Sitting of 2 December 1997

Preamble
The House met at half-past Two o'clock
PRAYERS
[MADAM SPEAKER in the Chair]
Oral Answers to Questions
  SCOTLAND
  The Secretary of State was asked—
  SCOTLAND

    Job Creation
    Mr. Swinney: When he last met Scottish Enterprise to discuss job creation in Scotland. [17090]
    The Secretary of State for Scotland (Mr. Donald Dewar): I and my hon. Friend the Minister for Education and Industry met representatives of Scottish Enterprise on 26 November when a number of issues, including job creation, were discussed.
    Mr. Swinney: I thank the Secretary of State for his answer. At a time when unemployment in Scotland is at a higher level than in the rest of the United Kingdom, and with press reports this morning that more than 1,000 manufacturing jobs in Scotland are under threat, what can the Secretary of State do to persuade his right hon. Friend the Chancellor of the Exchequer to follow some economic policy other than total dependence on interest rates as a means of slowing the overheating economy in the south-east of England, which has nothing to do with Scotland?
    Mr. Dewar: It is in the interests of the whole United Kingdom that we place public finances on a sound footing and get levels of growth that we can sustain and build on in the future.
    I appreciate that there has been some disappointing news—it was well reported in the newspapers today—but there is always an ebb and flow and there has also been some good news. As the hon. Gentleman will realise if he reads the unemployment figures, which show a claimant count of 146,700—the lowest in Scotland since January 1980—and the index of construction and production, which was up 5.2 per cent. in the year ending the second quarter of 1997, there is no reason for being over-gloomy about the current position. There is every reason to continue to fight hard to build economic prosperity.
    Mr. David Marshall: Does the Secretary of State agree that long-term unemployment is a huge problem in the city of Glasgow? Will he gave an assurance that the
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    Scottish Office will give its fullest support to Glasgow's bid for employment zone status, which will enable the city to tackle this critical situation?
    Mr. Dewar: My hon. Friend can be assured that we fully back Glasgow's bid and hope that it will be successful. I remind him that the welfare-to-work programme, which deals with those who have been out of the labour market for a considerable time, is an enormously important commitment, backed by heavy funding on the part of the Government, and Glasgow, in Scottish terms, is a very important part of that programme.
    Mr. Alan Clark: In considering disbursement of money from the Scottish Office, will the Secretary of State recall that in the entire county of Sutherland there are now fewer than 2,000 people engaged in agriculture and country occupations while in the city of which the right hon. Gentleman represents a part there are 82,000 registered drug addicts? Which section of society does he think is more deserving of reward from the public purse?
    Mr. Dewar: I think that the choice is a false one; it is not a matter of choosing between the two, as the right hon. Gentleman knows. I welcome his interest and concern for those who are struggling in Glasgow. No doubt he will be glad of my assurance that we work very closely with Highlands and Islands Enterprise, local authorities and other agencies to examine the problems of areas such as Sutherland, with which we are very familiar. I hope that the right hon. Gentleman will take the pleasure that I do in the fact that a working party is closely studying land management and the ownership in that part of the world.
    Mr. Canavan: Is the Secretary of State aware that yesterday the Wrangler jeans company announced 250 redundancies at the factory at Camelon in my constituency, and that that is a devastating blow for the work force and the entire local community? Will the Secretary of State therefore make urgent contact with the company to discover what can be done to save as many jobs as possible?
    Mr. Dewar: I assure my hon. Friend that I appreciate the importance of this to his locality—it was disappointing news. I gather that it is proposed that production should go abroad on this occasion, but we shall do everything we can to help with the difficulty. Forth Valley Enterprise is already involved and my office is looking at the matter closely. We shall try to offer any constructive help that we can.
    Mr. Ian Bruce: In his discussions with Scottish Enterprise, has the right hon. Gentleman mentioned the fact that it can offer new businesses coming to Scotland higher grants, that tourism in Scotland gets a lot more money, and that public spending there is higher too? Has he been able to reassure its members that Scotland will always enjoy that advantage over the other regions of England and that he will fight in Cabinet to ensure the continuation of that unfair advantage?
    Mr. Dewar: That was a somewhat confused question. If the hon. Gentleman is asking for my view of the current discussions on the proper co-ordination of the inward investment effort across the United Kingdom, I certainly

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    welcome such co-ordination. In the context of regional selective assistance, the hon. Gentleman will know that there are guidelines on the money per job that can be offered which apply across the United Kingdom. We observe them closely in Scotland. It is true that Scotland has a big success record, but that record is based on the virtues and merits of the services offered, not on any unfair advantage. I welcome sensible co-ordination which ensures that every part of the UK can properly put its case. That is what the current discussions are about.
    Ms Squire: Like my hon. Friends, I represent a constituency that has felt the full impact of large-scale unemployment. Will my right hon. Friend join me in paying tribute to the success of local authorities and local enterprise companies that work together on job creation, especially in Fife, where we have the fast-track skills seekers youth employment initiative involving 1,100 businesses, and where we have attracted inward investment? Will my right hon. Friend also join me in welcoming the unequivocal commitment offered by Hyundai last week to establish 800 new jobs in Dunfermline by this time next year?
    Mr. Dewar: I am happy to endorse my hon. Friend's good opinion of the efforts made by local enterprise companies and local authorities, in Fife and throughout Scotland. We are watching the Hyundai situation closely. There has been a good deal of rather excitable copy in the press about the costs of attracting that company. Most of the figures that I have seen have been wildly exaggerated. I also remind the House that under regional selective assistance and the many other elements involved payment is not made until the jobs are there: no jobs, no payment. However, I welcome the fact that the company has made it clear that it is committed to completing the first phase on time. We shall watch carefully—the more so in view of the unfortunate shock waves that have hit the Korean economy.
    Dr. Fox: What do the Secretary of State and the Chancellor of the Exchequer expect to happen to unemployment in Scotland over the coming year? Following the job losses at Wrangler, Pringle, Grampian Brands, Telecom Sciences and others, who else will be joining the dole queue to satisfy the Chancellor's commitment to preparing for economic and monetary union?
    Mr. Dewar: That is a very prejudiced view of what is happening in the Scottish economy. I have before me a long double column of recent job increases, but I do not think that swapping that sort of statistic is very helpful. The important point is that unemployment is low and there is growth in the economy. Our aims and policies, in Scotland and the rest of the country, are designed to sustain that state of affairs and to make sure that we avoid the stop-go cycles with which the hon. Gentleman, given the record of the Government he supported, will be very familiar.
    Mr. Ernie Ross: Does my right hon. Friend agree that the new deal must be tailored to meet local job creation requirements? The Minister for Education and Industry was in Dundee recently at a meeting hosted by Michelin and NCR—a meeting called to reflect the concerns felt on
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    Tayside by all sections of the community. The one thing that marks out Tayside is the co-operation across the board between all in an effort to make it a successful pathfinder area.
    Mr. Dewar: The Government see the importance of welfare to work as real and pressing. Dundee is a pathfinder area, and I am very satisfied to hear reports from my colleagues that these matters are going extremely well there; that was an impression that I gained from my own recent visit to Dundee. I associate myself with what my hon. Friend said about Michelin and NCR, and the level of commitment shown by local employers generally. I hope that my hon. Friend will not be embarrassed if I say that the hard work of both Dundee Members—my hon. Friends the Members for Dundee, East (Mr. McAllion) and for Dundee, West (Mr. Ross)—has been a feature of that effort.

    Higher Education
    Mr. Welsh: How many Scottish universities he has visited since 1 May to discuss higher education provision in Scotland. [17091]
    The Minister for Education and Industry, Scottish Office (Mr. Brian Wilson): My right hon. Friend the Secretary of State visited the university of Dundee in November. I visited the universities of Abertay Dundee and Strathclyde in September and the university of Edinburgh in November.
    My right hon. Friend and I attended a working dinner with the principals of the Scottish higher education institutions at the university of Glasgow in June. My right hon. Friend also addressed a meeting of the Committee of Vice-Chancellors and Principals in September, and I attended the annual forum of the Committee of Scottish Higher Education Principals in October.
    Mr. Welsh: The Government claim that nobody should be deterred from higher education because of financial circumstances. Why, since the abolition of maintenance grants and the introduction of tuition fees—in addition to student loans—have applications for universities fallen by about 10 per cent.? Will the Government now abandon that short-sighted and disastrous policy?
    Mr. Wilson: The hon. Gentleman would be well advised to wait until the figures are finalised. He would do his constituents and the young people of Scotland a service if he contributed to a more accurate flow of information.
    The three virtues of our proposal are, first, that it will put up to £140 million extra a year into Scottish higher and further education; secondly, 40 per cent. of Scottish students will pay not a penny in tuition fees; and thirdly, when the vast majority of students in Scotland graduate, they will repay less per month than at present. If the hon. Gentleman would help to get those three messages across, he would be doing the young people of Scotland a service. I would send the same message to everyone who has participated in misinformation, possibly based on misunderstanding.
    Mrs. McKenna: I welcome my hon. Friend's statement. Does he agree that access to higher education

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    is just as important for adults as it is for young people, and that the announcement last week of £28 million for out-of-school child care is an important part of that? Will he confirm that access to that is available to lone parents who will be taking part in further education?
    Mr. Wilson: Indeed, I confirm that that will be the case from next April. That is a move forward of great importance to lone parents. We shall be producing a separate Scottish White Paper on lifelong learning which will cover a wide range of initiatives in that field.
    My overwhelming message today is that nobody should be deterred from entering higher education by misinformation. I urge all potential students from all backgrounds to get the correct information and to make informed choices on that basis.
    Sir Michael Spicer: The Scottish higher education budget is part of a wider education budget for Scotland. It is a matter of fact that that budget, per head of population, is 25 per cent. higher than it is for England. How long will that situation continue for Scotland, when the income differentials between England and Scotland have narrowed almost to nothing?
    Mr. Wilson: Perhaps the hon. Gentleman could take a tutorial from the right hon. Member for Kensington and Chelsea (Mr. Clark), who has some acquaintance with Sutherland. The hon. Gentleman would then learn something about the geography and demography of Scotland, and he might understand why more factors than mere population statistics determine how public funds are allocated. The decisions within the Scottish budget are taken according to priorities and needs. We place a high priority, as I am sure do my hon. Friends south of the border, on education.
    We shall continue to make choices and I shall continue to take pride in the extra money that we have managed to get into every aspect of Scottish education since 1 May. I remind the hon. Gentleman that one of the burdens that we are very pleased to bear is £80 million from the Scottish block grant for students who come from other parts of the United Kingdom into higher education in Scotland.
    Dr. Lynda Clark: I am grateful for my hon. Friend's assurances in relation to adult students. I am particularly concerned about the situation of students from low-income families. Can the Minister tell us what policies there are to assist such students?
    Mr. Wilson: It is important to understand that the headline caricature of £1,000 a year tuition fees is not true. On present statistics, 40 per cent, of Scottish students will be entirely exempt from tuition fees. That is extremely important.
    The other major inhibitor to young people from less well-off backgrounds going into higher education is the concern that they will have to pay back maintenance loans despite perhaps not earning after leaving university—in other words, a mortgage-type loan. It is essential that it should be understood that after our proposals are implemented all repayments will be income contingent, which means that if the individual does not earn he or she will not repay.
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    If those factors are put together, it is obvious that there is no barrier to people from lower-income backgrounds going into higher education. On the contrary, there are many incentives to do so. I urge every young person who has the academic ability and qualifications to go into higher education to do precisely that.
    Mr. Menzies Campbell: How many of the principals of Scottish universities whom the Minister and his right hon. Friend the Secretary of State have met have given unequivocal support to the proposal for tuition fees, especially bearing in mind the effect that the proposal will have on students from other parts of the United Kingdom deciding to come to Scottish universities?
    Will the Minister take an early opportunity to visit St. Andrews university in my constituency, which has substantial experience of these matters? Indeed, 44 per cent. of its students come from countries in the United Kingdom other than Scotland. Will not the Minister relieve himself of the serious charge of discrimination by abandoning the discredited proposals for tuition fees at Scottish universities?
    Mr. Wilson: I would be anxious to visit a cross-section of universities. If I went to St. Andrews with its 44 per cent. of students from south of the border, I might equally go to Paisley university with its 1 per cent. If I went to St. Andrews, I would not swallow whole everything that the principal told me. I might even advise the principal that if he wants to maintain the precise number of students from outwith Scotland, especially from England, it is absolutely open to him to do so. He could do so by taking more students from that large group who are not subject to tuition fees and are therefore not affected by our proposals.
    Mr. Campbell: It would make it more exclusive.
    Mr. Wilson: By definition, those who do not pay tuition fees are students from lower-income backgrounds. If the principal of St. Andrews wanted to go down that road, I would welcome it. I wonder whether the hon. and learned Gentleman would do so.

    Inward Investment
    Mr. Baldry: If he will make a statement on the interdepartmental concordat relating to inward investment in respect of Scotland. [17092]
    Mr. Gray: What discussions he has had recently with the President of the Board of Trade on inward investment matters. [17099]
    Mr. Wilson: The Government undertook in our White Paper "Scotland's Parliament", Cm 3658, to produce a concordat on common guidelines and consultation arrangements on the handling of financial assistance to industry. Discussions are proceeding among interested Departments.
    Mr. Baldry: Is not the concordat really a con on the people of Scotland? The Government are seeking to give the impression that a Scottish Parliament will have control over inward investment into Scotland when the reality

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    is that under the dead hand of the Treasury control throughout the United Kingdom will be transferred to the President of the Board of Trade. Far from more influence being in Scotland, more influence will be exercised by Ministers in London. Is not one of the reasons why it has taken such a long time to publish the Bill on the Scottish Parliament the fact that it is difficult for even the most creative parliamentary draftsman to produce a Bill that is not entirely transparent in terms of the con on the people of Scotland?
    Mr. Wilson: I can understand the attractiveness of that line of argument to the hon. Gentleman. However, the timetable is bang on schedule. That is a tribute to the draftsmen and to everyone else working with them, and one that refutes the hon. Gentleman's implied criticism. It is entirely proper, and much in Scotland's interests, that a concordat should be in place and that there should be a set of rules.
    Locate in Scotland has done very well over the years because it is extremely good at what it does. It is not in Scotland's interests to have a state of affairs where various agencies are bidding against one another, expensively and unproductively. That is why it is right to have rules and a concordat and on that basis Scotland will continue to do very well with inward investment, which is in the interests of Scotland and the United Kingdom as a whole.
    Mr. Gray: Will the Minister pay tribute to the record £5 billion of inward investment that was achieved under the Conservative Government? Does he agree that that record achievement stands a good chance of being undermined by the triple whammy of the Scottish Parliament, the social chapter and the minimum wage?
    Mr. Wilson: The brief answer is no, but I will make a slightly fuller reply in response to the earlier point. Yes, I pay tribute to a great deal of the work that was done. I pay tribute to some of the decisions that were taken and to the continuing work of Locate in Scotland throughout that period. I do not pay tribute, however—I do not attribute this to the hon. Gentleman—to hon. Members, perhaps from other parties, who welcome job announcements, but who at the first whiff of grapeshot and difficulty start to condemn and say things that are very different from what they said when the announcements were greeted. We have seen examples of that in recent days in relation to the reports on Hyundai.
    Mr. O'Neill: Does my hon. Friend agree that although the success of Britain has been considerable, as a share of the European total the number of jobs and projects that Britain has achieved has fallen, that it is essential that there should not be wasteful competition between the various parts of the United Kingdom, and that for that reason as much as for financial concerns we need a proper concordat between the English regional development agencies, when they arrive, and the Parliaments in Scotland and Wales and the Northern Ireland Development Office?
    Mr. Wilson: My hon. Friend speaks with authority on these matters, and is absolutely correct. It is a paranoid response to believe that rules will always work against us. That is not the case. The political situation is changing,
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    and there will be devolved Parliaments in Scotland and Wales. At the same time new agencies with their own ambitions will emerge in England. It is entirely right within those circumstances that there should be rules that are simple to understand and enforceable, but in which flexibility, which has ensured the success of agencies such as Locate in Scotland, is maintained. That is simple, it is in Scotland's interests and it is what we hope to achieve.
    Mr. Connarty: Is my hon. Friend aware of the excellent joint ventures across borders between, for example, Elf of France and BP in my constituency at Grangemouth, or Toatsu of Japan and Zeneca in my constituency, or Rhom and Haas and its Japanese partners? Does he agree that it is the stability of the relationships between Scotland and the regions of England that has created these? In fact, in the chemical industries people do not talk about Scotland, England or other parts of the UK, but about east coast Britain, which goes from Teesside to the Don in Aberdeen. Does not the small-minded and hypocritical approach of the Conservatives merely continue the attempt to divide people and to prevent decent partnerships from being put together between the private and the public sectors, which has always been their strategy?
    Mr. Wilson: I agree with the thrust of what my hon. Friend says, although I do not associate the last charge with anything that we have heard from hon. Members today. My hon. Friend is absolutely right that part of Scotland's strength as an inward investment destination is its place within the United Kingdom. In a recent visit to the far east, I had excellent assistance and co-operation from UK representatives abroad. There is, of course, a crossover between what we can do for Scotland directly and our inward investment effort for the United Kingdom as a whole, and long may that continue—it is very much in Scotland's interests.
    Mr. Wallace: Does the Minister agree that, as well as the important job of attracting inward investment, the Scottish Parliament will be wise if it tries to devise strategies to promote indigenous companies in Scotland? It might equally be wise to enter into a concordat with other development agencies in the rest of the United Kingdom to try to prevent—I think that these were the Minister's words—the expensive and unproductive outbidding that there has been? Will the Minister assure the House that that will be a decision that the Scottish Parliament can freely make and not be bound beforehand by any decision of the Secretary of State?
    Mr. Wilson: The Scottish Parliament's responsibilities in this area are clearly set out in the White Paper and will be translated into legislation. They are easily understood and must be enforceable. I have no doubt that the political focus that the Scottish Parliament will put on issues of economic development and inward investment will be beneficial for Scotland. I must make it clear that we are completely evenhanded. I am very anxious to stress again the support that is available to indigenous companies. No case has been brought to my attention in which indigenous companies have been refused assistance because resources were unavailable through the investment that was made in attracting companies coming into Scotland. The happiest arrangement of all is for

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    inward investors to stabilise, expand and become indigenous companies. The sooner we stop making these false distinctions the better.
    Mr. Alasdair Morgan: Given that Locate in Scotland is one of the most successful inward investment agencies in Europe, will the Minister explain why new rules are necessary at this stage? Furthermore, as Scotland usually competes not with the north-east of England but with the Czech Republic or the Irish Republic, is there not a danger that new rules will reduce the total amount of inward investment into the United Kingdom rather than transfer it to somewhere else in the United Kingdom?
    Mr. Wilson: Let us be clear about this: Locate in Scotland does better for Scotland within the United Kingdom than any other development agency in Europe, and that is how we intend to keep it. The hon. Gentleman asked why we needed to change or update the rules. It may have escaped his notice that major constitutional change is taking place. There will be a Scottish Parliament and a Welsh Parliament, and there will be a group of powerful economic development agencies in Europe. The hon. Gentleman should understand that rules can work in Scotland's interests. The idea that someone is always trying to steal our piece and working against Scotland is ridiculous. I welcome the rules, and we shall work with other Departments to bring them to fruition.
    Mr. Ancram: Why were these important and totally foreseeable inward investment issues not resolved before the devolution referendum, which has given them such unhelpful exposure? Does the hon. Gentleman agree that the unseemly Cabinet row that is now raging is very damaging to inward investment not only in Scotland but in the rest of the United Kingdom? Does he share my fear that if his right hon. Friend the Secretary of State and his colleagues in the same Cabinet find it so difficult to agree on such matters it will be well nigh impossible in the future for a Scottish Parliament, a Welsh Assembly and a queue of English regions to do so? Is that what his right hon. Friend meant by devolution strengthening the United Kingdom?
    Mr. Wilson: The right hon. Gentleman should not always believe what he reads in the newspapers. There is constructive dialogue to produce the best possible solution for Scotland and for the United Kingdom as a whole. That is our aim, and that will be our achievement.

    Ferry Services
    Mrs. Ray Michie: If he will ensure that the present level of Caledonian MacBrayne ferry services is maintained. [17093]
    The Parliamentary Under-Secretary of State for Scotland (Mr. Malcolm Chisholm): The Government are committed to safeguarding appropriate lifeline ferry services for communities in the highlands and islands, and to maintaining Caledonian MacBrayne in the public sector. The level of service on individual routes within the Caledonian MacBrayne network is regularly reviewed by the Scottish Office and the company in the light of changing service requirements, the introduction of new vessels and other relevant factors.
    Mrs. Michie: The Minister must be aware of the increasing concern that Caledonian MacBrayne is not able
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    to maintain services. When will a decision be made about the Tarbert-Portavadie service? I take this opportunity to give the Minister a friendly but timely warning that he will encounter enormous opposition if any attempt is made to downgrade or remove the Dunoon to Gourock service, given the damage that it would cause to the economy of Dunoon. In the 1980s, the Tory party tried to remove the service, so I hope that the Labour Government will not go down that road.
    Mr. Chisholm: Ministers have given approval for the Tarbert service to continue for the summer of 1998 pending further consideration in the comprehensive spending review. A report commissioned by the previous Government on the Gourock-Dunoon service is awaited. It will examine a number of options, and the recommendations will be carefully considered. I remind the hon. Lady that in 1981, when there was a proposal totally to withdraw the CalMac service on that route, my right hon. Friend the Secretary of State gave evidence for the objectors at the public inquiry.
    Mr. Godman: Is my hon. Friend aware that there is serious concern in Gourock about the management and development of the company under the regime of Admiral Rankin and Captain Simpkin and that the two vessels which operate the Gourock-Dunoon service are, in shipping terms, very elderly ladies and should be replaced long before 2002?
    I hope that my hon. Friend will agree to meet a small delegation of the company's employees and me to discuss these issues. I also hope that he will ditch the report that was commissioned by the odd job lot opposite.
    Mr. Chisholm: Of course we shall consult local bodies when we have received the report and I shall also be delighted to meet my hon. Friend to discuss the matter.

    Anti-social Neighbours
    Mr. Davidson: What plans he has to take action against anti-social neighbours. [17094]
    The Minister for Home Affairs and Devolution, Scottish Office (Mr. Henry McLeish): We are giving effect to our manifesto commitment to take tough action on neighbour nuisance and anti-social behaviour. Provisions for anti-social behaviour orders will be included in the crime and disorder Bill. We recently announced proposals for further legislative and administrative measures to tackle this totally unacceptable menace in every community in Scotland.
    Mr. Davidson: Do my hon. Friend and the Government accept that anti-social neighbours are a curse on good and decent people in all parts of Scotland? Will my hon. Friend pledge that the Government will take action during their first year in office? It is essential that action is taken quickly because the problem was completely neglected during the 18 years of the previous Government.
    Does my hon. Friend accept that this is not simply a problem of council tenants misbehaving? Action must also recognise that many owner-occupiers and private tenants, often in previously council-owned houses, are also behaving in an anti-social manner. Simply to

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    have new rules for the easier eviction of council tenants will not address the whole range of problems. Does my hon. Friend accept that we must have action quickly?
    Mr. McLeish: I could not agree more with my hon. Friend. This is not within my power, but I expect that the crime and disorder Bill will become law by the summer of 1998. Everyone should appreciate that we are embarking on the toughest ever crackdown on anti-social behaviour. It will cover local authority tenants and private tenants and, of course, it will also cover home owners. We intend to make sure that the mindless behaviour of the few in every community in Scotland who undermine at every turn the quality of life of the many will be vigorously tackled.
    Let me make it quite clear that the orders will be tough. They will be proposed by local authorities and will ensure that people's freedom will be restricted. People could be restricted to their houses or to certain areas and, of course, many types of activity will also be restricted. A breach of an order will result in a term of imprisonment of up to five years and an unlimited fine. These are tough measures to tackle a tough problem. Scots are sick and tired of having to live in this way in many communities and we intend to take the action that will solve the problem.
    Mrs. Laing: Will the Minister assure the House that the provisions that he outlined will extend to hon. Members whose constituencies neighbour that of the hon. Member for Glasgow, Govan (Mr. Sarwar), whom we are delighted, if rather surprised, to see in his place?
    Mr. McLeish: I am sure that that contribution was about suggesting that every hon. Member supports the tough measures that the Labour Government are taking on anti-social behaviour. We expect that the orders could cover almost 600 people. That means that the tiny minority of people who are causing mayhem in towns, villages and cities will be tackled. That is real progress and we await with interest the passing of the Bill.
    Mr. Charles Kennedy: Does the Minister recognise another matter in addition to his legislative proposals? For example, every time I visit west Inverness in my constituency for discussions with the three key public agencies involved—the police, the social work department and the housing department—they all point to the continuing resource starvation since the general election and the lack of improvement since the Conservatives were, thankfully, turfed out. Therefore, will he recognise that, until those agencies get more money, no amount of legislation will bring about a great practical improvement for people who are affected at the local community level?
    Mr. McLeish: We appreciate that our measures will involve resources. We are willing to face that. The hon. Gentleman is right to say that we are speaking not just about anti-social behaviour orders. We need to look at the questions of eviction and of witness intimidation, which is rife in many cases, and, of course, we want inter-agency co-operation in relation to witness protection. This is a package of measures and I assure the House that we intend to pursue the matter speedily to get appropriate and effective action.
    Miss Begg: I am sure that the constituents who have written to me describing the misery that they have
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    experienced as a result of anti-social neighbours will be delighted by my hon. Friend's statement, particularly his comment that not just council tenants but owner-occupiers and private landlord tenants will be covered. I urge my hon. Friend to ensure that, when such legislation is passed, anti-social neighbours are dealt with through the courts as quickly as possible to put the victims out of their misery.
    Mr. McLeish: I am grateful for my hon. Friend's comments. I reassure her and the House that, when the Bill is passed, we intend to have proper procedures in place to maximise the speed with which anti-social neighbours are dealt with. That has been the problem: it has taken far too long to bring culprits to the courts. That has meant more misery for the victims, who can be found in every constituency.

    Midlothian Community Hospital
    Mr. Eric Clarke: When he expects construction of the new Midlothian community hospital to commence. [17095]
    The Parliamentary Under-Secretary of State for Scotland (Mr. Sam Galbraith): I understand that the East and Midlothian NHS trust expects to submit a revised outline business case for the hospital to the NHS management executive by the end of this month.
    Mr. Clarke: I thank my hon. Friend for his reply. I hope that he is aware that Midlothian is the poor relation in terms of medical facilities. We have two hospitals: the Rosslynlee, which is a mental hospital and is due for closure, and a geriatric hospital in Loanhead, which is due to be refurbished or replaced. As Edinburgh's Eastern general, Northern general and City hospitals, as well as the Princess Margaret Rose hospital, may close as well, my constituents are worried. They are not only poor; many are disabled, and to go to St. John's in Livingston or to the Western general in Edinburgh is an ordeal. I hope that my hon. Friend will give the utmost priority to the new hospital, which is badly needed in Midlothian.
    Mr. Galbraith: I think I can give my hon. Friend an absolute assurance that no hospital will close until suitable alternative facilities are in place. The timing for development of the new hospital is a matter for the trust and the board, but I know that, with a doughty fighter such as him taking up an interest, the hospital will progress as quickly as possible.

    Housing and Health
    Sir Robert Smith: What representations the Scottish Health Department has received since October about the links between poor housing conditions and public health. [17096]
    Mr. Galbraith: Since October, 127 representations have been addressed to the Department, almost all in response to a campaign by Shelter. The links between housing and health are clear, as our forthcoming Green Paper on the subject will mention.
    Sir Robert Smith: I thank the Minister for that answer. In the light of the representations and the fact

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    that 93 per cent. of Scottish housing is below minimum energy efficiency standards, does he accept that, in the long run, investing in improving the housing stock will benefit the health service by reducing the winter health crisis?
    Mr. Galbraith: I have absolutely no problem with that. Poor housing is undoubtedly one of the links to ill health. We recognise that. It will be re-emphasised in our Green Paper. Recently, however, we have taken measures to deal with the problem. We have reduced value added tax on materials for insulating houses from 17.5 to 5 per cent. and the welfare-to-work programme contains a special option to insulate houses. We are taking action that will benefit the health of the whole nation.
    Mr. McAllion: My hon. Friend will accept that the statistics on the relationship between poor housing and poor health in Scotland are appalling. Ninety-seven per cent. of our stock failed a national energy efficiency rating, one in four houses suffer from damp and condensation and, every winter, there are 2,000 excess deaths as a result of poor housing in Scotland. Does my hon. Friend therefore accept that the link between bad housing and bad health in Scotland will never be finally broken until the Labour Government have the courage to recognise that we require a major programme of public investment in housing stock and in tackling the reasons for poverty, which cause so much ill health in our country?
    Mr. Galbraith: I like to think that one of the differences that I have made to the health agenda is the recognition of the link between poverty and ill health, something that was always denied before. The problem relates not only to housing but to jobs, education, transport, leisure and recreation. Only when we have got these things right can people genuinely make choices, so we have not only to present them with information about the choices but to give them the economic wherewithal to improve their health.

    University Students
    Mr. Chope: What assessment he has made of the impact on Scottish universities of the number of students from England wishing to study at such institutions. [17097]
    Mr. Dewar: Cross-border flows of students in both directions can contribute to a healthy diversity of backgrounds in our universities. The proportion of students from England attending Scottish universities varies greatly. In financial terms, English-domiciled students bring with them tuition fees paid for by local education authorities in England, and the remainder of the cost of teaching is met by grant funding from the Scottish Higher Education Funding Council.
    Mr. Chope: I agree with much of what the right hon. Gentleman said, but my commitment to the Union comes from my four years' experience as an undergraduate at a Scottish university. How much would it cost the Department for Education and Employment in England to pay the tuition costs of English students at Scottish universities during their fourth year, thereby enabling them to benefit from the four-year Scottish education as
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    I did and as I know the hon. and learned Member for Edinburgh, Pentlands (Dr. Clark) did at the same time, in the same faculty and at the same university?
    Mr. Dewar: I am absolutely delighted that the hon. Gentleman enjoyed his years at Dundee so much. I am sure that he benefited from them, although I would have liked to see further improvement.
    As for the hon. Gentleman's question, the cost is variable. As has been explained, the tuition fees apply only to certain students, and getting on for 40 per cent. of them may be exempt. There are, of course, other misunderstandings about that, but, at the end of the day, English students, and, indeed, students from Northern Ireland and Wales, come to Scottish universities because they see advantage in doing so. I hope that they will continue to do so, as they are a very valuable addition to our educational kingdom.

  HOUSE OF COMMONS
  The President of the Council was asked—
  HOUSE OF COMMONS

    Statements
    Mr. Rendel: What assessment she has made of the advantages of introducing time limits on Front-Bench responses to statements. [17120]
    The President of the Council and Leader of the House of Commons (Mrs. Ann Taylor): I have not considered any changes to the House's rules on this, but I know that you, Madam Speaker, have often called for shorter questions and shorter answers, both on statements and at Question Time.
    Mr. Rendel: Has the right hon. Lady noticed that the main spokesperson for the official Opposition seems to be taking longer and longer to reply to statements and that that not only makes it difficult for the Minister, who has to try to remember all the questions to answer, but tends to leave less time for spokespersons from other parties and for all Back Benchers? Will the right hon. Lady consider what to do about this in the Select Committee on Modernisation of the House of Commons?
    Mrs. Taylor: I have some sympathy with the hon. Gentleman. There have been occasions when the official Opposition have taken a very long time, but there are of course times when a statement is complex and detailed questions have to be answered. However, I think that we could probably improve the situation.
    Mr. Dalyell: Is this not actually a matter for the Speaker? Is there not a precedent in the fact that Mr. Speaker Selwyn-Lloyd on one famous occasion simply told the official Opposition that enough was enough?
    Mrs. Taylor: Madam Speaker, it might be better if I left that to you.

    Members' Allowances
    Mr. Steen: If she will make a statement on the arrangements for the payment of Members' allowances. [17122]
    Mrs. Ann Taylor: Allowances for hon. Members are provided by resolution of the House. Claims and payments are handled by the Fees Office, whose systems are designed to ensure accountability for the taxpayers' money involved.
    Mr. Steen: Because of the misdemeanours of one or two Members of Parliament, there has been an understandable push for greater transparency when allowances are claimed from the Fees Office. However, is the Leader of the House aware that this has resulted in a plethora of forms such as C1s, which are the reimbursement claim forms, C2s, C3s, Members' car allowance scheme forms and Members' constituency mileage continuation sheets? There is also a 43-page document called "Parliamentary Salaries, Allowances and Pensions" which includes details of where to get help. It takes many hours every week to fill in these forms, but would not that time be far better spent looking after one's constituents? Surely, accountability and transparency do not have to mean excessive form filling. We are not all crooks.
    Mrs. Taylor: I think that hon. Members have a duty to ensure that our own systems are transparent and that we are as accountable as people in other spheres of public service. I realise that there has been additional paperwork for hon. Members, but I think that the vast majority of them are not finding it difficult to comply with the regulations.

    Prime Minister's Question Time
    Mr. Robathan: What plans she has to review the arrangements for Prime Minister's questions. [17123]
    Mrs. Ann Taylor: The new arrangements have been in use for barely six months, and I have no plans to review them.
    Mr. Robathan: Does the right hon. Lady agree that, in a parliamentary democracy, the Prime Minister is accountable to Parliament? Did she see yesterday's report in The Times revealing that the Prime Minister had not voted since the summer recess—which may have prompted him to vote once, yesterday? Is she aware that the Prime Minister failed to declare a registrable interest by going to Silverstone, in 1996, and not putting the visit in the Register of Members' Interests? Does she agree that that shows that the Prime Minister does not consider himself to be accountable to Parliament? Furthermore, does she agree that he is treating the voters—all those, of whatever party, who elected us to this place—with contempt and treating parliamentary democracy and the House with disdain and contempt?
    Mrs. Taylor: The hon. Gentleman was, I think, asking about Prime Minister's Question Time and accountability. Before I came into the Chamber, I checked the number of questions asked of the Prime Minister in the last week
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    of the previous Parliament, before the system changed—when a total of 16 questions were asked—and last week, when he was asked 25 questions. The figures mean that more hon. Members had an opportunity to ask a question of the Prime Minister and that, perhaps most important, more Back Benchers had an opportunity to ask him a question.
    Sir Patrick Cormack: What attempt has the Leader of the House made to discover hon. Members' reaction to the change? Is she aware that many hon. Members who sat in the previous Parliament do not believe that an improvement has been made? Will she also give the House a total assurance that there will be no more arbitrary changes to our procedures without consultation?
    Mrs. Taylor: Yes, I can give an assurance that, when we are considering changes to the rota—which may occasionally happen, depending on the pressures and the wishes of the House for more time for certain Departments—there will be consultations through the usual channels. We have had very few representations criticising the current format of Prime Minister's Question Time. As I said, many Back Benchers seem to approve of the fact that more Back Benchers now have an opportunity to question the Prime Minister.

    Private Members' Bills
    Mr. Mackinlay: If she will take steps to increase the time available for private Members' Bills. [17127]
    Mrs. Ann Taylor: I have no plans to do so.
    Mr. Mackinlay: Does my right hon. Friend realise that that is a very disappointing reply, bearing in mind the fact that we were elected as new Labour—[Interruption.] Some of us are Labour mainstream. Does she agree that, as well as checking the Executive, the role of Back Benchers is to be proactive in the House? It would therefore be greatly welcomed if she were to find parliamentary time so that the rank and file in this place could contribute to the legislative process.
    Mrs. Taylor: I can confirm that my hon. Friend was absolutely on message about increasing the role of Parliament. I realise that Back Benchers have opportunities to be proactive, and that he is one of those who takes many of those opportunities and uses them to good effect. The Standing Orders of the House provide 13 Fridays in each Session for private Members' Bills. I know that some hon. Members think that that is not enough, but it is a rule of the House.
    Mr. Forth: Does the right hon. Lady accept that many, if not most, members of the public do not wish to regard this place as a legislation factory? The thought of random, if not bizarre, legislation by private Members would scare the wits out of the public.
    Mrs. Taylor: The public, like the House, have made their views on certain private Members' Bills very clear.
    Mr. Rooney: Does my right hon. Friend agree that extra time would not be needed if certain hon. Members recognised the will of the House as expressed last Friday and did not try to obstruct it?
    Mrs. Taylor: One of the most disappointing things about last Friday was the intervention by the hon. Member

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    for Beaconsfield (Mr. Grieve), who made it clear that, no matter how much time was provided for certain Bills, some Conservative Members would try to block them. Hon. Members have a responsibility to consider not just the strong views expressed and the strong majority last week, but public opinion.

    Consideration of Bills
    Mr. Chidgey: What assessment she has made of the advantages of spreading consideration of Bills more evenly throughout the parliamentary Session. [17128]
    Mrs. Ann Taylor: The annual nature of the legislative programme inevitably means that it cannot be spread evenly throughout the Session. The possibility of carry-over, which was approved by the House on 13 November, creates an opportunity to improve the House's consideration of Bills. I hope that we shall be able to test that out on appropriate occasions.
    Mr. Chidgey: I thank the right hon. Lady for that reply. I welcome the advance publication of certain Bills, which is helpful. To return to a previous point, however, is the right hon. Lady aware that, following the Jopling recommendations, there is less and less time for Back Benchers to debate issues in the House? A case in point was the wild mammals Bill last Friday—[HON. MEMBERS: "Wild Members?"] Hon. Members must have misheard; I am referring to the Wild Mammals (Hunting with Dogs) Bill, which had overwhelming support in the House and elsewhere. It is not tenable for a Government who have such a large mandate to rely on the Opposition not to oppose in order to get their Bills through. I ask the right hon. Lady to allow Government time so that the Bill can progress.
    Mrs. Taylor: I do not think that there is anything I can add on that Bill. I believe that, post-Jopling, there have been a number of useful extra opportunities for hon. Members to raise issues. The Wednesday morning debates, for example, have proved extremely important for Back Benchers; that comment is slightly wide of the hon. Gentleman's original point. I believe that it is a question of swings and roundabouts, and that the interests of Back Benchers have been protected.
    Mr. Pike: Was it not a fact that, in the debate on the report by the Select Committee on Modernisation of the House of Commons, it became clear that the carry-over of certain legislation would lead to the better distribution of legislation? Was it not particularly notable that a well-respected former Leader of the House, the right hon. Member for South Norfolk (Mr. MacGregor), wished to go even further than the report suggested?
    Mrs. Taylor: I thank my hon. Friend for reminding me of that point. It is true that the very distinguished former Leader of the House, who happens to be in his place this afternoon, strongly supported the principle of carry-over. I am pleased that the second report by the House of Lords Select Committee on Procedure also accepts that there is a case for the carry-over of some Government Bills. This is the first Session of this Parliament; I am not sure whether there will be any Bills that are candidates during this Session. I hope that we can move towards looking at
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    legislation, especially if we can manage to publish draft Bills, in a more ordered way and I believe that carry-over will have a part to play in that.

    Oral Questions
    Mr. Canavan: What assessment she has made of the allocation of time to different Ministers to answer oral questions. [17129]
    Mrs. Ann Taylor: We will review the rota from time to time. There have not been many criticisms of the existing rota, but I am always willing to listen to representations.
    Mr. Canavan: Did my right hon. Friend notice that, in Scottish Question Time earlier this afternoon, we reached only Question 8? Until such time as the Scottish Parliament is established, can we have the restoration of a full hour of Scottish questions?
    Mrs. Taylor: I sat through some of Scottish Question Time and I noticed that at 3 o'clock we were still on Question 3. I did not hear all the exchanges, so I do not know the reason for that. I know from conversations on the Bench that Scottish Ministers were disappointed by that situation.
    Mr. Garnier: How many minutes has the Minister without Portfolio, the hon. Member for Hartlepool (Mr. Mandelson), spent answering questions or making statements or speeches at the Dispatch Box since his appointment to the Government?
    Mrs. Taylor: I do not monitor those figures.

    Modernisation Proposals
    Mr. Rhodri Morgan: What are the main recommendations of the Select Committee on Modernisation of the House of Commons which (a) have been implemented, (b) were rejected and (c) are pending further decisions. [17130]
    Mrs. Ann Taylor: A new style of Order Paper has been implemented. The recommendations of the Modernisation Committee on the legislative process were approved by the House on 13 November. I am pleased that none of the recommendations has been rejected.
    Mr. Morgan: I thank my right hon. Friend for her reply. Has she received any representations about better protection of time for private Members' Bills? For example, has she received any representations that any private Member's Bill that gets a majority greater than one third of the total membership of the House should be able to proceed without let or hindrance from delaying tactics? I say that in the hope of encouraging private Members to be more proactive, rather than "Prozactive".
    Mrs. Taylor: I answered that point earlier, to a certain extent, but my hon. Friend is entitled to make it again. If Conservative Members do not frustrate the Wild Mammals (Hunting with Dogs) Bill which was given a Second Reading last Friday, there is no reason why it should not progress further.

