beef. Therefore I am particularly concerned about the point made by the noble Lord, Lord Gallacher, that those who claim hill livestock compensation payments will be 26 per cent. down this year. I hope that the Minister will comment.
There is one particular point which I ask my noble friend to bear in mind; namely, the price now of shearing ewes. It will hardly be worth shearing them. Quite soon we shall be in the position of not shearing them. That raises a point about cruelty, in line with what has been happening in Australia where the profitability of sheep has been so low that they have been left to die and one has not even been able to afford to shoot them. I hope that we do not reach that stage here. I support the amendment.
Lord Plumb: I support the amendment on the extension of the wool guarantee for a further two years. The Minister may be tempted to ask whether, if the world wool price looked like increasing over the next two years, we would be saying the same thing. I believe that we might be saying something slightly different. Frankly, in the light of what has been said, and given the knowledge that we have at the moment of the virtual collapse of the wool price worldwide, the removal during this year of the wool guarantee could be disastrous for the whole of the sheep industry and for flock masters in particular over the next two years.
The sheep industry is going through a difficult period. The variable has been very much dependent on the export of sheep, particularly to France. We exported something like 394,000 sheep this year, which is something of a record. But that in itself is perhaps not of a long-term nature. Wool is seen, and always has been seen, as an industrial product. Nevertheless, the guarantee is absolutely essential as we see the various changes take place. I hope that the Minister will look favourably at the substance of the amendment to make sure that the flock masters and the sheep industry are preserved and protected over the next two years as we phase out or phase in, as the case may be, a change of regulation.
Lord Borthwick: I had news this morning that much wool remains undelivered because it is not worth delivering. Many sheep this year have not even been clipped. I have never heard of that happening before

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but I guarantee it happens today. We got it straight from headquarters. I think that we are in a very serious position indeed on the sheep farms.
Earl Howe: The noble Lord, Lord Gallacher, asks me to be sympathetic to the amendment. I like to be sympathetic whenever I can. I listened very carefully to what was said.
I explained at Second Reading that while the wool guarantee had served the industry well over the past 40 years, the Government feel that it has now outlived its usefulness. It is out of place in the conditions of the 1990s. It has, in particular, become redundant in the face of EC support measures for the sheep sector under the common agricultural policy. The wool industry is ready to accept financial responsibility for its own affairs and it should do so as quickly as possible.
It would not therefore be right to accept the amendment, which would postpone the date for termination of the wool guarantee by two years—from 30th April 1993 to 30th April 1995.
I understand the concern that this action will take place at a time when the market for wool is particularly depressed. It is true that the guarantee element currently accounts for approximately 65 per cent. of the producer's return from wool. However, it is important to emphasise that his total return from wool amounts to only about 5 per cent. of his total return from sheep production. Substantial producer support by means of the sheep annual premium and hill livestock compensatory allowances will continue to be paid. UK sheep producers currently benefit from over £400 million a year in direct subsidies from these sources.
The noble Lord, Lord Geraint, I am sure, does not need reminding, because he is so experienced, that although the guarantee has in practice operated as a means of support over the past three years, it was intended as a means of price stabilisation for producers, not as continuous market support. So I am not quite sure what he thinks is the underlying justification for the UK taxpayer supporting the sheep sector over and above the very substantial support provided under Community measures.
A number of Members have asked me to comment on the reports of the hill livestock compensatory allowances for next year. My right honourable friend the Minister has this afternoon announced the outcome of the autumn review of the hills and uplands, including the fact that we will be cutting HLCAs on sheep in the severely disadvantaged area.
HLCAs are designed to compensate hill farmers for the disadvantages of farming in the hills. The rates are decided only after the autumn review of economic conditions in the hills. In previous years rates have increased when incomes have fallen. This year evidence shows very substantial increases in hill farmers' income, suggesting that HLCAs were higher than necessary.
Even after the reduction, hill farm incomes will still be very substantially higher—at least £20 million higher than last year. The devaluation of the green
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pound will provide a strong additional boost to their 1992 ewe premium payments as well as those in 1993 and thereafter.
My noble friend Lord Borthwick understood that the wool board was being abolished. The wool board is not being abolished; it is the guarantee that is being abolished. Termination of the guarantee will not affect the marketing arrangements for wool, which will continue to be organised by the British wool marketing board. This decision reflects the Government's view that the board has been successful in recent years in promoting improvements in the quality and marketing of British wool in the interests of wool producers and consumers. The scheme is popular with producers. The existing system of collecting, grading and selling wool enables UK wool, which represents about 2.5 per cent. of world production, to compete effectively against larger producers. It also ensures that all wool is collected, including that from small and remote producers, as well as providing significant economies of scale to the benefit of producers. The ending of the guarantee will not affect these arrangements.
The industry has been given a number of years to prepare for the withdrawal of the guarantee. It is now ready to respond more directly to the needs of the market, and I believe that it should not be prevented from so doing.
I turn briefly to Amendment No. 34. Clause 48 of the Bill would not only terminate the wool guarantee from 30th April next year, but would provide that wool already collected by the British wool marketing board in the 1992 clip year—that is to say, 1st May 1992 to 30th April 1993—and previous clip years should continue to qualify for the guarantee, provided it is sold by the board before 1st May 1995. That will assure for the board a sensible and appropriate timetable for the sale of the wool without disruption to its traditional marketing patterns. It will also provide a clear and precise end date for Exchequer liability. The amendment proposes that the timetable should be extended by two years. It is therefore closely related to, if not directly consequential upon, Amendment No. 33.
I do not believe that it is appropriate or necessary to contemplate going back on what is a well-flagged decision by the Government. I hope that the noble Lord will be content to withdraw the amendment.
7.30 p.m.
Lord Gallacher: I am disappointed with the Minister's reply because, in spite of the somewhat rosy picture that he painted of the financial position of sheep farmers, the speech of the noble Lord, Lord Geraint, was at variance with that. The decision to leave price stabilisation to the board is somewhat arbitrary. The crux of the problem lies in world market conditions. Anyone who reads about the position of sheep farmers in Australasia cannot help but be depressed about the state of their wool market. The fact that such a state exists must mean that the problem for the British Wool Marketing Board on the

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world scene is significant. In those circumstances our proposition is not unreasonable; namely, an extension of two years.
The Minister said that farmers have had time enough to get ready for what lies before them. If that preparation time had been in conditions of market stability I should have agreed with him. However, the time has been one of market instability—and chronic instability at that. Furthermore, it shows no sign of diminishing.
The Minister has acknowledged that the board has done a useful job and we agree with him. He spoke of the improvement in the overall financial position and mentioned the figure of £20 million as the basis of comparison. What is the basis on which that comparison is made? Is it this year with last year, or has some other basis been taken? Perhaps the Minister will answer that question before I decide what to do about Amendment No. 33.
Earl Howe: The calculations that we made on the incomes of hill farmers are based on a number of factors including the hill livestock compensatory allowances and ewe premiums. The figure of £20 million which I mentioned calculated that even after reductions in the HLCAs, which we announced for the coming year, hill farm incomes will still be substantially higher than they were in the previous year.
Lord Geraint: I am disappointed with the Minister's reply. We have all tried our best to persuade him. But if he has not had sufficient evidence of the situation on the hills I invite him to come to the village of Ponterwyd where I have lived all my life. When I was a boy in the local school there were 33 farms. There are still 33 farms in our village. When I was in school all the farmers were full-time but today only three are full-time. That says it all. I beg the Minister to look once again at the amendment which was so ably argued by many Members of the Committee.
Lord Borthwick: I wish to put forward another point and apologise that my queries were not all put at the same time. The Minister mentioned two years. That period was proposed because vast amounts of wool are still held in Europe. We hoped to get rid of that wool during that time. Given a little more time some of that wool may be got away and the trade improve. We want a little extra time to help us to clear the stocks.
Lord Gallacher: I am grateful to the Minister for the information about the basis on which the comparison with better times was made. However, at the beginning of his speech he confirmed as a fact of life what I knew only as a rumour. It is an unpleasant fact of life for those people who will be affected by it. I propose to let the farming community reflect on what the Government have done in that regard. In the light of those reflections we may return to this issue on Report. In the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 34 not moved.]
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Clause 48 agreed to.
Clauses 49 to 52 agreed to.
Clause 53 [Orders and regulations]:
[Amendments Nos. 35 to 38 not moved.]
Clause 53 agreed to.
Clauses 54 and 55 agreed to.
Schedule 5 [Repeals and revocation]:
Lord Carter Lord Carter moved Amendment No. 39:
Page 41, leave out line 11.