Local Government Finance (England)
3.30 pm
The Secretary of State for the Environment, Transport and the Regions (Mr. John Prescott): With permission, Madam Speaker, I should like to make a statement about the local authority revenue finance settlement for England for 1998–99. The Secretary of State comes before the House at about this time each year to make a statement about local authority finance for the following financial year.
There will follow a period of consultation with local authorities and others, after which I shall bring a report to the House, which, when approved, will finalise the arrangements. Today's statement is important to local authorities, because it gives them firm information on which to make progress in setting their budgets. The statement concerns England only. My right hon. Friend the Secretary of State for Wales will make an announcement today and my right hon. Friend the Secretary of State for Scotland will make an announcement shortly.
As this is the first such statement of the new Parliament, I hope that it will be helpful if I put it into a wider context. We were elected on a manifesto that pledged us to a renewal of local government. We aim to achieve the reinvigoration of local democracy, a commitment to best value, a prospect of greater fairness and increased local discretion allied to greater local accountability.
We have made good progress so far, although we still have some way to go. We have set up a new central-local government partnership to help local and central Government work in harmony. We have signed the European charter of local self-government, which the previous Administration refused to sign. We have brought forward legislation to provide for the release of £800 million in additional capital expenditure in England under our capital receipts initiative. That money will help the unemployed, it will be used to build and refurbish homes for those in need and it will support our wider new deal objectives. We have put local authority public-private partnerships on a clearer footing. We are supporting Lord Hunt's Bill on local authority innovation, which will allow for greater experiments in local democracy.
We are discussing ways of renewing local democracy with the Local Government Association. We are decentralising decision making to the local level. We have introduced a Bill to give London a voice once again. Tomorrow we shall publish our White Paper on regional development agencies, setting out how we shall work with local government and others to revive the regions of England. Shortly, we shall announce the pilot local authorities for our best value programme. Finally, in co-operation with the Local Government Association, we have started a review of the system of local government finance—and not before time.
Each of those items is important in its own right. Taken together, they demonstrate that we mean what we say about a new relationship and partnership with local government. We have done all that in just seven months in government, but our full progress will be judged not in seven months but over a full five years of a Labour Government.
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We shall issue consultation papers starting later this year. Following that consultation, we shall publish a White Paper in the late spring.
This new relationship follows many years when the previous Government did not listen to local authorities and squeezed their expenditure year after year. Despite all that, local government has survived, I am glad to say. My aim is to build a strong partnership between central and local government to the advantage of our citizens and our communities.
The first important element of the local authority settlement is my proposals for the Government's provision for spending by local authorities. In forming my proposals, I have of course considered the pressures that local authorities will face in the coming year—which are considerable—and I have listened carefully to the views of the Local Government Association. In line with those views, we have chosen in the settlement to concentrate on the policy priorities—above all, education—that we set out in our manifesto, which was endorsed by the electorate.
We were elected on a pledge to stick to the previous Government's public expenditure totals for 1998–99. Nevertheless, my right hon. Friend the Chancellor of the Exchequer announced in his Budget on 2 July that, by careful consideration of the priorities for public expenditure, we had been able to make available an extra £835 million for revenue expenditure in English schools in 1998–99. I can confirm that we shall provide an extra £835 million of revenue support grant for our schools. That means that none of the cost of the extra schools spending will fall on the council tax payer, as was so often the case under the previous Administration.
We are providing £662 million for local authorities for the education of four-year-olds, following the abolition of nursery vouchers, as promised in our manifesto. I also propose to provide up to £130 million for the transitional costs of local government reorganisation, such as for the unitary authorities. We have also taken into account smaller changes that will take place in local government functions. Taken together, those factors mean that the Government's view is that the appropriate level of total standard spending for local authorities in England in 1998–99 will be £48.2 billion.
My right hon. Friend the Secretary of State for Health will today be making a separate announcement on resources for community care. My right hon. Friend the Home Secretary will today be making a separate announcement on resources for the police. Both are included in the figure that I have just quoted.
The £48.2 billion provides for an increase of £1.78 billion—or 3.8 per cent.—in local authority spending year on year. That is expected to be 1 per cent. above inflation, therefore allowing an increase in real terms, to reflect our key policy priorities.
Education is the top priority for this Government and, indeed, for the nation. Raising standards in schools is not only of benefit to children. It is an investment in our country's future. Altogether, we have made provision for an extra £1.06 billion—or 5.7 per cent.—to go into English schools in 1998–99. It can and should be spent in the classroom, reversing the years of neglect. It meets the pressures identified by the Local Government Association and enables a start to be made on raising educational standards, which we all are determined to see. That is a big step.

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Community care is another important area in which local authorities are facing up to the difficulties involved. Local authorities provide a vital service by looking after elderly and disabled people. We have maintained previous plans to make resources available in that area—£350 million. We expect a reduction in the net costs of financing outstanding debt. Therefore, we have been able to make a larger than average increase in provision for some services, including a further £70 million for children's social services—the first substantial increase for three years.
As the House will agree, fire services provide an essential and much appreciated service in the community. Therefore, I am pleased to announce that we have increased provision for the fire service by 4.8 per cent. within the overall increase for other services of 1.4 per cent. Other services include highways, libraries, probation services and environmental services.
I now refer to how much assistance local authorities will get from the business rates and the national taxpayer, which together totals £37.51 billion. That includes the extra £835 million, to ensure that the cost of our extra provision for schools does not fall on the council tax payer. It also includes an extra £20 million to make possible the development of £200 million-worth of local authority private finance projects.
The business rate will be increased to 47.4p in the pound, as provided by the legislation, following the 3.6 per cent. increase in the September retail prices index. That means that we can distribute £12.52 billion of business rates to local authorities in 1998–99. I am today publishing the detailed basis for that distribution to local authorities.
I propose that the revenue support grant should be £19.5 billion. In addition, some £5.49 billion of specific and special grants will be available. The total revenue support grant for England on which I am consulting may need to be altered slightly as a result of consultation. The total may be increased if it appears that less provision is needed for the transitional costs of local government reorganisation.
I come now to the means of distributing the revenue support grant. At its heart is the standard spending assessment for each authority. An authority's SSA is its share of the total provision for all authorities, taking account of its local circumstances. It is not a spending target.
We were elected on a pledge to remove the unfairness that has dogged standard spending assessments since they were first introduced. We have discussed with local government during the summer a wide range of ideas for improving fairness. I am today announcing changes that are well founded in research evidence, which respond to long-standing concerns of many local authorities of both parties, and which remove the more blatant cases of unfairness.
I first propose a new basis for assessing spending needs for the education of under-fives. The nursery voucher scheme was wasteful and a bureaucratic paperchase. The money released by its abolition will assist in our programme to make universal provision for four to five-year-olds. The new distribution will recognise the number of pupils for whom local authorities currently provide. Authorities that need to expand their nursery education, and put forward sound plans for doing so,
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will be able to get an additional grant from the Department for Education and Employment. That is just one element of the national child care strategy, of which after-school clubs form another part.
Secondly, I propose to tackle a piece of nonsense in the present formula. Currently some authorities have an incredible ranking on the measure of neediness. It is hard to believe that leafy Kingston upon Thames is as needy as beleaguered Barnsley. [HON. MEMBERS: "Hear, hear."] I am sure that the Liberal Democrats also agree with that. We have carried out, with the Local Government Association, a thorough re-examination. We have at last applied explicit principles to those calculations. I believe that the new measures of neediness that we are proposing are a clear improvement on what went before.
Thirdly, I propose a new basis for the allocations for elderly residential social services. The formula has had a thorough overhaul, using research commissioned by the Department of Health from the university of Kent. For the first time, it takes proper account of the changes in social services in the past five years, following the introduction of community care.
Fourthly, I propose a new treatment of debt incurred by local authorities before the current system was established in 1990. During the 1980s, local authorities had a choice. They could use capital receipts to pay off debt or they could use them to finance new capital expenditure. However, in 1990, the previous Government decided to penalise those which had chosen new capital expenditure during the previous decade. The previous Government treated everyone as if they had chosen to repay debt, whether they had or not. I am proposing to put that right wrong. [Laughter.] Just for the record, I am proposing to put that wrong right. [HON. MEMBERS: "Hear, hear."] I propose that we should reflect in the standard spending assessment each authority's actual debt as at 1990, if that improves its position.
Finally, I have given priority to tackling the great unfairness whereby visitors and commuters were assumed to have the same economic and social characteristics as the residents of the authorities that they were visiting. That was an anomaly exposed time after time in the House. The previous Government's formula treated people staying in the Ritz in London as if they were as deprived as the average local resident. That was unfair and wrong.
Even the research on that, commissioned by the central London authorities themselves, which were the greatest beneficiaries, did not recommend keeping the existing approach. From next year, we shall get rid of that glaring injustice. We shall take account of visitors and commuters; but only fair account.
I shall mention only one of the many other proposals for changes which were pressed on me, but which I have not taken up. It concerns the area cost adjustment. That is the means by which higher employment costs, particularly in London and the south-east, are recognised in standard spending assessments. I do not believe that the evidence is sufficiently clear enough to warrant a change this year. However, I am commissioning research to see whether there is a sound basis upon which to consider changes for this time next year.
The changes that I have outlined, with some smaller technical changes, are a big step towards making the grant system fairer, as we promised at the election.

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Those changes will have a large impact on council tax levels in some authorities if the authorities do not adjust their spending accordingly. I accept that authorities and their council tax payers may need a period in which to adjust to those changes. I propose to phase in changes in the way in which standard spending assessments are calculated.
I propose that damping—or phasing in, as I prefer—of the larger corrections that we have introduced should be limited to the equivalent of half the SSA reduction. That strikes a reasonable balance between the need for time to adjust and the need to get more fairness into the system. There will again be separate phasing-in schemes for police and non-police authorities.
I also propose to repeat this year's scheme to phase in council tax increases that are directly due to reorganisation. The scheme would damp such council tax increases that are above a threshold of £52 a year at band D, for authorities that are subject to reorganisation from April 1998. It would also provide continued damping for the authorities reorganised in earlier years, where they exceed a threshold of £104 a year at band D.
Let me now refer to council taxes. We are examining in the local government finance review ways in which the fairness of the council tax might be improved. I do not propose to make any changes ahead of the results of that review.
I expect that, for the foreseeable future, the council tax will remain the prime means by which local residents contribute to the cost of local services. Each year, the Government identify a notional tax level for each valuation band. That is known as the council tax for standard spending.
We do that to calculate a distribution of grants that would enable all authorities to provide a standard level of service for a similar council tax level for a similarly valued property, whatever the differences in needs and resources. My proposals set that figure at £635 for a band D property. That reflects the previous Government's plans to increase council tax by 7 per cent.
The increase was built into the previous Administration's spending plans. That is not a prediction of the average level of council tax, nor of the band D bills for individual authorities. The actual council taxes in the individual authorities will vary considerably, depending on their spending decisions, their financing decisions, their collection performance and their efficiency. No Secretary of State could predict those factors with a high degree of accuracy for individual authorities.
The pressure on the council tax is inherent in the public expenditure totals set by the previous Government. We have sought to relieve pressures by a number of means, in particular by fully funding the £835 million extra for education. That extra funding for schools is worth £50 a year for the typical taxpayer. However, I have made it clear that local authorities must give full weight to the burden on their taxpayers when they come to set their budgets.
We remain committed to the ending of crude and universal capping, but in the light of our public expenditure plans, as both the Chancellor and I made clear to the Local Government Association conference in July,
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capping will remain in place for 1998–99. We have provided extra money for schools. We cannot risk that being undermined by unplanned increases in spending.
I am today announcing my provisional capping principles for 1998–99. I am also issuing proposals for the calculation of notional amounts for authorities whose boundaries or functions will change from 1 April 1998. Those include reorganised authorities and local education authorities affected by the abolition of the nursery voucher scheme. The notional amount is the base level from which I shall measure the increase in budget in determining whether that increase is excessive.
My provisional capping principles make allowance for expenditure on community care, which is being met in 1997–98 by the special transitional grant, and for changing funding arrangements for the National Criminal Intelligence Service. The adjustments are necessary to make a fair year-on-year comparison of budgets.
Subject to the allowances that I have already mentioned and to other technical adjustments affecting individual authorities, my proposals for capping are as follows. As in previous years, authorities whose base budgets are more than 12.5 per cent. above their standard spending assessment will not be permitted any increase over their 1997–98 base budget, nor will any other authority be allowed an increase that would take it beyond 12.5 per cent. above its SSA.
I propose to allow each class of authority to increase its base budget more than in recent years. That will be helped by changes to the so-called passporting about which I shall tell the House. Let me explain the term passporting, as it had to be explained to me. There is a lot of science in the language of local authority finance, and I shall have a bit more to say about that later.
In the past, the Government recognised increased spending needs for a particular service, but prevented councils from spending that money, through the capping system. That was a ridiculous situation, and passporting is designed to deal with it. When an authority's standard spending assessment increases, that will follow through into its capping limit so that the money can really be spent.
The permitted increases that I propose for classes of authority are as follows. For inner London boroughs, the City of London and shire districts, I propose that the year-on-year increase should be limited to 1.5 per cent; for outer London boroughs, metropolitan districts, county councils, unitary authorities, and the Isles of Scilly, to 3 per cent.; for police authorities outside London, to 3.2 per cent.; and for the London and metropolitan fire and civil defence authorities, to 4.5 per cent.
For all classes of authority other than police, the year-on-year permitted increases are substantially greater than they were last year, particularly reflecting the extra provision that we have made for schools. Shire districts have been treated especially harshly in recent years, so I am permitting them an increase in 1998–99 that will be three times greater than in previous years.
That is not all. I can further announce today that, for all authorities, other than police authorities, budgeting up to 12.5 per cent. above their standard spending assessment, I intend to passport the increases for all service blocks within the spending assessments. That will extend the benefits of passporting to shire districts for the

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first time. It will also be the first time that increases in highway maintenance, other services and capital financing blocks have been passported.
Those are important changes in the capping regime. They give greater discretion to local authorities; but I expect local authorities to look carefully at their permitted increases, including passporting, and to make a careful judgment about whether they need to make those increases in budget and whether their council tax payers can afford them.
Many authorities have budgeted below their capping limit in the past. I have given local authorities extra room within which to exercise their discretion, and I expect them to do exactly that. Those principles are necessarily provisional: I cannot take my firm decision on capping until authorities have set their budgets for 1998–99. When I come to take those decisions, I shall of course take into account all relevant considerations.
My Department is today writing with the details of the settlement to every local authority in England. That package includes a consultation paper setting out how we propose to distribute central Government support among authorities, including my proposals on standard spending assessments and damping. It sets out my provisional capping criteria, and includes my proposals for notional amounts. Copies have been placed in the Vote Office and the Library.
The package is large, and some elements are very complex and precise. That is possibly unavoidable for a system that distributes huge sums of money among 400 local authorities, all with different needs and resources. The basis of those calculations has been set out in detail, to assure the House and local authorities that each authority is being treated in exactly the same way.
We are reviewing how we might simplify the process in the long term, while retaining that reassurance. I know that if we can make the whole exercise simpler, it will be much appreciated by Members of the House, local authorities, the general public and especially me.
For the immediate future, I plan to provide the House, before the revenue support grant report is debated in the new year, with a plain English guide to these aspects of local authority finance. [HON. MEMBERS: "Hear, hear."] I told you we were radical.
The proposals that I have outlined today represent a substantial improvement on the settlement that local government could have expected, following the Budget of the previous Administration a year ago. There is £835 million extra provision for education. Standard spending assessments will be made fairer. Local authorities will have more scope to exercise their discretion on budgets. This is a better and fairer settlement than in previous years.
Too often in the past two decades, central Government in Whitehall seemed to be waging a war on local government in town halls. When Labour was elected on 1 May, we declared that it was time to bury the hatchet. Whatever the considerable difficulties we found—financial, social or environmental—we shall face them together, with local government, regardless of the party in charge of any specific town hall.
In just seven months, we have taken the first steps in developing that new partnership. We shall be judged on a full five-year programme, but the direction is right, the priorities are different and we are working in partnership.
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The Government believe in local democracy. This year and next will be tough financially, but we are firmly on the road to reinvigorating local democracy, and restoring new and more positive relations between central and local government.
Hon. Members: Hear, hear
Sir Norman Fowler: Government Back Benchers cheer, but I doubt that very many will cheer once the implications of the statement have been understood. Whatever else he has done, has not the Secretary of State opened the way for major over-inflation increases in council tax next year, which will affect millions of ordinary council tax payers throughout the country? Does he accept that the net result of what he has announced today will be that council tax bills could rise by as much as 10 per cent. next year? Does he realise that, for many elderly people, that wipes out at a stroke any advantage that they might have had from the winter payment scheme?
The Secretary of State says that he has inherited our Red Book figures, but can he confirm that, since May, local authorities have been burdened with a wide range of new costs? The increase in inflation since May will add more than half a billion pounds to local authority costs; there have been no fewer than five increases in interest rates since May, also adding to costs; and the £5 billion-a-year pension tax in the Budget has a direct impact on local authorities of £300 million a year.
Moreover, can the Secretary of State confirm that the £800 million for education in England, which was announced in the July Budget and has now been announced again by the right hon. Gentleman, comes from the contingency reserve provided by the previous Government? It was in the previous Government's spending plans. Is he aware that many Labour local authorities—not Conservative; Labour authorities—are saying that this settlement could have a dire effect on personal social services, especially those for children and the elderly?
Does the right hon. Gentleman remember that last year the then Opposition spokesman, the right hon. Member for Holborn and St. Pancras (Mr. Dobson), said that the 1996 figures
"make no allowance for inflation, the cost of pay increases or the cost of providing extra services for the growing number of old people and of children at school"?—[Official Report, 27 November 1996; Vol. 286, c. 343.]
Is it not that very settlement that the right hon. Gentleman has just announced to the House?
As for debt, will the right hon. Gentleman confirm that he got it right the first time he attempted to make the announcement to the House? Will he confirm that his changes to standard spending assessments will mean rewarding councils that have run up large debts and penalising councils that have been thrifty? Will he further confirm that his changes to the damping mechanism will cause acute problems for many councils, which can be solved only by sharp council tax increases?
Does the right hon. Gentleman recall that in September last year, the Prime Minister, then the Leader of the Opposition, said:
"We have no plans to increase tax at all"?

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Will not these major council tax rises that the Secretary of State has just announced hit the very people who relied on those promises at the election?
Mr. Prescott: We will take no lectures from the Opposition spokesman on taxation, assessments of need, relationships with local authorities or the benefits that council tax payers got for their money under the previous Administration.
I have admitted to a 7 per cent. band D increase in council tax—
Sir Norman Fowler indicated dissent.
Mr. Prescott: That is exactly the same increase as the Tories allowed for—
Sir Norman Fowler indicated dissent.
Mr. Prescott: Is the right hon. Gentleman suggesting that it was more than that? I say that it is precisely the same amount as the Opposition allowed for when they were in government. The facts are easily checked in the Library. Despite considerable criticism, we have accepted the public expenditure plans of the previous Chancellor of the Exchequer.
We have also made it clear that we are giving more money than is necessitated by inflation. The figures amount to a 1 per cent. real increase.
It is all very well saying that the money for education comes from the contingency fund, but of course the previous Government did not commit themselves to spending that amount on education. The previous Chancellor did not mention any extra resources for education. The fact that we choose to make education a priority is a reflection of our priorities, not those of the Opposition.
As the right hon. Gentleman knows, the effects on pensions cannot be calculated until the revaluation of pensions is carried out; pensions in this financial year are unaffected. The Chancellor has made it clear that if extra costs are eventually involved, he will take them into account at the appropriate time. The fact remains that local authority pensions in this financial year are unaffected.
In answer to the implied claim that local authorities were better off under the Tories, I remind the right hon. Gentleman of the electorate's view: the Conservatives had 240 councils in 1979; they now have about 30. That clearly shows what the electorate thought of the Conservatives' administration of councils and services.
The right hon. Gentleman claims that there is no extra money for children's social services, yet I have announced £70 million in that context. Nothing at all was provided in the previous three years—the right hon. Gentleman's colleagues could not find the money for desperately needy children and social services.
Our assessment of the social needs of local authorities is a good deal sounder than the assessments used by the Conservative Government, under whose rule people staying in the Ritz and in the Westminster area benefited from resources that should have gone to authorities with
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far greater needs. Our standard spending assessment system represents a fairer approach, of working with local government in partnership to improve local government services. We are justly proud of that
Mr. Stephen Timms: I particularly welcome the new emphasis on fairness in my right hon. Friend's announcement, and the change to the treatment of capital financing charges in the formula. Will he join me in paying tribute to the long fight by the Newham Needs campaign for the abolition of the concept of notional debt, which played such a significant part of the formula used by the Conservatives?
Will my right hon. Friend confirm that the beneficiaries of the change that he has announced are not profligate authorities, but several of the hardest-pressed authorities in the country, including Sunderland, Barnsley and Tower Hamlets, as well as my own authority in Newham?
Mr. Prescott: Yes, I agree with my hon. Friend. The reassessment shows that Newham is in desperate need. It did not have a very high ranking under the assessment that I am changing. We make it clear that we are adjusting the programme so that Newham gets more resources. The present assessment is better than the previous one and is based on the greater needs in Newham. It is a good example of the way in which our fair assessment of the principles has applied.
Mr. Paul Burstow: We on the Liberal Democrat Benches welcome the Secretary of State's announcement on the local government finance review. Liberal Democrats want a more accountable system, which raises tax on the basis of ability to pay and guarantees greater freedom of action for local councils.
Is it not the case, however, that today's settlement is one of the tightest ever? Council tax bills are set to soar, and council services are set to suffer. People will pay more and get less. Will the Secretary of State confirm that the figures published only last week by his colleague, the Chancellor, show that council tax bills are set to rise by more than 10 per cent. this year—biggest increase since council tax was introduced by the previous Government?.
Does the right hon. Gentleman accept that the settlement fails to tackle the cash crisis in our schools? Does he accept House of Commons Library figures which show that, even after the extra money that is to be put in, this year there will be a 0 per cent. real-terms increase in funding for local authorities? Does he accept, therefore, that for every £1 that a school gets, there will be £1 off care for the elderly, as a consequence?.
Is the Secretary of State aware that more than 476,900 children aged five, six and seven are in classes of more than 30? Where in his statement today is the extra money that will pay for his pledge on class size reduction? Where is the extra money to pay for the 55,000 additional pupils coming into our schools next year? Can he tell us whether class sizes will go up or down next year?.
Does the Secretary of State accept that the previous Government underfunded community care, and forced social services into the business of rationing care for the elderly and disabled people? Will not the settlement mean longer waits for care assessment and provision,

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tighter eligibility criteria and increased charges for home helps and meals on wheels? Are not the real losers from the settlement the most vulnerable pensioners?.
Will the right hon. Gentleman confirm that this is the last year of capping? Does he accept that capping distorts local priorities and undermines local accountability? Will he admit that because of capping and Labour's decision to stick to Tory spending plans, the responsibility for cuts and council tax rises this year rests with Whitehall, not with the town halls?.
Local council tax payers will recognise in the statement—[HON MEMBER: "TOO long."]—I am concluding—not just smoke and mirrors, which is how the previous Government always treated such settlements. This year. we have added Labour spin.
Mr. Prescott: We certainly have added Labour financial resources. I have spelt them out, and they have nothing to do with spin. Instead, there is extra money to fund the new services that are needed. All these matters are under review with the Local Government Association.
We have made it clear that this will be the last year of crude capping. We think that what we propose is different from what we had last year. We want to move forward to a proper form of financing local government.
I have already referred to the local government financial review. The issues are complex and detailed discussions are taking place. I shall report to the House at the appropriate time. It is necessary for the review to take place, for the very reasons to which the hon. Gentleman drew attention.
As for education, we have provided £835 million. It is apparent that there are extra resources for that sector, even taking into account increased demands. We have already started to abolish the assisted places scheme, and money has to be transferred for reducing class sizes, which will certainly not increase. We shall be judged over five years, and we have started to take the essential steps.
My right hon. Friend the Chancellor of the Exchequer talked of 10.5 per cent. in his pre-Budget statement, but that is not comparing like with like with my 7 per cent. The Treasury book figure was for Great Britain—scotland Wales and England. It takes account of increased earnings and employment, and it assumes that some authorities will use the headroom that is allowed in the new capping arrangements.
I made a joke about passporting, but that process will allow more services to be provided. The Government used to assess a local authority and the services that it should be allowed to cater for, and then tell the authority that it did not have the resources to make that provision. The passporting principle will allow authorities to meet local requirements without encountering capping. Surely that is a sound principle and one that meets the need for more resources.
I have no doubt that more needs to be done, but we have taken the essential steps to improve the relationship between ourselves and local government and to put things on a new footing, to ensure that better value and better services are provided by local authorities.
Several hon. Members rose—
Madam Speaker: Order. Now that the hon. Member for Sutton and Cheam (Mr. Burstow), the Liberal
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Democrat spokesman, has put his questions, I require one question per Member from the Back Benches. There will be a question immediately, not a statement.
Dr. Alan Whitehead: May I congratulate my right hon. Friend the Deputy Prime Minister on his settlement and, especially, on the changes that have been made to the standard spending assessment reckonings, along with the ending of the pernicious bed-night factor, which did one local authority very well?
Will the principles behind the changes in the SSA continue, and does my right hon. Friend intend to ensure that there is greater transparency in SSA principles at an early stage in discussion between the Local Government Association and the Government?
Mr. Prescott: We are addressing an important principle on the SSAs. The process should be spread over a longer period than one year, and we think that three years could be appropriate. We shall continue to use the criterion that we have employed, but we are reviewing it under current financial arrangements. I think that Southampton will receive an increase in its SSA of 3.7 per cent., which is more than the average for the unitary authorities. We shall be using the present criterion and discussing with the Local Government Association how it can be further implemented.
Mr. David Curry: Does the right hon. Gentleman accept that some council tax increases will be significantly higher than the 7 per cent. that has been predicated because of the weakening of the damping mechanism that he has announced? If the right hon. Gentleman is to get rid of crude capping, does he intend to maintain sophisticated capping? If so, what is it?
Mr. Prescott: It is a fair point that no Government can afford to ignore local authorities' expenditure. It would be foolish if I were to say otherwise. Indeed, I have made that clear already. When we set limits, we do not necessarily say that local authorities must spend up to them. We hope that they will exercise discretion. We are examining how we can have proper relationships between central and local government, because both have more than a passing interest in sound public finances. After 18 years of Conservative government, we were not left with sound public financing.
Mr. Peter L. Pike: Is it not a fact that the previous Government's final two statements at this time of the year on local authority financing did not fully fund education, which meant that local authorities had to squeeze other services? Does not it mark a significant change of direction that the new Labour Government are making a full commitment to funding £835 million, which shows that they are committed both to fairness and to local government?
Mr. Prescott: I am grateful to my hon. Friend for what he said. How education is dealt with is a very important point. The problem in the past was that Governments agreed that education expenditure could increase, but did not provide the resources. We have made it absolutely clear that the £835 million that we shall provide for

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education will be fed directly into the revenue support grant, so that it can be spent and is not a penalty on the local tax payer.
Mr. Peter Brooke: Will the Secretary of State expand, preferably without rhetoric, on what he described as the fair account or amount for visitors and, in particular, commuters?
Mr. Prescott: The assessments, for example, of people in Westminster who are staying as commuters or visitors will now be considered at half the rate that applied before [Interruption.] We shall consider them just as visitors, not as residents. That is the main point that will apply in those matters. We have changed it in that sense.
Ms Rosie Winterton: Will my right hon. Friend give further consideration to a point that I have raised previously with Ministers, about allowing local authorities to use their collection funds accumulated from successful council tax collection schemes to alleviate their financial difficulties? Does he agree that that would not increase the amount ultimately paid by council tax payers, but could go some way to improve services for them?
Mr. Prescott: I recognise that my hon. Friend has been campaigning on that matter since she arrived in the House. It has forced me to see what resources are available from what is known as the collection fund, where, as an incentive, local authorities hold back certain moneys from the collection of rates and the council tax. The amount appears to be about £300 million. That money, according to previous legislation, which I believe still applies, can be used only to reduce the council tax payment. It is a matter of some concern. Resources are there. I am advised that current legislation prevents us from acting immediately on that, but we shall take it into account during the local government review.
Sir Paul Beresford: What does the Deputy Prime Minister anticipate will happen to the difference between local government total standard spending and budget next year compared with this year?
Mr. Prescott: If I heard the question correctly, the difference between the TSS and budget this year will be in the calculation of the expenditure.
Sir Paul Beresford: What does the Deputy Prime Minister anticipate will be the difference between the local authority TSS and budget next year compared with the TSS and budget this year?
Mr. Prescott: I thought that it was just me. I do not think that that calculation can be made. I do not have one at the moment, and I await the appropriate time for it.
Mr. Christopher Leslie: Is my right hon. Friend continually astonished, as I am, at the brazen way in which that lot over there made such a hash of the
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financial programme for local government, and the way in which they fiddled the figures to benefit their own areas, unlike the way in which—
Madam Speaker: Come on, I want a question.
Mr. Leslie: Does my right hon. Friend recognise that that contrasts greatly with the way in which our Government are meeting the needs of local authorities, such as Bradford district, which have extremely diverse needs?
Mr. Prescott: Those are differences that one has to take into account. In this assessment, Bury was able to get an increase of 6.4 per cent.
Mr. John MacGregor: On pension funds, the right hon. Gentleman will be well aware that most local authorities are very concerned about the provision that they will have to make as a result of the abolition of advance corporation tax in a couple of years' time, and are looking to make that provision. Does taking into account mean considering but ignoring, or does it mean meeting in full the extra cost?
Mr. Prescott: That is a matter of some concern, and it has been discussed in the House. My right hon. Friend the Chancellor has made it clear that he will take into account the changes in the next financial year. We must await his statement to see exactly what he will do and what the proportion will be, after a decision has been made on the revaluation of pensions. A proper assessment cannot be made until the revaluation has been completed.
Mr. Alan Simpson: I congratulate my right hon. Friend the Deputy Prime Minister. Will he confirm that Nottingham, which becomes a unitary authority this coming year, will not now be faced with the decision to make £13.5 million-worth of cuts so as to reduce the council tax? Will he further confirm that when responsibilities for staff are transferred from the county council to the city—the staff will do the same job in the same place but receive a different pay cheque—it will not be assumed to be facing increases of only half the rate of inflation that would have been allowed under the county council?
Mr. Prescott: The assessments affect authorities differently. My hon. Friend's authority will receive a permitted increase in the budget of 3 per cent., which, with passporting, will allow it to meet extra requirements without being penalised by the capping regime. That is how we have made the system fairer. We are moving away from the crude capping arrangements. I am sure that that is what his authority would want, and that is what we have done.
Mr. John Greenway: Why has Ryedale district council been given a nil increase in its budget? Is not that a disaster for shire districts, which will result in cuts in services for some of the most vulnerable people in rural areas, as well as a massive hike in council tax?
Mr. Prescott: The reason is that the council's expenditure over the standard spending assessment is more than the 12.5 per cent. that I have announced will

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be the capping limit. That is the reality. We have reviewed services and given our judgment on the SSAs. If an authority's expenditure over the SSA is more than 12.5 per cent., as the hon. Gentleman's authority's is, it will not benefit from the measure.
Ms Beverley Hughes: I welcome the statement. If I had achieved such a settlement from the previous Government in the years when I was leader of a council, I would genuinely have been very pleased. Does my right hon. Friend agree that the total spending on personal services represents an increase of about 5.8 per cent.? That increase, together with the retention of the community care grant in special transitional grant and the increase in money for children's services, will be widely welcomed. It gives the lie to the contention of Conservative Members that personal social services would be cut in the settlement.
Mr. Prescott: My hon. Friend has given a good example of how we have made SSAs fairer. Trafford's SSA will increase by 2.9 per cent., and it has particularly benefited from the changes that we have made to the elderly residential social services formula. That is about needs, justice and fairness, and it is a good example of the changes that we have made.
Mrs. Virginia Bottomley: The right hon. Gentleman made much of fairness and consultation. The town and country issues group of authorities represents a series of towns that dominate a rural hinterland. Will he or his Minister of State agree to meet that group, so that it can put its case direct to Ministers rather than through consultations with the Local Government Association? They can then hear its arguments for themselves.
Mr. Prescott: We intend to carry out considerable consultation with local authorities, including through video conferences and by other modern methods. I shall take into account the right hon. Lady's request for me to meet a delegation from her authority.
Mr. Phil Woolas: My question is straightforward. Does the Prime Minister—[Interruption.] I am sorry, I should have said Deputy Prime Minister. I was wrong, then right; or right, then wrong. Does the Deputy Prime Minister welcome the announcement by Mr. Ken Charnley, the leader of the Conservative group on Chorley council, that he has defected to the Labour party? Does my right hon. Friend think that he has done so because he considers the Conservatives to be incompetent and mean? He has bypassed the Liberal Democrats because, as they have shown today, they are two-faced and incompetent.
Mr. Prescott: I am sure that my hon. Friend will agree that that Conservative has left his party and joined the Labour party because these figures show that it is a fairer party and has dealt fairly with the problems in his area. In my hon. Friend's local authority area, the figure for education has now increased by 5.3 per cent., and the permitted increase in the budget is 3.8 per cent., whereas for Rochdale the figures are 6.5 per cent. and 4.9 per cent. That Tory party member has done what many Tory councillors have done over the years—left the Tory party,
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leaving it with no organisation. The party that proudly proclaimed that it had 240 councils in 1970 now has fewer than 30. Councillors have left the party because the Conservative Government were not concerned about fairness.
Mr. James Paice: Does the Deputy Prime Minister realise that people in Cambridgeshire will see nothing fair in a settlement that breaks a promise that was given during the election campaign by the Prime Minister, to get rid of the iniquitous area cost adjustment? The settlement means that council tax in Cambridgeshire will rise by an iniquitous amount—considerably higher than the amount that was stated by my right hon. Friend the Member for Sutton Coldfield (Sir N. Fowler). However, the overall capping limits mean that expenditure cannot rise by more than the rate of inflation.
Mr. Prescott: As I have said, I am concerned about the area adjustment matter, but I am not convinced by all the current evidence. I take on board the hon. Gentleman's point, but I have promised to review the matter and make a statement about it. Cambridgeshire has had its resources for education increased by 5.5 per cent., although the permitted budget increase is 3.6 per cent. I do not think that the people of Cambridgeshire are likely to say that that is not good for the county.
Mr. Harry Barnes: May I pursue the matter of weighting in the context of people moving to areas such as Westminster, because that affects my constituency in the other direction? Has the enhanced population figure been given a reduced weighting? I do not think that that can be the case, because north-east Derbyshire suffers terribly. It has finished up with a smaller revenue support grant than it received previously. Rather than the principle itself, the weighting for people moving and the area cost adjustment need to be considered.
Mr. Prescott: My hon. Friend has spoken to me about the matter of the proper weighting for visitors and commuters. I know that he has another scheme in mind. Perhaps he would like to discuss with me how that might be considered in the financial review.
Sir Teddy Taylor: Is the Deputy Prime Minister aware of the special situation in Southend-on-Sea where, incidentally, we had five gains from Labour and no losses on 1 May? It will become unitary in May and will totally break away from the county of Essex. Southend has a much higher than average share of social problems because of the number of bed-and-breakfast establishments and houses in multiple occupation. It also has a much higher than average percentage of elderly people and a much higher percentage of unemployment than the rest of Essex. Will those factors be taken into account in assessing our needs in comparison with those of Essex?
Mr. Prescott: I think that the hon. Gentleman is correct. We have done what he asks, as is reflected in the figures. Those for Rochford and Southend, East show an increase in education spending of 6.5 per cent.

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The increase in the budget, taking into account some of the factors that the hon. Gentleman mentions, is 8.4 per cent. I hope that that is acceptable.
Mr. Terry Rooney: When will the Government move to a triennial review system and get away from this annual nonsense? Will my right hon. Friend promise not to visit Bradford, because every time a Conservative Minister visited Bradford, we lost money?
Mr. Prescott: I cannot give my hon. Friend a timetable, but as I have said, we are reviewing the matter and considering a period longer than one year. Every year, much time is taken up by considering standard spending assessments, and meeting all sorts of delegations for many types of marginal changes seems to take up much of my Ministers' time. A fairer way to deal with this matter could be on at least a three-year period. We shall certainly take that into account in our review.
Mr. Tony Baldry: Is the Deputy Prime Minister aware that Oxfordshire is already threatened by the closure of day centres and by a reduction in provision for respite care and home help? The situation is desperate. The right hon. Gentleman's figures propose for Oxfordshire a reduction of nearly £2 million in the provision for personal social services. How on earth can people there be expected to accept a year-on-year reduction, when they already face a critical situation? Is not the consequence of his statement for Oxfordshire and for other counties that the most vulnerable will be hit and will have a substantial hike in their council tax bills?
Mr. Prescott: I believe that my hon. Friend the Minister for Local Government and Housing met the hon. Gentleman on Friday to discuss the implications of the settlement and, as he knows, the Government have had considerable discussions with the Oxfordshire authority, particularly arising out of the capping position last year. I hear what the hon. Gentleman says. We are dealing with more than 400 authorities. All have similar problems and all are trying to deal with them. We are trying to provide a fairer system.
With regard to Oxfordshire, there has been a 4.4 per cent. increase in the education budget for Banbury—
Mr. Baldry: But not in social services.
Mr. Prescott: Yes, but the hon. Gentleman's constituency is to have a 4.4 per cent. increase in its education budget and the permitted budget increase is 3.1 per cent. That compares well.
Mr. Baldry: What about social services?
Mr. Prescott: I understand all the problems that local authorities face, and they are no more difficult in Oxfordshire than they are in other areas. We have to be fair in how we deal with the matter and in how we distribute national resources. That is what we have done. I have stated how the hon. Gentleman has fared, and that is our position.
Several hon. Members rose—
Madam Speaker: Thank you. We now come to the statement on social security uprating.

Social Security Uprating
4.30 pm
The Parliamentary Under-Secretary of State for Social Security (Mr. Keith Bradley): With permission, Madam Speaker, I should like to make a statement on the uprating of social security benefits and on the re-rating of national insurance contributions for 1998–99. I should also like to report on our objectives for reforming social security.
This is the first benefits uprating announced by this Administration and, unlike those of previous years, it will not be marked by a long list of cuts to the welfare programme—not that we are content with the size of the budget. We cannot be complacent when, despite growing prosperity, spending on social security has continued to grow. It now consumes one third of Government expenditure and is set to break through the £100 billion barrier before the end of the century. That is more than is collected in income tax, twice what is spent on the national health service and nearly three times what is spent on education.
As important, we are not content with the way in which the money is spent. The huge cost that is our legacy has done little to reduce the amount of poverty. The inability to harness social policy, to use it as a tool for change, has not only been the main driver of welfare spending but has resulted in the greatest social division for generations.
We are committed to breaking with the past. We are undertaking a systematic review of the welfare programme. The review is both necessary and timely. We need a modern welfare system to reflect modern circumstances. Our welfare-to-work programme will provide people with a route out of benefit dependency, and our comprehensive spending review will lead to the modernised system that we need. I will say more about that later.
First, we have immediate business. The House knows that we are required to review the rates of benefits and national insurance annually. Our intention for the year 1998–99 is to uprate most national insurance benefits, child benefit and benefits for disabled people and carers by 3.6 per cent. That is the increase in the retail prices index in the year to September. War pensions will also be uprated by the RPI.
As in previous years, jobseeker's allowance and the main income-related benefits will be uprated by the Rossi index, which at September had a year-on-year increase of 2.4 per cent. As hon. Members will know, the Rossi index is the RPI less those elements for housing costs. It is a more appropriate index for income-related benefits, where housing costs are, in the main, met separately.
Most rates of deductions in respect of non-dependants have been increased over and above inflation. That will reduce the benefit that is paid in respect of housing costs to claimants who have a non-dependant living with them. Taking forward that measure allows us to reverse the previous Government's plans to extend the single room rent restriction. The withdrawal of the extension, which would have restricted housing benefit to people aged over 25, has been welcomed both inside and outside the House.
That was a hard choice in maintaining our commitment to live within existing spending ceilings. It is important to remember that the mandate that we so recently received was based on a manifesto which committed us to controlling public expenditure.

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I shall deal now with national insurance. We do not propose to increase the rate of class 1 contributions paid by employees and their employers, or the earnings brackets for the three lower rates of employers' contributions. The rates of class 4 profits-related contributions paid by self-employed people will also remain unchanged. The lower earnings limit for class 1 contributions will increase broadly in line with the basic rate of retirement pension, as will the upper earnings limit which applies to employees' contributions only. Similar increases apply to the lower and upper profits limits for class 4 contributions. The weekly class 2 contribution paid by self-employed people and the voluntary class 3 contribution also increase in line with that formula.
The cost of the uprating will be £2.45 billion. The maximum available Treasury grant for the national insurance fund will be set at £800 million. Most new rates of benefit and the changes made to national insurance contributions come into effect on 6 April next year. Schedules showing the new rates of benefit and the new rates of national insurance have been sent to all hon. Members today.
The most pressing need is to develop our approach to people of working age. They are responsible for supporting their children. Their actions while in work will determine how adequate their income will be in retirement. The best we can do for people of working age is to give them the opportunity to work. That is our first objective for welfare reform.
The wage motivation to work is for most people compelling—with the best will in the world, benefits can never be a substitute for earnings. Equally, there are also very strong non-wage motivations for working which, in total, reflect and influence the shape of society. Work enables people to be in the mainstream of society, to make their own contribution, to develop their potential, and to offer a positive role model for their children. Work also provides access to social networks and to new opportunities for advancement. None of this is new. It could be argued that making work the best form of welfare has always been the objective of social policy, but the facts show that the current social security system fails actively to promote a return to work.
An indifference to social policy, and an assumption that unemployment is a price worth paying for economic success, have meant that millions of people have been set aside from the labour market and condemned to a life of dependency. Our objective is to root out that worklessness and to give all people of working age a chance to enjoy economic opportunity. That is why our new deal programme extends beyond the unemployed. We need to give lone parents and sick and disabled people worthwhile help. We also need to make sure that, where possible, work pays, and that tax and benefit systems encourage work, not deter it.
That is why we have a Whitehall task force on tax and benefits to help deliver the Government's pledge to streamline and modernise the welfare system. It is why we are introducing a minimum wage. It is why we are looking carefully at every benefit to see whether it helps or hinders people in achieving their aspiration to be in work. We are seeking totally to recast the aim and operation of welfare, and to make it clear that work, rather than benefit payment, is the right solution,
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economically and socially, for people of working age. We will continue to support those people who cannot work.
The second group needing our attention is children. Our objective is to ensure that all children are supported, wherever possible, by their working parents. Nearly 3 million children now live in workless households, which represents a threefold increase since 1979. The best way to support these children is to ensure that their parents are working. They benefit from the lasting financial security that work ensures and from role models which help them to learn how they can live independent lives when they grow up. Our new deal for lone parents will help to tackle the problem by providing a comprehensive package of back-to-work help for lone parents.
Effective child care arrangements are vital, as nine out of 10 lone mothers would work if they could afford child care. The Government are committed to a national child care strategy, which will help parents, especially women, to balance family and working life.
Child support maintenance will have a major part to play. Receiving regular maintenance payments helps lone parents to work, independently of all other powerful influences on their ability to work. We must also reach a point at which an absent father's failure to provide proper financial support for his children is regarded as socially unacceptable.
Our ambitions do not stop at people of working age, because it is also essential to help pensioners. On average, pensioners' incomes have grown over the past 20 years, but the gap between the poorest and richest pensioners has widened. Moreover, projections show that the gap will continue to widen unless urgent corrective action is taken. Our objective is to promote financial security in retirement in a way that enables people to build up a stake in their own provision.
It is clear that the difference between richer and poorer pensioners is a result of the extent to which the former have had access to second-tier pension opportunities, and have taken advantage of the chance to save during their working lives. Secure income in retirement will be achieved when people of working age realise that the more that they and their employers make contributions to their own pension, the greater will be the reward when they retire.
Work—to fund savings—is the best form of pension provision, which is why we have launched our pensions review. That is also why we are consulting on stakeholder pensions and developing citizenship pensions, which will extend the opportunities for good-value pensions to the 8 million people who are poorly served by current arrangements. Our review will also begin to address current inequalities between the opportunities of women and men to have adequate pensions.
We are taking action to ensure fair treatment of pensions on divorce, giving greater rights to women who have contributed to the build-up of pension by supporting their husbands in the home.
We are determined to tackle the situation in which nearly 1 million pensioners do not take up the income support to which they are entitled. We have already commissioned research to establish the reasons why they do not take up that support. From April, we will begin pilot exercises to discover the best ways of delivering income support to older citizens.