The noble Lord said: On Second Reading I referred to the watershed in our post war agricultural history and the Government's proposals for removing the appropriate section of the 1947 Act. That is a watershed because the Government are in effect removing themselves from the responsibility of ensuring fair incomes for farm workers and farmers and the promotion and maintenance of a suitable and efficient agricultural industry. We are all well aware that our farming fortunes are now decided in Brussels. Of course, the annual review of prices now takes place in Brussels. An annual report on UK agriculture deals with farming income and expenditure and gives many other valuable statistics. I suggest that we have one of the best measured farming industries in Europe.
I understand the Government's wish to remove the requirement for the annual review. In a Written Answer given to Mrs. Dunwoody in another place the Minister for Agriculture, Fisheries and Food made a statement about the future of his Ministry's document, Agriculture in the UK. The reply was:
"It will continue to be published".—[Official Report, Commons, 2/7/92; col. 705.]
That is a firm commitment. Is the Minister prepared to bring forward an amendment to put that commitment on the face of the Bill? We know that the current 1991 edition of Agriculture in the UK states:
"The document provides an accessible form of information on the economic conditions and prospects of the United Kingdom agriculture industry. The Government will draw on this when considering policy issues, including proposals by the European Commission for agricultural support in 1992–93".
It is a very valuable document. The Government have said that it will continue to be published. This is a probing amendment to raise the point. I hope that the Government will accept the purpose behind the amendment and will agree that the statistics should continue to be published in the annual document Agriculture in the UK and that they will be prepared to write that commitment on the face of the Bill.
Earl Howe: I can well understand the nostalgia which the revocation of Part I of the Agriculture Act 1947 must engender in many who have had a long and close association with British agriculture. It does indeed draw a line under a chapter in our past, one which commenced shortly after the Second World War and represented a substantial new deal for farmers. Nevertheless we must accept that times have moved on. Decisions on levels of support for the agricultural industry are now taken largely on a European Community basis under the common agricultural policy, which represents a no less effective —and certainly more expensive—safety net for farmers.

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The purpose of the annual review was to assist Ministers in the setting of national price support levels. The last of the national price supports—the potato and wool guarantees—will be brought to an end by the Bill.
The annual reviews, which Members of the Committee will recall used to be published as Command Papers, have already been replaced as a meaningful exercise by the Community's annual price fixing, and the Command Papers have been superseded by Agriculture in the United Kingdom, which is published annually by agriculture departments. Publication of Agriculture in the United Kingdom will continue after the ending of the requirement to hold an annual review, so there need be no fears that repeal of the requirement will reduce the flow of publicly available information. I see no need to place that requirement on the face of the Bill.
Consultation with the agricultural industry also now takes place at times when major decisions for agricultural support and other policy issues are made, not only during the annual CAP price-fixing exercise, but also when other important CAP proposals come forward from the Commission. I can assure the Committee that the Government's consultations with the agricultural industry will not be diminished by enactment of the Bill.
I hope that, in view of these assurances, the noble Lord will be content to withdraw the amendment.
Lord Carter: I shall withdraw the amendment but I am disappointed. The Minister said that we should have no fear but I am sure that if we look back in Hansard over the years we can see that we have been told by successive Ministers of different departments to have no fears about something, only to find that it has disappeared. To have this provision written on the face of the Bill would have strengthened the commitment. I know that the Government recognise the value of that annual publication and I do not see why they are not prepared to accept the amendment. However, in the light of what the Minister said, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Schedule 5 agreed to.
Clause 56 agreed to.
House resumed: Bill reported without amendment.

Oversea Companies and Credit and Financial Institutions (Branch Disclosure) Regulations 1992 Companies Act 1985 (Disclosure of Branches and Bank Accounts) Regulations 1992 Companies (Fees) (Amendment) Regulations 1992
7.44 p.m.
Viscount St. Davids Viscount St. Davids rose to move, That the regulations laid before the House on 26th November [13th Report from the Joint Committee]; and the regulations laid before the House on 17th and 19th November be approved [12th Report from the Joint Committee.]
The noble Viscount said: My Lords, the purpose of these regulations is to implement two EC directives: the Eleventh Company Law Directive and the Bank Branches Directive. They were both adopted in 1989.
The eleventh directive deals with the filing of company documents, including annual accounts, by branches of limited companies that are incorporated outside the member state in which the branch is operating. The Bank Branches Directive sets requirements for the disclosure of the accounting documents of credit or financial institutions. Both directives thus deal almost entirely with registration and accounting requirements for non-British companies which work through branches in this country.
We are debating here today three sets of regulations that implement these directives. To help your Lordships, the forms and guidance notes which will be used in operating the regulations have been placed in the Library. The Oversea Company and Credit and Financial Institutions (Branch Disclosure) Regulations 1992 are addressed to non-British companies. I shall refer to those as the main regulations. The Companies Act 1985 (Disclosure of Branch and Bank Accounts) Regulations 1992 are addressed to British companies. The Companies Act (Fees) (Amendment) Regulations 1992 set out the fees that will be charged in operating the main regulations.
Although we are considering the implementation of these directives in Great Britain, I want to take the opportunity to say a few words about the implications of the directives for British companies operating through branches in other member states. The directives are of considerable help to British companies because they prevent other member states imposing excessive demands for information from branches; in other words, one of the hidden barriers to the completion of the single market. They are to be welcomed in that light.
The regulations implementing the directives are technically complex because Britain already has a registration regime for foreign companies. This "place

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of business regime" is contained in the Companies Act 1985. It requires a foreign company to register if it sets up any form of permanent presence here. For the time being this existing registration regime must continue for operations that conduct functions that are solely ancillary or incidental to the parent company, such as a warehouse or internal data processing facilities. Companies incorporated in Northern Ireland or Gibraltar will also continue to be registered under this regime.
The regulations introduce branch registration for the rest. Companies will be required to register a branch if the presence here is sufficient for people to be able to transact business as they would with the parent company. That is a branch within the meaning of the directives. It is not a branch in the sense we usually know it—for example, the branch of a bank where we cash cheques or a local office. "Branch" is used for the purposes of registration rather more in the sense of a subsidiary of a foreign company; but one that is not separately incorporated. It is important that companies understand this distinction, as the directives, and therefore the regulations, require the separate registration of each branch. It is in no one's interest for companies to register each of their individual offices if those are joined within a common management structure and can be regarded as being a single operational entity or, in other words, a branch within the meaning of the directives.
I have spent some time explaining the definition of branch and the two registration regimes because they are crucial to understanding the main regulations. We issued a consultative document on implementation of the directives to over 700 organisations and individuals as well as making it available in the Library. The definition of branch and the problems of the dual regime were the points that concerned most respondents. Many pointed out that deciding between registration regimes is potentially confusing or expensive. The Department of Trade and Industry recognises that an up-to-date system of company law helps to reduce the burden of regulation on business and generally promotes the competitiveness of industry. Those are both high priorities for the department and it continues to look at ways of improving selected areas of the Companies Act 1985.
Your Lordships may wonder, therefore, why the Government are bringing in this dual regime. We have a Community obligation to implement the directives by the beginning of next year. We cannot lecture others about not meeting their obligations if we ourselves fail to do so because we are unable, at the moment, to find the legislative time to resolve the problems of our existing regime. There are benefits too not only for British companies but also for foreign companies operating here. But I can assure your Lordships that these regulations have been designed to make the operation of the dual regime as easy as possible for companies. For a start, those already registered will not need to file again details of their directors and secretary or their constitutional details and will not have to pay to re-register in the transitional period. Secondly, there is a clear set of
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guidance notes—which have been made available to your Lordships—to help companies understand what is required of them. I should like to take this opportunity to thank the many organisations who provided help to the department in preparing those notes. The comments received about what should be explained were, I understand, very useful and the guidance notes were amended to take account of those comments. It is an excellent example of the Government and industry working together to ease the impact of a regulatory change and reduce the costs of compliance.
The most important benefit for companies registered under the branch regime is that from next year most of them will no longer have to prepare a different set of accounts for this market—known as Section 700 accounts in honour of the relevant provision of the Companies Act 1985. Section 700 accounts are the sort of accounts that a British company would have had to prepare in the 1960s. In future, foreign companies will be able to file instead the accounts that are prepared, audited and disclosed according to their home state law. That should not only be less burdensome for companies but in most cases the information filed should be more helpful to inquirers than the Section 700 accounts. But, as a protection, if accounts are not required to be disclosed in the home state Section 700 accounts will still be required. The arrangements for banks are slightly different but the effect is to allow them to disclose here their home state accounts.
As the department's consultative document made clear, it is concerned that some companies might try to take advantage of that change by deliberately incorporating in territories with minimal public disclosure requirements and then working through branches here. From the comments the department received, it was clear that that point concerned others too. I wish to tell your Lordships that Companies House will monitor the numbers of registrations under the branch regime to see whether there is any sign of an increase in companies operating from such territories. If there are signs of abuse we shall not hesitate to take action. The directives provide one solution to this: requiring such companies to produce branch accounts. If that does not work, then the Government will have no hesitation in going back to the Commission and demanding a different solution.