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As our manifesto has made clear, the Government believe that pensioners should share fairly in the nation's increasing wealth. That is not merely a long-term aim. We have already reduced VAT on fuel, and, from next year, we will abolish the gas levy—showing that we will act quickly.
In his pre-Budget statement, the Chancellor announced the winter fuel payment, which will pay pensioners £20 and the poorest pensioners £50. Those payments will be made in time for winter fuel bills and will be on top of normal pensions payments, which will be uprated next year, as I have already announced.
We are a modernising Government. We believe in bringing opportunities equally to all sections of the community, although we also believe that those opportunities bring responsibilities. Our reform will be guided by our objectives for the main groups that we are attempting to help: welfare to work for those of working age; security for older citizens, for now and in the future; and support for children.
As the House knows, the orders introducing the new benefit rates and the main elements of national insurance require affirmative resolution. We look forward to the wide debate on our programme for social policy to which that occasion will lend itself. I commend the statement to the House.
Mr. Simon Burns: I thank the Minister for his statement. Will he accept that, in the past, this significant annual statement has been dealt with by the Secretary of State for Social Security, and that, at the previous week's business statement, it was customary for the Leader of the House to publish the date of the uprating announcement? I am mildly surprised that no answer was given to my right hon. Friend the Member for South-West Norfolk (Mrs. Shephard), who raised the matter at business questions, and that we have had such short notice of it today.
Is the Minister aware of the written answer given by the Minister for Welfare Reform, who said that an uprating in line with inflation would cost £600 million above the 1996 budget assumptions? I should be grateful if the Minister will tell the House where that money will come from.
The Government have proved by their actions since 1 May that, although sticking to the previous Government's overall spending totals, they had room to manoeuvre in withdrawing the changes to housing benefit for over-25s. Will the Government repeal the measures for under 26-year-olds? Does the Minister agree that there is something illogical in the current policy? What is the difference between a 25-year-old and a 27-year-old? Perhaps he will explain that to the House.
In the repeal of the housing benefit rules, the Government have shown clearly that they could have honoured their pre-election pledges on lone parents, if they had been minded to do so. Will the Minister—as we are on the issue of lone parent benefits—confirm that the Government have continued the freeze for existing lone parent claimants, therefore effectively allowing that benefit to wither on the vine for current claimants?
Does the Minister agree with the hon. Member for Kingswood (Mr. Berry), who said this week that, before the election, Labour described the abolition of help to lone
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parents as "particularly spiteful"? Does he agree with the comments made by the Secretary of State for Social Security in the uprating order debate that
"Cuts in lone mothers' benefits make the poorest families poorer"?—[Official Report, 19 February 1997; Vol. 290, c. 944.]
Will the Minister tell the House—as he and the Secretary of State for Social Security have singularly failed to do so far—what aspect of the issue is different now, compared to last winter, except that there has been a general election, and that the Labour party has milked the issue for all the votes possible by leading people to believe that Labour would not implement the previous Government's policy?
The Minister has also been trying to duck questions on the new deal on child care in the context of lone parents. I should be grateful for some answers on the child care issue, because there are so many unanswered questions. Will he explain what the charging policy for child care will be for the remainder of this Parliament? Will it be means-tested? I should be very grateful for an answer—an answer of substance, not a soundbite—to that specific question.
Does the Minister understand the irony in his statement that the Government's objective is
"to promote financial security in retirement"
for pensioners? How can he reconcile that objective with the raid on millions of personal pensions made by the Chancellor of the Exchequer in his July Budget, which was worthy of Mr. Robert Maxwell?
The Minister also talked about moving towards equality in pension opportunities between men and women. How can he reconcile that aim with the possibility that the Chancellor will remove the independent financial status of women in the United Kingdom?
The hon. Gentleman mentioned also the matter of reducing value added tax on fuel. Will he confirm that the Government—by reducing VAT on 1 September 1997, rather than on 1 October 1997—ensured that the pensions uprating was calculated on a lower inflation figure, costing the average pensioner just over £6 a year, whereas savings from the 1 September VAT cut are infinitely less than that?
Far better than most hon. Members, the Minister will understand that, since 1 May 1997, the Department of Social Security has been riven with differences of opinion between the Secretary of State and the Minister for Welfare Reform; there has been a plethora of reviews, which are getting nowhere, as even some of the reviews are being reviewed; and there seems to be utter chaos, with no one knowing exactly what others is doing.
Could the hon. Gentleman, just for once today, treat the House with some respect and answer the questions that have been posed to him so often in the past in Committee and in debates on the Floor of the House? We want meaningful answers to the questions arising out of the statement.
Mr. Bradley:.It is not the normal practice to announce when the uprating statement will be. In the past, the uprating statement has normally followed the Budget and it has been the Budget debate which has been announced. There is no problem there.
The published plans include an assumption of the cost of uprating. The assumption made for 1998–99 was too low, so the reserve will be used; it is designed for the shortfall between forecast and outturn.

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It is extraordinary that the hon. Gentleman raises the single room rent limit. The Conservatives intended to extend the limit to apply to people up to 60, but they should welcome the fact that we did not proceed with that measure. We are continuing to evaluate the impact of the single room rent limit for the under-25s because there is a view that at that lower age, different circumstances apply compared with those for older people, some of whom may be forced to live in houses in multiple occupation or worse. We will continue that evaluation and report on it next year.
I can confirm that the higher rate for lone parents in receipt of child benefit will be £17.10, the higher rate for family premium in income support and the jobseeker's allowance will be £15.75, and in housing benefit and council tax benefit, the higher rate will be £22.05. The family premium for existing lone claimants on income support will still be £4.70 a week more from next April than is paid to two-parent families in the same circumstances. Existing lone parents receiving child benefit will still get an extra £5.65 a week on top of the basic child benefit. In terms of the new deal generally, it is our view that lone parents will be better off in work because of the national child care strategy. From the evidence we already have, they will be an average of £50 a week better off, which is far better than being dependent on very low benefits.
The hon. Gentleman referred to the tax credit system. The Chancellor announced in his pre-Budget statement that a working family tax credit was under consideration. We are considering all options; replacing family credit with a working family tax credit is only one of them. It must be pointed out, however, that most wage earners in low-income households with children are women. The proposed working family tax credit would build on the successful elements of family credit and would involve better help through the tax system for child care costs.
We are trying to create the economic conditions to ensure that pensioners have their fair share of the rising national prosperity which only this Administration are prepared to deliver. My statement, which will ensure that pensioners receive a 3.6 per cent. uprating in their pension, on top of the £20 for fuel costs,£50 for pensioners on income support, the reduction in VAT on fuel and other measures, including the abolition of the gas levy next year, is a package of help for pensioners which the Conservative Administration never even considered.
Mr. Dennis Skinner: Is my hon. Friend aware that in trying to meet the rising social security bill of £90 billion-plus, which will rise to £100 billion before the end of this Parliament, he would be in a much better position if, for instance, the Government realised, even at this stage, that it was necessary to increase taxes for people such as Members of Parliament and those who get even more money than we do? That is one approach which has, sadly, been excluded, but it will have to be returned to.
My hon. Friend talks about welfare to work and the new deal. It is difficult for me to understand that kind of language. I have seven villages in my constituency where pit closures took place three or four years ago. One thousand young men, who hitherto had training schemes under British Coal, no longer have training schemes.
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Almost everybody is out of work in those pit villages. There is nowhere for those young men to go, as I hope the Minister understands. He is not saying, is he, that these people have got to get on a bike? I do not like that kind of language.
I want Ministers to understand that there are areas of Britain, including mine, where the idea of work being available is laughable for many people. Unless special measures are taken in that respect, we can talk about welfare to work only for areas where it is feasible. The Government should not rub the noses of people where there is no work at all in the idea of welfare to work. If the Minister will see the matter in that fashion, he may be able to deal with the problem generally.
Mr. Bradley: My hon. Friend always talks passionately, and rightly so, about the problems of his constituency and I hear clearly what he says. On his first point, I will refer his remarks about taxation to the Chancellor.
My hon. Friend talked about welfare to work. It is essential that we do not give up on unemployed people and that we give them hope for the future. It is essential that the welfare-to-work programme recognises the problems that my hon. Friend identifies. The programme must be tailored and it is important that we recognise that there are different regional economic problems. The programme must deliver hope for my hon. Friend's constituents.
Mr. Steve Webb: I welcome many aspects of the statement, but I want to press the Minister to look more closely at three aspects of it. First, will he look at provision for pensioners aged over 80? As happened under the Conservatives, the Minister has chosen to freeze the extra help for the over-80s at just 25p a week, which is an insulting amount. Does not he accept that pensioners over 80 are the poorest in the land and that many of them do not claim income support? Converting that 25p into a worthwhile sum such as £5 a week would guarantee help for the poorest and would give them not £20 a year, but £20 a month.
Secondly, I understand and appreciate why the single room rent reform was reversed. Would the Minister, however, look at the way in which that change has been funded? Has the increase in non-dependant deductions—that is, the tax on young people who live with their parents—gone too far? For the highest-earning young people, the figure has gone up by 36 per cent. in the statement. Will the Minister at least undertake research to see whether the change breaks up households? It may produce more demand for housing and more burden on the Exchequer.
Thirdly, we must return to lone parents. The statement means a freeze not for new claimants, but for the 1.5 million lone parents who are existing claimants. Does the Minister accept that many of those people will not move from welfare into work? Does he accept that, yesterday, the Secretary of State for Social Security seemed to acknowledge that looking after young children at home was a valid thing to do? Will he explain why he is cutting the real living standards of those families?
Mr. Bradley: I shall try to answer the hon. Gentleman's three questions. We recognise the plight of

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very elderly pensioners and our pensions review will look specifically at that point. At a recent meeting of the review team at which Jack Jones, a doughty champion of pensioners, was present, that item was specifically put on the agenda. The pilot schemes that we are introducing to find out why the poorest pensioners are not claiming income support will recognise that many of those may be the very elderly. We must study the pilot research projects to find out why that group are not claiming their entitlement.
I am grateful for the hon. Gentleman's support for our decision not to extend the single room rent limit to 25 to 60-year-olds. I recognise that the non-dependant changes are hard choices, but I hope that the hon. Gentleman will recognise that we have protected the lowest-paid within that to ensure that the system is as fair as we can make it, in context. In our current housing review, which is under way as part of the comprehensive spending review, all those matters will be reconsidered as we develop a sensible housing policy and sensible housing benefit changes.
I have confirmed the figures for lone parents. I must put them in the context of the new deal and in the context of the speech yesterday by my right hon. Friend the Secretary of State about choice for lone mothers and about flexibility. The crucial aspect of the national child care strategy will be to ensure that that is a reality.
Ms Margaret Moran:: I welcome the opportunities that my hon. Friend outlined to move the poorest from welfare to work. As part of his review, will he consider the opportunity for substantial housing benefit savings that might be afforded through rent reductions? Does he accept that a 10 per cent. rent reduction would not only afford substantial housing benefit savings, but could offer many households the chance to move from welfare to work, alleviating the poverty trap?
Mr. Bradley: I am grateful for my hon. Friend's comments. I recognise and value her expertise, particularly on housing benefit. We recognise that housing costs can be a critical element in decisions on general reform programmes. I assure my hon. Friend that we shall look carefully in our housing policy review at the disincentives that emanate from the current system in our welfare-to-work programme. I should be grateful if she could send any further comments on that to me at the Department.
Mr. Andrew Rowe: The Minister may know that I have always been rather in favour of a minimum income scheme. One of the disadvantages of the idea is that it involves a minimum wage at some point. Now that the Government have decided that we shall have a minimum wage, will the Minister look carefully at the advantages of a minimum income scheme?
Ministers have constantly complained about the lack of skills in society. Will the hon. Gentleman give further thought to the 50-year-olds who have been sliced out of employment, often to save their employers' considerable pension contributions? Will he ensure that that pool of
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potentially highly skilled people with the capacity to learn new skills is properly catered for in the new deal or in some other manner?
Mr. Bradley: I am grateful for the obvious overwhelming support for the Government's reform programme, particularly the recognition of the introduction of a minimum wage. I shall refer the hon. Gentleman's comments to the Taylor review of the tax-benefit system. I am sure that his contribution will be valued. We recognise that many people have been dumped out of employment and on to benefit dependency at too early an age. That is not acceptable. I welcome the hon. Gentleman's recognition of that. It is unfortunate that the Conservatives did not recognise the value of people in that age group when they were in government and did not do anything to help them get into work, where many of them want to be.
Audrey Wise: My hon. Friend said that all children should be supported by their working parents. For lone parents, that implies full-time work, as one part-time job is not enough to support a family. Will he clarify what he means? Will he also tell the House why child care is regarded as a job if done by a stranger, but not if done by the child's mother or father?
Mr. Bradley: The purpose of our reforms is to create opportunities and flexibility, so that people can move flexibly into work. Many lone parents want to work. The changes that we have made to family credit and the increase in the child care disregard to £100 will help to fund those proposals. The national child care strategy, with the development of 30,000 after-school and out-of-hours clubs to benefit up to 1 million children will help in that. Our package of measures will give real help to ensure that children do not remain in poverty and are able to benefit from the fruits of economic prosperity.
Mr. John Swinney: The Minister said that his comments would not be marked by a long list of cuts to the welfare programme. There may not have been a long list, but there were cuts. Does he accept the growing anxiety about the Government's proposals to cut child benefit for lone parents? Will he give a commitment that the Government will think again about the concern that is being expressed and remove the relevant provisions in the Social Security Bill?
Mr. Bradley: I have made the rates of child benefit for next year clear in my statement. Personal allowances and children's additions in income support will be uprated as normal. That will mean an increase in benefits. Lone mothers in low-paid work will benefit from the full uprating of family credit by the Rossi index. I have confirmed that the child care disregard will go up to £100 per week from next June. All those measures will help lone parents and their children. All Departments, including the Department of Social Security, always look carefully at new measures and evaluate them before undertaking the reforms that are necessary for a modern social security system.
Mr. John Cryer: The aim of full employment, which seemed implicit in my hon. Friend's statement, is laudable, but I do not understand how that is

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compatible with cutting the higher rate of child benefit for single parents, which provides a disincentive to work. The higher rate generally applies only to single parents who are already in work. Those who are not in work are likely to be on income support and do not get the means-tested money.
My hon. Friend talks about tough decisions. Tough decisions are not made by people who earn a minimum of £43,000 a year. Tough decisions are made by people who live in genuine poverty, which has affected ever greater numbers in this country for the past 10, 15 or 20 years. People who have to choose between eating and heating are the ones in difficulty. We are in danger of making their situation worse by cutting the higher rate of child benefit.
Madam Speaker: Order. That was an interesting contribution, and would have been so in a debate, but there was not a question in it. If the Minister would like to make some comments, of course I shall allow him to do so, but I want questions from other hon. Members.
Mr. Bradley: I agree with your view, Madam Speaker. As I have said, there will be an opportunity for a full debate on the orders when they are presented to the House, before they are implemented.
Mr. Tam Dalyell: Is my hon. Friend aware that, in the year that I was elected to the House, Buckingham palace sent just over 200 telegrams of congratulation to those who had reached their 100th birthday? Last year, the palace sent 5,460. Anecdotally and from constituency experience—I have no definite evidence—I suspect that many nursing homes and homes for old people do not take up the income support that people in their late 90s are unable to claim themselves. Will that be addressed in the review? Will something be done to help carers, who play an increasingly important role?
Mr. Bradley: I am grateful for my hon. Friend's comments. He is right about the number of telegrams that are sent out. As a new Minister, I was surprised to learn that there is a dedicated official for that task because of the number of telegrams to be sent. My hon. Friend has raised important points, which our pensions review and our review of long-term care for elderly people must take into account. It is crucial that elderly people do not live in abject poverty.
Mr. David Rendal: Will the Minister confirm that hidden in half a sentence of his statement was a comment that made it clear that the thresholds at which employers pay national insurance will be frozen in cash terms? That means that he is introducing a real-terms increase in business taxes.
Mr. Bradley: May I clarify that? No employer will pay more on existing payrolls as a result of the freezing of the bands.
Mr. David Winnick: Will the Minister bear in mind the fact that unemployed people whom I often see are unemployed not because they want to be but because of genuine disability or age—people who are in their 40s and 50s have been made redundant
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and cannot find work? They want to find employment. Despite what the Government have said, there will continue to be much difficulty for such people. They should not be penalised by any cuts in social security payments. That would be wrong.
Like my hon. Friends, I welcome what the Government have done for pensioners in the past six months—actions which the Tories would not dream of taking, such as the action on fuel payments. There is more to be done, as my hon. Friend has said. Far too many pensioners are living in dire poverty, and among them are a good number of war veterans. We should do justice to those people, and as soon as possible.
Mr. Bradley: I am well aware of my hon. Friend's continuing and effective championing of the plight of pensioners. I recognise that and pay tribute to him for it. Our pensions review will take into account the matters that he has raised; it is essential that it does.
Clearly, there are barriers to work. Part of the pilot scheme that we are setting up—especially the £195 million of new deal money to help people with disabilities—will look at those barriers so that we can effectively address them. As my hon. Friend rightly said, many such people want to work, to recognise their capacities rather than their incapacities. We have to learn from the pilot experience to ensure that the new deal is effective for all people who want to move from benefit dependency into work.
Mr. John McAllion: My hon. Friend rightly recognised the growing gap between poor and rich pensioners. Does he also recognise that the present generation of pensioners bequeathed to our generation a national health service and a welfare state from which all of us have benefited? Does he further recognise that, for the poorest among them, it is now too late to take out a second-tier or stakeholder pension? At the very least, we owe it to them to restore the link between pension increases and average earnings, which was so callously broken by the Conservative party in 1981.
Mr. Bradley: Clearly, we recognise the plight of pensioners who have not been able to make proper second-tier provision. That is why we are looking closely at those who are not claiming their income-related benefit—income support—to ensure that they at least come up to the minimum level. The pensions review recognises the plight of the poorest pensioners. I assure the House that representatives on that review will not let the Government forget it. Through that review, we will explore how we can most effectively help those poorest pensioners.
Mr. Tony McWalter: I thank my hon. Friend for his statement. Will he reflect on his rather anodyne words about the Child Support Agency, which is a vital component of social security? It would be more appropriate to describe its operations with alarm, especially as the resources that it is allocated for the detection and pursuit of people who evade its operations seem to be very low. Does my hon. Friend think that the agency should be deemed not the Child Support Agency

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but a child neglect agency? Will he consider seriously whether its operations should be more profoundly reviewed?
Mr. Bradley: I thank my hon. Friend for his comments. As I mentioned in the statement, we recognise the importance of payment of child maintenance. It is not acceptable for the money not to go to the parent who cares for children. It is an essential element of such parents' income and they need to know that it will be reliably and efficiently received. That is why we are undertaking a fundamental review of the CSA. We hope to bring forward proposals on the matter in the first half of next year.
Mr. Burns: Will the Minister please tell the House categorically whether the Government have any plans at all in the new deal for lone parents to bring in compulsion, as there is compulsion in welfare to work for young people? Yes or no?
Mr. Bradley: The Secretary of State has made it absolutely clear that compulsion is not the issue. We shall continue to work to help lone parents to get into work. That is what they want and that is what we shall continue to do.

Welsh Ports (Blockades
5.14pm
Mr. Nigel Evans: I beg to ask leave to move the Adjournment of the House, under Standing Order No. 24, to debate an important matter that requires specific and urgent consideration, namely,
the blockading of Welsh ports by farmers at Holyhead and Fishguard, and threats that the illegal action will spread.
I should make it absolutely clear that we cannot condone the action of the farmers involved. We understand their anger and resentment, and sympathise with their plight, but we cannot condone the blockading of any ports in Wales or elsewhere which prevents the free movement of goods by people going about their lawful business.
The wilful dumping of 40 tonnes of beefburgers on Sunday night in Holyhead harbour was disgraceful, as were the skirmishes with the police. The blockading of lorries at Holyhead and Fishguard cannot be allowed, and the turning back to Rosslare of six lorries carrying £600,000-worth of beef and lamb flies in the face of free trade.
The Government need to address this urgent issue quickly. Enough damage has already been done. As the actions of French lorry drivers demonstrated recently, compensation claims will follow—as happened with British lorry drivers who saw their livelihoods being damaged. The Government must act to ensure that all ports remain open at all times. They must not allow the issue to deteriorate.
The economic issues about which the farmers are rightly angry must be addressed, but not as a reaction to illegal actions and midnight ultimatums. The disruption must stop. The Government must look separately, and without duress through threats from anyone, at the crisis facing farmers, especially beef farmers and those in less-favoured areas.
It has been estimated that farmers' incomes this year will drop by between 37 and 50 per cent. One commentator has described the industry as bleeding to death. Prices are sharply down on 12 months ago, and, even in the past seven days, prices have fallen dramatically—in some dairy herds they are lower than they were 17 years ago—from 89p per kilogram to 50p per kilogram. Farmers are selling some of their meat at a loss.
Interest rate rises by the Government have strengthened the pound, so we are sucking in imports at the expense of domestic produce, which is hitting our farmers. The Government could seek more compensation from the European Union, but they refuse to do so. They could use some of the rebate from the ewe premium underspend, but they refuse to do so. They could reinstate the hill livestock compensatory allowance—extra payments that the Conservative Government made to the tune of—60 million last year—but they refuse to do so.
The Secretary of State for Wales should be fighting his corner against the Ministry of Agriculture, Fisheries and Food and the Chancellor of the Exchequer. He either refuses to do so or has failed—whichever it is, it is dismal. Instead of concentrating on the siting of his beloved Welsh Assembly, he should concentrate on the urgent plight of his farmers.

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Farmers' unions have condemned the illegal actions, but, at the same time, they want urgent talks with the Government. They want the crisis in farming to be addressed. They need help and support, and they need it now. The president of the National Farmers Union said—
Madam Speaker: Order. I have listened very carefully to what the hon. Member has said. Of course, I must give my decision without giving any reason. I do not consider that the matter that he has raised is appropriate for discussion under Standing Order No. 24. I cannot therefore submit the application to the House.

Points of Order
5.17 pm
Mr. Graham Brady: On a point of order, Madam Speaker. Was it in order for the Paymaster General to make a statement today on the replacement of the whole regime for saving, replacing the highly successful tax-exempt special savings accounts—TESSAs—and personal equity plans—PEPs—and to choose to do so outside the House? Is it perhaps possible that he is avoiding the Chamber so that he does not have to take questions on other matters which may embarrass him?
Madam Speaker: I understand that a Green Paper has been issued. It is perfectly in order for such a statement to be made outside the House. On other matters, I refer the hon. Gentleman to the reply that I gave yesterday.
Mr. Charles Kennedy: On a point of order, Madam Speaker. Further to your ruling in response to the application under Standing Order No. 24, may I seek your guidance? Although, understandably, the application was made by the Opposition Front-Bench spokesman on Wales—I notice that the Welsh Office Minister responsible for agriculture is present—many of us on both sides of the House and from all parts of the United Kingdom feel that the issues raised by the events in Wales go much broader and deeper than just what has happened in Wales.
That being so, and while acknowledging that many of the issues predate the present Government and cannot be divorced from the actions, decisions and track record of the Conservatives, all of us who are deeply concerned hope that you, Madam Speaker, might look favourably on an application for a Wednesday morning Adjournment debate, during which matters could be explored much more fully on a cross-party and cross-United Kingdom basis.
Madam Speaker: I would look very favourably on such a debate, but I have to tell the hon. Gentleman and the House that I do not select the subjects. That is done by ballot. However, the hon. Gentleman must get his application in tonight.

National Transport Safety
5.19 pm
Mrs. Gwyneth Dunwoody: I beg to move,
That leave be given to bring in a Bill to create a National Transport Safety Authority.
The Bill is designed to create an authority to promote safety in all modes of transport, including aviation, rail, road and maritime; to investigate accidents and all safety-related occurrences; to report to Parliament annually; and to receive information on all related matters.
The reality of modern transport is that, overall, it is becoming safer, but every time there is a major accident of any kind in any form of public transport it attracts considerable attention and worries the travelling public, who want to feel completely confident in the method of travel that they have chosen. It is not only those of us who are especially interested in transport who feel like that.
After the Clapham and Cannon Street rail crashes caused fears about the age of rolling stock—which is a real concern to anyone watching what privatised companies are bringing back on to the rails—the whole question of safety was raised in the reports on both crashes. After Zeebrugge, the deficiencies in the design of roll-on roll-off ferries were very worrying. The marine engineers who gave evidence to the Transport Select Committee suggested that there was a good case for reconsidering the granting of safety licences to new types of ferry.
The Civil Aviation Authority was reluctant to introduce a system of inspection for foreign-registered aircraft when that subject was raised by Members. Concern is increasing about safety on London underground, especially as it is becoming so congested. The channel tunnel is governed not by normal safety procedures, but by a treaty, so the House does not receive reports that provide the level of detail that many of us feel we ought to receive. It must be clear from those examples that the public have real worries about the provision of safe transport.
It is also clear that there are many instances, even in the properly regulated safety authorities, of people acting as judge and jury in their own cases. Railtrack gave evidence to the Transport Committee last week, explaining that the part of Railtrack that was responsible for safety was independent. We were told that a Chinese wall existed between the two parts of the authority. I am of a suitable age to have grave reservations about organisations with Chinese walls between one part and another.
The time has now come for us to set up a national, independent—I emphasise independent—transport authority that would cover the whole range of transport facilities in this country. It already exists in embryo in certain organisations, such as the Civil Aviation Authority and the maritime authorities. A number of agencies could be combined into one large, independent unit that would investigate and report on problems; make the reports public, if necessary; and take advice and transmit it from some parts of the transport industry to others. The unit's role would be clear to the public.
The idea is not revolutionary, because it has already been done successfully in the United States of America, Canada, Sweden and elsewhere. We could benefit from

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several aspects of those examples. The Canadian system, for example, provides the opportunity for people working in the transport industry to report, in confidence, any worrying aspect that they have discovered during their working lives. That opportunity is not restricted to workers in the industry.
Confidentiality is respected and it is possible to report to the safety authority any incidence of equipment not being properly used or some aspect of safety legislation that is not being operated correctly. Of course, personal grudges are carefully ruled out, but it is made clear that people reporting to the authority will have their cases taken seriously and that their names and involvement will not be disclosed without their agreement. If there are sufficient cases of misuse, or clear evidence in one case, that will be investigated. That does not happen in this country.
It is essential to have a national transport authority that seeks to improve safety at every level. It should not, as many of the agencies currently do, be only reactive: it should consciously offer support and help to all aspects of the transport industry. All areas of transport could benefit from the reports made by the safety authority. If other countries can do that successfully, we should follow their lead.
Such a move would also restore the public's confidence, given the true independence of the authority. How often do Members find themselves arguing with Ministers about inquiries into rail crashes, air crashes or ferry disasters? Individual Members often have to demand the publication of reports. If a national transport authority made an annual report to the House of Commons, the evidence would be available and the House could demand, in specific instances, that it be made public for the benefit of everyone with a specific involvement.
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The time has come to demonstrate that although we appreciate and respect those working on safety in the various transport industries, a wholly independent agency would have more muscle, better support and an obvious transparency which is lacking at present. Because this is a Bill presented under the ten-minute rule, I would not dream of suggesting any monetary support for such an authority, but there are several ways in which we could set up such a unit and give it sufficient muscle to carry out its work.
I have great faith in the transport industry, those working in it and, above all, those who seek to regulate it, but that is no longer enough. The changes that have happened—including the privatisations, the pressures on ferry operators and the intense pressure on the national air traffic services—mean that we should have a national authority that stands outwith any of the existing structures. A national authority could ensure that it reported consistently and continually to Parliament, and could be seen to be doing its job. I believe that such an authority would be warmly supported by the general public.
Question put and agreed to.
Mr. Deputy Speaker (Sir Alan Haselhurst): Second Reading what day?
Mrs. Dunwoody: On 12 December, my birthday.
Bill ordered to be brought in by Mrs. Gwyneth Dunwoody, Mr. Brian H. Donohoe, Mr. Gwyn Prosser, Mr. Andrew Mackinlay, Kate Hoey, Mr. John Heppell and Mr. Nick Ainger.

National Transport Safety
  NATIONAL TRANSPORT SAFETY
  Mrs. Gwyneth Dunwoody accordingly presented a Bill to create a National Transport Safety Authority: And the same was read the First time; and ordered to be read a Second time on Friday 12 December, and to be printed [Bill 92].
Orders of the Day

  European Communities (Amendment) Bill
  Considered in Committee [Progress, 27 November].
  SIR ALAN HASELHURST[SIR ALAN HASELHURST in the Chair]

  European Communities (Amendment) Bill
    Clause 1

      MEANING OF "THE TREATIES" AND "THE COMMUNITY TREATIES"
      Amendment proposed [27 November]: No. 65, in page 1, line 12, at the end to insert the words
      'but (for the avoidance of doubt) not Article 1 of the said Treaty.'—[Mr. Howard.]
      5.29 pm
      Question again proposed, That the amendment be made.
      The Chairman of Ways and Means (Sir Alan Haselhurst): I remind the Committee that with this we are taking the following amendments: No. 13, in page 1, line 13, after '(i)', insert
      'Article 1 (other than paragraph 1)'.
      No. 14, in page 1, line 13, after '(i)', insert
      'Article 1 (other than paragraph 3)'.
      No. 15, in page 1, line 13, after `(i)', insert
      'Article 1 (other than paragraph 5)'.
      No. 17, in page 1, line 13, after '(i)', insert
      'Article 1 (other than paragraph 10)'.
      No. 18, in page 1, line 13, after '(i)', insert
      'Article 1 (other than paragraph 11)'.
      No. 19, in page 1, line 13, after '(i)', insert
      'Article 1 (other than paragraph 12)'.
      No. 20, in page 1, line 13, after '(i)', insert
      'Article 1 (other than paragraph 13)'.
      No. 21, in page 1, line 13, after '(i)', insert
      'Article 1 (other than paragraph 14)'.
      No. 1, in page 1, line 13, after 'Articles', insert
      '1, other than the words in paragraph 5, (Cm. 3780, page 9) "and through the establishment of economic and monetary union, ultimately including a single currency in accordance with the provisions of this Treaty".'.
      New clause 30—Extension of jurisdiction of European Court of Justice: legal advice—
      '.—This Act shall not come into force until Her Majesty's Government has obtained specific legal advice from the Attorney General setting out the extent to which the provisions on police and judicial co-operation in criminal matters in Article 1 para 11 of the Treaty of Amsterdam extend the jurisdiction of the European Court of Justice in the United Kingdom, such advice to form the basis of a report to each House of Parliament and to be subject to an affirmative resolution.'.
      New clause 37—Relations between European Union and WEU—
      '—The Government will not take any steps to foster relations between the European Union and the WEU with the view to the possibility of the integration of the WEU into the Union,
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      as contemplated by Article 1, paragraph 10 [Article J.7] of the Treaty of Amsterdam, without first tabling a motion in each House of Parliament which shall be subject to affirmative resolution.'.
      New clause 38—Common foreign and security policy—
      '—The Government shall not take any steps to participate in the decision making arrangements as set out in Article 1 paragraph 10 [Article J.13 1 and 2] of the Treaty of Amsterdam, without first tabling a motion in each House of Parliament which shall be subject to affirmative resolution.'.
      Mr. John Bercow: There is a real concern among Conservative Members that article F.1 of the treaty of Amsterdam is a device conjured up by supporters of European federalism to end the use of the national veto. To date, that real concern has been met by Ministers with a mixture of faint puzzlement and lofty disdain. Clearly, they do not comprehend our concern.
      The Minister will, I hope, recall that I promised him last week three examples which illustrate the basis of our concern. I had time to offer him two; I would like simply to conclude by providing the third. The two with which I dealt last week related to the minimum wage and to the possibility of a conflict between the attitude of other member states to the age of consent with that of the United Kingdom.
      The third example which I offer for the Minister's consideration is that of strikes in essential services. Let us suppose, for example, that a future Government were to decide to outlaw strikes in essential services. My concern—shared by a number of my right hon. and hon. Friends—is that under article F.1 of the treaty of Amsterdam, there is a danger that we could be had up by the institutions of the Community on the ground that we had breached a fundamental right or freedom. That concern is exacerbated or reinforced by the reference in article 1 to the
      "Fundamental Social Rights of Workers."
      Is there not a danger that that wording and that article could be used as an excuse to take action against this country and to strip it of its voting rights if its Government were to opt to ban strikes in essential services? Has the Minister considered the point? Has he obtained a guarantee from other member states that the article will not be invoked in that way? Can he say? Does he know? Will he share his view with us?
      Silence is no longer an option. We must have answers. I respect the fact that the Minister genuinely does not believe that this problem will arise—my anxiety is that it might. A prudent Government must guard against the possibility of that problem arising. The problem will not go away. It cannot be wished away. It cannot be pretended out of existence. I respectfully ask the Minister to take account of our concern and to seek to respond to it. I have no doubt that other right hon. and hon. Members will reiterate the concern during the debate. I ask him to respond to them and, in the first instance, to me.
      Mr. Kenneth Clarke: This debate has run on for some time, and I have sat through quite a lot of it. I read the remainder of the debate—which, unfortunately, I had to miss—before this debate restarted. I propose to make a short speech, as we have gone on for some hours.
      I note that I was quoted earlier—I think with approval—as having said that I did not think there was any great reason to get very excited about the treaty of

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      Amsterdam, which did not seem to me to have made any fundamental changes. Indeed, I was rather disappointed by the treaty of Amsterdam. Certainly, there are people on the continent of Europe—who, no doubt, are more pro-European than me—who think that the outcome of the proceedings at Amsterdam was a triumph for British caution at the expense of those who wish to go for European integration at a faster rate.
      I have always thought that it was a mistake to insert in the treaty of Maastricht a binding commitment to hold an intergovernmental conference at a set time. The aftermath of Maastricht showed the great dangers that Governments in Europe faced in trying to go for great institutional reform ahead of public opinion. A certain flexibility in the timing of the inevitably necessary intergovernmental conferences might have been of value.
      I voted against the Second Reading of this Bill because I have two great objections to the treaty of Amsterdam. First, it contains references to the agreement at Amsterdam that we would accept the social chapter and waive the opt-out negotiated so carefully by the previous Government. Secondly, I do not believe that Amsterdam remotely faced up to the problems of enlargement. It was so unsatisfactory for those of us who attach great importance to the enlargement of the Union to include more and more countries from central Europe. The result is that a great deal of business is left undone.
      I would like to make a full speech about the social chapter, but I have made my views clear on many occasions. I simply wish to record that I think that subsequent generations will bitterly regret that we exposed ourselves to the risk of introducing into the British economy provisions on labour market regulation which might increase the cost of employment in this country. We derive considerable advantage from the opt-out negotiated by my right hon. Friend the Member for Huntingdon (Mr. Major) at Maastricht. It has been one of the marked differences between the British and the European economies in recent years.
      We have been able to combine strong economic growth with the creation of new employment. The principal reasons for the tragically high levels of unemployment across the remainder of the continent, in my opinion, remain the inflexibility of labour markets there and the inheritance of social legislation which causes great difficulties when the prospect of new jobs arises.
      By waiving the British opt-out from the social chapter, the British Government have done a great disservice to many people in other member states. The climate of opinion was steadily moving in our direction across Europe. I encountered many German, French, Spanish and Italian employers who agreed that the British model was better for the creation of employment, and that the burden of social legislation—which, in most cases, had been implemented by their national Governments, although some was implemented as a result of European directives—was a serious disadvantage to them.
      The argument was going our way, and I am afraid that the British accession to the social chapter is likely—for a short time, at least—to give a fresh breath of confidence to all those who adhere to an older model of how an employment market should be regulated. We will have difficulty in fighting off Padraig Flynn and his directorate
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      as fresh proposals are made, because it is believed that we are back on the old agenda which ought to be discredited—that social legislation is somehow the way of providing more security in employment to people in the modern world.
      My second objection is that Amsterdam failed to tackle the problems of enlargement. As I have said, I think that the enlargement of the Union is one of the great objectives for European politicians in the next few years. The most dramatic events of my political life—the first was before I came to this House—were the erection of the Berlin wall, which symbolised all that was worst about the division of Europe, followed by the moment I never expected to live to see; the demolition of the Berlin wall by the citizens of Germany, symbolising the end to the division of Europe.
      As the European Union is one of the ways in which we strengthen our commitment to liberal democracy, human rights, the free market economy and the principles that we hold dear, the sooner we reinforce the reunification of Europe by admitting into the EU those countries in central and eastern Europe which steadily become ready for it, the better.
      We cannot simply enlarge the present Union without tackling serious policy and institutional problems. Policy problems are to be dealt with under a separate heading. It is plainly necessary to reform the structural funds and the common agricultural policy.
      I strongly support the German, Dutch and other politicians who say that, when enlargement is attained, the enlarged Community should have a budget limited to 1.27 per cent. of gross domestic product, as at present. That accelerates the need for reforms that were in any case desirable in the interests of the present members of the Union. That matter will be addressed at another time.
      Institutional change has to be made, touching on the size of the Commission, weighted voting for majority voting, and other matters that we shall have to return to at an intergovernmental conference. I voted against Second Reading because I object to the social chapter, and I am disappointed by the outcome on institutional reform.
      Mr. Roger Casale: The right hon. and learned Gentleman mentioned the importance of human rights in the context of European integration and enlargement to include eastern and central Europe. Does he agree with the shadow Foreign Secretary, who objected to the way in which human rights clauses were to be incorporated, referring especially to the importance of procedures for triggering sanctions in cases of human rights abuse? Surely it is crucial that, when we enlarge to include countries in central and eastern Europe, we anchor those countries' commitment to human rights.
      Mr. Clarke: I intended to comment on that, so I am happy to do so in response to the hon. Gentleman. I listened to my right hon. and learned Friend the Member for Folkestone and Hythe (Mr. Howard) last week, and I entirely share his commitment to human rights, in every ordinary sense of that phrase. He went out of his way to emphasise the fact that no one in the Conservative party challenges the principles of human rights, the need to protect individual liberty and free speech, and the right to demonstrate, to have parliamentary democracy and to be governed by the rule of law. There is no division in our party on those principles.

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      I agree that, as the Community is enlarged, we must consider what happens if any member state acquires a Government who fall short of those fundamental standards. That involves not only new members. One of the reasons why we admitted Greece was to reinforce the change that had taken place there, with a return to parliamentary democracy and a proper standard of human rights.
      We have never known what would happen if, tragically, the Greek colonels were to return to power, or if some military regime were to take over in the Iberian peninsula. The idea of that happening in Portugal or Spain may be utterly fanciful these days, but it is legitimate for the treaty to consider the possibility.
      If we enlarge into eastern and central Europe, where the tradition of stable democracy is hardly well established, some protection will be required. I believe that article F.1 is an acceptable part of the treaty. My right hon. and learned Friend shared my analysis but suggested that the matter should be tackled in some other way. As I understand it, he objected to the treaty rights of a member state being taken away if it remained subject to the treaty obligations, but I can envisage that being an attractive response.
      I do not see why, if a military regime has taken over a country in eastern or central Europe, it should be released from the obligations, or why we should sever our trading contracts and the policing of those contracts by the European Court, simply because we disapprove of the Government; but I would strongly object to a Government who were not respecting human rights casting votes at the Council of Ministers, and perhaps blocking action, when vetoes were the order of the day, without effective action being taken to stop them.
      It is difficult to say with certainty that the procedures will ever be invoked, because every relevant situation that arises will in itself be a political crisis, and will have to be responded to according to the facts of the case, but I personally have no objection to article F.1.
      The fear is raised that the article might be totally abused, to remove the veto of the Government of a member state with a satisfactory record on human rights, but with some peculiar social provision that could be described as a breach of human rights. Anything is possible in international relations, and in debates on the treaty of Rome, the Single European Act 1985, and the treaty of Maastricht, I have heard some pretty fanciful suggestions about what might occur, but the provisions of the treaty envisage the clause being invoked only by the unanimous vote of all member states, except the one whose conduct is under examination, ratified by two thirds of the Members of the European Parliament.
      5.45 pm
      There is nothing in the treaty that allows me to turn to my hon. Friend the Member for Buckingham (Mr. Bercow) and say that what he fears is absolutely legally impossible, but when I consider the dangers of having a military regime inside the Union at some time in the future, I am prepared to say, as a matter of political judgment, that I do not think that anyone will deprive the United Kingdom of all its voting rights and leave it bound by the treaty obligations because, in the opinion of the heads of state of 14 other member countries, our refusal of the right to abortion on demand, or some such matter, is a breach of human rights.
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      One must consider the risks in both directions, and I personally share the alarm of those who were at Amsterdam about the lack of any provision in the event—again, we hope that it will never happen—of some member state being governed by a regime that is in breach of fundamental human rights.
      Mr. Robert Jackson: It has been suggested that it would be preferable to expel a member state rather than suspend it in those conditions. Does my right hon. and learned Friend agree that the legal complexities, and the consequences and ramifications, of expulsion of a member state, including the suspension of contracts and the possibility of actions arising therefrom, would be so great that, in effect, the sanction would become a useless deterrent, whereas a suspension in the conditions that he has described would provide a relatively effective redress?
      Mr. Clarke: I am inclined to agree with my hon. Friend. In practice, if some military regime seized power and started abusing human rights, article F.1 might not be the end of the story. The European Union could not tolerate the situation indefinitely.
      My right hon. and learned Friend the shadow Foreign Secretary suggested that the proper course would be expulsion, but I agree with my hon. Friend the Member for Wantage (Mr. Jackson) that we would then have to consider whether to sever trading relations or renegotiate them and what would happen to existing contracts, and so on. I understand the fears about the article, but they do not seem to me to be totally credible.
      The European Court of Justice always causes a certain agitation in the House. I was glad to hear my right hon. and learned Friend the shadow Foreign Secretary and my hon. Friend the Member for Stone (Mr. Cash) confirming that the European Union needs a strong and effective court of justice. It is impossible to have a single market in the European Union, with trading taking place on a fair basis, with the nations subject to the same obligations and specifications, including open access to markets and freedom from state subsidy—all of which we want—if there is absolutely no means of enforcing the rules.
      In Britain, we labour under what I believe is a slightly exaggerated notion that we are the only ones who obey any of the rules, and that they are systematically broken throughout the rest of Europe. That perspective can be taken only on this side of the channel, but we do, indeed, bind ourselves by the rule of law and our treaty obligations, and we are entitled to expect that those in other states will do likewise. That is why we in this country go to the European Court of Justice with such persistence, and that is why we win most of our cases when we do so. That is why we shall have no redress against complaints of unfair trading, breach of treaty obligation and so on if the European Court of Justice is diminished. On that, I trust, we are now all agreed.
      I shall not discuss specific judgments. In my surgery, I frequently meet disappointed litigants whose confidence in British justice has momentarily dropped because, unfortunately, they have lost a case before the High Court of Justice or the Crown court. I always listen with great sympathy. They are usually going to the Queen, they are going to the Pope after that and they are usually going to the European Court of Human Rights to get a finding of fact reversed. Recently, we lost one or two cases that I,

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      as a Minister, was anxious for us to pursue, but I do not judge a court on the basis of whether we have won every action there. On the whole, we have used the European Court of Justice to considerable advantage.
      Mr. William Cash: Will my right hon. and learned Friend give way?
      Mr. Clarke: No. I see that I am in danger of being drawn into the details of individual litigation. I will do that on another occasion.
      Mr. Cash rose—
      Mr. Clarke: All right—I give way just once.
      Mr. Cash: Does my right hon. and learned Friend concede that, although some of us accept the idea of a court of justice with limited functions, objections are made to the expansion of the court not only because it tends to go into judicial—and even political—activism, but because the functions that have been conferred on it under the process of continuing treaties, in the continuous rush towards ever closer union, are creating a situation in which the court is becoming a supranational body with power over areas of governmental activities, including economic and monetary union? That is the problem that many of us have with the European Court of Justice. If its powers were more limited, it would be more acceptable.
      Mr. Clarke: I do not agree with that. We use the European Court of Justice and it seeks to reach its decisions judicially.
      I will not be drawn into my full comments on the European Court of Justice. One of the dangers that makes all the court's judgments unpredictable is that it is usually required to interpret treaties, regulations and directives that have been somewhat carelessly drafted.
      The decision-making process in Europe has been experienced by quite a few of my right hon. Friends, and it is less than perfect. I have probably taken part in more Councils than most people still alive, and I am used to late-night decisions being taken on texts, hurriedly exchanged between officials, looked at by Ministers and wrangled over in the Council. Anything that gets agreement is published, on the basis that it will be sorted out later. All too often it winds up before the judiciary in the European Court of Justice, who are expected to give some expression of what the draftsman of the regulation intended. As, at the time, different Ministers went out of the meeting and addressed their national press, each claiming that they had achieved a totally different type of triumph at the expense of the other, that can be difficult to resolve. That lies at the root of most of the problems.
      The idea that the court is supranational has always been established and was accepted as part of our membership. It has been known for 25 years—ever since we entered the European Union—that legislation of individual national Parliaments can be set aside if it is inconsistent with a judgment of the European Court. I remember it being fiercely debated for days on end in the House of Commons soon after I entered the House. The idea that we supposed that we were entering only a trading arrangement is one of the great myths of our time.
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      I believe that the European Court serves its purpose quite well. The British win more cases than we lose there. We should use it more often in future. However, I strongly agree with the points that my right hon. and learned Friend the shadow Foreign Secretary made about our proposals for the European Court of Justice.
      In my views on the European Union, I am not a starry-eyed idealist; I have seen it at far too close quarters for that. There are countless defects, not only in the decision-making process but in many of its institutions. The previous Government carefully prepared a lot of propositions for improving the workings of the European Court of Justice and protecting all member states against judgments that could have horrendous implications.
      We wanted to limit the retrospective nature of judgments. As Chancellor of the Exchequer, I was extremely worried about the constant challenges that were made at the European Court to the scope and incidence of our VAT because, whereas in this country we have imposed limits on how far back in time such claims may extend, in the European Court, judgments might be awarded undoing the imposition of VAT all the way back to the introduction of VAT. Several countries risked billions of pounds of damages.
      We also wanted to introduce a principle that member states were liable for compensation only in cases of serious and manifest breaches of their obligations.
      We wanted national time limits to be respected when people brought actions before the European Court. That was not Euro-sceptic or Europhile. It was an extremely constructive approach to improving the workings of the European Court. It is no good dismissing what my right hon. and learned Friend the shadow Foreign Secretary said as though it was a frontal attack on the European Court; it plainly was not. Astonishingly, the new British Government, who I trust were advised—we cannot inquire about their advice—about the point of all those changes, appear to have abandoned them when they reached Amsterdam.
      We had allies on that point. I may have had a biased view because I was attending ECOFIN, but I assure the House that Finance Ministers were rather enthusiastic about limiting the scope of the court's judgments. We have never had a satisfactory explanation of why those arguments were not pressed. I believe that those objectives could have been attained and it is a serious weakness that none of the arguments was advanced.
      I understand the concern that my right hon. and learned Friend the shadow Foreign Secretary has about the ECJ and the home affairs pillar. I agree with him that the pillared approach of Maastricht was one of the best features of the Maastricht negotiation. In my opinion, the only proper way to proceed on foreign affairs and security and on home affairs was on the basis of intergovernmental co-operation and not using the institutions of the European Union. That was the best feature of the Maastricht treaty; it has led to some progress, and I would defend the pillared approach.
      The pillared approach appears to have been encroached on marginally by giving the ECJ some jurisdiction in that area. If there are conventions and so on under the home affairs limb, it is necessary for someone to resolve disputes about their meaning, but we should be very cautious about the implications, and I trust that the jurisdiction of the ECJ will not be extended further into other pillared areas.

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      The failures at Amsterdam included not only the apparent adoption of the social chapter by everyone, but the failure to make any proper institutional reform. The Government failed to get any progress on what the weighting of individual member countries' votes would be in weighted majority voting. I have long believed strongly that qualified majority voting cannot continue on the present basis, whereby votes in an electoral college are given to individual member states rather arbitrarily, in a way that bears no relationship to their population.
      That matter was raised by my right hon. Friend the former Prime Minister during the Greek presidency. When he returned to the United Kingdom, he took a lot of abuse for raising it. He was obliged to accept that the matter would be postponed until the Amsterdam conference so that we could not be accused of excluding the Scandinavians and others from membership; and then nothing was done at Amsterdam.
      The bigger the European Community gets, the more necessary it becomes for states like our own to ensure that any risk of QMV is based on a weighting of votes that reflects the position of individual member states. The present voting system gives rise to the possibility that small states will be given overweening power; that position is not sustainable. We are drifting towards a situation where, if many more states enter the European Union, we might have Germany, Britain and France, or Germany and Britain, or Germany, Britain and Italy voting together and being voted down by the combined weight of all the other member states, despite the fact that, in population terms, nothing like an adequate majority had been achieved.
      We must address the size of the Commission, which is far too big. It is absurd. If the Community gets bigger—for example, if we take in micro-states such as Malta if the Maltese resume their application—we cannot have a Commissioner from every member state. We should not have two Commissioners from the bigger states. We should have rotation between states with the right to nominate Commissioners.
      People complain about the overweening power of the Commission; I believe that the power of the Commission is waning. The power of the Delors Commission will turn out with hindsight to have been the high watermark of the Commission. We are moving to a Union based more on the power of the Council of Ministers, subject to the democratic checks of the European Parliament and national Parliaments.
      The problem is that the more Commissioners there are, the more they try to do. There is the continual attempt to extend their competence and jurisdiction to areas where subsidiarity should prevail. That problem should have been tackled at Amsterdam; it will have to be tackled again.
      6 pm
      I realise that many of the speeches by my colleagues in the debate have not always taken exactly the same approach as mine—[Laughter.]— although I have shown that there is quite a lot of common ground between us. Listening to the concluding remarks of my hon. Friend the Member for Buckingham, I realised that he remains concerned about this commitment to an ever closer Union, which appears again in the article under discussion, as amended. I have already made it clear that the European
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      Union has for 25 years been a political as well as an economic endeavour. This House committed itself to ever closer union in the debates that I attended in 1972, when the implications were debated at inordinate length.
      The process of ever closer union will continue, but it is a mistake to think that that means a united states of Europe, or that it is a threat to the power of the nation state. A united states of Europe is no longer contemplated by any of the members of the EU. 1 remember in my younger days meeting the founders of the Union, who actually believed in the blueprint: the Commission would become a European Government, the Council of Ministers would be a senate, and the European Parliament would be the European House of Commons. I believe it was that idea to which my right hon. Friend Baroness Thatcher emphatically said, "No, no, no." If my recollection is right, I say no, no, no to that too. It is a dead blueprint; no one pursues it any longer.
      Since we joined in 1972 when all these fears were first raised, in my judgment this country has become a more powerful nation state and more respected around the world, with more influence than it formerly had. We have built on our membership of the Union and have become a more successful and self-confident nation. But we live in the modern world, where the political interdependence of nation states will grow ever stronger; where the power of each and every nation state in Europe will increasingly depend on our ability to act collectively; where we have common interests that reinforce our influence; and where our economies are going to become ever more integrated whatever Governments want, or do not want, to do about it. We are moving into a free trade, integrated global economy—and I welcome that.
      What we need to retain—and what the Government are losing—is influence over the direction of this process. If we detach ourselves too much from what is going on, we shall lose our influence on the environment in which our political power and economic well-being can flourish. I read of the Chancellor's dismay at the fact that the other member states propose to proceed with an informal Council of Economic Ministers and may not let him attend. I share the Chancellor's view; I spent my time arguing with colleagues on ECOFIN that such a Council should not be created. I am not surprised, however, that the right hon. Gentleman has failed. Once he had made his statement that was supposed to clarify his approach to economic and monetary union; once it was obvious that he had done no such thing; once it was obvious that he had put off making any definitive decision, because hard choices are what the Government talk about but do not make readily; once all this had happened, I could sense the influence of the Chancellor weakening when he returned to Europe. He cannot ask to sit on the new informal Council and influence its decisions but also say that he has to go back and consult Alastair Campbell, Rupert Murdoch and perhaps even the Prime Minister to find out whether he can seriously commit this country to joining once the economic conditions are right.
      This is an illustration of how, if we do not take clear decisions based on hard choices, when the circumstances eventually are right, British influence will be damaged. I do not say that it will be damaged by Amsterdam, which is a mouse of a treaty compared with what the people who first thought of the IGC intended. It has some good and some bad features. Among the latter was the failure to get the right deal on the European Court. I strongly agreed

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      with the criticisms in that respect levelled by my right hon. and learned Friend the Member for Folkestone and Hythe.
      Several hon. Members rose—
      The Chairman: Order. I should like to assist the Committee. This is a wide grouping of amendments, but it is not infinitely wide. I sense that the Committee is in danger of repeating the Second Reading debate, which would be out of order. I remind hon. Members that there is a debate arranged for Thursday, when it will be possible to roam far and wide on the subject of the European Union.
      The other danger is that some of the speeches already made on this group of amendments are more pertinent to later groups. That will obviously influence the attitude of the Chair to the length of those future debates. I would therefore ask the Committee to bear it in mind that I have tried in my selection of amendments to allow every aspect of the Bill to be discussed in an orderly manner; and it would assist the flow of debate if the Committee kept strictly within the terms of each group of amendments.
      Mr. David Prior: I am and always have been a pro-European. I have worked in almost every country in Europe; I have bought and sold products in every country in Europe; and I have run a business in Germany. I believe in free trade, in breaking down tariff barriers and in removing state aids, but we have a long way to go in practice before we can genuinely say that we have created a single market in Europe.
      One has only to look at a set of Italian accounts, or to try to sell a product in southern Italy, to know that we have a long way to go before we reach a true single market. It is because I am pro-Europe that I am opposed to article 1 of the treaty of Amsterdam, and opposed to the monetary union foreshadowed in it.
      I agree with my right hon. and learned Friend the Member for Folkestone and Hythe (Mr. Howard) that the treaty of Amsterdam marks
      "an unnecessary move towards further integration of the European Union. It contains a series of measures that transfer power to Brussels from the national parliaments".—[Official Report, 27 November 1997; Vol. 301, c. 1138.].
      The treaty raises two issues that go to the heart of the European question. First: is the Conservative vision of Europe as a community of independent states compatible with the treaty and with monetary union, or is the treaty compatible only with the Government's vision of a Europe of the regions? Secondly: is the economic and industrial playing field being created in Europe, inspired as it is by a corporatist and dirigiste ethic, good enough to be competitive with north America and Asia in the future?
      I shall deal with the first point first. The Conservatives have always focused on trade. Whether it was the European Coal and Steel Community, the Common Market or the Single European Act, our focus has been on trade—although I agree with my right hon. and learned Friend the Member for Rushcliffe (Mr. Clarke) that there has always been a political dimension to Europe as well—but we in this country have not stressed that dimension as much as we should have for the purposes of a truly fair
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      public debate. Indeed, we have played down the loss of sovereignty inherent in the moves afoot in Europe. Under this treaty, with the extension of qualified majority voting, the increased powers of the ECJ and the foreshadowing of a common defence and foreign policy, the political aspects of Europe become more explicit.
      I believe that we are arriving at a watershed. No longer can we pretend to our constituents that Europe is solely about trade, because it is not. We must be more honest and accept that there is a sizeable political dimension to our continued involvement in Europe.
      Mr. Ian Taylor: My hon. Friend is right to say that the politics may not have been stressed enough in public debates, but one of the key achievements of Margaret Thatcher as Prime Minister was her realisation that qualified majority voting was essential in the about-to-be created single market to overcome the protectionist instincts of any one nation. She realised that it was vital to Europe's wider interests that there be no national veto in the single market—which I am sure is why my hon. Friend the Member for Stone (Mr. Cash) voted in favour of the Single European Act.
      Mr. Prior: I, too, am in favour of the Single European Act, but when the Chancellor of the Exchequer says that monetary union will involve some pooling of economic sovereignty, that statement is disingenuous. I believe that monetary union goes beyond that. That view is not necessarily wrong, as I accept that there are different views on Europe, but monetary union goes way beyond some pooling of economic sovereignty.
      The combination of Amsterdam and monetary union provides the basis for a single European state, and that is what the debate should be about. Although my personal views are against that, it is the nub of the issue that we should be debating. It would be a tragedy if, in the discussions on monetary union, we were diverted into a narrow debate about convergence criteria, and so on. We would be doing the public a great disservice.
      Nothing could be more dangerous to this country than if the British public went into closer political union without fully understanding the facts, and that is what they are doing. In those circumstances, political union would unquestionably be damaging to Europe.
      My second point is the economic one. In 1972, when we joined the Common Market, the continental systems had performed extremely well for 20 years. There is no doubt that, despite the high levels of state ownership and the more dirigiste approach to managing their economies, they were extremely successful That was before the general agreement on tariffs and trade had largely opened up free trade, before the globalisation of business and the capital markets, and at a time when the western economies were still pre-eminent technologically.
      That has changed. Over that period, America has re-emerged as probably the great dynamic economy in the west. The UK's economy, as well, was transformed during the 1980s and 1990s. I would be the last person to write off the continental economies. No one who has seen Germany, France and Italy would dream of doing that; they still have very strong engineering and manufacturing bases. Nevertheless, to tie ourselves irrevocably into the continental social system at this time could prove to be a great mistake.

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      On both political and economic grounds, this is a bad treaty. It is a clear departure from the popular notion—albeit not the notion inside the House of Commons—that the EU is first and foremost about trade. Lastly, it will make Europe a more difficult place in which to do business.
      Mr. Desmond Swayne: At the Committee's previous sitting, the hon. Member for Harlow (Mr. Rammell), who unfortunately is not in his place, suggested that the defeat that the Conservatives suffered on 1 May was a consequence of the events of September 1992, and our inability to control our interest rate in what he called
      "a global international currency situation."—[Official Report, 27 November 1997; Vol. 301, c. 1169.]
      In some respects, I agree with the hon. Gentleman, but I want Labour Members to consider what would have happened if, instead of entering an exchange rate mechanism, we had been bound into a full currency union, and therefore were unable to take the escape route that we took—unable to reduce interest rates and make the best of the remaining four to five years to bring about an astonishing recovery. Had that not been possible, what vengeance might the electorate have wreaked? Perhaps Labour Members might learn from that experience.
      The hon. Member for Harlow went on to complain about the sentiments expressed by the Opposition, which he called "xenophobic rhetoric". I do not know how tightly one should define the word "xenophobic", but it was not my experience that the arguments advanced by Conservative Members were xenophobic in any sense. However, the hon. Gentleman is a reasonable man, and if he wishes to call such sentiment xenophobic, that is his right, although we would disagree.
      The hon. Member for Harlow may not have realised how grave an accusation he made, as the treaty goes some way towards outlawing such sentiments. The hon. Gentleman may believe that the sentiments expressed were xenophobic, but I am sure that he would also believe that we have every right to express them. That is not a point of view consistent with the treaty. Labour Members should consider voting for amendment No. 65 on precisely that ground.
      6.15 pm
      Mr. Bercow: Does my hon. Friend recall that, when the hon. Member for Harlow (Mr. Rammell) was invited to cite a single example of a xenophobic statement during the Committee's deliberations, he could not produce an example?
      Mr. Swayne: I thank my hon. Friend, as I had indeed forgotten that. It is pertinent that I should be reminded.
      I draw the attention of the Committee to article 1 of the treaty, which replaces article B of the Maastricht treaty. It states:
      "The Union shall set itself the following objectives:".
      I draw particular attention to the fourth objective:
      "To maintain and develop the Union as an area of freedom, security and justice, in which the free movement of persons is assured in conjunction with appropriate measures with respect to external border controls, asylum, immigration and the prevention and combating of crime."
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      Attention has perhaps rightly focused on the abolition of border controls and the so-called flanking measures, whatever they might be. The United Kingdom, of course, has an opt-out, as is made clear in the protocols. Despite that, I find it difficult to believe that we will escape being drawn into some centralised process of interference in our administration of justice and law.
      That is precisely because of further provisions. I draw the attention of the Committee to article K.1, which states:
      "Without prejudice to the powers of the European Community, the Union's objective shall be to provide citizens with a high level of safety within an area of freedom, security and justice by developing common action among the Member States in the fields of police and judicial cooperation in criminal matters and by preventing and combating racism and xenophobia."
      Now we realise the gravity of the accusation made by the hon. Member for Harlow. How long will it be before my hon. Friend the Member for Stone (Mr. Cash) is arraigned before some court for xenophobia? How long will the teaching of history in our schools be secure from those who would revise it and interfere with it to exclude xenophobic tendencies?
      The most important question is what on earth that has to do with a treaty that deals with the development of Europe along the lines that the Government have suggested. Where is the need for common action among all the member states on such activity? Why is that not left to individual member states? What became of the principle of subsidiarity?
      The answer is in the treaty. The fifth objective set out in article 1 makes it clear what the attitude to subsidiarity shall be henceforth. It will be
      "to maintain in full the aquis communautaire and build on it with a view to considering to what extent the policies and forms of cooperation introduced by this Treaty may need to be revised"
      That is as far as we seem to be able to go on subsidiarity.
      We are talking not of bland statements or of flowery words. Instead, we are dealing with legal documents, which will be interpreted as such. They must, therefore, be tightly defined and coded.
      There is a great danger that the treaty creates a means by which the European Court of Justice—certainly article K.2 is fully justiciable before the ECJ—can extend its jurisdiction into the administration of criminal and civil law in the United Kingdom. That is precisely the process that took place in the United States with the 14th amendment after the civil war, which required that the states give equal protection to citizens under the law. That was an entirely unobjectionable amendment, but it gave the federal supreme court the ability to exercise huge jurisdiction over state law. It led to a great advance in federal achievement in the United States. That is fine if one is looking for that sort of development in Europe.
      The article calls for an area of freedom and justice that affords a high level of safety and protection to the citizen, and I fear that it will create the 14th amendment for the European Union. I urge the Committee to vote for amendment No. 65.
      Mr. Howard Flight: The debate is important because it does not turn on a small, minor item that the approval of the treaty of Amsterdam represents. As my right hon. and learned Friend the Member for Rushcliffe (Mr. Clarke) said, we are talking of a step down the path towards European integration.

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      It is interesting that no one is clear about the form of political integration. Will it be the United States federal model or a relatively undemocratic model that is run by the Commission? As my right hon. and learned Friend suggested, will it be a new model that will activate the power of the European Parliament? It is clear that we have reached a significant stage.
      The treaty provides for universal, including British, membership of the social charter. As my hon. Friend the Member for New Forest, West (Mr. Swayne) said, the extension of powers to the European Court of Justice gives the potential power of veto over United Kingdom criminal law as well as creating the framework for a European model of the United States supreme court. The harmonisation of civil law must mean for citizens of the United Kingdom the erosion of UK common law. The progressive framing of a common defence policy, wherever that leads, is, self-evidently about attempts to pull together European defence activities.
      Included also is the introduction of citizenship of the Union. As we know, everything to which I have referred is accompanied by other outside measures involving tax harmonisation.
      Right hon. and hon. Members may claim that the House of Commons has known that Britain embarked a long while ago on the course of integration into a European state of some sort, which must mean inevitably the ending of the nation state as we have known it. It is clear, however, that the nation has scant awareness of that process. That leads me to ask why there is hiding and deceit. Why is it pretended that the treaty represents a little something that does not matter much? Why is it that the newspapers and other sectors of the media do not more clearly bring to the attention of the British public the fact that we are faced with a sequential stage? I am understanding of those who wish that to be, but it is astonishing that the citizens of the United Kingdom do not understand that that is what it is all about and that that is the path down which we are going.
      I warn the Government and others who wish to advance down the path to which I have referred that, because citizens do not understand and have not been fully educated, there will be a major nationalistic backlash, when they suddenly realise where the treaty is leading us. We shall then be locked up in xenophobia.
      The provision for a single currency is crucial. The other issues on which I have touched can ultimately be abrogated by a future United Kingdom Government, but inclusion of sterling in a single currency would be much more difficult to reverse than other processes.
      It is still a controversial issue with some that a single currency is clearly to be accompanied by the harmonisation of taxation. We are all to sign a code committing ourselves to such harmonisation and it is inconceivable for any major currency—a fiat paper currency—not to have the backing of some form of single state. It would be impossible ultimately to pledge the assets of such an area, or even to manage that currency in the event of a major crisis, without there being at the back of it the concept of a single sovereign state.
      Cross-subsidies would not be possible to organise without central power in some form of a single state. The two issues to which I have referred go hand in hand.
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      It is not a matter of Ireland having been able to have its punt managed in line with sterling in the past. After all, Ireland is a very small economy.
      I wish to focus on the economic arguments. It is self-evident that a single currency means the loss of ability to manage our own interest rates. There will be the loss of an independent exchange rate. As I have said, powers will be lost to pursue tax policies and tax rates.
      Let us think of an economy that is facing serious problems. Let us consider the problems that are likely to spread round the world because of what is going on in Asia. The individual Governments of the surviving nation states in Europe will have lost virtually any individual power to manage their own affairs. That seems likely to cause major political problems and major nationalistic reactions.
      I move on to the case study analogy of united Germany. Much has been said about the reunification of Germany, but there are some crucial points to bear in mind. Two economies have been put together—east and west—with entirely different capital stocks, work habits and skills. The east of Germany has on average a productivity level that is about 35 per cent. below that of western Germany. The rate at which things started does not matter because that represented about the value of east German savings.
      I predicted at the time that German firms would be looking to Czechia, Hungary and Poland for investment, not to eastern Germany. Indeed, they looked to Britain as well. What has happened to eastern Germany? The answer is virtually permanent stagnation. It cannot compete with economies with much cheaper currencies to the east. It cannot compete either with the superior west German economy. That is what is happening in one country with one language with a fair degree of labour mobility. At the same time there is a major fiscal burden on the west German economy in subsidising the east German economy.
      My fear is that one can apply that case study Europewide. Anyone who believes that a single currency can be operated without an increase in cross-subsidisation is living in a world not of this planet. From where is the cross-subsidisation to be raised? Who will pay for it? Who will take the political decisions? I cannot see any Government winning an election here or in Germany on a ticket of putting up taxes to give greater cross-subsidisation to Italy, Spain, Greece, east Germany, or wherever. I fear that a substantial undemocratic element will be involved.
      Sir Raymond Whitney: Do my hon. Friend's concerns, which, on the whole, I do not share, about the possibility of Britain joining the single currency lead him to conclude that we should never in any circumstances join a single currency union, whatever the impact on Britain, because of the fundamental objections that he sees? Therefore, it is not a question of postponing a decision for five years, 10 years, or whatever; it is a question of saying never.
      6.30 pm
      Mr. Flight: Clearly, joining the single currency means surrendering the existence of the country as a nation state. It means giving up a considerable amount. If we are to give up such an amount, the argument has to be

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      powerfully in favour economically. I assert that the argument is, if anything, negative economically. It is certainly negative in terms of economic cycles being out of sync and, if anything, becoming more so. If one is to sell one's birthright, do not sell it for an economic mess of pottage. It is worth selling only if there are economic gains to be had.
      Mr. Ian Taylor: My hon. Friend has raised an interesting point. If not for a mess of pottage, for what would he sell his birthright?
      Mr. Flight: Like all Conservatives, I am ultimately a pragmatic person. Who knows what the circumstances will be in the future? There is no case for selling our birthright in the immediate future. One of the things that has most worried me is that the provisions of the Maastricht treaty for coming together are a completely wrong measure of the economic homogeneity that is needed for a common currency to work.
      Even America, since the civil war, has had the problem that the deep south—anyone who has been there will know this—has remained a relatively depressed area. It was a backward plantation economy and has never really got off the ground.
      Mr. David Curry: Georgia?
      Mr. Flight: The deep south, Sir. Certainly not Georgia, which is the mid-south.
      The issue is that, if economic regions that are insufficiently economically homogenous are put together, it will cause major problems. The less successful areas will become worse. One then has to choose whether to subsidise them. If not, unemployment will rise on a massive scale. Considering when or whether this country should sell its birthright is a serious issue. The Maastricht criteria are by no means a measure of adequate economic homogeneity.
      The second crucial point that I wish to make was made substantially by my right hon. and learned Friend the Member for Rushcliffe. Does the single currency encourage or discourage areas of Europe to adapt their economies towards economic success, towards competing with the new emerging parts of the world, towards the new world of free trade and free global flows? I do not see any evidence of that whatever.
      For nearly a decade, there has been talk of setting up private sector pension funds. What has happened? Scarcely anything. A major problem, of huge unfunded debt, has not been addressed. What has been done to remove barriers to employment? What has been done to lessen the 40 per cent. employment taxes that keep people out of employment, and price people out of jobs? Absolutely nothing. It is Europe's priority, in terms of its own good in the world, as well as in terms of creating the single market, to address those items. For too long the excuse has been given, "You can push those under the bed; the single currency will do everything." The single currency will worsen Europe's economic problems, not solve them.
      Thirdly, I shall talk about the role of the euro as a world currency reserve. I see a very great danger, because, to a large extent, there is an element of resentment and jealousy in wishing to compete with America, which is
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      the leading world power and owner of the reserve currency, and in the desire to compete with and perhaps even overtake it. If one follows policies that are designed to achieve a strong, hard reserve currency, where one is running a substantial external surplus, one runs the risk of slipping into the very problems that face Japan. A country can have a substantial reserve currency only if it is in regular deficit, creating the external ownership of the currency, which others can buy, hold and trade among themselves. I severely warn Europe and the Government that, if that is the way in which the European central bank goes, there is a danger that Europe will face the same problems in a few years that have faced Japan this decade.
      I conclude by making the essential point that the Committee should vote for the amendment, because at its heart is the single currency, and because it is a serious stage down the path of European political integration. That is something of which this country has little or no knowledge, which perhaps the House of Commons or others have deliberately concealed from it. It is time that the people of this country knew where we are going, what is involved and what the risks are and were free to express what I believe to be their view—that they do not wish to lose their nation statehood.
      Dr. Julian Lewis: I wish to touch on three topics—two briefly and one in more detail. I shall say a few words about economic and monetary union, then a few words about the human rights provision of article F.1 and, finally, and in more detail, I shall speak about a common foreign and security policy.
      On economic and monetary union, I have no difficulty with the intervention made by my hon. Friend the Member for Wycombe (Sir R. Whitney). I believe that, in principle, a single currency is wrong. It will not work and I cannot envisage any circumstances in which I would support our joining it. However, there is always the possibility that all one's predictions in economic and political forecasting may be proven by events to be wrong.
      If, over a decade, everything that people believe—as I do—is wrong with the single currency were tried out by other countries in the European Union and, against all our expectations, all our fears were shown to be groundless, we would have to admit that we were wrong, but we do not expect that to happen. That is why it is possible for people who believe—as I do—that we should never join the single currency to live quite happily with the formula propounded by the Conservative Opposition: that we should oppose the single currency in this Parliament and the next.
      Even someone as certain as I am that the single currency will prove to be a disaster for the countries that enter into it would have to admit that we were wrong if at the end of this Parliament and the next our fears were shown to be groundless. I am happy to give that hostage to fortune because I do not believe that we will be shown to be wrong. I believe that EMU will turn out to be an implosion on an even greater scale than was the implosion of the exchange rate mechanism in 1992.
      It is rather strange that people—not necessarily hon. Members who are present for this debate—increasingly refer to European monetary union rather than to economic and monetary union, which is what EMU stands for. The distinction is important, because the term economic and monetary union recognises the fact that there cannot

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      be monetary union without economic union. We cannot have a single currency without creating a single economy. I have said before—and I shall never tire of saying—that we cannot have a single economy without creating a single Government, and we cannot have a single Government without creating a single state. It therefore follows that those who oppose the creation of a single state of Europe must oppose the introduction of a single currency for Europe, because the one leads directly to the other.
      I was interested in the comments of my right hon. and learned Friend the Member for Rushcliffe (Mr. Clarke). He said that he is not in favour of a single state, but that he is in favour of ever closer union, by which I take him to mean ever closer political union. My logical faculties may not be up to the task, but it seems to me that that argument is like saying that it is better to travel hopefully than to arrive. I remember a philosophical paradox that goes something like this: if a person starts out a certain distance from a fixed point and always moves towards it by covering half the remaining distance between him and that fixed point, he will move forward without ever reaching the fixed point. That is what my right hon. and learned Friend seems to have in mind: it is fine for us to go on having ever closer political union, but heaven forfend that we should end up with a politically united Europe.
      People who believe in ever closer political union should have the courage of their convictions and say that they want a politically united Europe. They cannot say that they want one without saying that they want the other, because the one will inevitably lead to the other.
      Conservative Members have gone into the human rights provisions in great depth and I do not intend to repeat their arguments. I shall merely point out that, in response to a question from me during the debate on 12 November, the Foreign Secretary said that he was willing to give me
      "an undertaking that, so long as the Labour party is in power, it will not be possible to find 14 EU states that will agree that the Government are in serious and persistent violation of democracy or of human rights."—[0fficial Report, 12 November 1997; Vol. 300, c. 912.]
      Much has been made of the example of the Greek colonels and much has been said about what we would do if an undemocratic regime came to power. My fear about the provision is not so much that it will be used directly against this country as that it could be used indirectly.
      Suppose this country were in a minority of one, not over a human rights question but over some other matter such as our budget rebate or the beef crisis. Would it not be tempting for other EU states to invoke the clause on a completely separate issue, such as discrimination on grounds of gender or homosexual rights in the armed forces, not so as to overrule us on the matter of the human rights that allegedly we were persistently abusing, but to deprive us of our veto so as to overcome the fact that we were the sole member state blocking progress on the other issue? My concern is not about direct application, but is about the indirect leverage given by article F.1, which would enable others to deprive this country of its protection, its veto and its voting rights.
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      6.45 pm
      The main purpose of my remarks is to deal with common foreign and security policy. It may come as a surprise to Labour Members—
      Mr. David Faber: Both of them.
      Dr. Lewis: As my hon. Friend observes, the Labour party is represented in this important Committee by fewer than the proverbial contents of a telephone box.
      I have a confession to make. It may come as a surprise to such of those dedicated Europhiles as are present on the Labour Benches to know that I am a Johnny-come-lately Euro-sceptic.
      Mr. Bercow: My hon. Friend took far too long.
      Dr. Lewis: My hon. Friend is absolutely right. I can even name the day on which I became a Euro-sceptic: it was 22 March 1995. I read an article in The Times, which was headed:
      "Santer seeks right to shape foreign policy for Europe".
      It said:
      "Brussels should have the right to shape Europe's foreign and security policy, a power currently jealously guarded by the governments of the European Union's 15 member states, Jacques Santer, the President of the European Commission, said yesterday."
      The article said that he had addressed the institutional committee of the European Parliament and had called for
      "a strengthening of the European Commission as the guardian of the European treaties. He said the Commission should be given the right of initiative in foreign and security policy."
      I have another confession to make. One does not often hear a politician say, "I was wrong," but I was wrong in my assessment of integration theory, which I learnt about when I studied international relations. Integration theory was developed more than a score years ago. As undergraduates, we were told by our lecturers that if states could not directly be persuaded openly to coalesce and to become a single nation state, they could indirectly be lured into doing so by a process of functional integration. The idea was that common patterns could be created through a particular sphere of activity so that states would be drawn together and, before they knew where they were, they would be irreversibly interlocked.
      In my naivety, I thought that that would never work because states have a hard-headed understanding of their national interests. I thought that they would be drawn part of the way along that slope, but that they would see what was happening, would turn round and would retreat from it. I confess that I underestimated the power of functional integration. The process of creeping federalisation has undoubtedly been far more successful than one could possibly have anticipated.
      Mr. Bercow: I am following closely the logic of my hon. Friend's thesis. Does he agree that the people of Britain will never knowingly consent to being governed by those who do not speak their language, live in their country or depend on their votes?
      Dr. Lewis: I agree with my hon. Friend, but I am not saying that that will not happen because the operative word in his intervention was "knowingly". The methods

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      that have been adopted bear a frightening resemblance to the methods that were used by other philosophies in the past. During the cold war, I often had to look at Marxist doctrine and the speeches of Soviet leaders. The people who delivered those speeches tried to cram as many words as possible into the smallest amount of thought. They tried to deaden the perception of people who were attempting to establish the propositions that were being conveyed by obfuscating them with massive amounts of jargon. In the end, people gave up rather than continue to try to tease out the meaning in the small print.
      Not only has the technique of trying to bore people into not knowing what they are being lured into been used; people have tried selectively to misquote history. I have in mind the attempts to cite Winston Churchill and his Zurich speech in 1946 as if he were recommending that Britain should be part of a united states of Europe. I shall read a few brief extracts from his speech of 19 September 1946. He said:
      "I am now going to say something that will astonish you. The first step in the re-creation of the European family must be a partnership between France and Germany. In this way only can France recover the moral leadership of Europe."
      Later he said:
      "Our constant aim must be to build and fortify the strength of UNO."
      The United Nations Organisation. He continued:
      "Under and within that world concept we must re-create the European family in a regional structure called, it may be, the United States of Europe…In all this urgent work, France and Germany must take the lead together. Great Britain, the British Commonwealth of Nations, mighty America, and I trust, Soviet Russia—for then indeed all would be well—must be the friends and sponsors of the new Europe and must champion its right to live and shine."
      That was under the aegis of a world body because in 1945–46 the United Nations was seen primarily as a "world security organisation". The phrase was often used interchangeably with "United Nations Organisation". In that context, it was possible to envisage regional groupings and alliances for collective self-defence.
      It was greatly to the credit of the post-war Labour Government that they signed the treaty of accession to NATO in April 1949. The treaty contained vital provisions, especially in articles 3 and 5. Article 3 stated:
      "In order more effectively to achieve the objectives of this treaty, The Parties, separately and jointly by means of continuous and effective self-help and mutual aid, will maintain and develop their individual and collective capacity to resist armed attack."
      Article 5 stated:
      "The Parties agreed that an armed attack against one or more of them in Europe or North America shall be considered an attack against them all".
      When there is such a superbly strong, successful and impossible-to-improve NATO treaty, why is it necessary to create a common foreign and security policy? The answer is spelt out in article B of the Amsterdam treaty, which states:
      "The Union shall set itself the following objectives:
      —to assert its identity on the international scene, in particular through the implementation of a common foreign and security policy including the progressive framing of a common defence policy".
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      That is not an intention to replace the NATO treaty or to improve the security of Europe's nation states. The aim is to assert the identity of this creature, the European Union, on the international scene. If there were ever a case of poor motivation for a dangerous act, that is it.
      Sir Raymond Whitney: I am listening to my hon. Friend with great interest, not least because he and I have collaborated in the past on many ventures. On this issue our views are somewhat different. Is he not satisfied that the Amsterdam treaty clearly secures the role of the Western European Union and its relationship with the European Union rather better than was done by the Maastricht treaty, which I am sure my hon. Friend would also condemn? Surely that was, from his point of view, a step forward. The close relationship between the WEU and NATO is not challenged or threatened. My hon. Friend is concerned about the potential loss of sovereignty. He spoke about our NATO defence obligations. Does he agree that to some extent our membership of and commitment to NATO are a derogation of our sovereignty?
      Dr. Lewis: My hon. Friend makes two points. I warmly remember our joint ventures against the unilateralist policies of the Labour party in the 1980s. I could not have had a more staunch colleague in those battles. He was from the front rank and he held ministerial office during that important period for NATO as a whole. He asked about the pooling of sovereignty. I have another conceptual problem about that which is analogous to the one about closer political union without ever having a united political society. One cannot pool sovereignty any more than one can pool virginity. One either has it or has lost it. In the context of NATO, one must ask whether the loss of sovereignty is parallel to the loss of virtue.
      Mr. Bercow: Does my hon. Friend recall that, in the past, he likened the process of European integration to the process of seduction? He has observed to me and to others that the outcome in both cases seems to be the same.
      Dr. Lewis: I recognise my words of wisdom from the past, but I do not wish to be distracted from my words of wisdom in the present. On whether one has pooled sovereignty or lost virtue, the issue of NATO is a case in point. Nothing in the NATO treaty is irreversible, but the European treaties are irreversible. If there were a parallel with the NATO treaty, rather than a treaty from which one cannot withdraw or whose provisions cannot be reversed if they work out badly, I would be far more relaxed about these matters.
      I am getting signs that I am using up my allotted time very quickly. The WEU is a useful political prop to NATO, but it could turn into the Achilles heel of the alliance because, naturally, the WEU does not have the involvement of America. The more that is done to build up the parts and aspects of NATO that exclude America, the more is done to undermine the basic security of Europe, which depends upon American involvement.
      Mr. Damian Green: I am worried that my hon. Friend's characteristic eloquence is masking an illogical position. He says that the European treaties that the United Kingdom has signed are irreversible and that it

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      is impossible to pool sovereignty, which is like virginity; but this country has already lost its virginity and sovereignty, so all his arguments are a waste of time. On his own terms, his argument that we cannot pool sovereignty and that it is like virginity must be wrong.
      Dr. Lewis: With respect, that is not true; we are being asked to abrogate each aspect of sovereignty and we either keep that function or lose it irretrievably. Just as there is more than one person in a country, so there is more than one opportunity to lose one's virginity irrecoverably. There is no chance to recover subsequently each one of the functions that is lost.
      7 pm
      Mr. John Wilkinson: May I challenge one aspect of my hon. Friend's admirable speech? He says that the acquis communautaire is in essence an irretrievable process—an irrecoverable process. As a sovereign Parliament, could we not, if we had the support of the British people, abrogate the treaty on union, as we could any other treaty? We could make a unilateral declaration of independence at any time of our choosing.
      Dr. Lewis: We could do that at present but, as I have explained, the idea of economic and monetary union is to have a situation in which we could no longer do that because we would be subject to the authority of a single Government. We would be in no position to abrogate any of the treaties that we had been drawn into over previous years.
      I wish to place other Amsterdam treaty provisions on the record. It says:
      "The European Council shall decide on common strategies to be implemented by the Union in areas where the Member States have important interests in common.
      Common strategies shall set out their objectives, duration and the means to be made available by the Union and the Member States…
      The Council shall ensure the unity, consistency and effectiveness of action by the Union…
      Joint actions shall commit the Member States in the positions they adopt and in the conduct of their activity…
      The Council shall adopt common positions. Common positions shall define the approach of the Union to a particular matter of a geographical or thematic nature. Member States shall ensure that their national policies conform to the common positions."
      The treaty fulfils the aim that Jacques Santer set out in that speech in March 1995. He intended that the intergovernmental conference should do for foreign and security policy what Maastricht attempted to do for economic policy. I fear that the treaty will do that. I wholly oppose it and support the amendment.
      Mr. Ian Taylor: I take great pleasure in following two such cerebral contributions by my honourable colleagues. I am not sure that I can emulate them. My right hon. Friend the Member for Huntingdon (Mr. Major) might have said that they were perhaps a touch too ideological in tone. My hon. Friend the Member for New Forest, East (Dr. Lewis) touchingly spoke about his Pauline conversion and quoted the headline about Santer dictating foreign policy, which sounds like a proper offering for the Christmas season. Nevertheless, perhaps it did not
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      have the same beneficial consequences as the original Pauline conversion, which I think was for the better: my hon. Friend's conversion was, sadly, for the worse.
      I listened carefully to my hon. Friend the Member for Arundel and South Downs (Mr. Flight), who from his previous occupation is genuinely well informed on matters of currency and international currency movements. We need to put one or two factors about monetary union firmly on the record. Whether or not the Conservative party is in favour of a single currency, a single currency there will be. There will also be considerable consequences for world foreign reserves, not least because there will be considerable debt instruments. Under the convergence criteria and the terms of monetary union, it is likely that all Governments' deficits will be converted into euros and that those will be securitised.
      The second factor that one needs to bear in mind about monetary union is that it will have a massive effect on world trade and the currencies held in world trade, largely because of the propensity to import by the European Union, which is greater than that of the United States of America. The consequence is that contracts are likely to be written in euros.
      Let us be under no misapprehension: whether we like it or not, the euro will come and it will have a dramatic impact on world trade and on reserve currencies. In many different ways, it will also have a considerable knock-on impact on British companies, including—despite what the Institute of Directors erroneously says—medium and small companies, simply because they are part of the supply chains that will, inevitably, increasingly use the euro as part of their internal accounting, treasury and supply contracts. All the new systems will, to a greater or lesser extent—but at least to some extent—have a knock-on effect on hundreds of thousands of smaller British companies.
      That will all begin from 1 January 1999. Many small UK companies will find that their price lists will have to be denominated in euros. Their computer databases will not be able to cope, because the convergence criteria are different from those established in international currency markets. The databases will in any case have to be updated. Those companies will have to learn all sorts of new and exciting things, such as triangulation, dealing in currencies that are not part of the euro, and dealing with the euro.
      I am not trying to be too technical. I am pointing out merely that the euro will emerge and have a knock-on effect on British business, yet the Chancellor of the Exchequer still believes that he can sit around and wait and see what happens. Not surprisingly he has found—much to the UK's cost—that sitting around and not making a firm commitment to make sterling a part of economic and monetary union has excluded him from the conference table. That is a sad event. Once it is realised that the UK and sterling will be less influential in world markets—because of our exclusion from the controlling bloc that will influence the future of economic and monetary union and the euro—the British public will wake up to the fact that this is genuinely a loss of sovereignty. That is the opposite of the arguments that have been advanced over the past few weeks in the Chamber and outside.
      It is not timely for us to enter a cerebral, intellectual and academic discussion of what the word "sovereignty" means. My hon. Friend the Member for New Forest,