Your Lordships will have noticed that the regulations we are debating are different from those first laid. The Joint Committee on Statutory Instruments pointed out that in its view the regulations exceeded the legal powers of the European Communities Act 1972 in setting the level of penalties for failure to comply with them. There is more than one school of thought on the extent of the legal powers in that respect, but to avoid delaying the implementation of the directives, the regulations were amended in the way sought by the Joint Committee. The regulations we have before us clearly show the changes.
I shall turn now to the second set of regulations we are debating today—the Companies Act 1985 (Disclosure of Branches and Bank Accounts)

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Regulations 1992. As I explained, these are addressed to British companies. The Eleventh Directive requires all companies to disclose in the directors' report,
"the existence of branches of the company".
That provision was inserted into the directive at the request of the European Parliament so that those dealing with a company would be aware of the extent to which it operates through branches; subsidiaries already have to be disclosed. The department consulted on the basis that that would mean disclosing the addresses of branches. Those responding argued that that was too onerous an interpretation. That concern has been recognised and the regulations have been changed so that they now repeat the words used in the directive. The regulations also make some technical changes arising from the implementation of the bank accounts directive and to reflect changes to the definition of credit institutions introduced by the main regulations.
The third set of regulations that we are debating is the Companies (Fees) (Amendment) Regulations 1992. Those provide for the fee levels which Companies House will charge companies for registration of branches and inquirers for inspecting the data held. Those fees are in line with those charged to domestic companies and will be subject to the same controls.
We are not debating the forms regulations here today or the guidance notes but they have been made available so that your Lordships can see how the whole package will work. The regulations are complex. They serve the dual purpose of keeping the burdens on companies to a minimum while at the same time providing adequate disclosure of information for those dealing with the companies. I beg to move.
Moved, That the draft regulations laid before the House on 26th November [13th Report from the Joint Committee], and the draft regulations laid before the House on 17th and 19th November be approved [12th Report from the Joint Committee]. —(Viscount St. Davids.)
Lord Clinton-Davis: My Lords, I thank the Minister for having introduced these complicated matters in the way that he has, but I have a number of questions. I agree with him that, overall, the directives upon which the regulations are based are likely to he of considerable help to British and, indeed, other companies, but the fact remains that they are extremely complicated, as the Minister conceded in the last part of his remarks. So I immediately wonder to what extent, if they are so complicated, they are issues which will be tackled successfully by the companies affected.
The Minister says that the department has provided guidance notes, and the rest of it, but, even so, the matter remains complex. I therefore ask him, first, to what extent he is satisfied, from the discussions that the department has had that British and other companies can deal with the matters satisfactorily. One of the issues raised was not just their complexity but the expense involved. Although some steps have been taken to mitigate that expense, can the Minister cast further light on that and say whether, from
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discussion he has had with the CBI, chambers of commerce and other such bodies, companies still find that the regime will be expensive.
One of the points raised by the Minister was that the directives and regulations require separate registration of every branch. He went on to say something to the effect that companies would be able to register each of the individual offices if they are joined with a common management structure and can be regarded as a single branch. I was not able to take down every word that he said. Is that situation well understood?
Secondly, the Minister said that deciding between registration regimes was potentially confusing. While it was helpful to say, as the Minister did, that the Government are looking at ways and means of improving various areas of the Companies Act 1985, that does not offer much assistance in unravelling the regulations. So, again, I ask the Minister to reveal to the House the result of the discussions his colleagues in the Department of Trade and Industry have had on that point with the various representatives of industry.
The next point I wish to take up with the noble Viscount is that it appears that we were under an obligation to transpose the directive into our law by 1st January next year. Why have the Government left it for so long to take that action? After all, we have only a few parliamentary days left before the Recess and therefore before the date for transposition expires. Were the Government not leaving a little to chance?
Incidentally, as regards that point, the Government often say that they do so much more than other member states to undertake obligations to transpose directives into our law. There has been some criticism of that stance of late. It appears that we have taken steps to transpose and adopt about 70 per cent. of the necessary internal market directives, whereas others appear to have been doing rather better. What progress has been made as regards these directives by other member states?