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      East showed the dangers of that when he started almost to decline the noun "virgin", as if it had different meanings. It has one meaning. One loses one's virginity—I would not understand that, of course—or one does not. The UK has lost its virginity many times and it has not been that painful, except, funnily enough, in relation to currency.
      Currency is the one sector where we have not had sovereignty for a long time. It has been mismanaged and, sadly for exporters, over the past few months, it has been the opposite—it has been too strong. In those circumstances, if we are not going to be able to influence the principal currency used in 80 per cent. of our single market—namely, the European Union—we shall lose sovereignty. It is not only by joining that we lose sovereignty, but by not joining. We lose sovereignty by not having influence and not being able to ensure that the rules of the game are not only properly formed but observed. That seems to be the public's main concern as to whether the government of this country, now in the hands of the Labour party, is being properly conducted in the long-term interests of our people, not some semantic debate about whether joining might or might not mean the loss of some academic form of sovereignty. Conservatives are supposedly famous for practical politics, so we should be concerned about whether we can influence the economic well-being of our people if we are not part of something as dramatically important as economic and monetary union.
      I wish to refer to another matter that has been touched on by other hon. Members. There is no doubt that the development of what is now called the European Union has been political. My political activity began in the 1960s. I became a member of the Conservative party because the party was positive about Europe. Europe was a political experiment. I never engage in debates about what it might become, and whether it might become more like the United States. Europe is a unique experiment, and there is nothing to compare it with. We are making it up as we go along. That sometimes leads to failure, and sometimes to success, but let us not fall into the trap of making comparisons. It was the attempt to experiment that attracted me to the Conservative party in the 1960s.
      The European Union is a political exercise. After all, it stemmed from the most political exercise of all—the European Coal and Steel Community and the desire to pool the key industries of what had been the driving powers in the first and second world wars. Out of the Coal and Steel Community came the Common Market. At no stage has there been any attempt to disguise the political element.
      In an intervention on my hon. Friend the Member for North Norfolk (Mr. Prior), I said that when Margaret Thatcher was Prime Minister, she made the greatest political gesture of all. She had deliberately given away—let us use those words provocatively—sovereignty, knowing that without qualified majority voting in the single market, there would be no single market. There would be no way to overcome the protectionist instincts of certain countries unless it was possible to override them in the voting structure. She understood that when she gave up national sovereignty—I would not insult her by saying that she did not understand, so I assume she did.
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      Perversely, it is not being said that the Amsterdam treaty is political. In fact, it is the least significant of the several treaties that the House has debated over the years. In some ways, it is beneficial because it tidies up some of the things that we did not get right at Maastricht.
      Mr. Bercow: Does my hon. Friend believe that there is a ratchet for European integration which, to all intents and purposes, is irresistible?
      Mr. Taylor: No, I do not believe in the ratchet theory any more than I necessarily believe in the train theory, for the reason that I started to outline a moment ago. There is no preordained destination. The whole point is that mistakes will be made in the European Union. None of us who regard ourselves as Europhiles, because we are supposed to have labels these days, would say that the European Union is always right and that no mistakes have been made. I will oppose things that are wrong in the European Union, but if I oppose them, or if the Prime Minister of the day opposes them, it is important that in doing so we have influence over the other members of the Union if we are to get our way. We shall not get our way if we sound abusive from the sidelines.
      7.15 pm
      It is important to make a clear commitment to being part of the most exciting political and economic experiment of our generation, one which we have to ensure succeeds. There is no benefit for this nation in any political party investing all its political capital in the failure of the euro. The failure of the euro would be a disaster for the economic interests of this country and its business men and women. Of course, no political party would dream of investing all its political capital in the failure of the euro—
      Mr. Denis MacShane: Except one.
      Mr. Taylor: I do not know which one that might be, but I certainly hope that it is not the one to which I am proud to belong. It is important to understand that influence is part of the power structure that some call sovereignty, and our influence over the rest of the European Union is critically based on our credible attachment to it. In that respect, there are no half measures. If there are successful ways to bring about an ever closer union or unity, we shall pursue them because they are successful. The single market is one of them.
      I am often puzzled by those who are worried about this form of ever closer union in view of the way in which the markets are driving that union. Within the single market of which we were, in a sense, the founding fathers, we are breaking down barriers and forcing the market to dictate terms to national Governments. It is not possible to have an independent fiscal policy if independence means that we pay no attention to what else is happening in the same market in which we are freely trading in goods, services and capital and in which people can move.
      There are implications. No Chancellor in living memory has set an exchange rate without paying close attention to what is happening in the capital markets, and in particular the market in which there is free movement of capital—again, incidentally, something of which we

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      were the leading proponent. It was as a result of our arguments that the French eventually opened up what had been a much more protectionist market.
      Sir Peter Tapsell: My hon. Friend is saying that markets are driving these matters but, if that is so, does he not think that they are driving them in a curious way? Today, there are FF10 and almost DM3 to the pound. No one who has considered the practicalities has ever suggested that we would join the single currency at a rate higher than DM2.6 to the pound. How would we relate to the practical currency in practical terms? One of the reasons why sterling is so strong against the deutschmark and the French franc is precisely that the international markets think that we are not going to join the euro, because it will be a disaster. If it is a disaster, it is better to be out than in.
      Mr. Taylor: First, I repeat that the failure of the euro would not leave us immune and would be extremely damaging to our economy. Secondly, I do not draw the same conclusion as my hon. Friend. The position of sterling at the moment is due to a variety of factors, not least those being witnessed in Japan. They are a sign of the considerable turbulence and disruption that can occur on international markets. They also point to another factor that I have not yet mentioned, which is, once the euro is out there, sterling is likely to be buffeted up and down because of the squeezing effect of the euro as a reserve currency, the dollar and whatever happens to the yen. None of those factors is very comforting to any British Chancellor or British business man.
      My hon. Friend the Member for Louth and Horncastle (Sir P. Tapsell) should not conclude that the markets have assumed that sterling will not join. I am not going to make a speech about economic policy, but I suspect that the Chancellor is holding back some information about the slowing down of the British economy towards the end of the cycle. We need more information from him about how he expects convergence to take place and then be sustained, and how he intends to run the economy to achieve the convergence that he says would be ideal. Those factors will have a big impact on sterling.
      My hon. Friend the Member for Louth and Horncastle is absolutely right that one of the factors causing us to pause and preventing us from immediately entering economic and monetary union is the way in which sterling has bounced all over the place. There will have to be some currency stability and other types of stability as we join.
      The market signals given by the Chancellor could be very encouraging. I dare say that, if he stood up and said, "We now have a clear timetable for joining monetary union," British exporters would be extremely happy, because sterling would begin to converge; and it would be a downwards movement.
      The treaty's overall effect is to tidy and tighten up one or two aspects of previous treaties. I agree with my right hon. and learned Friend the shadow Foreign Secretary, who, in his opening speech for this debate, clearly said that there would have to be an institutional structure and a strong European Court of Justice. Such beliefs do not prevent us from saying that there should be criticism of or changes to the European Court of Justice. We can argue
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      that case forcefully. Sadly, I do not believe that, at the Amsterdam summit, the Foreign Secretary argued the case as strongly as he should have done.
      The point is that the European Court of Justice and the many other institutional parts of the European Union are vital to its success; and that is why I support them.
      Amendment No. 65 merely confirms that article 1 is not part of the Bill. On that basis, and that basis alone, I shall be very happy to follow the shadow Foreign Secretary and Opposition Front Benchers into the Lobby.
      The Minister of State, Foreign and Commonwealth Office (Mr. Doug Henderson): When I am required to reply to debates, I try to keep myself in order by putting page numbers on my notes. Today, I have used not only page numbers but dates. We have had a very wide-ranging debate. Not all the speeches have been directed completely to the central point of the amendments, but—because of the nature of the subject and the way in which we have to debate the issues—that has largely been inevitable.
      To help the Committee, I should like first to explain in reasonably technical terms my specific views on the amendments and new clauses. Subsequently, I should like to deal with some of the issues raised in the debate. It would be impossible to deal with all the issues, although I shall try to do my best.
      The Government reject amendment No. 65 because it would delete sections of article 1 that are necessary to write into British law sections of the treaty and of the first pillar, such as the flexibility provisions.
      The Government also reject amendments Nos. 13 to 15 and 17 to 21, which would also prevent us from adopting the necessary sections of article 1, but for different reasons. Although they accept article 1, they would make certain exclusions. Therefore, the effect would be the same.
      The Government also reject amendment No. 1, which was tabled by some of my hon. Friends. The amendment would delete the section on economic and monetary union, which was originally included in the Maastricht treaty and repeated in the Amsterdam treaty. The Government wish that provision to remain.
      We reject new clause 30. I believe that it would be inappropriate to delay the Bill's enactment so that the Attorney-General could report on any extension of the powers held by the European Court of Justice.
      The Government also reject new clause 37, which would require a resolution of the House before any relations could be fostered between the European Union and the Western European Union. Anyone who has been involved in any of those matters will know that that is clearly impractical.
      The Government also reject new clause 38, which would require a vote of Parliament before any decisions were taken on a common foreign and security policy. The right hon. and learned Member for Rushcliffe (Mr. Clarke)—who mentioned his involvement over the years in the Union's various forums—will know, as will the right hon. and learned Member for Folkestone and Hythe (Mr. Howard), that dealing with such matters in the Chamber would be impractical.
      The Government are committed to improving scrutiny of European matters, as we have already announced in Select Committees. The Leader of the House will soon be

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      making a general announcement on the matter. If I have managed to assess correctly the response of Select Committees, they were reasonably warm to our plans to improve scrutiny.
      In trying to deal with the issues raised by hon. Members, it may be useful if I start with the speeches that were made today, because they are most readily in the minds of hon. Members.
      I used to think of the hon. Member for Esher and Walton (Mr. Taylor)—who tried to talk out my Access to Health Records Act 1990—as an errand boy from the Government. I have changed my view, as he is clearly a man of independent thought. The House welcomes his independence. Whatever one may think of his speech, he raised some very important issues, which have also been raised by members of the business and commercial community with whom I have met. I commend him for raising the issues in the debate.
      I did not agree with all the points that the hon. Member for Esher and Walton made or with his comments on the Chancellor of the Exchequer, whose recent statement in the House has been well received by our European partners. Nevertheless, the hon. Gentleman pointed out that when a euro is established, it will have a dramatic impact as a reserve currency. Surely that must be true. He also said that companies will begin to price in euros because it will suit their businesses to do so.
      Companies such as Marks and Spencer have already said that they plan to offer customers and suppliers the possibility of making transactions in euros. People from many small companies have told me that, because they are involved in the European economic chain, they would like to be able to quote in euros. They have formed their assessment on that basis.
      The hon. Member for Esher and Walton was right when he said that the euro's failure would be disastrous not only for those involved but for all of Europe and for the entire European monetary system. Arguably, the consequences could extend even beyond Europe.
      We heard an interesting speech by the hon. Member for New Forest, East (Dr. Lewis). He began by confessing his sins, reminding me that a militant tendency is not peculiar to one party, and that confessions by those belonging to such tendencies are not peculiar to one party. Nevertheless, I tell him that it is better to be honest with oneself and to be honest about the issues. The Committee will respect him for his honesty.
      I do not know what the Committee will make of the comment by the hon. Member for New Forest, East that the United Kingdom should never join a European currency. He may have some difficulty, because, in the past six months, the Leader of the Opposition has held five positions on a European currency. Originally, he said, "Never"; then it was "Maybe"; then it was "In 10 years"; then it was "Maybe"; and now he is back to "In 10 years". At least the hon. Gentleman is consistent. He says "Never", and the House looks forward to his sticking to that position.
      The hon. Member for North Norfolk (Mr. Prior) made the important point that Europe is not only about trade; it has a political dimension. I did not agree with his other remarks, but I concur with him on that point.
      The hon. Member for New Forest, West (Mr. Swayne) said that he was concerned about the word xenophobic. He was worried, after listening to some Conservative
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      Members' speeches, that they might risk being indicted. He has identified that risk, but Conservative Members know what to do if they want to keep themselves straight.
      The hon. Member for Arundel and South Downs (Mr. Flight) said that if we had to sign up to the treaty, it would be the end of the nation state. He also thought that it was deceitful of other hon. Members not to own up to that in their comments on the treaty, and that they were particularly deceitful when they said that the treaty did not matter. I respect the fact that the hon. Gentleman holds a different view from mine, but I believe that he also holds a very different view from that held by many of his hon. Friends who have spoken in the debate.
      7.30 pm
      My hon. Friend the Member for Ilford, South (Mr. Gapes) said that this was a modest treaty and that he expected it to take us forward from Maastricht to an era of enlargement and reform of the common agricultural policy. He believed that if we accepted the amendments, we would hold up that process. He rejected the amendments for that important reason; I reject them for that reason and others.
      My hon. Friend the Member for Harlow (Mr. Rammell) supported my hon. Friend the Member for Ilford, South; he opposed the amendments for similar reasons. He also said that he thought that the contributions from Conservative Members were unrepresentative of the views of the Committee and of the Opposition generally. That imbalance has been partially corrected today, because we have seen that there are very different views within the Conservative party on Europe.
      Many Conservatives feel that the leadership of their party has got things wrong and risks alienating the British public for a long time. It is important for British democracy that that view has been put today and that the British people know that the Conservative leadership does not have the support of a significant section of the Conservative party on the issue.
      My hon. Friend the Member for Liverpool, Riverside (Mrs. Ellman) said that she would not support the amendments because she wanted to move on to the real debate on structural funds which would follow the Luxembourg summit. She said that that was of great importance for her constituency and I can understand why she took that view.
      I did not expect the same support from my hon. Friend the Member for Merthyr Tydfil and Rhymney (Mr. Rowlands) and my right hon. Friend the Member for Llanelli (Mr. Davies) as I had from other hon. Friends. However, I was pleased that they highlighted the importance of seeking high employment. There may be some differences on how we can best reduce unemployment and get higher employment, but my hon. Friend and my right hon. Friend agreed that it was important that the treaty emphasised tackling unemployment, and they are right.
      My hon. Friend and my right hon. Friend also asked, in different ways, whether it was possible to define a high level of employment. I do not think that it is possible to define that because there are as many different views on that as there are Members of Parliament. What matters is that we all recognise the importance of tackling the terrible problem of unemployment. That is a very important issue in the European context and in the context of our nation state.

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      My hon. Friend and my right hon. Friend said that by raising the issue of employment, we also raised the important issue of employability. I know that we shall discuss the matter later in Committee so I do not want to dwell on it now. However, it is crucial that as a wider European community, we consider how we best prepare ourselves to take on the jobs challenge of tomorrow. There is agreement on that in the factories and businesses of my constituency because the people who work there know that they must be employable tomorrow. If they are employable, businesses will flourish and will be able to provide them with employment.
      Mr. Gerald Howarth: Can the Minister explain to the Committee why the United Kingdom is enjoying increasingly lower unemployment while unemployment is rising on the continent? Is it, perhaps, something to do with the social chapter and all the burdens on business on the continent which we in these islands have resisted?
      Mr. Henderson: I am tempted to say to the hon. Gentleman that seven months of a Labour Government have not done us any harm in that regard. The hon. Gentleman raises a serious question, however. One cannot measure employment over a short period; one must look at it over the long term. Over the long term, we have no better record than comparable countries in the European Union. It is arguable that for much of the period of Conservative Government, we had a far poorer record than many of our European partners. The main factor is that the business cycle is at a different point and that is the real reason why there is a difference between us and our European partners.
      Mr. Ted Rowlands: If we can have inflation targets, monetary targets and deficit targets, why can we not have employment targets?
      Mr. Henderson: My hon. Friend will recognise that it is easier for the Government to be specific about inflation targets and to take measures that are tightly linked to achieving those targets than to set employment targets. Even if the Government had to set employment targets, it would not be easy to hit them, as my hon. Friend will understand. That is why it is important to get the approach right. My right hon. Friend the Chancellor made it clear in his statement to the House three weeks ago that the important thing is to fight inflation and to get the right monetary context, and then to take all the other measures to raise employability which will help to tackle the problem of unemployment.
      Sir Peter Tapsell: The hon. Gentleman has just said what people are perpetually saying, which is that the economic cycle in Britain is different from that on the continent of Europe. The whole point of economics is to try to influence economic cycles. The reason why our economic cycle is in a beneficial phase is that we left the exchange rate mechanism in 1992. The reason why European countries are in a bad economic cycle is that they stayed within it.
      Mr. Henderson: I know that the hon. Gentleman follows these matters closely. He would be dishonest with
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      himself if he did not recognise that the reason why our unemployment levels are now lower than those in Europe is the stage of the economic cycle. One can then have an argument about the extent to which the economic cycle has been influenced beneficially or in a damaging way. The point my right hon. Friend the Chancellor made in his statement to the House three weeks ago was that we must influence European matters positively. The reason why there has been a marginal improvement in employment in recent years is that we were recovering from the devastation caused by the Conservatives' mismanagement of the economy from 1987 to 1992.
      Mr. Flight: Unemployment can be caused by cyclical or structural factors. Surely it is clear that the major cause of unemployment in Europe is structural. The European economies have been in an up-cycle for the past 18 months and will probably reach the peak of that cycle during the next six months. There is still massive and rising structural unemployment which results from the social chapter and the huge cost of employing people.
      Mr. Henderson: The hon. Gentleman is in a fantasy world. Of course employment is influenced by cyclical and structural factors, but the hon. Gentleman is surely not telling me that the reason why all the shipyards went bust in the north of England was cyclical issues or burdens on business. It happened because of fundamental structural imbalances in the economy. We have to improve employability to take on the challenges in Europe and the rest of the world. It is important to make progress in the Amsterdam treaty so that we can take up the other issues at Luxembourg and beyond.
      Mr. Ian Taylor rose—
      Mr. Denzil Davies rose—
      Mr. Henderson: My patience will be exhausted in a little while.
      Mr. Taylor: I intervene to help the Minister. The flexible labour policies that the Chancellor has been preaching recently—he has begun to understand why we put those policies into practice when we were in government—are crucial to the success of economic and monetary union. Those of us who can envisage economic and monetary union taking place understand that flexible labour markets are at the heart of it. There is no confusion. The Minister can admit that flexible markets will assist the reduction in unemployment and the increase in the number of jobs created on the continent. That will be good news for the whole European Union.
      Mr. Henderson: The hon. Gentleman makes an interesting point. I do not totally disagree with him. However, I do not think that there is any conflict between giving working people protection—in some instances at a European level, but in more instances at a nation state level—and having a flexible labour market that allows companies to change their production methods and reskill workers so that they can take on the challenges of tomorrow. I see the hon. Gentleman smile slightly. He knows that business people tell him the same as they have told me.
      Mr. Denzil Davies: I apologise for interrupting my hon. Friend. As a non-economist, I have always been

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      interested in the economic cycle. The Old Testament talks about seven lean years and seven fat years. I think that someone called Krondatieff talked about 50 years. How long will the economic cycle last?
      Mr. Henderson: I am grateful to my right hon. Friend for raising that. If I knew the answer, I would be rich—although I am probably debarred as a Minister from allowing my bank to invest on my behalf. A cycle lasts as long as it lasts. We cannot predict how long the current cycle will last. We can only prepare for decisions that we may want to take in future on European currencies. It is crucial that we debate such matters and that businesses are aware of the debate, take part in it and prepare themselves for the decision.
      I want to move on, because we have had a reasonable exchange of views on economic issues. The hon. Member for Buckingham (Mr. Bercow) seems to be in the Chamber only when he is speaking—which is quite frequently. He said that the provisions on basic rights were about meddling on issues such as the minimum wage, the age of consent and strikes in essential services.
      As the right hon. and learned Member for Rushcliffe made clear, the hon. Gentleman has misread the purpose of those clauses, which is to prepare the European Union for enlargement. The provisions would be invoked only if there was a massive change in one of the new countries, or in one of the existing countries, that posed a real threat to democracy, such as the establishment of an entrenched fascist Government. That was the intention of those who were involved initially. I am sure the Conservatives who were involved in the discussions took part in that dialogue. I was involved for six weeks before Amsterdam and my right hon. Friends the Prime Minister and the Foreign Secretary continued that dialogue. The intention is clear. Being alarmist about the issue does no good.
      Mr. Michael Howard: Does the hon. Gentleman recall my right hon. and learned Friend the Member for Rushcliffe (Mr. Clarke) saying that there was no guarantee that the provisions would be interpreted in that way? Their interpretation is to be entirely at the behest of the other member states. Would it not be better if a power were taken in the treaty to expel any member state that was in serious and fundamental breach of human rights rather than attempting to hold that state to its obligations while depriving it of rights?
      Mr. Henderson: The right hon. and learned Gentleman is not aware of the debate that has taken place with our partners. We are talking about how to deal with a critical situation, not an everyday situation. It is a political decision which would have to be taken by a 15 minus one majority. Every country other than the country involved would have to agree. The power would not be used in a trifling way, to take revenge on an existing member because one country or a group of countries disagreed with it. If that happened, the future of the European Union would be in great jeopardy. [HON. MEMBERS: "It is."] No, it is not. The member states of the European Union have a deep commitment to making changes when necessary, agreeing common positions when it is sensible and retaining our distinctiveness when that is better.
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      7.45 pm
      I am sorry to be taking so long, but I want to reply thoroughly to the debate. We should have a full interchange of views so that hon. Members know all the arguments when we come to vote. I shall have to take some time to reply because there have been so many contributions.
      The right hon. and learned Member for Rushcliffe said that there were two differences between his position and mine on the treaty. He disagrees with the social chapter. We have already had an exchange on those arguments. I do not believe that the social chapter threatens the economic integrity of the European Union or that the business community here or elsewhere believes that. The social partners recognise that it is an essential part of the development of the Union, and one with which they can cope. It is not the case that every idea put up for inclusion in the social chapter will be included. There is a firm understanding of that among the majority of the partners I have talked to. I understand the right hon. and learned Gentleman's concerns, but he will find, as business will find, that it will not damage his other objectives.
      The right hon. and learned Gentleman also talked about enlargement. He wanted further progress on that in the treaty. So did I. My right hon. Friends the Prime Minister and the Foreign Secretary pushed hard on the final evening of negotiations for progress on institutional reform. Our inability to reach an agreement was not due to a lack of motivation or an unwillingness on our part to consider other views. The problem was the intransigence of other partners. We shall continue to press for progress. I agree that reform of the institutional arrangements is essential before enlargement. The treaty says that that will be the case. I hope that when he has more time to reflect, the right hon. and learned Gentleman will follow his original instinct to be a little bit in favour of a modest treaty. I hope that he will give that further consideration before Third Reading.
      I want to link the comments of the right hon. and learned Member for Rushcliffe with the opening comments of the right hon. and learned Member for Folkestone and Hythe about article F.1 on basic rights. The right hon. and learned Member for Rushcliffe said that he had no worries about establishing the basic right that if a country joins the European Union, it must meet certain conditions, which must be broadly reflective of what is only wise and consistent with a democracy. That is different from the position adopted by the right hon. and learned Member for Folkestone and Hythe.
      On the first day of the debate, the right hon. and learned Member for Folkestone and Hythe said that he had some concerns about the flexibility of articles K.12 and K.15 and that he had sympathy for the objective. I understand that; I have read his speeches. We both agree that there is a need for flexibility, but that when that flexibility is applied, it should be applied by unanimity. I think that there is a misunderstanding on the matter.
      In effect, there is an unanimity provision in the treaty: it is called the emergency brake. If nine or 10 countries decide that they want to act together to do something that the rest of the Union does not want to do, they should have flexibility to do so. However, if one or more than one country outside those nine or 10 countries says that it is in their national interest that such a thing does not

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      happen for a particular reason, they can invoke the emergency brake, and the decision would then need to be made by unanimity in the Council. What the right hon. and learned Gentleman is looking for is in the treaty. I hope that he will recognise that. That might make it slightly easier for him to vote with the Government.
      Mr. Howard: I do not want to raise false expectations on the Minister's behalf. If that is indeed the explanation—it may be the explanation on a proper reading of the relevant portions of the treaty—why on earth does the treaty not make it clear that the article is based on unanimity? Why on earth does it use such circuitous language? Why does it use the language of qualified majority voting instead of saying straight out that such matters will be decided on the basis of unanimity?
      Mr. Henderson: I am very glad that I gave way to the right hon. and learned Gentleman. I like to give those who wish to confess an opportunity to do so. That is not the first confession of a change of position in Committee. I genuinely welcome the fact that there has been a debate in Committee and that the Opposition have recognised that the Government have achieved what the Opposition said that they would have wanted to achieve had they taken part in the negotiations.
      Mr. Cash rose—
      Mr. Henderson: I shall not incessantly give way to the hon. Gentleman, but I am tempted on this occasion.
      Mr. Cash: Does the Minister accept that this new-fangled concept of flexibility has serious dangers not least because, as he suggested, it creates a legal framework in which there is a momentum towards the creation of functions for certain member states? There is a continuous momentum towards the kind of integration that, apparently, the Government on the whole do not want. Is not there a contradiction in their position in allowing, through the adoption of flexibility, a momentum towards integration, which they say they would rather not have?
      Mr. Henderson: The hon. Gentleman is not aware that there was a discussion at the intergovernmental conference about whether flexibility is necessary in principle. The answer to that question was, by and large, yes, there may be circumstances in which different groups of countries want to do things at a different speed. The point was made that we could not have continual flexibility or it would destroy the single market, and everybody would want to do what they thought was in their interest and not combine over a common cause when it was not in their interest. There had to be some way of meeting the two objectives.
      One of the ways, of which the hon. Member for Stone (Mr. Cash) may be aware, was to exclude all sorts of circumstances in which flexibility would not be possible. On reflection, and in the debate at the IGC—it was essentially agreed before the Prime Minister and the Foreign Secretary endorsed it on the final day—it was agreed that there should be a facility for an emergency
      226
      brake. None of the EU partners thought that it would be applied on a regular basis. It was included because it was thought that it might be necessary in some circumstances and the possibility should not be excluded.
      Mr. Bernard Jenkin: On that point—
      Mr. Henderson: I think that I have exhausted that point. The Opposition have put a fair argument and the Government have given a fair response.
      The right hon. and learned Member for Folkestone and Hythe mentioned policing and said that article K.2 empowers Europol to join national policing operations in a support capacity. Yes, it does, but it does only that. There are very strict limits on how that should take place.
      British police forces are, and will remain, responsible for British policing in Britain. That is not in any doubt. Any Europol personnel would be involved on the invitation of the British police and have no powers of arrest. The operational rules for Europol, which would have to be agreed in future, would be agreed only by unanimity. That is in the treaty. Therefore, if there were any suggestion that any operational rule would put Europol officers in a position—in Britain or anywhere else in the EU—that we felt was not proper or right, we would be able to block it because unanimous agreement would be required. I hope that I have been able to reassure the right hon. and learned Gentleman on that point.
      I apologise to hon. Members who have just joined the Committee. There has been a very long two-day debate and there are many issues to cover.
      The next issue is foreign policy. The hon. Member for Reigate (Mr. Blunt) made a useful contribution-although not in support of the Government. Although he was trying his best to support his Front-Bench team, he said that it was firmly established in the treaty that NATO was the basis of British defence for the future. We strove hard to achieve that in negotiations in Amsterdam and I am pleased that he recognised it.
      The hon. Member also said that he supported the enlargement process. Again, I welcome his commitment. I hope that, when he weighs up the commitment that we achieved on NATO and our commitment to move forward from Maastricht in the EU to a post-Maastricht enlargement agenda, he will see the need to endorse the Amsterdam treaty as a way of moving from one position to the other. If we fail to endorse the Amsterdam treaty, there will be such disruption in the EU Councils that we will not be able to take on board enlargement in a way necessary to make progress. I know that that would concern the hon. Gentleman.
      Mr. Crispin Blunt: The point that I made was that the NATO aspect sits alongside the progressive framing of a European defence identity. I should like the Minister to address that issue.
      Mr. Henderson: The point is clear. When it comes to defence, it is the responsibility of NATO. There is a need to co-ordinate—for the Western European Union to talk to the European Council about important issues such as foreign policy issues that were agreed under Maastricht's second pillar by the previous Government. There is a need to liaise and work together, but ultimately, if it comes to

      227
      the defence of this nation, NATO will be the bedrock. That is firmly established in the treaty, but was a little ambiguous in the Maastricht treaty. We recognise that as one of the most important parts of the deal that we struck, although it is also part of a deal that other countries think is important.
      Mr. Blunt rose—
      Mr. Henderson: If the hon. Gentleman will allow me, I shall move on to the points raised by the right hon. and learned Member for Folkestone and Hythe about foreign policy.
      The right hon. and learned Gentleman asked whether there was a vision. The answer is yes, there is a vision. The vision is that we should be more co-operative with our European partners. After agreeing that foreign policy was a right area for the EU to be involved in under Maastricht, it is important that there is maximum co-operation, so that all the different organs know in which direction they are moving on any issue. Ultimately, there is a bedrock position on NATO.
      How will the system work? It will require unanimity. The right hon. and learned Member for Folkestone and Hythe and others raised a question. Under the treaty, a strategy is differentiated from an action. A strategy must be agreed by unanimity, but an action in meeting a strategy can be agreed by qualified majority. The question was: if there was any possibility of force being involved, could it be agreed as an action to meet a strategy under QMV?
      I know that the right hon. and learned Gentleman had serious worries about that issue, but I reassure him that such matters cannot be agreed by qualified majority voting. Anything that involves force—any defence issue—would have to be agreed by unanimity. If that decision were to be part of a strategy that involved a foreign policy initiative and defence considerations, the strategy would have to be agreed by unanimity. If force were not involved and a difference of view arose between one European nation and the other partners, an emergency brake could be applied, in a similar way to the one in the flexibility clause, which would put a stop to the proceedings and require unanimity. I believe that the right hon. and learned Gentleman's worries on that point have been met.
      8 pm
      I shall move on to the question of justice, on which several issues were raised. The first was raised by the right hon. and learned Member for Folkestone and Hythe and several of his colleagues. They asked why the European Court of Justice was not reformed by the Amsterdam treaty. The right hon. and learned Gentleman implied that a Conservative Government, had they been in power at the time of the Amsterdam talks, would have achieved reform, but I do not believe that that is the case.
      The right hon. and learned Member for Rushcliffe said that support for reform existed in ECOFIN. He may be right, although I have my doubts. However, even if he were right, I assure the Committee that there was no question of our European partners agreeing to the proposals made by the previous Government to limit the retrospective effects of the court's jurisdiction. If the
      228
      right hon. and learned Member for Folkestone and Hythe had been a member of the Government in June, he would not have been able to achieve reform, even if he had told his hon. Friends that it was his main aim.
      Several of my hon. Friends and other hon. Members raised the question of extensions to the powers of the European Court of Justice. A strong case for the ECJ has been made in the debate, because if any doubt arises about what is intended by any agreement for Community action, we need a body that intervenes to decide. I am glad that the laudable principle behind the ECJ has been recognised on both sides of the Committee. The question then arises about the extent of the authority of the European Court of Justice, but I can reassure hon. Members that the extensions are third pillar extensions.
      I wish to give specific answers to the points raised in the debate about the extensions. The first extension is that the ECJ can be asked to give a preliminary ruling on the validity and interpretation of framework decisions and other Council decisions. The right hon. and learned Member for Folkestone and Hythe will know from his time at the Home Office that such issues arose in the discussions that he had with me. I know that he has a deep interest in them. He will know that, under the Maastricht treaty, it was possible to provide in conventions in the third pillar that the ECJ could intervene to settle any arguments about the workings of the convention. Indeed, the previous Government, on at least two occasions of which I am aware, signed conventions containing specific provisions allowing the ECJ to intervene. They signed the conventions on the application of customs information systems and on the protection of the financial interests of the Community. They were right to sign those conventions, because it was important that the ECJ should be able to intervene if any argument arose.
      This Government, like the previous Government, do not want to see massive extensions in the powers of the ECJ in the third pillar. That is why, in the Amsterdam treaty, we agreed provisions that made a modest increase in those powers, which now apply to any framework decision under the Amsterdam treaty. If a member nation—for example, the United Kingdom—felt that it did not want the ECJ to intervene in an argument, it could block the framework decision because that would be decided by unanimity. Therefore, we would have to be sure when we signed a framework decision that we were prepared, if necessary, to have any argument adjudicated by the ECJ.
      The second area of extension of the ECJ's powers is its ability to review an action brought by the Commission or a member state on whether the Council had acted beyond its powers. The right hon. and learned Member for Folkestone and Hythe will be aware that it is extremely unlikely that that power would be invoked, because a member state would not be likely to give the Council the authority in the first place and then challenge it through the ECJ at a later stage. It might happen on an interpretation of the wording, but not on a point of principle. There is, therefore, no great extension of power in that area.
      The third area of extension of the ECJ's power is its ability to rule on any dispute between member states. The previous Government accepted a limited form of that power under the Maastricht treaty, and it has now been widened.

      229
      The fourth area of extension is the ability to rule on whether a Council decision in the areas that I have previously outlined—preliminary rulings, actions brought by the Commission and disputes between member states—is lawful. The ECJ may intervene on such points, but it is unlikely that that power will be used very often.
      The fifth area of modest extension is when a group of member states pursue a flexible arrangement in the third pillar. The role of the ECJ would not be to mediate on the substance of any agreement, but it could mediate on whether the procedure had been followed in reaching the appropriate decision on flexibility.
      I put it to the Committee that the Amsterdam treaty will mean only a limited extension of the powers of the ECJ. That extension is essential, and the Government welcomed it in concluding the treaty.
      Mr. Oliver Letwin: Will the hon. Gentleman give way?
      Mr. Henderson: No, I will not give way now. There is also no question of the ECJ's having any role in the maintenance of law and order in this country or our internal security.
      I have given the Committee a fair opportunity to debate the issues. [HON. MEMBERS: "Hear, hear."] I hear a lot of hungry voices and I therefore wish to conclude my remarks. I hope that when the Committee votes on the amendments, it will reject them.
      Mr. Howard: I shall attempt to be brief. We have had a good and wide-ranging debate. It is true, and I acknowledge it, that not every speech from my hon. Friends has been identical with the speech before or after. Nor would I wish that to happen, because the Conservative party does not encourage the kind of clone-like attitude that we see from the Labour party.
      Notwithstanding the predilection of the Labour party for clones, it obviously escaped the Minister's mind that almost 50er cent. of speeches by Labour Back Benchers were seriously critical of the Government. The speeches by the right hon. Member for Llanelli (Mr. Davies) and for Merthyr Tydfil and Rhymney (Mr. Rowlands) went far beyond the one point to which the Minister referred—their questioning of a lack of a target for high employment. Their devastating speeches indicted the Government's whole strategy. It was a pity that the Minister did not acknowledge that.
      I thank the Minister for the extent to which he endeavoured to answer the questions that we raised. He took much trouble over that and I am grateful, but he did not entirely succeed. For example—I do not wish to detain the Committee, but I wish to dwell on this example so that we may have a proper answer in the future—Iut an important series of questions to him on the way in which qualified majority voting would work in the implementation of a common foreign and security policy. The Minister answered my question by talking about brakes; the way in which the unanimity rules could be used in certain circumstances to stop countries taking certain action.
      The question that I put to the Minister was entirely different. What happens if a common decision on strategy has been taken to take certain action, for example, against
      230
      Iraq? What happens if a qualified majority decision is then taken that that action should stop short of the use of force? What happens if this country, for example, wishes to use force? In those circumstances, will this country be debarred from using force, according to the provisions of the treaty, by the qualified majority voting provisions? That is very important, and we have not had an answer. I hope that we shall have an answer; if not tonight, then at some future stage.
      It has been clear from the debate that there are many different reasons for opposing article 1 and for voting for amendment No. 65. A number of my right hon. and hon. Friends have identified those reasons. There is the fact that the treaty brings in the social chapter. There is also the absence from the treaty of proper provisions for securing enlargement of the EU, to which the Opposition attach great priority.
      My right hon. and learned Friend the Member for Rushcliffe (Mr. Clarke) referred to the total failure of the Government to press the argument for the reform of the European Court of Justice. It is not a sufficient reason for failing to press the argument that there was not at first blush a tremendous amount of support from the other member states. In previous negotiations, we have secured our position by pressing home our case and by persuading our partners of its merits. That is what the Government manifestly failed to do at Amsterdam.
      For all the reasons that I identified last week, and which my right hon. and hon. Friends have identified today, I urge the Committee to vote for amendment No. 65 and to reject article 1 of the treaty.
      Question put, That the amendment be made:—
      The Committee divided: Ayes 133, Noes 328.

      Division No. 103]

      [8.11pm

      AYES

      Ainsworth, Peter (E Surrey)

      Fabricant, Michael

      Amess, David

      Fallon, Michael

      Ancram, Rt Hon Michael

      Flight, Howard

      Arbuthnot, James

      Forsythe, Clifford

      Atkinson, Peter (Hexham)

      Forth, Rt Hon Eric

      Baldry, Tony

      Fowler, Rt Hon Sir Norman

      Beggs, Roy

      Fox, Dr Liam

      Bercow, John

      Fraser, Christopher

      Beresford, Sir Paul

      Garnier, Edward

      Blunt, Crispin

      Gibb, Nick

      Body, Sir Richard

      Gill, Christopher

      Boswell, Tim

      Gillan, Mrs Cheryl

      Bottomley, Peter (Worthing W)

      Gorman, Mrs Teresa

      Bottomley, Rt Hon Mrs Virginia

      Gray, James

      Brady, Graham

      Green, Damian

      Brazier, Julian

      Greenway, John

      Brooke, Rt Hon Peter

      Grieve, Dominic

      Browning, Mrs Angela

      Hammond, Philip

      Bruce, Ian (S Dorset)

      Hawkins, Nick

      Burns, Simon

      Hayes, John

      Butterfill, John

      Heald, Oliver

      Cash, William

      Heathcoat-Amory, Rt Hon David

      Clappison, James

      Hogg, Rt Hon Douglas

      Clark, Rt Hon Alan (Kensington)

      Horam, John

      Collins, Tim

      Howard, Rt Hon Michael

      Cran, James

      Howarth, Gerald (Aldershot)

      Curry, Rt Hon David

      Hunter, Andrew

      Davies, Quentin (Grantham)

      Jack, Rt Hon Michael

      Davis, Rt Hon David (Haltemprice)

      Jackson, Robert (Wantage)

      Duncan, Alan

      Jenkin, Bernard

      Emery, Rt Hon Sir Peter

      Johnson Smith, Rt Hon Sir Geoffrey

      Evans, Nigel

      Faber, David

      Key, Robert

      231

      King, Rt Hon Tom (Bridgwater)

      Sayeed, Jonathan

      Kirkbride, Miss Julie

      Shephard, Rt Hon Mrs Gillian

      Laing, Mrs Eleanor

      Shepherd, Richard

      Lait, Mrs Jacqui

      Simpson, Keith (Mid-Norfolk)

      Lansley, Andrew

      Smyth, Rev Martin (Belfast S)

      Letwin, Oliver

      Soames, Nicholas

      Lewis, Dr Julian (New Forest E)

      Spelman, Mrs Caroline

      Lidington, David

      Spicer, Sir Michael

      Lilley, Rt Hon Peter

      Spring, Richard

      Lloyd, Rt Hon Sir Peter (Fareham)

      Steen, Anthony

      Loughton, Tim

      Streeter, Gary

      Luff, Peter

      Swayne, Desmond

      MacGregor, Rt Hon John

      Syms, Robert

      McIntosh, Miss Anne

      Tapsell, Sir Peter

      MacKay, Andrew

      Taylor, Ian (Esher & Walton)

      Maclean, Rt Hon David

      Taylor, John M (Solihull)

      McLoughlin, Patrick

      Taylor, Sir Teddy

      Madel, Sir David

      Tredinnick, David

      Major, Rt Hon John

      Trend, Michael

      Malins, Humfrey

      Viggers, Peter

      Maples, John

      Walter, Robert

      Maude, Rt Hon Francis

      Wardle, Charles

      Mawhinney, Rt Hon Sir Brian

      Wells, Bowen

      May, Mrs Theresa

      Whitney, Sir Raymond

      Moss, Malcolm

      Whittingdale, John

      Nicholls, Patrick

      Widdecombe, Rt Hon Miss Ann

      Norman, Archie

      Wilkinson, John

      Paice, James

      Willetts, David

      Paterson, Owen

      Winterton, Mrs Ann (Congleton)

      Prior, David

      Woodward, Shaun

      Redwood, Rt Hon John

      Yeo, Tim

      Robathan, Andrew

      Young, Rt Hon Sir George

      Robertson, Laurence (Tewk'b'ry)

      Rowe, Andrew (Faversham)

      Tellers for the Ayes:

      Ruffley, David

      Mr. Stephen Day and

      St Aubyn, Nick

      Mr. Nigel Waterson.

      NOES

      Abbott, Ms Diane

      Bruce, Malcolm (Gordon)

      Adams, Mrs Irene (Paisley N)

      Burden, Richard

      Ainger, Nick

      Burnett, John

      Ainsworth, Robert (Cov'try NE)

      Burstow, Paul

      Alexander, Douglas

      Butler, Mrs Christine

      Allan, Richard

      Byers, Stephen

      Allen, Graham

      Cable, Dr Vincent

      Anderson, Donald (Swansea E)

      Campbell, Alan (Tynemouth)

      Armstrong, Ms Hilary

      Campbell, Mrs Anne (C'bridge)

      Ashton, Joe

      Campbell, Menzies (NE Fife)

      Atherton, Ms Candy

      Canavan, Dennis

      Atkins, Charlotte

      Cann, Jamie

      Ballard, Mrs Jackie

      Caplin, Ivor

      Banks, Tony

      Casale, Roger

      Barnes, Harry

      Caton, Martin

      Barron, Kevin

      Chapman, Ben (Wirral S)

      Battle, John

      Chaytor, David

      Bayley, Hugh

      Chisholm, Malcolm

      Beard, Nigel

      Clapham, Michael

      Begg, Miss Anne

      Clark, Dr Lynda (Edinburgh Pentlands)

      Beith, Rt Hon A J

      Bennett, Andrew F

      Clark, paul (Gillingham)

      Benton, Joe

      Clarke, Charles (Norwich S)

      Bermingham, Gerald

      Clarke, Eric (Midlothian)

      Berry, Roger

      Clelland, David

      Best, Harold

      Clwyd, Ann

      Betts, Clive

      Coaker, Vernon

      Blears, Ms Hazel

      Coffey, Ms Ann

      Blizzard, Bob

      Colman, Tony

      Borrow, David

      Connarty, Michael

      Bradley, Keith (Withington)

      Cook, Frank (Stockton N)

      Bradshaw, Ben

      Cooper, Yvette

      Brake, Tom

      Cotter, Brian

      Brand, Dr peter

      Cousins, Jim

      Breed, Colin

      Cranston, Ross

      Brinton, Mrs Helen

      Crausby, David

      Brown, Rt Hon Nick (Newcastle E)

      Cryer, John (Hornchurch)

      Brown, Russell (Dumfries)

      Cummings, John

      232

      Cunningham, Jim (Cov'try S)

      Illsley, Eric

      Cunningham, Ms Roseanna (Perth)

      Ingram, Adam

      Jackson, Ms Glenda (Hampstead)

      Dafis, Cynog

      Jackson, Helen (Hillsborough)

      Dalyell, Tarn

      Jamieson, David

      Darvill, Keith

      Johnson, Alan (Hull W & Hessle)

      Davey, Edward (Kingston)

      Johnson, Miss Melanie (Welwyn Hatfield)

      Davey, Valerie (Bristol W)

      Davidson, Ian

      Jones, Barry (Alyn & Deeside)

      Davies, Rt Hon Denzil (Llanelli)

      Jones, Helen (Warrington N)

      Davies, Rt Hon Ron (Caerphilly)

      Jones, Ieuan Wyn (Ynys Môn)

      Dawson, Hilton

      Jones, Jon Owen (Cardiff C)

      Dean, Mrs Janet

      Jones, Martyn (Clwyd S)

      Denham, John

      Jowell, Ms Tessa

      Donohoe, Brian H

      Kaufman, Rt Hon Gerald

      Doran, Frank

      Keeble, Ms Sally

      Eagle, Angela (Wallasey)

      Keen, Ann (Brentford & Isleworth)

      Eagle, Maria (L'pool Garston)

      Keetch, paul

      Edwards, Huw

      Kelly, Ms Ruth

      Efford, Clive

      Kemp, Fraser

      Ellman, Mrs Louise

      Kennedy, Charles (Ross Skye)

      Ewing, Mrs Margaret

      Kennedy, Jane (Wavertree)

      Fearn, Ronnie

      Khabra, Piara S

      Fitzpatrick, Jim

      Kilfoyle, Peter

      Flint, Caroline

      King, Ms Oona (Bethnal Green)

      Follett, Barbara

      Kingham, Ms Tess

      Foster, Rt Hon Derek

      Kumar, Dr Ashok

      Foster, Michael Jabez (Hastings)

      Laxton, Bob

      Foster, Michael J (Worcester)

      Leslie, Christopher

      Foulkes, George

      Levitt, Tom

      Galbraith, Sam

      Lewis, Ivan (Bury S)

      Galloway, George

      Lewis, Terry (Worsley)

      Gapes, Mike

      Liddell, Mrs Helen

      Gardiner, Barry

      Linton, Martin

      George, Andrew (St Ives)

      Livsey, Richard

      George, Bruce (Walsall S)

      Lloyd, Tony (Manchester C)

      Gerrard, Neil

      Llwyd, Elfyn

      Gibson, Dr Ian

      McAllion, John

      Gilroy, Mrs Linda

      McAvoy, Thomas

      Godman, Norman A

      McCabe, Steve

      Godsiff, Roger

      McCafferty, Ms Chris

      Gordon, Mrs Eileen

      McCartney, Ian (Makerfield)

      Gorrie, Donald

      McDonagh, Siobhain

      Grant, Bernie

      McDonnell, John

      Griffiths, Jane (Reading E)

      McFall, John

      Griffiths, Win (Bridgend)

      McGuire, Mrs Anne

      Grocott, Bruce

      McIsaac, Shona

      Grogan, John

      McKenna, Mrs Rosemary

      Gunnell, John

      Mackinlay, Andrew

      Hain, Peter

      McNulty, Tony

      Hall, Mike (Weaver Vale)

      MacShane, Denis

      Hall, Patrick (Bedford)

      Mactaggart, Fiona

      Hanson, David

      McWalter, Tony

      Harris, Dr Evan

      McWilliam, John

      Heal, Mrs Sylvia

      Mahon, Mrs Alice

      Healey, John

      Mallaber, Judy

      Heath, David (Somerton & Frome)

      Mandelson, Peter

      Henderson, Doug (Newcastle N)

      Marsden, Gordon (Blackpool S)

      Henderson, Ivan (Harwich)

      Marshall, David (Shettleston)

      Hepburn, Stephen

      Marshall-Andrews, Robert

      Heppell, John

      Martlew, Eric

      Hill, Keith

      Maxton, John

      Hodge, Ms Margaret

      Meale, Alan

      Hoey, Kate

      Michael, Alun

      Home Robertson, John

      Michie, Bill (Shef'ld Heeley)

      Hood, Jimmy

      Michie, Mrs Ray (Argyll & Bute)

      Hoon, Geoffrey

      Miller, Andrew

      Hope, Phil

      Moffatt, Laura

      Hopkins, Kelvin

      Moonie, Dr Lewis

      Howarth, Alan (Newport E)

      Moore, Michael

      Hoyle, Lindsay

      Moran, Ms Margaret

      Hughes, Ms Beverley (Stretford)

      Morgan, Alasdair (Galloway)

      Hughes, Simon (Southwark N)

      Morgan, Ms Julie (Cardiff N)

      Humble, Mrs Joan

      Morgan, Rhodri (Cardiff W)

      Hurst, Alan

      Morley, Elliot

      Iddon, Dr Brian

      Morris, Ms Estelle (B'ham Yardley)

      233

      Mudie, George

      Southworth, Ms Helen

      Mullin, Chris

      Spellar, John

      Murphy, Denis (Wansbeck)

      Squire, Ms Rachel

      Murphy, Jim (Eastwood)

      Steinberg, Gerry

      Norris, Dan

      Stevenson, George

      Oaten, Mark

      Stewart, David (Inverness E)

      O'Brien, Bill (Normanton)

      Stewart, Ian (Eccles)

      O'Brien, Mike (N Warks)

      Stinchcombe, paul

      Olner, Bill

      Stoate, Dr Howard

      O'Neill, Martin

      Stott, Roger

      Organ, Mrs Diana

      Stringer, Graham

      Osborne, Ms Sandra

      Stunell, Andrew

      Palmer, Dr Nick

      Sutcliffe, Gerry

      Pearson, Ian

      Swinney, John

      Pendry, Tom

      Temple-Morris, Peter

      Pickthall, Colin

      Thomas, Gareth (Clwyd W)

      Pike, peter L

      Timms, Stephen

      Pollard, Kerry

      Tipping, Paddy

      Pope, Greg

      Todd, Mark

      Powell, Sir Raymond

      Tonge, Dr Jenny

      Prentice, Ms Bridget (Lewisham E)

      Trickett, Jon

      Prentice, Gordon (Pendle)

      Truswell, paul

      Primarolo, Dawn

      Turner, Dennis (Wolverh'ton SE)

      Purchase, Ken

      Turner, Desmond (Kemptown)

      Radice, Giles

      Turner, Dr George (NW Norfolk)

      Rapson, Syd

      Twigg, Derek (Halton)

      Raynsford, Nick

      Twigg, Stephen (Enfield)

      Reed, Andrew (Loughborough)

      Tyler, Paul

      Reid, Dr John (Hamilton N)

      Vaz, Keith

      Rendel, David

      Ward, Ms Claire

      Roche, Mrs Barbara

      Wareing, Robert N

      Watts, David

      Rooker, Jeff

      Webb, Steve

      Rooney, Terry

      Welsh, Andrew

      Ross, Ernie (Dundee W)

      Whitehead, Dr Alan

      Rowlands, Ted

      Williams, Rt Hon Alan (Swansea W)

      Russell, Bob (Colchester)

      Ryan, Ms Joan

      Williams, Alan W (E Carmarthen)

      Salter, Martin

      Williams, Mrs Betty (Conwy)

      Sanders, Adrian

      Willis, Phil

      Savidge, Malcolm

      Wills, Michael

      Sawford, Phil

      Wilson, Brian

      Sedgemore, Brian

      Winnick, David

      Shaw, Jonathan

      Winterton, Ms Rosie (Doncaster C)

      Sheerman, Barry

      Wise, Audrey

      Sheldon, Rt Hon Robert

      Wood, Mike

      Simpson, Alan (Nottingham S)

      Woolas, Phil

      Singh, Marsha

      Wright, Anthony D (Gt Yarmouth)

      Skinner, Dennis

      Wright, Dr Tony (Cannock)

      Smith, Jacqui (Redditch)

      Wyatt, Derek

      Smith, John (Glamorgan)

      Smith, Llew (Blaenau Gwent)

      Tellers for the Noes:

      Smith, Sir Robert (W Ab'd'ns)

      Mr. Kevin Hughes and

      Soley, Clive

      Mr. Jim Dowd.

      Question accordingly negatived.
      Mr. Rowlands: I beg to move amendment No. 2, in Page 1, line 13, after 'Articles', insert
      1, paragraph 9 (Cm. 3780, page 10)'.
      The First Deputy Chairman of Ways and Means (Mr. Michael J. Martin): With this, it will be convenient to discuss amendment No. 8, in page 1, line 13, at end insert
      '(except Article 2 paragraph 57)'.
      Mr. Rowlands: The amendment was designed to offer the Committee the opportunity to discuss the new article F.1, but it has been made semi-redundant by the contributions to the previous debate, so I hope to be brief.
      The shadow Foreign Secretary took up at least two columns of Hansard on the subject of article F.1 when he opened the debate on amendment No. 65. He made a bit
      234
      of a meal of the issue, and over-egged the pudding. I would not say that he was put in his place, but the position was, quite rightly, well qualified by the right hon. and learned Member for Rushcliffe (Mr. Clarke), who spoke from the Back Benches.
      The shadow Foreign Secretary argued that the new article was vaguely defined and that it would be dealt with not by a judicial body but by politicians. I detected a somewhat derisory view of the idea that politicians should be involved. I think that he said that individual countries would be at the mercy of others. He argued that there was no need for such a provision, because if a country in the European Union fell into dictatorship, started persecuting its citizens, and confiscated private property or suspended the due process of law, there was one simple solution: expulsion.
      I do not think that my hon. Friend the Minister had the full opportunity, despite his extensive reply to the previous debate, to remind us what procedures and effort would be required to expel a state under there sent provisions of the treaty, given that expulsion was the shadow Foreign Secretary's only solution. How difficult would it be to deal with a state that had offended?
      When I tabled the amendment, I wanted to underline my support for the principle of the provision in the treaty. Despite some differences of nuance, I think that we all agree that it is essential that European Union membership—to become and to remain a member—should require good, fundamental democratic credentials. As many hon. Members said in the previous debate, it is almost impossible to envisage how one could sit on a Council of Ministers if one of the company was a colonel who had seized power in a coup.
      That idea is not all that fanciful. The right hon. and learned Member for Rushcliffe reminded us of the fact that when I entered the House in 1966 Greece was governed by one of the most brutal abusers of human rights that western Europe has known for a very long time. As the right hon. and learned Gentleman also pointed out, the Iberian peninsula had been in a similar position. Therefore one need not go back into the mists of time to recall that, even within the existing membership of the European Union, in my parliamentary and political lifetime, we have had dictatorships and authoritarian Governments that would now be intolerable in the European Union.
      Therefore it is important to assert that democracy is a fundamental obligation and to say that, if a member state persistently abuses fundamental human rights, it should be subject to discipline. However, I found it difficult to appreciate the argument by the right hon. and learned Member for Folkestone and Hythe (Mr. Howard) that a country could go from nothing to expulsion without any gradation of action that could be taken by other member states to tackle the problem of persistent infringement of human rights.
      We all support and endorse the argument made by the right hon. and learned Member for Folkestone and Hythe that, as are condition for membership, applicants must root their institutions in principles of democracy and human rights. It will be a matter of considerable scrutiny by the Commission and by the present Union that any applicant must fulfil those conditions and achieve those democratic institutions in a way that has a sense of permanence and does not look fragile or capable of being abused.

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      8.30 pm
      I believe that we all agree with that, so one hopes that the situation envisaged in the article will not arise. If, as observations made by Front-Bench and Back-Bench Members on both sides of the Committee suggest, the provisions turned up in the treaty in anticipation of the problems that might possibly occur if applicant states enter the European Union but cannot sustain democratic institutions, obviously the key must be to ensure that the application process for membership ensures that the institutions that create and form that state are generally democratic.
      I should be grateful if the Minister would reveal more about the origins of the article and tell us how and why it came into existence when it did. Was it anticipating some of the problems that may occur in the case of new applicants?
      I wondered where I might get a feel for the issues that the article might wish to address. I believe that it is useful to bring to the Committee's attention the Agenda 2000 document and the Commission's assessment, under the Copenhagen criteria, of the political situation of the applicant countries. The document gives a flavour of some of the issues and arguments that may well arise, even after individual states have successfully joined the European Union, and of how, presumably, F.1 might address them.
      I shall quote from two of the country reports of the Agenda 2000 Commission opinions. The first relates to an applicant country that I believe had expectations of being in the first group—Slovakia. The report obviously damaged those expectations. The following passage gives us an idea of the problems that might arise if a member state lapsed into certain behaviour. On the subject of applying the Copenhagen political criteria to Slovakia, the Commission said:
      "The operation of Slovakia's institutions is characterised by the fact that the government does not sufficiently respect the powers devolved by the constitution to other bodies and that it too often disregards the rights of the opposition. The constant tension between the government and the resident of the Republic is one example of this. Similarly, the way in which the government recently ignored the decisions of the Constitutional Court and the Central Referendum Commission on the occasion of the vote on 23/24 May 1997 directly threatened the stability of the institutions."
      That is a powerful assessment of the fragility of the institutional position in an applicant state—Slovakia.
      As a result of that Commission opinion, it now appears that Slovakia would not achieve membership without tackling, and satisfying the present European Union that it had tackled, those fundamental problems. In fact, as the Commission report says,
      "Despite recommendations made by the European Union in a number of demarches and declarations, there has been no noticeable improvement."
      Would the provisions of article F.1 apply if a similar situation arose in a state such as Slovakia after it had joined the European Union? Are those the areas of constitutional and democratic concern that were considered when the article was drafted? If a member state in a sense persistently abused its own constitution in key respects relating to human, rights, would that allow the European Union to act as the article suggests?
      I do not want to take too long because these arguments have been discussed, but I want to prise out of my hon. Friend the Minister some illustrations of the persistent breaches of rights that would trigger the processes described in the new article.
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      The other Commission opinion that raises a similar set of arguments is that on the political institutional position of Bulgaria. The Commission says that democratic institutions in Bulgaria
      "need to be reinforced by fuller respect in practice for the rule of law, at all levels of public administration".
      It says:
      "the operation of the judicial system"
      needs to be improved
      "to protect individual liberties in the face of too frequent abuses by the police and the secret services."
      That is another opinion in the context of an applicant state and the Commission giving its view. If such behaviour had occurred in a member state in the enlarged Union, would it be the type of behaviour that the article was meant or designed to start to bite on?
      Those are the questions that have been left in my mind. I have listened in the Committee to most of our previous debates. I want to know more about the way in which Ministers envisage the operation of the provision.
      If the article relates to the types of problems that have been identified in the Commission opinions on applicant states, I say to the right hon. and learned Member for Folkestone and Hythe that I believe that there is a case for a political judgment, not a judicial one. These are decisions about politics and democracy. I am not sure that judges are necessarily the best guides in that area. There is a case for saying that, in assessing whether certain behaviour is acceptable, the collective view of democratically elected politicians who represent public opinion is as good as that of a judge.
      I have thought about the subject, because obviously one wants very clear criteria and they do not exist. I agree with the right hon. and learned Member for Folkestone and Hythe that there is a vagueness in the wording, but I do think that, in many cases, those will be matters of considerable political judgment as opposed to judicial interpretation. Therefore the decision to place the matter in the hands of the European Council, to allow the heads of state of every other member of the European Union to make these difficult assessments, probably achieves a balance in respect of such problems and issues. So I do not share the queasiness about the provisions of the article that the right hon. and learned Member for Folkestone and Hythe feels.
      I certainly thought that the right hon. and learned Gentleman over-egged his case when talking about how one country can be left at the mercy of a random choice by other members of the Union. He should remember that a most elaborate procedure is involved. The decision must be unanimous; one third of the member states have to make an approach; the decision must be endorsed by two thirds of the European parliament. So built into the article is a fantastic number of hurdles that must be crossed before any state charged with persistent breaches of human rights can be suspended.
      Mr. Cash: Would the hon. Gentleman be good enough to bear in mind the fact that although the Union is founded on principles of liberty, democracy and the rule of law, if we dig a little deeper into the behaviour of current member states of the EU we find that "fundamental freedoms" and the rule of law do not apply with equal

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      validity to all member states? I am not even thinking of Greece at this point. It is not xenophobic to claim that there is a serious problem in the EU already.
      Mr. Rowlands: I defer to the hon. Gentleman's more detailed knowledge of the political performance of members of the current Union. I cannot think of any immediate examples of member states seriously abusing human rights. If the hon. Gentleman can, perhaps he will list them in his speech. As I understand it, the safeguards will apply to current members as well. I do find it difficult to believe that the sort of breaches envisaged in this article are being committed by any of the present 15 member states—but if they are, we should be aware of them and shoulder perhaps invoke a procedure to deal with them. There might be some virtue in that.
      I certainly believe that the Union should uphold and stand up for these rights, and if there are any breaches of the kind the hon. Gentleman has in mind a power should be created to bring offending member states to book.
      Earlier, my right hon. Friend the Member for Llanelli (Mr. Davies) rather wickedly suggested to me in conversation that some of the European Union's current institutions might not be up to the mark in certain respects. Certainly, no one can sack the Council of Ministers. One could play around with these arguments endlessly, but I for one do not share the qualms expressed by Conservative Members about the article. I just wanted to prise out of the Minister a better understanding of the context that gave rise to the article, and of the situations that might trigger its use.
      When I entered the House in 1966, three of the current member states in the Union were then autocratically governed. That is why I believe it important to buttress the idea that the chief obligation on a joining state should be to uphold these fundamental rights—hence my support for the new article.
      8.45 pm
      Mr. Howard: As the hon. Member for Merthyr Tydfil and Rhymney (Mr. Rowlands) has said, I deployed my arguments on this matter fairly fully last Thursday and I do not intend to go over the same ground again. I would like, however, briefly to respond to the points that the hon. Gentleman has just made.
      We start from the common position of wanting to do all we can to safeguard and advance basic human rights. The hon. Gentleman says that the treaty may not contain procedures at the moment that would enable a country seriously and persistently breaching fundamental human rights to be expelled, which would be my referred remedy if it ever came to it. My answer to that is put such procedures in the treaty. Just as the Government have put procedures into the treaty of Amsterdam to permit this much more unsatisfactory course to be adopted—depriving a member state of its rights but continuing to subject it to its obligations—so it would have been possible at Amsterdam to deal with the problem in the way I think preferable: providing procedures for expulsion.
      It is not right to say, either, that on this alternative approach there would be nothing between the first step and expulsion. It would be perfectly possible for the other
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      member states to give measured warnings to the offending state and to make it clear that unless it mended its ways expulsion would follow. So there is no question of expulsion coming out of the blue.
      I suggested last Thursday that it was difficult to identify any precedent for the procedures that have been put in to the treaty of Amsterdam. The Minister has not volunteered any precedent. I do think it extraordinary to say of a member state, however badly it has behaved, that it will continue to be fully bound by all the obligations of the treaty but deprived of all its rights under it.
      As my right hon. and learned Friend the Member for Rushcliffe (Mr. Clarke) conceded in his speech earlier today, the procedure could be used and abused to take away the voting rights of a recalcitrant state. The hon. Member for Merthyr Tydfil and Rhymney calls that a fanciful scenario. perhaps so, but if this Committee is to carry out its responsibilities in relation to the scrutiny of a treaty, it is incumbent on us to identify scenarios that may not be very likely but which could be turned to the disadvantage of this country. It is also our duty to point out the dangers.
      It is, after all, not entirely unprecedented for provisions in European treaties to which we have signed up and agreed to be used in a way that was never predicted at the time. One obvious example would be the way qualified majority voting procedures in respect of health and safety were used to introduce a 48-hour maximum working week. No one in the previous Government who agreed to QMV for health and safety measures at the time of the Single European Act ever contemplated their use to introduce a maximum length of working week. Indeed, none of my hon. Friends during the debates on that treaty made this point, to my knowledge. I have no doubt that had they made it that, too, would have been dismissed as fanciful or extremely unlikely.
      The point is that we have a duty to examine the provisions of treaties such as this and to make sure that there is no scope for abuse or for their use in a way that may never have been intended or which might be to the disadvantage of our country. That is the basis on which I offered my observations on Thursday, and I remain unconvinced by the doubts expressed by the hon. Member for Merthyr Tydfil and Rhymney.
      Sir Raymond Whitney: My right hon. and learned Friend the Member for Folkestone and Hythe (Mr. Howard) is right, and we would all agree that the Committee has a duty to examine legislation such as this, especially legislation of an international nature, to make sure that there are no traps or hidden dangers or faint possibilities that might endanger our national interest. However, there is a danger of that awareness and alertness turning into paranoia. We can take matters so far that they verge on the absurd.
      I hope that there is no dissension on either side of the Chamber from the view that article F.1 of the treaty of Amsterdam is well intentioned and necessary. It is directed not only at the potential new members of the European Union, but possibly at existing members. It started as an initiative at the Copenhagen summit, where all attention was focused on the enlargement of the European Union, to which my party has traditionally attached a good deal of weight.
      We want to ensure, of course, that the character of the European Union does not fundamentally change. That is what the article is surely designed to achieve. As the

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      hon. Member for Merthyr Tydfil and Rhymney (Mr. Rowlands) pointed out, before any candidate member is accepted, there is a test to be passed. We must recognise the possibility that a country can be in a state of grace and pass the test one year, but—especially in the case of democracies that are not deeply rooted—a few years later the standards achieved to pass the test may no longer be met. Therefore criteria are required.
      By their very nature, such criteria cannot be spelled out in every last detail. I believe that the drafting of the treaty is adequate. I shall not read the treaty out; the hon. Gentleman mentioned it and we went over this ground in the earlier debate. It is clear enough. We know what we mean when we say that human rights are persistently and seriously breached. It is chopping logic to suggest that we do not understand. Even if one nation did not know, the other 14 or 15 would surely get it right.
      Mr. Letwin: All of us throughout the Chamber know what is meant, and we all agree that it is necessary to do something about a member state in such circumstances. Does my hon. Friend agree, however, that sometimes, regrettably, there has been a tendency for the European Court to apply interpretations of clauses in treaties that go far beyond the ordinary meaning of those terms, with a view to establishing certain patterns of integration? Does he agree that that could give rise to the problems to which my right hon. and learned Friend the Member for Folkestone and Hythe (Mr. Howard) alluded?
      Sir Raymond Whitney: No, I do not agree. I suggest that my hon. Friend read article F.1 of the treaty. He will see that, before the matter ever came near the court, it would have to be approved by unanimity minus one—that one being the state in the dock. It is for the Council of Ministers to make the judgment and activate the other criteria—one third of the Council to bring the charge and two thirds of the European parliament to go along with the conviction, so to speak. At a subsequent stage, if the accused state wanted to apply to the European Court of Justice, it would have a right to do so.
      My hon. Friend may fear what might happen to Britain, but that is another safeguard. There are so many hurdles in the procedure that we should rest assured. I am not saying, and my right hon. and learned Friend the Member for Rushcliffe (Mr. Clarke) made the point that one cannot say definitively, that the world will not go mad tomorrow, but compared with the prospect of no such provision being included in the Amsterdam treaty, and compared with the risk of the provision being absurdly abused, common sense would judge that we need the provision.
      Earlier in the debate, some pretty rum options were offered to the Committee. We were told that the provision might be applied to a Communitywide minimum wage. Our minimum wage would allegedly be set at too low a level, and that might be interpreted—or misinterpreted—as a serious and persistent breach of human rights. Misguided as the concept of a minimum wage might be, the possibility that Greece would be in a position to vote with the rest of the Community and condemn us does not bear contemplating.
      We were told about the possibility that if we had—orerhaps if we did not have—abortion on demand, that would be seen as further evidence that we were in serious and persistent breach of human rights. Another such
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      possibility might arise if we changed—or failed to change—the age of homosexual consent from 18 to 16. My hon. Friend the Member for Stone (Mr. Cash), who, happily, is not in his place, even mentioned the risk of paedophilia. How crazy can we get?
      It is fun to have an after-dinner debate, but this is a serious issue. We want to ensure that any criticisms of the Amsterdam treaty—the Opposition do indeed have some criticisms—are legitimate and well founded.
      My right hon. and learned Friend the Member for Folkestone and Hythe wants the treaty to contain a mechanism for expulsion. There might be a case for that, or perhaps such a mechanism exists already. I look forward to the Minister of State explaining the exact legal position, as the hon. Member for Merthyr Tydfil and Rhymney invited him to do.
      Perhaps there could be a sanction of total expulsion, but the suspension option strikes me as sensible. This situation is posited: a state passes the entrance exam; it would be up to snuff to be allowed in. A few years later, things go wrong—a military coup, or whatever. Surely the sensible approach would be for the other member states—14, 21 or however many there are—to say to the offending state, "You are suspended. All the rest of us abhor what you are doing, and you are suspended until you return to the paths of righteousness." That would be the common-sense approach.
      I hope that we will not pursue any amendment that would expunge article F.1, which is a perfectly sensible and necessary element in the Amsterdam treaty.
      Sir Teddy Taylor: My hon. Friend the Member for Wycombe (Sir R. Whitney) and I have been in the House of Commons for a very long time. That being so, it is only fair to tell my younger hon. Friends that, although we have great respect for my hon. Friend's sincerity, kindness, aptitude and integrity—I am sure that he is kind to animals as well—he has been wildly optimistic about all the previous treaties that we have signed. There are those of us who have said that it would all end up in a horrible mess, and we have been proved right.
      My hon. Friend has said that he is rather worried about the attitudes of some of those who occupy the Opposition Front Bench, right hon. and hon. Friends whom I regard as having great integrity and wisdom. At the same time, there is a great danger of over-optimism. We hear it said that things will work out in the interests of the people and it is to be hoped that all will go well. I hope that, on reflection, my hon. Friend—and certainly newly elected hon. Friends—will bear in mind what has happened.
      So many glorious opportunities have been offered to us—for example, signing the treaty of Rome, enacting and implementing the single Act and signing the Maastricht treaty. I am certain that they have all worked out terribly badly for the people of Europe. I am thinking not of big business but of the people and how they have suffered. I am thinking also about the abuse of public money, of which some of my hon. Friends and I warned.
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      My hon. Friend said that we did not need to worry about that, but think of all the money that we are spending on, for example, destroying food. I wonder how my

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      hon. Friend can sleep at night while thinking about poverty in the world and misery in the United Kingdom against the background of the vast sums that are spent on destroying food as a result of the absurd policies that he and others are supporting.
      Let us be extremely careful about agreeing to new and splendid sentences being written into treaties. Unfortunately, treaties are ratified and they look lovely—they state, in effect, that we are all in favour of nice things happening—only for the wretched European Court, or individuals, including some of the Euro-enthusiasts, to come along and to interpret legislation in a ridiculous way that causes us to wonder why we agreed to it in the first place.
      I am sure that the hon. Member for North Durham (Mr. Radice), who has this moment entered the Chamber, will remember how we were passing rules to the effect that dumping would be handled by the European Union. We thought that that was all right because it was necessary only to prove conclusively that someone was selling something cheaper abroad than at home and that nasty commercial activity was taking place. We used to have a splendid organisation in this country that enabled us to take action if someone was dumping. There was an appeal process and it was necessary to provide evidence. What happens now? The Commission decides whether dumping has taken place. It comes to a conclusion and there is no appeal. No proof is required. Let us be extremely careful about approval, because things do not always work out as we would wish or think.
      We must bear in mind the interests of big business. There are some who wonder why it is so enthusiastic about extending the powers of the European Union. It seems to me, however, that the reason is clear. Big business much refers to deal with organisations such as the Commission and other non-democratic organisations than with democratic Governments.
      Philips, for example, can obtain a far better deal for itself by involving itself with the Commission rather than trying to deal with a democratic process. That being so, I hope that right hon. and hon. Members will be extremely careful. I hope also that they will support the amendment and not agree to the insertion of the ridiculous article F.1. Surely we should not vote in the House of Commons for something that is completely nonsensical. Article F.1 states that the EU is a democratic organisation. Younger Members—apart from the old gentlemen, my hon. Friend the Member for Wycombe and me—should think carefully. If they do, they will find that the EU stands basically for the destruction of democracy. All the things that we fought to reserve in a democratic process will be undermined by the EU.
      Democracy means that the people's voice should count. It means that people should be able to express opinions and that others should listen to them. It is sad that in the context of the EU people's views do not matter and public opinion is largely irrelevant.
      I shall give some examples from my own experience. For some time, I have been a member—there was only a brief interruption—of the Conservative party. The party has an annual conference where many of its supporters come together. The Conservative conference this year was held in Blackpool. Apart from the wisdom that we heard
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      from those who occupy the Opposition Front Bench in this place, delegates were handing out badges. That is one of the things that we do in the Conservative party. We tend to demonstrate our affiliation to something by wearing badges. One of the badges read, "Save Duty Free in 1999". That is something that some members of the Conservative party support.
      In fact, democracy can do nothing about saving duty-free goods. Even if every Member in the House of Commons, including the Prime Minister and my right hon. Friend the Leader of the Opposition, said, "We want to keep duty free in 1999," nothing could be done, unless there was a unanimous decision of the Council of Ministers to allow Britain to preserve the duty-free system.
      I fear that the Conservatives, most unusually for them, were misleading themselves by handing out badges about preserving the duty-free system. Another wee badge was handed out about saving Britain's fish. I should love to save our fish, and I think that most Members of this place—especially young Members—would support me. Unfortunately, given the wording of article F.1, there is nothing that we can do to that end. If the Prime Minister, my right hon. Friend the Leader of the Opposition and all Front-Bench and Back-Bench Members were to say, "We shall save Britain's fish," nothing would happen. Decisions are made by a majority vote of the Council of Ministers. Why put in the words supporting democracy? It is not democracy at all. The democratic process can do nothing whatever.
      Mr. Martin, you are, as we know, one of the most conscientious Members of parliament that we have, and you have a surgery just like everyone else. people come to our surgeries to complain. What do they complain to me about? A big deputation of 12 people, including a clergyman who brought a dog to show that he was fond of animals, came to see me. They asked me to vote to stop the export of live cattle. I had to tell them, "I am terribly sorry, but we cannot do anything about it," to which they replied, "Well, the Liberal Democrats support us." I said, "That does not really show anything. It is a sad fact that, even if you had a Liberal Democrat Government, which would bring many advantages, there is nothing you could do about the export of live cattle."
      People complain to me about VAT, saying, "Why should we pay VAT on things that are wrong? Will you vote against it?" I have to say no. To that, some people might say, "Well that shows that you MPs are a useless crowd and you should have done something about it." But there is nowhere else to go.
      Mr. Mike Gapes: Does the hon. Gentleman agree that the policies about which he is complaining were introduced as a result of the Single European Act, which was introduced by Baroness Thatcher and the Government whom he supported? Therefore, he should criticise himself rather than the European Union.
      Sir Teddy Taylor: Younger Members who are conscientious and good attenders sometimes do not check their facts. I assure the hon. Gentleman that I voted against every single clause of the Single European Act. He is trying to make party political points when we are talking about democracy, and that is what is wrong with

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      these amendments. Instead of people talking about democracy, freedom and liberty, they try to make silly party political points. I am glad that the hon. Gentleman has come to the debate, because quite a few newer Members do not bother, but please check up. Some of us have been warning and voting against this legislation time after time.
      I also remind the hon. Gentleman that his Government are introducing this legislation. All Governments do this for the best of reasons. I knew Baroness Thatcher very well. She is a very fine woman who did great work, but she, like all Prime Ministers, started off saying, "Europe is in a mess. It is not going well. I am going to sit around the table and try to sort them out." She brought out what she thought was a very good treaty to try to improve free trade. In fact, it did not. The Prime Minister before her said that he was going to do the same.
      The First Deputy Chairman: Order. The hon. Gentleman is going rather wide of the amendment. I note the examples that he has given. One or two examples are fine, but when he goes on at great length to give the Committee examples, he is going wide of the amendments before us.
      Sir Teddy Taylor: You are absolutely right, Mr. Martin. I am sorry that I was distracted. This is what happens. We try to make a conclusive case, younger Members sometimes ask questions, which I am sure are well intentioned, and we get diverted.
      The simple point that I should like to make is: how on earth can Members vote for a clause that is utter and complete nonsense? Can anyone say with any sincerity that things are decided in the European Union on the basis of democracy? Democracy means the rights of the people. What can the people do? Say, for example, Mr. Martin, your constituents said, "I am upset that £1.2 billion is spent on subsidising the growing of high-tar tobacco. I want to do something about it." I am sure that, with the splendid Member of Parliament that they have, they would ask, "What can you do about it?" The answer is absolutely nothing. [Interruption.] Hon. Members might laugh, but I assure them that some people feel very sincerely about the issue of tobacco. They think that it is shocking to waste money on subsidising the growing of high-tar tobacco. They think that the health risks of tobacco should be taken very seriously. Some hon. Members might disagree, but for goodness sake do not forget that many people think that.
      What can people do? For whom can they vote? The sad fact is that, under the European Union, the powers have gone. people's views are of no consequence whatever. By all means, if we are to have treaties, let us put in things that are sensible. Do not write into treaties things that are simply untrue. That is vital. Happily, I have never been on trial, but I should hate to be tried by a law that was nonsense. How would hon. Members like to be tried on the basis of a law that was a load of codswallop and nonsense? Some unfortunate country—perhapsortugal, Greece or Britain—will be on trial, and liable to expulsion on the basis of a law that is utter nonsense, illogical and silly and does not add up. If someone is on trial, it should be on the basis of a law that is sensible.
      I hope that hon. Members will think about my final point. My hon. Friend the Member for Wycombe and I know what goes on, because we have been around for
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      a long time, but new Members may not be aware of it. Decisions are made in the European Union, not on the basis of what is right or wrong. The Council of Ministers is not like some of our splendid Select Committees with their excellent Chairmen. We ask what is right and what is wrong, what we should support and what we should oppose, whereas decisions in the European Union are arrived at by horse trading.
      We may want to export beef because there is so much of it that we do not know what to do with it, and we may want the French and the Germans to support us. We would support them on one Council to get their support on another. That is worrying. Britain may do something that others do not like. Our splendid shadow Foreign Secretary is a man of integrity and toughness, but in government he may do something that others do not like. The danger is that we are creating circumstances in which we may be subject to such horse trading. It is a very bad thing indeed.
      I hope that hon. Members will think carefully about the amendment. We have passed piles of laws, and we never know what we are doing when we pass these treaties, because the courts interpret them widely. We have some protection, because the courts would not take us up on the basis of this provision as they do with other provisions: we would have to have a vote beforehand. Quite honestly, it is silly to write something into a treaty that is nonsense. Any treaty that says that the European Union is founded on the principles of democracy is utter and complete nonsense. There may be good intentions, and those who support the European Union may think that it will do people good, although it has not yet shown that it will, but the plain fact is that we should not write into treaties provisions that are utter and complete nonsense.
      Conservative Members have many attributes, but Labour Members in particular care about democracy. It mattered to the Labour party: people were prepared to be locked up and beaten up to protect the rights of working people. Sadly, the rights of working people are being undermined massively—in some areas, totally—by the European Union. I do not like it, and I do not think that the majority of people like it. We should not write nonsense into law, and those who argue that the European Union is democratic are misleading themselves. It is not true, it has not been true, and it never will be true. Let us get rid of this silly nonsense, and support this excellent amendment.
      Mr. Swayne: I want to speak in favour of amendment No. 8. Several hon. Members have outlined the extreme unlikelihood of the provisions in article F.1 ever being brought into force. That begs the question: why is the article in the treaty?
      This provision is difficult to oppose: after all, who could oppose the principle of human rights? However, there are widely differing conceptions of what constitutes a right and how it should be implemented. Those different conceptions arise from the different traditions and histories of member states. That is the proper way to implement such human rights.
      The intrusion of the European Union into the realm of human rights in this article of the treaty is a retrograde step. As a consequence, because of differing national traditions, the form of human rights that is adopted will be diluted and remote from our view of human rights.

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      The treaty states that the European Union is founded on the principles of liberty, democracy, respect for human rights and fundamental freedoms and the rule of law. Those principles are common to all member states. They are fine-sounding words, but they bear only an approximation to reality.
      Rights in England are usually understood as vetoes, such as the right not to be imprisoned without due process and the right not to have one's house searched or occupied. By and large, rights in the continental tradition have tended to be regarded as claims on the Executive, obligations that must be fulfilled. For example, such an obligation on the state might be the right to some form of social protection. It is precisely on the basis of that difference that my hon. Friend the Member for Wycombe (Sir R. Whitney) was wrong in not perceiving that there could be a dispute between member states on the basis of different perceptions of what constitutes a human right. It is all very well for my hon. Friend to rely on the good sense and fair play of other member states, but our experience in this matter bids us to be cautious.
      My recollection of the case that we brought over the European working time directive is that the European Court ruled against us on the basis that what constituted a health and safety measure was what the Council of Ministers thought constituted such a measure. No protection is afforded by relying upon the words or their plain meaning.
      It is questionable whether the member states even rely on any common understanding of the rule of law. Our understanding of the rule of law in England is based on the fact that the Executive are subject to the law because it makes the king. There is a different concept in some continental traditions. The treaty, which ignores the distinct European traditions and relies on the concept that is outlined in article F.1, is most definitely a step away from our tradition. What have we to gain from it, we who already have the advantage of habeas corpus and trial by jury? We have much to lose and little to gain. In that respect, it is instructive to note the way that article F.1, by being brought into the treaty, effectively demotes the old article F.1 which, of course, required the European Union to respect the different traditions of the member states.
      9.15 pm
      Mr. Doug Henderson: I have been called earlier than I expected. I am grateful to my hon. Friend the Member for Merthyr Tydfil and Rhymney (Mr. Rowlands) for moving the amendment in a supportive way. He often does that, although not always. As the right hon. and learned Member for Folkestone and Hythe (Mr. Howard) said in his short speech, there was much discussion on the issue to which the amendment relates during our debate on the earlier group of amendments. We are debating an important part of the Bill. The Government cannot accept the amendment, but I know that its purpose was to enable the Committee to debate the issues. I hope that my hon. Friend will eventually withdraw his amendment.
      Hon. Members have asked about the expulsion procedures. They might find this strange, but there are no procedures for expulsion in the rules. As far as I am aware, there was no amendment to the draft documents
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      that were circulated at the intergovernmental conference before 1 May. The previous Government did not table an amendment to insert an expulsion clause. I have checked with officials at UKREP in Brussels and as far as I am aware no amendment was tabled.
      Where did the concept of expulsion come from? It came from the potential enlargement of the European Union. The hon. Member for New Forest, West (Mr. Swayne) asked what we had to gain. The answer is a constructive role in the EU's enlargement, to which the previous British Government were also committed and to which the Opposition, I think, are committed. It is an important issue, which we may discuss in more detail when we reach other clauses. We will certainly discuss it on Thursday in the debate in the House on the Luxembourg summit.
      Enlargement is an important issue for Europe's future security and economic prosperity. We in democratic countries were the first to criticise the Governments in central and eastern Europe before 1988. Now we have to offer those countries the hand of friendship. We have to say that we want them to be part of our wider Community and that, if they can meet the conditions that have been laid down—we want to help them to do that—they can be part of the enlargement.
      However, there has to be a little protection for the integrity of the European Union. That is why the provision is important. It is not so much that it is going to be used. I think that all countries would want to use it only as a last resort and after a serious and persistent breach of the regulations and repeated warnings that countries have to change their act. If they do not, the provision will be invoked. If, after all that, the nations of the European Union agree unanimously, except for the one country involved—at the moment, 15 minus one—and the European parliament has its say, a country could be suspended.
      We would have to be extremely careful about how an expulsion provision is drafted because being a member of the European Union is a privilege and obligation not only for the nation, but for its citizens. One part of a nation being in serious and persistent breach of the basic obligations of EU membership does not mean that other citizens, who perhaps have nothing to do with that, but who have contracts with other EU citizens, should be penalised. That serious question has to be investigated if we are to introduce an expulsion provision.
      That point was discussed in the short time that I spent at the intergovernmental conference, when the original proposals were considered. It was felt that a suspension clause, which could become permanent for the nation, although its citizens might still have certain obligations and privileges, would be in place unless the wrong was put right.
      Mr. Cash: Has the Minister given serious thought to the question that I tried to raise earlier about the common principles that apply to the existing European Union? Has some form of analysis been made, even within the existing EU, let alone with any prospective new members, of what the common principles are in relation to democratic procedures, accountability, trial by jury, habeas corpus and such things? Otherwise, simply stating

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      that there are common principles, which are supposed to be endorsed into our law as a result of these debates, is meaningless.
      Mr. Henderson: I am sure that the hon. Gentleman has read the Commission document "Agenda 2000" on enlargement.
      Mr. Cash indicated dissent.
      Mr. Henderson: I refer the hon. Gentleman to it. In it, the Commission outlines the sort of tests that a country has to meet to gain admission to the European Union. Many of those principles, which are accepted without any serious doubt by all EU partners, are the ones that, at the minimum, would apply. However, in response to a similar question, which the hon. Gentleman asked me in the Select Committee, I said that those principles change over time.
      There are fundamental principles such as habeas corpus and others to which the hon. Gentleman referred, but others relating to the interpretation of democracy, the relationship between the police and the justice system and so on change as circumstances change. I think that the nations of the European Union are sensible enough to interpret that fact. It is a political interpretation, which was an important point made by the right hon. and learned Member for Rushcliffe (Mr. Clarke). I am satisfied on that point and I know that our partners in the European Union are too.
      The hon. Member for Wycombe (Sir R. Whitney) put it as well as it can be put, if he does not mind my saying so, when he said that article F.1 is well intentioned and necessary. I hope and believe that it will be interpreted sensibly by nations. We are all clear about the reasons for it: when the new countries, which have changed a great deal over the past 10 years, apply to join the European Union and begin to meet some of the economic criteria, they know that they must enshrine in their democracy the political test put to them. Their response must be lasting and sustained; if not, they would risk being caught under the article. The importance of the article is that it concentrates the minds of new countries and, indeed, our own on ensuring that we continue to meet those desirable standards. With that explanation, I hope that my hon. Friend the Member for Merthyr Tydfil and Rhymney will feel able to withdraw the amendment.
      Mr. Rowlands: On this occasion, I accept my hon. Friend's reasons for not accepting the amendment. I beg to ask leave to withdraw the amendment.
      Amendment, by leave, withdrawn.
      Mr. Howard: I beg to move amendment No. 3, in page 1, line 13, after '2', insert '(except paragraph 19)'.
      The First Deputy Chairman: With this, it will be convenient to discuss the following amendments: No. 4, in page 1, line 13, after '9', insert
      '(except Article 2 paragraph 22)'.
      No. 59, in page 1, line 13, at end insert 'except Article 2(3)(c)'.
      No. 34, in page 1, line 13, at end insert
      'other than in Article 2, paragraph 19)'.
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      No. 36, in page 1, line 13, at end insert
      'other than in Article 2, paragraph 22)'.
      New clause 21—Appointments to Employment Committee—
      '.—Pursuant to Article 2 of the Treaty of Amsterdam, paragraph 19 (Cmd. 3780, age 31), Her Majesty's Government shall make appointments to the Employment Committee in consultation with employers' and workers' organisations.'.
      New clause 27—Social Chapter: Report to parliament—
      '.—Her Majesty's Government shall make a half-yearly report to parliament on the implementation of Article 2, paragraph 22 of the Treaty setting out the United Kingdom legislation and employment implications arising from the new Employment Chapter and Social Chapter as agreed in the Amsterdam Treaty which shall be subject to resolution by each House of parliament.'.
      Mr. Howard: The amendments deal with European social policy, in particular the scrapping of Britain's opt-out from the social chapter, and the new employment chapter agreed at Amsterdam. Let me make it clear at the outset that the Conservative party is opposed to both. We believe that they will lead to more regulation, less flexibility and lost jobs. They are bad for Britain and bad for Europe.
      In 1992, my right hon. Friend the Member for Huntingdon (Mr. Major) negotiated an opt-out for Britain from the social chapter. That was no mean achievement. It was a hard-won gain which was warmly welcomed by British business. Even Jacques Delors acknowledged that it was an excellent deal for Britain. The United Kingdom would, he said, become
      "a paradise for Japanese investment".
      That prediction has been amply justified.
      Let us consider the facts. The United Kingdom is the No. 1 destination for inward investment. In 1995–96, Britain attracted a third of all inward investment into the European Union. That included more than 40 per cent. of all Japanese and American investment and more than half of all Korean and Taiwanese investment. With this investment have come jobs—British jobs.
      The UK has a higher proportion of its working population in work than any other major European Union country and, unlike France, Germany or Belgium, our unemployment rate is well below the European Union average. The truth is that because we have a flexible labour market, excellent industrial relations and low overheads, Britain is a good place in which to do business.
      Our strike rate has been lower than the European average for the past nine years and we have the lowest labour overheads of any member of the European Union. For every £100aid in wages, employers must add non-wage costs—such as social security contributions and health insurance—of £32 in Germany, £41 in France and only £18 in the United Kingdom. It is those non-wage costs, not the level of the wages themselves, that do such damage to a company's ability to compete. By signing up to the social chapter, the Government risk having those burdens imposed on British business—burdens that will chip away at our competitiveness, destroying British jobs.