The next question concerns the filing of accounts. As I understand it, foreign companies have an option to file the accounts which are prepared, audited and disclosed according to their home state law or they can file accounts which have been prepared for them in this country. Let us assume that they file their accounts which have been prepared, audited and disclosed according to their home state law. Does that mean that the accounts can be filed in exactly that form? It may be that some would require a measure of translation. Are the company authorities here able, ready and willing to undertake those necessary tasks? Would it involve additional expense? That matter needs to be clarified.
I noted that the noble Viscount said that a specific provision was inserted into the directive at the request of the European Parliament. The provision in question seemed to be valuable, thereby vindicating the role of the European Parliament in going into some of those matters in considerable detail and having a real role to play. I wish that it had a greater role to play. It might he of some small assistance to those who feel that the European Parliament is often unfairly denigrated.

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Having said all that and posed those questions, I hope that the noble Viscount will be able to respond. I still believe that overall the regulations will prove to be helpful, but it may be that some further steps need to be taken to explain them rather better to those businesses which remain a little concerned about their over-complexity.
Viscount St. Davids: My Lords, it is essential to understand the way in which we are now using the word "branch". It indicates a major structure with a management control and not a great number of small, individual operational offices. I know that my right honourable friend the President of the Board of Trade is keeping company law under constant review and will seek the earliest opportunity which the legislative programme accords in order that some of those problems can be removed, for it is obviously not desirable to run the two regimes together.
The noble Lord, Lord Clinton-Davis, raised the question of expense. It is unlikely to exceed £5,000 to comply with the regulations. That is an amount which many companies have to find in the normal course of meeting legal requirements. He also asked, why so long? As noble Lords will see from the regulations, they are enormously complex. A great number of consultations have had to be undertaken, various documents produced and guidelines brought in. That explains why we have had to deal with the matter at quite a late date. I can tell the noble Lord that a number of European countries have already implemented the regulations.
In drawing up accounts foreign companies delivering their home state accounts will have to provide English translations for use in this country.
Lord Clinton-Davis: My Lords, I am very much obliged to the noble Viscount for giving way. Can he specifically indicate to me where that requirement appears in the regulations? I could not find it and it may be because the regulations are so complicated. If he has difficulty on that perhaps he will write to me.
Viscount St. Davids: My Lords, I do have difficulty on that. I shall write to the noble Lord.
He has drawn attention to the complexity of the regulations. As I said, we have consulted a wide range
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of legal and accountancy firms which have offered their advice. That includes organisations such as the CBI; and we spoke about one-off costs. The consultative document has been drawn up to meet its requirements as far as we can. The member states of France, Germany, Belgium, Denmark, Spain and Greece have already implemented the eleventh directive. France, Germany, Greece and Luxembourg have also implemented the bank branches directive. I hope that that is useful.
Lord Clinton-Davis: My Lords, before the noble Viscount sits down, can he give an undertaking that the Government will not leave matters of this importance to the last minute in the transposition of directives into our law? It is most unsatisfactory. It may well be that the Government can be accused of having still brought about an overly complicated system, but they cannot now amend it because we have to undertake our obligation to transpose by 1st January. If the noble Viscount cannot give an undertaking now, will he undertake to consider the point with his right honourable friend the President of the Board of Trade because it is an extremely unsatisfactory state of affairs?
Baroness Seear: My Lords, I support what the noble Lord has said. As noble Lords will see, we are somewhat denuded on these Benches. I have colleagues who might well have wished to make a contribution if these regulations had come forward at a more convenient time and with a little more notice.
Viscount St. David: My Lords, I shall draw these matters to the notice of my right honourable friend. It would be unrealistic to give an assurance that such matters will not arise late because, as I have said, they are extremely complex. We have to make them work on an existing structure of complex company law. I shall endeavour to ensure that such legislation is brought forward at the earliest possible opportunity.
On Question, Motion agreed to.

Sea Fish (Conservation) Bill
Returned from the Commons with the amendments agreed to.
House adjourned at nine minutes past eight o'clock.

  TRANSPORT COUNCIL, 7th AND 8th DECEMBER
  TRANSPORT COUNCIL, 7th AND 8th DECEMBER
  SAFETY ASPECTS OF SHIP DESIGN: REPORT
  SAFETY ASPECTS OF SHIP DESIGN: REPORT
  RUNWAY CAPACITY
  RUNWAY CAPACITY
  ARMED FORCES: REDUNDANCIES
  ARMED FORCES: REDUNDANCIES
  CONTROL OF RESPIRATORY SENSITISERS: CODE OF PRACTICE
  CONTROL OF RESPIRATORY SENSITISERS: CODE OF PRACTICE