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      Ministers talk endlessly of the importance of job creation. The trouble is that they fail to understand how jobs are created. As the chairman of the German equivalent of the Confederation of British Industry has said:
      "Excessively high German labour costs are costing more and more German jobs."
      On another occasion, he said:
      "we have too rigid labour laws. We have too high social costs and taxes. We have the shortest working week in Europe. The German Government spends 50 per cent. of GDP as opposed to 42 per cent. in Britain. No wonder we have problem."
      The chairman's assessment is backed up by The Wall Street Journal, which pointed out that
      "Britain imposes a much lower burden of social charges on employers than any other European country. British social taxes were less than half those in Switzerland, 40 per cent. of those in Germany and 29 per cent. of those in France."
      The French newspaper Le Monde has explained that
      "if unemployment is dropping in Britain it is because they have done everything to deserve it. For several years, considerable efforts have been made to improve the workings of the labour market, thereby boosting job and new company creations".
      What, then, are the benefits that our opt-out from the social chapter has denied us? What is the pressing need that has not been met since that opt-out was won? What is the injury, the damage and the detriment that the opt-in agreed at Amsterdam is supposed to remedy? The Government have never answered those questions. Why? Because there are no such benefits and no such need. There is no injury, damage or detriment. If there were, it would be perfectly possible for this parliament to remedy it.
      9.30 pm
      I understand that the Labour party has different views on these matters from Opposition Members. No one who saw the Minister of State, Department of Trade and Industry reply to yesterday's debate on burdens on business could be in any doubt that old Labour is still alive and kicking. The Government have a large majority. If they take the view that further social legislation is desirable, they can introduce such legislation in the House. There is no need to make—and no justification for making—our economy vulnerable to measures imposed on us against our will by the European Commission and other member states.
      The Prime Minister once pretended that such an imposition could not happen. He once claimed that we could pick and choose the elements that we wanted to accept. The Prime Minister and the Government would be powerless to prevent damaging measures being imposed on the United Kingdom against our will because, under the social chapter, so many subjects are decided on the basis of qualified majority voting.
      The Government are keen, when it suits them, to pray in aid the views of the director-general of the CBI. They would do well to listen to him on this subject.
      "If you sign up to the social chapter,"
      he warned,
      "you can't actually be sure that you'll have your way, because some directives will be covered by qualified majority voting. There is, however, a way to pick and choose, and that is available to the Labour party if it wants to have it as its policy. The way to pick and choose is actually not to sign up to the social chapter."
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      The president of the Board of Trade has already come up against the problem. As my hon. Friend the Member for Sevenoaks (Mr. Fallon) pointed out in yesterday's debate, when the president of the Board of Trade—having told BBC television's "On the Record" that she did not support Commissioner Flynn's proposals for national works councils—was asked how the Government could prevent the proposals becoming law, as they would be introduced under qualified majority voting, there was a long pause and then she said:
      "Well, er, we shall see how things go."
      That is the clarion call of the president of the Board of Trade to British business.
      Under the social chapter, legislation in any of the following areas can be adopted by qualified majority vote: working conditions, informing and consulting workers, equality between men and women in relation to work opportunities and treatment at work, the integration of people excluded from the labour market, and health and safety at work. The social chapter allows burdens to be imposed on business in virtually all areas of social and employment policy.
      Already, two pieces of legislation have been introduced under the social chapter: the European works councils directive and the parental leave directive. The more profound danger of the social chapter, however, lies in the potential it provides for more far-reaching social legislation, such as the European Commission's proposal for national works councils. The existing works councils directive affects only large, multinational companies, but Commissioner Flynn has suggested that companies with as few as 50 employees should be forced to set up works councils. What is to be gained from agreeing to provisions that would enable British firms to be forced to do that? The Government are opposed to the proposal. A raft of further social legislation is currently under review.
      The treaty also contains a new employment chapter. It makes member states' employment policies a matter of common concern and requires member states to co-ordinate their action in that respect within the Council. The European Council will consider the employment situation each year and adopt conclusions. On the basis of the European Council's conclusions,
      "the Council, acting by a qualified majority on a proposal from the Commission and after consulting the European parliament, the Economic and Social Committee, the Committee of the Regions and the Employment Committee…shall year draw up guidelines which the Member States shall take into account in their employment policies."
      Member states will also be required to submit an annual employment report to the Commission. Once again, the Council,
      "acting by a qualified majority on a recommendation from the Commission, may, if it considers it appropriate in the light of that examination, make recommendations to Member States."
      Employment policy will cease to be a matter for individual member states. Britain's employment policy will become a matter for all European Union members. Guidelines which "shall"—not "can" or even "should"—direct employment policy will be determined by qualified majority vote in the Council. If the Commission and the Council are not happy with a member state's efforts to harmonise employment policy, they can, again on the basis of qualified majority voting, make recommendations to that member state.

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      What repercussions could such a chapter have? What guarantees can the Minister give us that it cannot be used to impose on this country an employment policy that we oppose and which would destroy, not create, jobs? What assurances can be given that a British Government will not find themselves having to support and implement employment policies that may be wholly inappropriate or unrealistic? Is it not the case that the European Court of Justice could interpret the employment chapter as placing a duty on the British Government to pursue employment policies dictated by other European states—policies that could well be against Britain's national interest?
      Under the new employment chapter introduced at Amsterdam, we can expect yet more interference and regulation. In particular, the treaty introduces a mechanism for so-called "incentive measures" which will be adopted by qualified majority vote. That is a potential source of expensive employment programmes for which we would have no need, but for which the United Kingdom would be expected to pay. Will the Minister explain the scope of the "incentive measures" that can be agreed by qualified majority voting under the employment chapter? Is it not the case that moneys could be voted under those provisions to finance worthless schemes in other countries despite the opposition of the British Government?
      The future of our country and of all our fellow citizens depends on our ability to earn our way in a world that is more fiercely competitive than ever. In that competitive world, all the crucial decisions are made at the margin. Marginal differences in price, in quality and in delivery can make all the difference between winning orders and losing them, between creating jobs and destroying them and between building prosperity and undermining it. Over the years, Conservative policies have given this country a critical competitive advantage that has enabled the British people to win orders, to create jobs and to build prosperity.
      The cumulative consequence of the Government'solicies—of which their signing up to the social chapter is one of the most prominent examples—will be the destruction of that critical margin of competitiveness. It will happen throughout the country, particularly to small and medium firms. In the end, we shall see what we have seen under every Labour Government—newspaper headlines that read, "Unemployment up again".
      That is the harsh reality behind the debate. It is why the Conservatives will continue to speak up for the men, women and children throughout the country who will lose out. There is only one sure way to protect the country from those unwanted burdens—to stay outside the social chapter. We should keep our opt-out and delete the provisions from the treaty. That is why I invite hon. Members to vote for amendments Nos. 3 and 4 and new clause 27.
      Mr. Laurence Robertson: My background is in industry. I started on the shop floor at the age of 18 and eventually moved into industrial management. I have had many clients over the years and worked with many thousands of people. I have also been active in small business—it was getting smaller and smaller—for about 14 years. The nearer the election came, the smaller it got.
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      I have also been unemployed. I know how wasteful unemployment is of people's energies and talents. I know how hard it is for families. Unemployment is my main concern. The social chapter and a range of other measures from Europe will cause unemployment.
      The social chapter does not contain a great deal at the moment. It is a procedure. However, that is what makes it dangerous. Not only could it grow to incorporate many things, but the countries involved in it could move on to the social charter. They have agreed to move towards it. That would involve many more measures than are contained in the social chapter. We should consider that carefully.
      Europe has had employment regulations for many years. That is why growth in Europe has been comparatively sluggish. European countries have had low levels of job creation, particularly compared with the United States. My visits to the United States have shown me that, much though I like the country, it is hardly as efficient as Britain. However, it is less regulated. That is the difference between the United States and the European Union.
      There is high unemployment in the European Union. Unemployment is lower in this country. That is not a coincidence. Our unemployment rate is approximately 7.2 per cent., as against 10.6 per cent. on the continent. Why is that? We have been doing well for some years, but we cannot be complacent. There are many threats to the well-being of our national economy, not just from Europe. Economies across the world are starting to challenge us. Those low-tax, low-spend economies are creating jobs and growth. They are a direct threat to employment in this country. We must be conscious of that.
      How do we meet that threat and come out on top? We cannot do it through the old jobs-for-life syndrome. Those days are long gone, regardless of which party is in government. We have to do it through efficiency. Will the social chapter and all the regulations that are coming from Brussels help us to be more efficient? They cannot. It is no coincidence that we are doing so much better than other European Union countries. We do not have the labour laws that exist on the continent. We do not have the social chapter. We have better industrial relations and fewer add-on labour costs. In short, we are basically less European.
      What do we mean by less European? It seems that we are attracting a great deal of investment into this country for one reason: we are so much better than the rest of Europe. If we were exactly the same as the rest of Europe, I should have thought that inward investment would have gone right to the geographic centre of Europe. It would make sense to invest in the very centre. The Japanese are not investing in the very centre of Europe, because it is not as efficient as this country.
      9.45 pm
      As my right hon. and learned Friend the Member for Folkestone and Hythe (Mr. Howard) said, we must look at the add-on labour costs—the extraordinary amount that it costs to employ a person in Germany, and on the continent generally, compared with this country. The difference between what it costs to pay somebody and what that person takes home is crucial. In Germany, it costs a fortune to employ a worker, but that worker

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      does not take as much home. That crucial difference creates jobs. Jobs are created not by Governments, regulations or even businesses, but by customers with money in their pockets.
      The social chapter and all the employment laws that are coming forward will stifle business in this country. As my right hon. and learned Friend said, if the measures are so good, why cannot the Government introduce them in this country? When they are found to fail, the Government could repeal them in this country. If companies want to live by the rules and laws anyway, that is a matter for them.
      The debate is about something more important than just the contents of the social chapter. I refer to a letter that I received only yesterday from a company in my constituency. It states:
      "My company is product of the Thatcher revolution. Founded in 1984 with just eight people, we now employ approaching 300. Our growth is directly attributable to changed attitudes in both the factory floor and management. We have built up a worthwhile export business. What I do not understand is why sensible British businessmen should see any advantage in belonging to such a high cost club."
      That is the crucial point. The regulations have not helped that man to build up his business. He describes very well what has helped him to do so: efficiency.
      The social chapter is bad in itself, but the issue goes an awful lot deeper. Taken with a range of other things, it is about who governs Britain. We have the social chapter and economic and monetary union, under which the monetary and fiscal policies of countries that join it will be determined not in each country, but in Brussels.
      I am not frightened to address the issue of sovereignty. I know that we have had a little debate about sovereignty, just on Conservative Benches. We should not walk away from it. Sovereignty is not just some romantic theory. It enables us to create the economy that suits our own industry, our own businesses and our own work force. We should not be afraid to claim the right to govern ourselves in the areas of employment, monetary policy and fiscal policy.
      We have done remarkably well in this country. I speak genuinely on behalf of people on the shop floor. I am concerned about their jobs. I see a great threat to jobs in this country. We need only look across to Europe to see the 18 million people who are unemployed. Do we want to join them and go along with the sluggish growth that we have seen in Europe for far too long, or go our own way and be able to compete with the Asian tigers and all the growing economies in the world?
      Mr. Gapes: Listening to some of the Conservative Members' speeches has reminded me of the old saying, "Just because you are paranoid doesn't mean they are not out to get you." Conservatives have the view that, as the hon. Member for Tewkesbury (Mr. Robertson) said, we are less European. Geographically and culturally, people in the United Kingdom are European. We have been members of the European Community and then the European Union for many years. We have had a role and we have had an opportunity to shape the future of Europe and the European Union.
      Anyone listening to the right hon. and learned Member for Folkestone and Hythe (Mr. Howard) would have assumed that he was making his speech in March or April
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      of this year. The fact that the Conservatives went down to an election defeat and that the British people overwhelmingly rejected the party that was opposed to the social chapter seems to have escaped him. He did not seem aware of the fact that a majority of people in this country wanted us to join the social chapter. The majority wanted the right to consultation for workers and the right to parental leave. [Interruption.] The hon. Member for South-West Devon (Mr. Streeter) is shouting from a sedentary position.
      Mr. Swayne: Will the hon. Gentleman give way?
      Mr. Gapes: In a moment. I am addressing my remarks to the hon. Gentleman who is shouting at me.
      The Chairman of Ways and Means (Sir Alan Haselhurst): Order. I hope that the hon. Gentleman is addressing his remarks to the Chairman.
      Mr. Gapes: I apologise, Sir Alan. I am happy to give way to the hon. Member for South-West Devon if he wishes to make a point without shouting at me from a sedentary position. He obviously does not, so I shall give way to the hon. Member for New Forest, West (Mr. Swayne).
      Mr. Swayne: Given the huge majority that the Government achieved, they could enact whatever social protection they wanted for the British people. What was to be gained by giving away our right to prevent social protection provision of which the Government might disapprove and which might cost jobs?
      Mr. Gapes: Nothing has been given away, in the sense that the hon. Gentleman suggests. We have gained the right to influence discussion in a European Union with a single market containing multinational companies and transnational corporations that operate in this country. The largest of those had already started to apply the provisions of the social chapter to their work forces in the European Union single market, including those employed in the United Kingdom. Therefore, by signing up to the social chapter, the British Government and people have an opportunity to influence provisions that are already being applied and are indirectly influencing employment conditions for employees of British companies that are subsidiaries of European or multinational companies.
      Mr. Swayne: Will the hon. Gentleman comment on the fact that the social chapter has remained a dead letter and has not influenced employment practices, because other member states were not prepared to disadvantage themselves through regulations that did not apply in this realm?
      Mr. Gapes: The hon. Gentleman should consult some of the largest multinational companies that operate in Germany, France, Italy and the United Kingdom and ask them whether they had adopted different provisions that affected the way in which they treated their employees. In many cases, they had not.
      Mr. Howard: If business is so keen on the social chapter, why has even the director-general of the Confederation of British Industry advised against doing anything about the opt-out, as I pointed out in my speech?
      Mr. Gapes: This Government have to represent the interests of workers as well as those of big business.

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      The hon. Member for Rochford and Southend, East (Sir T. Taylor) made disparaging remarks about big business, but business wants Britain to be at the heart of developments in the European Union. We have a responsibility not just to business, but to employees. The rights to consultation, paternity leave, paid holidays and, under other provisions, limits on the number of hours worked should be protected by a Government who care about the people as a whole. I am pleased to say that since 1 May we have had such a Government in this country.
      Sir Teddy Taylor: What does the hon. Gentleman think is causing the horrendous level of unemployment, which is getting worse, on the continent of Europe?
      Mr. Gapes: For the hon. Gentleman's information, unemployment in this country has fallen since the Labour Government signed up to the social chapter. Therefore, the argument that increasing unemployment is related to the social chapter cannot be used—it is palpably untrue. There are many complex reasons for unemployment. They include our position in the business cycle, which is why my right hon. Friend the Chancellor of the Exchequer has said that we do not meet the convergence criteria for the single currency. The business cycle in different European states is at different points.
      Other practices in European countries have not contributed to falling unemployment. They have older industries that have not shed employment as this country did in the 1980s. There are many complex reasons, but I suspect that I shall be told that I am drifting away from the subject of the amendment, so I shall not go down that line further.
      It is essential that this country contributes to shaping the social and employment policies that the EU develops. If we are to do that, we need not only to build co-operation and partnership with other member states, but to bring into the domestic debate the important concept of social partnership. That is accepted widely throughout the rest of EU among Christian Democrats, Liberals and Social Democrats.
      Mr. Swayne: Shame.
      Mr. Gapes: The hon. Gentleman says, "Shame." The European People's party—the group in the European parliament of which Conservative MEPs and their party are members—talks about the social partnership. It believes that it is important to have a dialogue and a relationship with both sides of industry, and that it is important to build consensus on employment legislation for the future of all the people of this continent. That European model—the Christian Democrat, Social Democrat and Liberal consensus on the socialartnership—will lead to success in European economies in the long term.
      Mr. Letwin: I am grateful to the hon. Gentleman, who has been extremely patient. Moreover, by sitting down for a moment, he may rescue himself from imminent explosion. How many years of persistent high unemployment on the continent of Europe would it take to convince him that there is a structural problem? Would 20 do, or 30, 40 or 50? At some point, presumably, his view of the economic cycle would collapse. Could he give us some guidance?
      Mr. Gapes: I dealt with that point in my answer to the hon. Member for Rochford and Southend, East. Regrettably, since 1945, living standards in this country have fallen below those of France and Germany. That is not unrelated to the fact that, for the bulk of that period, this country has, unfortunately, been under Conservative Governments. According to recent statistics, living standards in this country are below those of EU countries which, historically, were not as affluent as the UK.
      In European countries, there are currently some problems with unemployment, which is unfortunate. That is why the EU summit at Amsterdam decided that we needed co-ordinated measures among the different states. That is why the Swedish Government—with the support of the British and French Governments—proposed that an employment chapter be contained in the Amsterdam treaty. That is a positive and important step. Last week, I said that the employment chapter was limited, and it does not go far enough. More work can be done in that area. The important principle is that there is a commitment that the European Union is about not only the single market but social aspects and employment.
      We are trying to create a people's Europe, a Europe not only for those who can move money around and are in charge of big business but for those with economic and social aspirations and employment aspirations.
      Mr. Swayne: Does the hon. Gentleman accept that large companies that can afford compliance favour the social protection legislation of which he has spoken, and that small companies, which cannot afford that compliance, are being driven out of business to the advantage of the large companies that increasingly dominate the market?
      Mr. Gapes: If the hon. Gentleman studies the social chapter and the social provisions, he will notice that there are size limits in the regulations and that the smallest companies are not expected to comply.
      It being Ten o'clock, THE CHAIRMAN left the Chair to report progress and ask leave to sit again.
      To report progress and ask leave to sit again tomorrow.—[Ms Bridget Prentice.]
      Committee report progress; to sit again tomorrow.

  ENVIRONMENTAL AUDIT COMMITTEE
  Ordered,
  That Mr. Matthew Taylor be discharged from the Environmental Audit Committee and Mr. Norman Baker be added to the Committee.—[Ms Bridget prentice.]

  CONSOLIDATED FUND BILL
  Ordered,
  That, at the sitting on Tuesday 9th December, any Consolidated Fund Bill ordered to be brought in and read the first time shall be proceeded with as if the Second Reading thereof stood as an Order of the day, and Standing Order No. 56 (Consolidated Fund Bills) shall apply.—[Ms Bridget prentice.]

  LIAISON COMMITTEE
  Ordered,
  That Mr. John Horam, Dr. Lewis Moonie and Mr. Peter L. Pike be added to the Liaison Committee.—[Ms Bridget prentice.]

  HOUSE OF COMMONS COMMISSION
  Ordered,
  That Sir Alastair Goodlad be discharged from the House of Commons Commission and Dr. Lewis Moonie and Sir Peter Lloyd be appointed members of the Commission under the House of Commons (Administration) Act 1978.—[Ms Bridget prentice.]

  Bird Reserves
  Motion made, and Question proposed, That this House do now adjourn.—[Ms Bridget prentice.]
  10.1 pm
  Mr. David prior: I am delighted to have secured a debate on the impact of coastal erosion, saltwater and flooding on bird reserves and wetlands. The matter is of vital concern not only to people living on the coast but to many bird watchers throughout the country.
  It is difficult to imagine, when standing in the Chamber, what it is like to walk along the coasts of Norfolk and Suffolk, with that wonderful Norfolk sky above one and the sea pounding into the beach. As one walks along the beach, one will see that there are very few cliffs, because all that separates the sea from most of the land is raised beaches, shingle and shingle banks.
  In so far as there are cliffs, they are largely composed of clay and sand, and the coast is retreating all the time. At places such as Benacre and Covehithe in Suffolk one can see yards of land given up to the sea every year. I went to Cley in my constituency in February 1996, just after the main flood in that month. There was 6 ft of water across the Cley and Salthouse marshes, and much of the village was flooded. There were six breaches in that year.
  I have since been back several times, once with the Royal Society for the protection of Birds. The ferrymen at Morston, the fishermen at Wells and Salthouse and the wildfowlers who operate along that part of the coast tell me that there are more ducks and geese now than there were 40 or 50 years ago. That is testament to the essential vitality of the habitat.
  There are few more exhilarating sights than the Brent geese rising at Minsmere or sounds than the calling of widgeon at the mudflats at Blakeney or the boom of the bittern over the Cley marshes; but all is not well along that part of the coast. Sea levels are rising, partly because of climatic changes but also because of the long sink of the eastern part of the country, which has been in progress since the ice age.
  The best guess of the Department of the Environment, Transport and the Regions is that, by the year 2050, sea levels will have risen by about 50 cm. What is probably worse for this part of the world is the growing unpredictability of the weather, with high tides and strong storms. Local people fear that Governments, regardless of their political persuasion, will take action only when it is too late, and that funds will be available to take action only when their houses and bird reserves are under water.
  There are two essential habitats close to the sea that I wish to speak about. The first is the salt marshes, many of which have been squeezed between rising sea levels and coastal defences. It is estimated that about a third of the salt marsh in East Anglia has gone in the past 15 years.
  The second—and much more important—habitat is the freshwater wetlands comprising lagoons, grazing marshes and reed beds. About 50 per cent. of the United Kingdom's freshwater reedbeds are located in East Anglia. Those important wetlands mainly shelter behind shingle banks, which have become weakened by constant breaches, by a diminution in the natural supplies of shingle and by constant bulldozing, which has reduced their integrity.

  259
  In Norfolk and Suffolk, we have three bird reserves of international importance, at Minsmere, Cley and Titchwell. They have their high-profile birds—we have 14 of the 20 known booming bitterns in this country, we have marsh harriers and we have bearded tits—but for the amateur twitcher such as myself, it is the great mass of pintail, mallard, widgeon, geese of all kinds, avocets, terns which nest on Blakeney point, snipe and lapwing that make that part of the country unique.
  Those sites are recognised in the Ramsar convention and under the EU bird directive and habitats directive as sites of international importance. Hundreds of thousands of people visit Titchwell, Cley and Minsmere each year. Those habitats are at risk.
  I should like tout three points to the Minister. First, we must have a national strategy for our coastline. At the moment, responsibility falls between cash-strapped district councils, the Environment Agency, the Ministry of Agriculture, Fisheries and Food and the Department of the Environment, Transport and the Regions. Surely it would make sense to have one body to co-ordinate activities, to ensure that shore management plans are properly integrated, to pool expertise, to avoid duplication and, above all in the context of this debate, to ensure that environmental considerations are given a higher weighting.
  Existing shore management plans assume that a further 770 hectares of freshwater reserves will be lost in the foreseeable future. I do not believe that that is acceptable.
  Secondly, on funding, MAFF recently proposed a new funding formula, which North Norfolk district council believes will greatly discriminate against rural areas in favour of urban areas. It will do so because it is much easier to assess the economic benefits in an urban area than to assess the intangible value of environmental assets. Specifically, I ask the Minister to consider giving greater recognition to the value of wildlife habitats and adjusting the MAFF formula accordingly.
  Thirdly, there should be effective mechanisms and financial incentives to create replacement habitats where existing sites cannot be maintained. The Royal Society for the protection of Birds and I are not asking for existing sites to be preserved at all costs. Obviously, there will be times when the economics do not stack up or, for geological or landscape reasons, coastal defences do not make sense, but in those cases we should like new habitats to be established so that there is not a net loss of habitat in freshwater areas.
  I recommend the Minister, if he is ever in north Norfolk, to spend a few minutes at Stiffkey, where he will see that Lord Buxton has recreated a new freshwater habitat designed to—
  The Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mr. Elliot Morley)indicated assent.
  Mr. Prior: Perhaps the Minister has been there. That habitat was created with the bittern especially in mind.
  There is an urgency about this matter. It would be tragic if we had to have this same discussion in two, three or four years' time when these areas have been flooded. The Minister will know of the damage that saltwater can do to these habitats. Only this year, the bittern population at Cley has declined dramatically owing to the saltwater
  260
  flooding of just a year ago. I would ask the Minister to consider a funded, comprehensive plan of action for the Norfolk and Suffolk coasts, giving greater emphasis to rural areas and wildlife interests; and where habitat loss is unavoidable, ensuring that it is replaced elsewhere.
  Mr. Bob Blizzard: I should like to add my support to virtually everything the hon. Gentleman has said. The wetland nature reserves of the Suffolk coast attract significant numbers of visitors, just as they must do in Norfolk. They are thus of economic benefit to my constituency and the surrounding area. While I support the environmental thrust of the hon. Gentleman's argument, I would also point to the economic value of coastal protection schemes.
  Mr. Prior: The hon. Gentleman is right. Tourism is a vital part of the economies of Suffolk and north Norfolk.
  Dr. George Turner: The hon. Gentleman will be aware that only yesterday I opened a new visitor centre at Titchwell which already attracts about 140,000 visitors a year. As well as their international importance for wildlife, these unique places on the north Norfolk coast are also some of the jewels in our tourist industry—Titchwell is a good example. I hope that the Minister will take account of that when allocating resources to protect this sort of environment.
  Mr. Prior: I agree. The three bird reserves, Minsmere, Cley and Titchwell, are unique assets that bring many visitors to Suffolk and north Norfolk.
  Dr. Ian Gibson: I welcome the debate because I believe that an ecological disaster is waiting to happen, not just in Norfolk but throughout the world. Saltwater infusion causes the death of the freshwater fish on which the birds feed and breed. On the broads, the salination of the wetlands owing to higher sea levels is the cause of considerable anxiety.
  The climatic research unit at our local university of East Anglia made the national headlines today for pointing out that there will be temperature rises—despite all the good work that we hope will be done in Kyoto this week. That will mean that the sea will rise, and these magical areas in Norfolk and the rest of the world will find that their habitats will be compromised—
  Mr. Deputy Speaker (Sir Alan Haselhurst): Order. The hon. Gentleman must resume his seat when I am on my feet. This is an Adjournment debate in which a short intervention is permitted, but not a speech—unless the hon. Gentleman has the prior permission both of the hon. Member who initiated the debate and of the Minister.
  Mr. Prior: I thank the hon. Gentleman for his comments. There is no doubt that a fundamental change which will affect sea levels is under way. There are limits to what Governments or anyone else can do to limit the implications. The difficulty for wildlife habitats is that there is, in a sense, nowhere for the sea to go because of developments along the coast. If the coastal roads and houses had not been built, the coastline would have found its own natural place. However, that is not the position.
  If we want to preserve these habitats, some of them will have to be moved. The Minister will be aware of the claybank scheme at Salthouse, which is being proposed

  261
  with the general support of the Royal Society for the Protection of Birds and others. Even with that scheme, which is generally recognised to be a good one, we will lose one third of the grazing marshes at Salthouse. That is a price which we will have to pay.
  Mr. Keith Simpson: I reinforce the comments of the hon. Member for Norwich, North (Dr. Gibson). There is a major impact not only on the north Norfolk coast, but on the whole of Norfolk and Suffolk and my constituency, which borders the Broads. All the people who live in the area feel that the environmental changes will have a major impact not just on the wildlife, but on the areas in which they live. As my hon. Friend said, unless action is taken soon, we will have to take retrospective action, when it will almost certainly be too late.
  Mr. Prior: I thank my hon. Friend. We should pay tribute to the work being done by the Environment Agency in protecting the Norfolk Broads. The scheme at Sea palling and Hattisburgh—the offshore reach—is remarkable. It is not yet proven scheme, but it is a remarkable feat of engineering.
  I know that the parliamentary Secretary is a keen birdwatcher. I am sure that he has that at the forefront of his mind. In Norfolk and Suffolk, the issues that I have raised are crucial, and many people outside the area will listen carefully to what he says tonight.
  10.15 pm
  The parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mr. Elliot Morley): I congratulate the hon. Member for North Norfolk (Mr. prior) on the way in which he has pursued this Adjournment debate. He has spoken with great authority and knowledge. The matter is important, and I am delighted to see so many hon. Members present for the debate.
  I welcome the contributions of the hon. Member for Mid-Norfolk (Mr. Simpson), of my hon. Friend the Member for North-West Norfolk (Dr. Turner)—I envy any hon. Member who has palace as marvellous as Titchwell in his constituency—of my hon. Friend the Member for Waveney (Mr. Blizzard), who mentioned the similar problems and pressures experienced on the Suffolk coast, and of my hon. Friend the Member for Norwich, North (Dr. Gibson), who described the problems of global warming and rising sea level—an issue raised by the hon. Member for North Norfolk.
  I am aware of the problems of habitat loss and the practicalities of recreating the habitat elsewhere. The hon. Gentleman painted a wonderful picture of the north Norfolk coast. It is an area with which I am extremely familiar, having gone there for many years. I know the Minsmere, Cley, Titchwell and Salthouse bird reserves very well, and have spent many happy hours there pursuing many different species—not always with great success.
  In East Anglia alone it has been estimated that more than 770 hectares of internationally important wetlands are at risk from coastal erosion and saltwater flooding. The hon. Gentleman asked—quite reasonably—what is
  262
  being done to protect them. I visited Cley, not while it was flooded, but shortly afterwards, and I saw the damage caused to the habitat there. I am aware of the understandable concern of local people.
  The United Kingdom is laying a leading role in the protection of key habitats, birds, plants and animal species through the on-going programme of special protection areas for birds, special areas of conservation for key habitats and species other than birds, and Ramsar designations for important wetlands.
  The SPAs and proposed SACs will form part of the largest Europewide network of Nature 2000 important wildlife sites. In Norfolk, two overlapping such sites are the north Norfolk coast SPA and Ramsar site, and the proposed Wash and north Norfolk coast coastal SAC. They encompass a number of habitats of prime importance including fresh and saltwater grazing marsh, reedbeds, salt marsh and shingle structures.
  Those are among the 38 key habitats identified by the UK biodiversity steering group as requiring urgent conservation action. In addition, they are home to a number of rare birds, animals and plants. Action plans for coastal floodplain, grazing marsh and reedbeds were published, together with 12 other key habitats as part of the steering group's 1995 report.
  Implementation of these plans has now begun and among the actions proposed are the conservation, creation and re-establishment of such habitat types. Action plans for the remaining key habitats, including salt marsh and shingle structures, are being prepared and we expect to publish them by the end of 1998. Such habitat improvement work is also being undertaken as part of the salt marsh option of the Ministry's habitat scheme. That has considerable scope for recreating habitat.
  Over the past decade the Ministry has been developing an integrated and strategic approach to sea defence and coast protection. I shall deal with the questions raised by the hon. Member for North Norfolk on that issue. I shall deal also with shore management.
  The hon. Gentleman raised an important point about the need for co-ordination, an issue that needs to be considered. I shall take it up with my right hon. and hon. Friends in the Department of the Environment, Transport and the Regions.
  The hon. Gentleman talked about the funding formula for flood and drainage schemes. I can reassure him in that he is right in saying that a funding formula has been reintroduced. That is right and proper because if there are limited resources there must be a priority scheme. It is necessary to identify the schemes that must be given to priority in terms of Ministry of Agriculture, Fisheries and Food spending and capital grant. Within the new formula, for the first time, environmental factors are recognised. That will be to the benefit of many rural schemes as it will be to the benefit of important habitat areas such as those which have been discussed tonight. I shall deal later with the replacement of habitats.
  In 1993 the Ministry published, with the Welsh Office, a strategy for flood and coastal defence. The strategy set out a comprehensive framework within which Government and the operating authorities can work. In particular, the strategy advocates that defence measures should be based on an understanding of natural processes and, as far as possible, work with those processes. It is for operating authorities such as the

  263
  Environment Agency and local authorities to assess what measures are needed to reduce flooding and coastal erosion in their areas, and to come forward with plans for dealing with those problems that are cost-effective and sound in engineering and environmental terms. For its part. the Ministry makes grant aid available for capital defence schemes which meet these criteria. They are now part of the formula.
  As part of the strategic approach to flood and coastal defence problems, the Ministry encourages operating authorities to take and consider a wide range of possible options. It has also promoted the setting up of coastal defence groups, which provide a forum for discussion and co-operation and help ensure that coastal processes taking place within particular stretches of coast are taken into account.
  To assist those groups in the strategic management of discrete stretches of coast, the Ministry has encouraged the preparation of shoreline management plans and has issued guidance on their preparation. The aim of the plans is to provide a basis for sustainable coastal defence policies and to set objectives for the future management of coastline, taking into account natural coastal processes, coastal defence needs, environmental considerations, planning issues and current and future land use.
  Plans should be the subject of wide consultation with all bodies with an interest in the coastline and should take due account of other coastal initiatives. Coastal groups also play an important role in integrating SMPs with the work of local planning authorities with a view to avoiding problems in the future by discouraging inappropriate development.
  Shoreline management plans are intended to be living documents and will need to be reviewed at regular intervals.
  Mr. Tam Dalyellk: What is my hon. Friend's policy on sand dunes and their preservation?
  Mr. Morley: My hon. Friend raises an issue that is slightly beyond the scope of the debate. I know that he has raised it because sand dunes and sand dune stability are an important part of preventing coastal erosion. There are strategies for dealing with the issue that involve the planting of suitable grasses and vegetation, along with proper management plans. We listened to the advice of our statutory advisers—English Nature in England and the appropriate countryside bodies in Scotland and Wales.
  We intend to have a timetable for reviews, which should be included in shoreline management plans. This approach enables evolving knowledge of physical processes, environmental issues and land use to be drawn into the planning process.
  As our understanding of coastal processes has improved, we have seen attention turn to adapting and supplementing the natural processes with the aim of adopting responses to flood and erosion risk that are more environmentally acceptable and sustainable in engineering terms. By moving sea walls landward, we may be able to reinstate areas of valuable salt marsh and intertidal flat, and, by creating a new buffer zone seaward of the defended line, improve the defences. This "managed realignment" has been piloted at a number of sites in Essex by a series of joint projects involving the Ministry, the Environment Agency, English Nature and the National
  264
  Trust. These trials are still in progress, but preliminary results suggest that good results can be obtained. A consensus is emerging that managed realignment will play a significant part in the future management of low-lying coasts, and a joint Environment Agency/ English Nature policy paper on the subject is in preparation.
  Mr. John Hayes: I had a meeting earlier today on this very subject. We discussed the precise examples in Essex that the Minister has given. The creation of the new salt marshes conflicts to some extent with the water abstraction policy of some of the water companies. Does he have any view on that in respect of the trials?
  Mr. Morley: I can tell the hon. Gentleman that in Essex that was not the case. When using that strategy, other considerations have to be taken into account, and water abstraction is one. We have to look at where it is most appropriate for such a policy to be implemented. That is part of the study that is taking place.
  I am aware that some environmental and conservation bodies feel that the current initiatives do not go far enough. However, as the hon. Member for North Norfolk has acknowledged, these are very difficult and complex issues and their resolution is still very much in its infancy. That is why Ministry officials have already been involved in a series of discussions with colleagues in the Department of the Environment, Transport and the Regions, the Environment Agency and English Nature about how we might resolve them.
  In some cases, the managed realignment of flood defences will be the best option in terms of sustainability and cost. In other cases, it may not be appropriate to spend large amounts of public money for little environmental gain. We do not yet have a full picture of what area of freshwater coastal wetland is at risk. English Nature, the Environment Agency and the Countryside Council for Wales have just commissioned a joint study that will assess the potential impact of coastal processes on internationally important sites around the coast of England and Wales by utilising shoreline management plans. The report, due next year, will give us a clearer picture of the extent of the problem. The sites that the hon. Gentleman has discussed tonight will be included within the management plan, and it will be an opportunity to look at the serious issues that he has raised. I am particularly pleased that the Ministry initiative—shoreline management plans—will allow a better understanding of the natural impacts in environmentally important coastal sites.
  As I have said, there are no easy answers to these problems, but I am grateful to English Nature, the Royal Society for the protection of Birds and other conservation bodies for their contribution to the debate in their leaflet entitled "Coast in Crisis". They, too, accept that it may not be possible or, indeed, wise to try to protect some sites from flooding. Building new sea walls or continuing to maintain existing walls may disrupt the natural processes of erosion and deposition of sediments and simply shift the problem—or create a new problem—elsewhere.

  265
  It is worth mentioning that the avocet—the symbol of the RSPB—has returned to Britain, and its habitat is the result of a breach in the floodbank due to the failure of sea defences. The point that I am making is that, sometimes, changes to the coast, to the wetlands, can have beneficial as well as detrimental effects in terms of wildlife.
  The decisions that are taken must try to achieve a balance between the various competing interests. Although human health and safety must be paramount,
  266
  it may mean that tough decisions will have to be taken in relation to the enormous investment and costs of flood defence and sea defence. I can assure hon. Members who have spoken so eloquently tonight and made so well the case for coastal protection that we will take into account very carefully the points that they have made in this short debate.
  Question put and agreed to.
  Adjourned accordingly at twenty-nine minutes past Ten o'clock.

HOME DEPARTMENT

  Asylum Seekers
  Mr. Gerrard
  To ask the Secretary of State for the Home Department what are the consultation procedures for the inter-departmental review of asylum; which organisations have been invited to comment; and which organisations or individuals have made submissions. [17418]

  Mr. Mike O'Brien
  When the Comprehensive Review of asylum was announced, those interested were invited to comment direct to the Study Team. The following individuals and organisations have made submissions:

  London Borough of Merton

  Westminster City Council

  The Progressive League

  The Central London Interfaith Refugee Network

  Praxis

  Michael Symth Esq.

  The Churches Commission for Racial Justice

  The Housing Associations Charitable Trust

  Hackney Community Law center

  UNLEASH (Church Action on Homelessness in London)

  The Disability Alliance

  Newham Council Anti-Poverty and Welfare Rights Unit

  The London Advice Services Alliance

  The Hackney Refugee Training Consortium

  Turkish Speaking People's Culture center

  The Independent Immigration Support Agency

  The Royal Borough of Kensington and Chelsea Housing and Social Services Department.

  In addition, the Team has held discussions with:

  Refugee Legal center

  Refugee Council

  Association of London Government

  Refugee Action

  Immigration Appeals Authority

  Hammersmith Social Services Department

  Housing Corporation

  Australian High Commission

  Local Government Association

  Amnesty International

  Justice

  Medical Foundation for the Care of Victims of Torture

  Immigration Law Practitioners' Association centerpoint

  Commission for Racial Equality

  Camden Social Services

  Refugee Arrivals Project

  The Churches Interfaith Refugee Network

  The International Organisation on Migration.

  National Stud
  Mr. Paice
  To ask the Secretary of State for the Home Department if he will make a statement on the future ownership of the National Stud. [18141]

  Mr. George Howarth
  The National Stud is the responsibility of the Horserace Betting Levy Board. There are no current plans to change its ownership.

  Smoke Alarms
  Ms Jenny Jones
  To ask the Secretary of State for the Home Department if he will assess the advantages of instigating a publicity campaign to raise public awareness of the benefits of installing smoke alarms in homes. [18483]

  Mr. George Howarth
  I am well aware that publicity campaigns offer the potential for achieving wider installation of smoke alarms in homes. The Community Fire Safety Task Force have recently reported with a strategy and recommendations to secure significant reductions in the number of fires, deaths and casualties in homes. We are consulting widely on their proposals and will assess carefully the responses we receive.

  Smuggling
  Mr. Vaz
  To ask the Secretary of State for the Home Department what estimate he has made of the number of illegal immigrants who have been smuggled into Britain by criminal gangs in each of the last three years; and if he will make a statement. [18819]

  Mr. Mike O'Brien
  No reliable estimate can be made of the number of illegal immigrants smuggled into Britain by criminal gangs.

  Police Grant
  Mr. Coaker
  To ask the Secretary of State for the Home Department if he will announce the allocations of police grant for individual police authorities in 1998–99. [19097]

  Mr. Straw
  I have today put a copy of my proposals for the allocation of police grant for 1998–99 in the Library. I intend to implement these proposals subject to consideration of any representations I receive about them.

  The police service has indicated its support in principle for the continued distribution of police grant in accordance with a needs-based formula, and I am therefore proposing to continue to allocate the greater part of police grant according to the police funding formula.

  I am however proposing several changes to the formula to reflect the latest data now available, and in response to the representations I have received. The principle changes I propose are: to reduce from 30 per cent. to 20 per cent. the share of funding allocated on the basis of forces' past establishments: and to increase from 12.9 per cent. to 13.2 per cent. the proportion of funding allocated on the basis of forces' pensions commitments.

  I have also set the amount of the special payment to the Metropolitan Police, in recognition of its national and capital city functions, at £151 million in 1998–99.

  An additional £40 million of police grant has been made available in 1998–99. This allocation is to ensure that police authorities and the Receiver for the Metropolitan Police District have funds available which

  101
  would allow them to increase spending on meeting the key objectives for the police in 1998–99 over and above that available through the principal formula.

  Other police funding proposals within the local government finance system are being announced today by my right hon. Friends the Secretaries of State for the Environment, Transport and the Regions and for Wales. These proposals and mine would increase the total spending power of police authorities in England and Wales by 3.7 per cent. or around £258 million over 1997–98.

  The table below shows, by police authority, the effect of my proposals for 1998–99. It also shows the allocations approved by Parliament for 1997–98.

  £ million

  1997–98

  1998–99

  Police Authority

  1funding

  1funding

  English Shire forces

  Avon and Somerset

  158.7

  164.2

  Bedfordshire

  58.9

  60.9

  Cambridgeshire

  68.2

  72.0

  Cheshire

  101.1

  104.7

  Cleveland

  75.2

  80.4

  Cumbria

  58.6

  59.0

  Derbyshire

  95.3

  97.7

  Devon and Cornwall

  158.6

  167.5

  Dorset

  66.6

  67.8

  Durham

  73.3

  78.1

  Essex

  155.9

  158.4

  Gloucestershire

  60.1

  61.5

  Hampshire

  180.0

  189.2

  Hertfordshire

  92.4

  94.1

  Humberside

  105.9

  110.6

  Kent

  168.5

  179.0

  Lancashire

  167.7

  175.0

  Leicestershire

  97.3

  99.1

  Lincolnshire

  61.5

  60.7

  Norfolk

  78.1

  80.9

  North Yorkshire

  71.9

  75.7

  Northamptonshire

  60.0

  62.9

  Nottinghamshire

  119.3

  123.0

  Staffordshire

  111.8

  111.1

  Suffolk

  63.4

  66.0

  Surrey

  91.8

  84.2

  Sussex

  155.2

  162.6

  Thames Valley

  208.2

  219.3

  Warwickshire

  50.6

  51.1

  West Mercia

  106.3

  110.0

  Wiltshire

  62.2

  63.4

  English Metropolitan forces

  Greater Manchester

  351.2

  364.9

  Merseyside

  227.3

  233.3

  Northumbria

  193.4

  205.4

  South Yorkshire

  158.8

  165.4

  West Midlands

  353.4

  372.0

  West Yorkshire

  267.5

  279.6

  London forces

  Metropolitan Police2

  1,688.0

  1,715.6

  City of London3

  61.6

  57.1

  English Total

  6,483.9

  6,683.4

  102

  £ million

  1997–98

  1998–99

  Police Authority

  1funding

  1funding

  Welsh forces

  Dyfed-Powys

  49.9

  51.1

  Gwent

  64.5

  67.3

  North Wales

  71.2

  73.2

  South Wales

  155.1

  161.3

  Welsh total

  340.8

  353.0

  Total

  6,824.7

  7,036.3

  1 Rounded to the nearest £100,000. Funding is the sum of all police grant, SSAs and damping grant.

  2 Figure for the Metropolitan Police does not include funding allocated to the Receiver under the Other Services Block SSA for school crossing patrols, Magistrates' Courts and the Probation Service.

  3 Figure for the City includes Police SSA and Grant, but excludes other SSAs e.g. Capital Financing which are allocated to the Common Council of the City of London as a whole in respect of all its functions.

  Youth Justice
  Mr. Shaw
  To ask the Secretary of State for the Home Department if he will publish the advice he received from the Task Force on Youth Justice and the responses to his consultation papers on youth justice. [19126]

  Mr. Straw
  Yes. Copies of the two reports submitted by the Task Force on Youth Justice, in August and October, have been placed in the Library.

  Several hundred responses have been received to my consultation paper on youth justice and these are currently being assessed. We will provide Parliament with a report as soon as practicable.

  Low Pay
  Mr. Chidgey
  To ask the Secretary of State for the Home Department if he will list, by regions defined by the boundaries of the regional government offices, the lowest hourly rate paid by his Department to(a) full-time employees, (b) part-time employees, (c) persons employed under personal contract and (d) persons employed by firms undertaking contracted-out services for central government offices, defining the job title in each case. [18113]

  Mr. Straw
  Information in respect of(a), (b) and (c) is given in the attached table and covers the Home Office and its agencies. Information in respect of (d) is not available; figures could be provided only if all our contractors were prepared to waive commercial confidentiality considerations so as to allow disclosure.

  Region

  Category

  Job title

  Hourly rate

  London

  (a)

  Administrative Assistant

  4.61

  (b)

  Administrative Assistant

  4.61

  (c)

  Administrative Assistant

  4.61

  East Midlands

  (a)

  Administrative Assistant

  3.84

  (b)

  Administrative Assistant

  3.84

  (c)

  Administrative Assistant

  3.84

  103

  Region

  Category

  Job title

  Hourly rate

  Eastern Region

  (a)

  Administrative Assistant

  3.84

  (b)

  Administrative Assistant

  3.84

  (c)

  Administrative Assistant

  3.84

  Merseyside

  (a)

  Administrative Assistant

  3.84

  (b)

  Administrative Assistant

  3.84

  (c)

  Administrative Assistant

  3.84

  North East

  (a)

  Administrative Assistant

  3.84

  (b)

  Administrative Assistant

  3.84

  (c)

  Administrative Assistant

  3.84

  North west

  (a)

  Administrative Assistant

  3.84

  (b)

  Administrative Assistant

  3.84

  (c)

  Administrative Assistant

  3.84

  South east

  (a)

  Administrative Assistant

  3.84

  (b)

  Administrative Assistant

  3.84

  (c)

  Administrative Assistant

  3.84

  South west

  (a)

  Administrative Assistant

  3.82

  (b)

  Administrative Assistant

  3.84

  (c)

  Administrative Assistant

  3.84

  West Midlands

  (a)

  Sandwich course Student

  3.77

  (b)

  Administrative Assistant

  3.84

  (c)

  Administrative Assistant

  3.84

  Gender

  White

  Black

  Asian

  Other

  Not provided

  Total male and female

  Total ethnic minority male and female

  Industrial

  F

  0

  0

  0

  0

  0

  —

  —

  M

  7

  0

  0

  0

  3

  10

  0

  Support Grades

  F

  62

  8

  3

  0

  5

  0

  —

  M

  68

  6

  5

  0

  14

  171

  22

  Secretarial Grades

  F

  90

  7

  12

  0

  5

  —

  —

  M

  —

  —

  —

  —

  —

  114

  19

  Administrative Assistant

  F

  277

  57

  91

  10

  67

  —

  —

  M

  126

  22

  43

  3

  30

  726

  226

  Administrative Officer and Assistant immigration Officer

  F

  387

  57

  164

  6

  43

  —

  —

  M

  163

  27

  50

  4

  29

  930

  308

  Executive Officer and Immigration Officer

  F

  922

  36

  77

  13

  161

  —

  —

  M

  1,168

  21

  44

  24

  282

  2,748

  215

  Higher Executive Officer and Chief Immigration Officer

  F

  227

  2

  5

  2

  29

  —

  —

  M

  369

  4

  6

  5

  69

  718

  24

  Senior Executive Officer and Inspector

  F

  30

  0

  0

  0

  0

  —

  —

  M

  107

  1

  0

  0

  8

  146

  1

  Grade 7 and above

  F

  11

  0

  1

  0

  0

  —

  —

  M

  45

  0

  0

  0

  1

  58

  1

  Overall totals

  5,621

  816

PRIME MINISTER

  Humphrey the Cat
  Mr. Alan Clark
  To ask the Prime Minister what steps were taken by Cabinet Office staff to establish the state
  104

  Region

  Category

  Job title

  Hourly rate

  Yorkshire and

  (a)

  Administrative Assistant

  3.84

  the Humberside

  (b)

  Administrative Assistant

  3.84

  (c)

  Administrative Assistant

  3.84

  Equal Opportunities
  Mr. Vaz
  To ask the Secretary of State for the Home Department pursuant to his Answer of 13 November 1977,Official Report, column 654, if he will provide a further breakdown, by grade, of the ethnic origin and gender of employees in the Immigration and Nationalities Department. [18627]

  Mr. Mike O'Brien
  Details of the ethnic origin of Immigration and Nationality Directorate staff by gender and grade are set out in the following table. In some cases, grades have been amalgamated in order to avoid disclosure of individual ethnic origin.

  The breakdown refers to staff figures as at 28 November 1997. These differ slightly from the figure provided in my answer to my hon. Friend's question on 13 November 1997, Official Report, column 654, due to staff changes in the intervening period.

  of health of Humphrey the cat, prior to his departure from Downing Street; on what dates; and if he will make a statement. [18675]

  The Prime Minister
  The Cabinet Office staff have always taken excellent care of Humphrey the cat. He was taken to a Veterinary Clinic at least every six months for
  105
  the last five years where his kidney complaint was treated and his inoculations were kept up to date. His last visit was on 6 August 1997.

  In the weeks prior to his retirement from the Cabinet Office, the staff who looked after him were concerned about his loss of appetite and the general deterioration in his condition.

  Since retiring to a home environment it is reported that he has responded very well and put on weight.

ENVIRONMENT, TRANSPORT AND THE REGIONS

  Single Regeneration Budget
  Mr. Keetch
  To ask the Secretary of State for the Environment, Transport and the Regions if he will list the locations of the successful outline bids for round 4 SRBs, indicating the names and political control of those local authorities concerned; and if he will make a statement. [17311]

  Mr. Caborn
  Bids for round 4 of the SRB Challenge Fund are not defined at the outline stage as successful or unsuccessful. I have placed a table which contains details of all 371 outline bids received by Government Offices for the Regions in the House Libraries.

  Government Offices for the Regions currently are considering outline bids, to determine the extent to which these meet the objectives and criteria for the Challenge Fund and merit working up into final bids.

  Mr. Burstow
  To ask the Secretary of State for the Environment, Transport and the Regions how many local authorities submitted bids for each round of(a) the Single Regeneration Budget and (b) Capital Challenge; and how many were successful in each round. [18740]

  Angela Eagle
  The information is as follows:

  Single Regeneration Budget
  The numbers of bids for support from the four rounds of the Single Regeneration Budget Challenge Fund submitted by local authorities, either individually or as partners, are as follows:

  Round 1

  Round 2

  Round 3

  Round 41

  Total number of final bids received

  469

  329

  310

  371

  Number of final bids received from local authorities2

  235

  171

  186

  167

  Number of successful bids from local authorities2

  108

  93

  109

  —

  1 All bids are currently at the outline stage only.

  1 Where the local authority is the lead partner.

  Capital Challenge
  There has been only one round of Capital Challenge. There were 330 local authorities, acting jointly or separately, which submitted a total of 326 bids. Of these, 189 bids, involving 217 authorities, were successful either in full or in part.
  106
  Mr. Burstow
  To ask the Secretary of State for the Environment, Transport and the Regions what estimates he has made of the costs incurred by local authorities in preparing and submitting bids in each round of(a) the Single Regeneration Budget and (b) Capital Challenge. [18739]

  Angela Eagle
  For the Single Regeneration Budget Challenge Fund, my Department commissioned the Department of Land Economy at the University of Cambridge to evaluate rounds 1 and 2. An interim report explored the level of resources committed by ten local partnerships, including those with local authority partners, which submitted unsuccessful bids. The average time committed by each partnership to the bidding process was 16 weeks, at a cost of £10,000.

  None of the unsuccessful bidders regarded the bidding process as a waste of resources, nor did they regard it as more costly than preparing proposals under other funding regimes. The benefits of the bidding process were recognised, particularly in improving inter-agency partnership working.

  For Capital Challenge, the Local Government Research Programme Report "Evaluation of the Experience of Authorities during the Capital Challenge Pilot Scheme Bidding Round" estimated that the average value of resources used in the preparation of bids was £14,000.

  London Underground
  Mr. Stephen Twigg
  To ask the Secretary of State for the Environment, Transport and the Regions which organisations he has met in the last six months to discuss the future of(a) London Underground and (b) the Piccadilly Line; and if he will make a statement. [17527]

  Ms Glenda Jackson
  My colleagues and I have discussed the future of the Underground with a number of organisations, including London Transport, representatives of Transport Unions, and organisations representing business and other interests in London. No meetings have been held specifically on the future of the Piccadilly Line.

  We are urgently considering a range of options for public—private partnerships to improve the Underground.

  Regional Development Agencies
  Mr. Harvey
  To ask the Secretary of State for the Environment, Transport and the Regions if he will place in the Library responses to his consultation paper on RDAs. [17890]

  Mr. Caborn
  In accordance with guidelines on deposited papers issued to Government Departments by the House of Commons Library, I placed in the Library on 18 November a list of the responses to the Department's Issues Paper on Regional Development Agencies. The guidelines say that, for reasons of space, consultation paper responses should not be deposited in the Library. Consistent with the guidelines, copies of the responses to the RDAs consultation paper are deposited in the Department's library, and can be made available to Members there.

  Travellers
  Mr. Loughton
  To ask the Secretary of State for the Environment, Transport and the Regions (1) if he will seek to amend section 77(3)(b) of the Criminal Justice and Public Order Act 1994 so as to make it a criminal offence for travellers having been evicted to return to any land in the same district within three months; [18214]

  (2) if he will seek to amend the Criminal Justice and Public Order Act 1994 to enable agents acting for local authorities to confiscate property belonging to travellers subject to eviction orders as compensation for damage done to public land and legal costs incurred in securing evictions. [18215]

  Mr. Raynsford
  We have no plans to amend the Criminal Justice and Public Order Act 1994 in the way that the hon. Gentleman suggests.

  The 1994 Act already makes it a criminal offence for unauthorised campers who have been directed to leave land, to return to the same land with a vehicle within three months of the date of the direction. We do not think it would be reasonable to make the whole of a local authority's area out of bounds to campers, because they have been evicted from one site in that area. The stronger the powers, the more difficult it would be for a local authority to persuade the courts that it was acting reasonably in seeking an eviction order.

  Consultation preceding the introduction of the 1994 Act powers revealed a majority of respondents, including local authorities, opposed to local authority powers to seize vehicles belonging to unauthorised campers. This was thought to be unreasonable and impracticable, and the proposal was dropped.

  The Government considers that the 1994 Act powers strike a reasonable balance between the need to control what can be a public nuisance and the rights of the campers concerned, in line with the European Convention on Human Rights. We have commissioned research to look at how local authorities deal with unauthorised camping in their areas, and will be issuing good practice advice based on that research in Spring next year.

  Residential Development
  Mr. Tom King
  To ask the Secretary of State for the Environment, Transport and the Regions on which dates since 1 May was(a) he, (b) Ministers in his Department and (c) officials met representatives of the UK Round Table on Sustainable Development to discuss increasing the Government's target of new residential development to be built on previously used land. [18319]

  Angela Eagle
  Neither Ministers nor officials have met representatives of the UK Round Table specifically to discuss the Government's target of new residential development to be built on previously used land. My right hon. Friend the Minister for the Environment has, however, had general discussions with the Chairman about Round Table recommendations.

  Mr. Tom King
  To ask the Secretary of State for the Environment, Transport and the Regions what estimate he has made of the number of new homes provided in each year since 1981 through(a) urban infill and (b) house conversions. [18302]
  108
  Mr. Raynsford
  Estimates of the number of dwellings provided through conversions are shown below.

  Net gain in dwellings from conversions and changes of use

  England

  Thousands of dwellings

  1981

  14.6

  1982

  17.6

  1983

  16.2

  1984

  17.3

  1985

  16.6

  1986

  17.1

  1987

  17.3

  1988

  14.8

  1989

  14.6

  1990

  12.4

  1991

  13.1

  1992

  10.1

  1993

  7.7

  1994

  9.3

  1995

  9.2

  1996

  8.9

  Estimates of number dwellings through urban infill are currently not available, but should be available soon.

  Mr. Tom King
  To ask the Secretary of State for the Environment, Transport and the Regions what in each of the last three years for which information is available, was the proportion in each region of the amount of new residential development built on previously used land; and what(a) meetings he has had and (b) other actions he has taken in respect of these regions where the proportion was under 50 per cent. [18321]

  Mr. Raynsford
  The table below shows the percentage of new residential development that is on land previously developed for urban uses, by Government Office Region, for the latest three years for which reliable estimates can be made.

  The Government has held a number of meetings at which the issue of land recycling and other household growth matters have been discussed. The Government has also made it clear that, in making their housing land allocations, local authorities should make the best possible use of previously used sites for new housing. This applies in particular to those authorities who are achieving low levels of land recycling. The Government is considering these and other issues, taking into account the public consultation earlier this year, and will announce decisions in due course.

  Per cent.

  Government Office Region

  1991

  1992

  1993 (provisional)

  North East

  43

  46

  40

  North West and Merseyside

  49

  56

  59

  North West

  49

  54

  55

  Merseyside

  48

  65

  76

  Yorkshire and the Humber

  38

  42

  48

  East Midlands

  33

  34

  33

  West Midlands

  44

  46

  49

  Eastern

  41

  46

  49

  109

  Per cent.

  Government Office Region

  1991

  1992

  1993 (provisional)

  London

  83

  84

  83

  South East

  50

  49

  49

  South West

  30

  35

  32

  England

  44

  47

  48

  Source:

  Land Use Change in England No. 12 (Table 8.5), Statistical Bulletin.

  Household Growth White Paper
  Mr. Tom King
  To ask the Secretary of State for the Environment, Transport and the Regions if he will list the seminars which his Department(a) has held since 1 May and (b) plans to hold to debate the issues raised in the Green Paper "Household Growth: Where Shall We Live" (Cm 3471). [18318]

  Mr. Raynsford
  No public seminars have been held by the Government specifically on this subject since 1 May, nor do we have any current plans to hold such seminars in the near future. Officials attend independently arranged seminars on this subject as appropriate.

  Planning Appeals (Redundant Farm Buildings)
  Mr. Tom King
  To ask the Secretary of State for the Environment, Transport and the Regions how many appeals his Department has received in each year since 1988 involving the refusal of planning consent for the conversion of redundant farm buildings into(a) houses and (b) other uses; when the Department last issued new guidance on this subject; and what plans he has to issue revised guidance. [18301]

  Mr. Raynsford
  The following information has been provided by the Planning Inspectorate. Information is not available for the period before 1990. The data do not reveal whether the appeals related to redundant farm buildings. The number of unsuccessful appeals against refusal of planning permission for conversion of farm buildings to residential use was as follows:

  Number

  1 January to 31 December

  1990

  523

  1991

  419

  1992

  298

  1993

  194

  1994

  198

  1995

  196

  1996

  188

  1 January to 1 November

  1997

  88

  In 1990 there were 3 unsuccessful appeals against refusal of planning permission for conversion of farm buildings to industrial use. There have been none since.

  The Government's guidance on the conversion of redundant farm buildings is contained in Planning Policy Guidance note 7 "The Countryside—Environmental Quality and Economic and Social Development", which was revised in February 1997. This allows greater discrimination than formerly in favour of re-use for business rather than residential use. There are at present no plans to issue revised guidance.

  Energy Efficiency
  Mr. Alan Simpson
  To ask the Secretary of State for the Environment, Transport and the Regions if he will place in the Library a copy of the report "Options for the Future Development of Energy Efficiency Standards of Performance", prepared for him and the President of the Board of Trade OXERA Consultants. [18271]

  Angela Eagle
  I have placed a copy of the report in the Library. The analysis of options provided by the report will be taking into account in the Government's consideration of future regulation of the energy industry and of the achievement of energy efficiency climate change targets. There will be consultation on both issues.

  Organophosphates
  Dr. Brand
  To ask the Secretary of State for the Environment, Transport and the Regions if he will empower the Health and Safety Executive to examine with the permission of the patient the medical records of any person who suffers accidental exposure to organophosphates and other chemicals which results in admission to hospital or consultation with a doctor. [18162]

  Angela Eagle
  HSE may already examine medical records when it investigates reports of ill-health because of exposure to chemicals if the sufferer gives permission, except in special cases where the doctor judges that disclosure would itself put the patient at risk. Reported incidents of ill-health resulting from exposure to pesticides, veterinary and human medicines (including organophosphates) are assessed by expert panels who routinely examine medical records on this basis.

  Trees
  Ms Jenny Jones
  To ask the Secretary of State for the Environment, Transport and the Regions what plans he has to encourage tree planting and the conservation of mature trees in urban areas to reduce storm water run-off. [18479]

  Angela Eagle
  My Department encourages local authorities to develop long term strategies to guide the planting, maintenance, conservation and replacement of all trees in their area. Such strategies should contain an appraisal of how trees might contribute to the local environment, taking account of local circumstances and conditions. This might include their role in reducing storm water run-off.

  Railway Lines (Trespass)
  Mr. Kidney
  To ask the Secretary of State for the Environment, Transport and the Regions if he will review the duty to fence off railway lines with a view to requiring Railtrack plc to prevent trespass on railway lines. [18372]

  Ms Glenda Jackson
  Following a recommendation by the Health and Safety Commission (HSC), a review of railway safety legislation was completed by the Health and Safety Executive (HSE) in 1996. As a result, the
  111
  Railway Safety (Miscellaneous Provisions) Regulations 1997, which came into force on 10 May, place a new duty on Railtrack to take reasonably practicable measures to prevent unauthorised access by trespassers. Guidance on these Regulations, issued by the HSE, gives advice on the type of fencing or other physical barriers that should be provided.

  Rat Control
  Mr. Dafis
  To ask the Secretary of State for the Environment, Transport and the Regions what are the legal responsibilities of water and sewerage companies in respect of the control of rats. [18501]

  Angela Eagle
  There is no specific duty on water and sewerage undertakers in relation to the control of rats in sewers. However, all sewerage undertakers have programmes to control and reduce the number of rats in their systems. This includes the use of baits in pumping stations and air vents to stop rats entering the system and within sewers. In addition, I understand that the water industry will be undertaking some research into the issue of rats in sewers early next year. Finally, under Section 79 of the Environmental Protection Act 1990, local authorities have a duty to inspect their area for statutory nuisances such as"any premises in such a state as to be prejudicial to health or a nuisance."

  Bed and Breakfast Accommodation
  Mr. Cox
  To ask the Secretary of State for the Environment, Transport and the Regions how many people were living in bed and breakfast accommodation in each of the London boroughs on 1 November. [18582]

  Mr. Raynsford
  Information is published on households accommodated under statutory homelessness provisions in a quarterly Information Bulletin, "Statistics of local authority activities under the homelessness legislation: England". The Bulletin includes a table on homeless households temporarily accommodated and this identifies those in bed and breakfast accommodation.

  Copies of the Bulletin are in the Library and the latest provides statistics for the second quarter of 1997.

  Low Pay
  Mr. Chidgey
  To ask the Secretary of State for the Environment, Transport and the Regions if he will list, by regions defined by the boundaries of the regional government offices, the lowest hourly rate paid by his Department to(a) full-time employees, (b) part-time employees, (c) persons employed under personal contract and (d) persons employed by firms undertaking contracted-out services for central government offices, defining the job title in each case. [18115]

  Angela Eagle
  In London, the lowest rate paid by the Department to full-time employees is £4.39 an hour. £3.17 per hour is the lowest hourly rate paid in the English regions, by a Departmental Agency.

  Part-time and full-time staff are paid the same hourly rates.
  112
  The Department employs relatively few people who are on personal contracts. The lowest rate is £3.25 an hour, in an English region.

  The Department does not hold information on the rates of pay for persons employed by firms undertaking contracted-out services. This is a matter for the companies concerned.

  Local Government Finance
  Mr. Yeo
  To ask the Secretary of State for the Environment, Transport and the Regions (1) if he will list (1) for each class of authority and (2) for each individual local authority and Police authority in England(a) 1998–99 standard spending assessments in total and by major service block, (b) changes in standard spending assessments in total and by major service block, between 1997–98 and 1998–99, expressed in (i) monetary and (ii) percentage terms, (c) changes in standard spending assessments in total and by major service block, between 1997–98 and 1998–99, expressed (i) in monetary and (ii) percentage terms and adjusted to take account of changes in local authority functions and responsibilities (d) resident population, (e) tax base, (f) standard spending assessment, (g) standard tax income, (h) business rate income,(i) revenue support grant, (j) standard spending assessment reduction grant and (k) total external support, for 1998–99; [18632]

  (2) what is the (a) total standard spending assessment and Police grant and (b) total external support including revenue support, non-domestic rates, standard spending assessment reduction grant and police grants to be received by (i) all local authorities, (ii) each class of local authority,(iii) education authorities, (iv) authorities other than Police authorities and (v) all authorities, in (1) 1998–99 and (2) 1997–98 indicating (a) the change over 1997–98 in pounds and percentages, (b) adjustments for 1997–98 for local government reorganisation and for changed local authority functions and responsibilities in 1998–99; and if he will list each such adjustment and its monetary value; [18633]

  (3) what is the (a) total standard spending and (b) total aggregate external finance for (i) all local authorities and (ii) all local authorities other than Police authorities in England in (1) 1998–99 and (2) 1997–98, giving in each case (A) the change over 1997–98 in pounds and percentages and (B) adjusting 1997–98 totals for changed local authority functions and responsibilities in 1998–99, listing each adjustment and its monetary value. [18634]

  Mr. Raynsford
  This information will be available in the Library following my right hon. Friend the Secretary of State for the Environment, Transport and the Region statement on local government finance.

  Mr. Stringer
  To ask the Secretary of State for the Environment, Transport and the Regions if he will set out the basis of his calculations of the distributable amount of non-domestic rates for 1998–99. [18804]

  Mr. Armstrong
  The distributable amount of non-domestic rates in England for 1998–99 will be £12,524 million. This is based on a non-domestic rate multiplier of 0.474 and includes an allowance of £360 million for an Exchequer payment to the non-domestic rates pool, to compensate for the shortfall which would otherwise occur as a result of the regulations
  113
  under section 58 of the Local Government Finance Act 1988 to phase in the effects of the 1995 revaluation on rate bills.

  National non-domestic rates—Calculation of distributable amount

  £ million

  1995–96

  1996–97

  1997–98

  1998–99

  final outturn

  provisional outturn

  provisional outturn

  estimated in-year contribution

  1. Income from local lists

  Multiplier (p)

  43.2

  44.9

  45.8

  47.4

  Gross rate yield

  12,781

  13,369

  13,518

  13,843

  (i) Reliefs

  (a) Net transitional relief

  -731

  -546

  -497

  -616

  (b) Empty properties

  -1,054

  -1,014

  -1,098

  -1,137

  (c) Charitable

  -445

  -482

  -535

  -535

  (d) Discretionary

  -26

  -77

  -181

  -50

  Net yield after reliefs

  10,524

  11,251

  11,207

  11,504

  (ii) Collection costs/reductions to contributions

  (a) Costs of collection

  -75

  -76

  -79

  -79

  (b) Losses on collection

  -144

  -148

  -154

  -160

  c) City of London offset

  -7

  -7

  -7

  -7

  Total contribution in respect of year

  10,299

  11,020

  10,968

  11,259

  (iii) Adjustments

  Repayments/interest payments

  -1,005

  -363

  -350

  -426

  Total adjustments

  -1,005

  -363

  -350

  -426

  Net local yield

  9,294

  10,657

  10,618

  10,833

  2. Income from central list

  Net central list yield

  1,192

  1,221

  1,200

  1,211

  3. Income from crown contributions in aid

  Net crown yield

  481

  487

  485

  445

  Total NDR yield

  10,967

  12,365

  12,303

  12,489

  4. Exchequer contributions

  Total exchequer contributions

  505

  429

  400

  360

  Total NNDR pool payments (1+2+3+4)

  11,472

  12,794

  12,703

  12,849

  5. Adjustments

  Surplus brought forward

  -1,177

  -1,059

  -1,002

  -326

  Combined total

  10,295

  11,734

  11,701

  12,524

  Distributable amount

  11,354

  12,736

  12,027

  12,524

  Surplus carried forward

  -1,059

  -1,002

  -326

  —

  The amounts shown are those recorded in the post end-year (NNDR3) returns. For 1997–98 the amounts shown are the estimated outturn for the year based mainly upon authorities' provisional contributions to the non-domestic rating pool.

  1. Item 1: The gross calculated rate yield represents the total value of non-domestic hereditaments on local rating lists times the multiplier.

  2. Item 1(i)(a): The Transitional decrease adjustment includes the estimated amount of rates that will not be recouped from local list ratepayers under the transitional arrangements made by regulations under section 58 of the Local Government Finance Act 1988.

  3. Item 1(i)(b): the empty property relief adjustments include voids and partially occupied hereditaments. The 1998–99 figure includes an allowance for the increase in the gross rates yield.

  4. Item 1(i)(c): Charitable rate relief. The 1998–99 figure includes mandatory relief for village shops under the Local Government and Rating Act 1997. As for empty property relief.

  5. Item 1(i)(d): Discretionary relief granted to charities, non-profit making organisations and for other reasons including, for 1998–99, discretionary relief for village shops and other rural businesses granted under the Local Government and Rating Act 1997. As for charitable rate relief.

  6. Item 1(ii)(a)&(b): The allowances for the costs and losses incurred by local authorities in collecting non-domestic rates from ratepayers.

  7. Item 1(ii)(c): City Offset—the amount which the City of London will not be required to pay into the non-domestic rating pool. It is the amount which will be retained by the authority to meet its own expenditure.

  8. Item 1(iii): net adjustment in respect of appeals and other amendments to the rating list affecting liability for previous years rates settled in that year.

  9. Item 2: the rateable value of non-domestic hereditaments on the central rating list times the multiplier, less the net effect of transitional arrangements, and adjusted for appeals and other changes in respect of previous years.

  10. Item 3: the 1998–99 figure for crown properties includes an allowance for the effect of transition.

  11. Item 4: the contribution from central government to offset the amount of the Secretary of State's estimate of income forgone as a result of transitional arrangements established by regulations under section 58 of the Local Government Finance Act 1988.

  114
  The calculation for 1998–99, and the prior-year figures on which this is based, are set out in the following table:

  European Charter on Self-Government
  Mr. Burstow
  To ask the Secretary of State for the Environment, Transport and the Regions if he will make a statement on his plans to ratify the European Charter on Local Self-Government. [18865]

  Mr. Raynsford
  Subject to the views of this House and those of Another Place, the Government intends to ratify the European Charter on Local Self-Government as soon as practicable in the new year.

LORD CHANCELLOR'S DEPARTMENT

  Conditional Fees
  Mr. Garnier
  To ask the Parliamentary Secretary, Lord Chancellor's Department what research he has undertaken to discover(a) the number of people, who since their introduction, wanted to pursue civil claims on a conditional fee arrangement but whose cases were not accepted by solicitors and (b) the reasons for which those cases were not accepted by solicitors. [18733]

  Mr. Hoon
  None. Lawyers decline to accept cases from clients for many reasons whether the client wishes to fund these through conditional fee agreements or otherwise.

  Mr. Garnier
  To ask the Parliamentary Secretary, Lord Chancellor's Department what research he has undertaken to discover the suitability of conditional fee arrangements in(a) medical negligence, (b) breach of contract, (c) professional negligence, (d) defamation and malicious falsehood and (e) false imprisonment and malicious prosecution cases; and if he will publish it. [18732]

  Mr. Hoon
  None. The suitability of conditional fee arrangements in any given case must be a matter for the client and their lawyers. Our proposals to extend the availability of conditional fee agreements simply widen the options available to lawyers and their clients and thus increase the ways in which people can obtain access, to justice, even when they are unable to bear the costs of lawyers' fees but do not qualify for legal aid.

  Mr. Garnier
  To ask the Parliamentary Secretary, Lord Chancellor's Department what percentage of the damages awarded to plaintiffs in cases brought under a conditional fee arrangement were paid to(a) solicitors and (b) barristers as success fees in each year since their introduction. [18734]

  Mr. Hoon
  The information the hon. and learned Member seeks is not available. No arrangements were put in place by the hon. and learned Member's party when in Government to monitor this, which is, in fairness, dependent on the private contractual arrangements clients make with their lawyers. The PSI research did, however, show that in 97 per cent. of the agreements under study the solicitors had applied the voluntary cap of 25 per cent. of damages on their success fee.

  Mr. Garnier
  To ask the Parliamentary Secretary, Lord Chancellor's Department what research he has undertaken into the public's attitude to conditional fee arrangements; and if he will publish it. [18735]
  116
  Mr. Hoon
  Over 28,000 cases in just over two years and new agreements being made at a rate of 1,500 a month appear to me substantial proof that the public have welcomed conditional fees and have made considerable use of them.

  Plaintiff Liability Insurance
  Mr. Garnier
  To ask the Parliamentary Secretary, Lord Chancellor's Department what assessment he has made of the adequacy of insurance available(a) between 1995 and 1997 inclusive and (b) from 1 April 1998 to cover plaintiffs' liabilities for (i) their own costs and disbursements and (ii) defendants' costs and disbursements. [18736]

  Mr. Hoon
  There are a considerable number of legal expenses insurance products available to protect against one's own costs of going to law. Many people have them added to their household or motor car insurance policies at very modest cost. I have no reason to believe these are likely to reduce from 1 April 1998. There clearly has been sufficient availability of insurance to allow over 28,000 claims to be brought in a little over two years. New products are still being launched. I see no reason why other insurance products should not become available on or after 1 April 1998.

  Low Pay
  Mr. Chidgey
  To ask the Parliamentary Secretary, Lord Chancellor's Department if he will list, by regions defined by the boundaries of the regional government offices, the lowest hourly rate paid by his Department to(a) full-time employees, (b) part-time employees,(c) persons employed under personal contract and(d) persons employed by firms undertaking contracted—out services for central government offices, defining the job title in each case. [18226]

  Mr. Hoon
  This answer covers the Headquarters of the Lord Chancellor's Department (with Associated Offices), the Court Service, Public Trust Office, Land Registry, Public Record Officer and Northern Ireland Court Service. Minimum salaries currently payable to full-time staff, expressed as minimum hourly rates, are shown in the tables below. Part-time salaries are pro rata those of full-time staff. Staff are categorised by current grade. Information as to location is not held in the form requested, but separate details are given—where applicable—for staff in London and elsewhere.

  Details of the range of pay of staff employed by firms undertaking contracted out services are not held and could be provided only if contractors were prepared to waive commercial confidentiality considerations.

  LCD HQ (with Associated Offices)

  £4.51 (London)

  £3.44 (elsewhere)

  The above rates relate to staff in the grade of Administrative Assistant. They also represent the minimum payable to individuals employed on personal contracts (casual Administrative Assistants).
  117
  Court Service

  £4.45 (Inner London)

  £4.08 (Intermediate London zone)

  £3.96 (Outer London)

  £3.30 (elsewhere)

  The above rates relate to staff in the grade of Administrative Assistant and also represent the minimum payable to individuals on personal contracts (casual Administrative Assistants). The rates do not include a negotiated uplift due to take effect for permanent staff in April 1998.

  Public Trust Office

  £4.53 (Administrative Assistant)

  Staff on personal contract: as above (casual Administrative Assistant)

  All staff are in London

  Land Registry

  £5.06 (London) / £3.50 (elsewhere) } Registration Assistant 2

  Staff on personal contract: none outside Senior Civil Service.

  Public Record Office

  £4.27 (Junior Print Operator)

  Staff on personal contract: none

  All staff are employed in offices in the Greater London area.

  Northern Ireland Court Service

  £4.10 (Typist)

  Staff on personal contract: none outside Senior Civil Service.

WALES

  Cardiff Bay Development Corporation
  Mr. Rhodri Morgan
  To ask the Secretary of State for Wales what consultations he has had with the Chairman of Cardiff Bay Development Corporation about progress relative to the contract on the Barrage lock gate contract awarded to Messrs Noell of Würzburg, Germany. [18212]

  Mr. Ron Davies
  None. Responsibility for monitoring progress on the Barrage lock gate contract is an operational matter for the Corporation. It would not be appropriate for the Department or the Corporation to get involved or indeed to comment on sub-contractual arrangements.

  Local Government Finance
  Mr. Caton
  To ask the Secretary of State for Wales what proposals he has for local government revenue spending and grant support in 1998–99; and if he will make a statement. [19122]

  Mr. Ron Davies
  Following consultation with representatives of local government in Wales, I propose that the provision for local authority revenue expenditure (total standard spending) in 1998–99 should be £3,090.5 million. This represents an increase of £120 million, or 4 per cent. on the comparable level of funding for 1997–98. The provision includes £190.2 million for care in the community, the additional £50.3 million revenue spending for schools I announced 118
  on 2 July, and extra provision to help local authorities achieve the Government's policy objectives for nursery education.

  For local authorities, I intend to set provisional capping principles which will allow, on average, for a basic increase of 3 per cent. on 1997–98 budgets, an average of 4.6 per cent. when a number of capping disregards and the passporting of standard spending assessment increases in full are taken into account. The provisional capping principles allow local authorities further headroom for expenditure in addition to that provided by total standard spending.

  I propose to set central government support for total standard spending through aggregate external finance at £2,702 million. Within this support, I propose to make available £1,831.1 million in revenue support grant/council tax reduction grant (includes an extra £6 million to help limit council tax increases); £612 million in distributable non-domestic rates; and £258.9 million in specific grants.

  If local authorities spend in line with the proposed capping principles, council tax bills for band D properties should, on average, increase by about £1.20 a week. However, if councils use only a small part of planned efficiency savings to keep council tax bills down, or draw from reserves, I believe that average increases in council tax bills next year for band D properties should not exceed about £50 a year or £1 a week. The council tax reduction scheme is designed to limit the maximum increase in any authority for spending at the capped level to under £1 a week for band A properties to around £2.50 a week for band H properties.

  Looking further ahead, the Welsh Local Government Association has sought stability for the next two or three years and asked for a fundamental review of the system for distributing grant in readiness for the National Assembly for Wales. I have agreed to both these requests and plan to commission jointly with the Association an independent assessment of the current arrangements for calculating standard spending assessments. I hope that an interim report will be available next summer.

  Further information on the proposed settlement, including details for individual authorities, will be announced next week.

  I am making a separate announcement today giving details of the settlement for police authorities.

  My Department has written today to the Welsh Local Government Association and all local authorities in Wales to initiate a consultation on my proposals for next year's settlement. Copies of the consultation letter will be placed in the Library of the House.

  Police Expenditure
  Mr. Caton
  To ask the Secretary of State for Wales what proposals he has for police authority revenue spending in 1998–99. [19123]

  Mr. Ron Davies
  I propose to make £353 million available from total standard spending in Wales to fund police services in 1998–99. This sum comprises £179.6 million in cash-limited police grant, to be paid by my right hon. Friend the Home Secretary, and
  119
  £173.4 million in standard spending assessments (SSA). It represents an overall increase of £12.4 million, or 3.6 per cent. on 1997–98.

  The sums for each police authority are set out in the following table:

  £ million

  Police grant

  SSA

  Total

  Dyfed-Powys

  26.0

  25.1

  51.1

  Gwent

  34.3

  33.0

  67.3

  North Wales

  37.4

  35.8

  73.2

  South Wales

  81.8

  79.5

  161.3

  My Department is today writing to each police authority in Wales consulting them on their provisional standard spending assessment for 1998–99. The figures may alter slightly if the balance of funding between English and Welsh police authorities, which is determined by a joint formula, changes as a result of consultation.

  My provisional capping principles for police authorities allow for an increase in spending power of 3.7 per cent. I will make my final decisions on capping principles in the light of budgets set by police authorities.

  Copies of the consultation letter will be placed in the Library of the House.

  Non-domestic Rates
  Mr. Caton
  To ask the Secretary of State for Wales what proposals he has for the Welsh non-domestic rate poundage for the next financial year. [19124]

  Mr. Ron Davies
  I propose that the national non-domestic rate poundage for Wales should rise to 42.9 pence to reflect the annual increase in the retail prices index to September 1997.

  Low Pay
  Mr. Chidgey
  To ask the Secretary of State for Wales if he will list, the lowest hourly rate paid by his Department to(a) full-time employees, (b) part-time employees, (c) persons employed under personal contract and (d) persons employed by firms undertaking contracted-out services for central government offices, defining the job title in each case. [18108]

  Mr. Ron Davies
  (a) Full-time casual administrative assistants earn the hourly equivalent of £3.30 per hour.

  (b) Part-time casual administrative assistants earn the hourly equivalent of £3.75 per hour.

  (c) There are no staff employed on personal contracts in the Welsh Office.

  (d) Information of this nature is commercial in confidence.

  Brecon Beacons National Park
  Mr. Rhodri Morgan
  To ask the Secretary of State for Wales what representations he has received in relation to the future management of the Brecon Beacons National Park. [18836]
  120
  Mr. Ron Davies
  I have received representations from a number of members of the Park Authority. On 20 November, the Under-Secretary, my hon. Friend the Member for Bridgend (Mr. Griffiths) requested a report from the Chairman.

FOREIGN AND COMMONWEALTH AFFAIRS

  India (Entry Clearance)
  Mr. Vaz
  To ask the Secretary of State for Foreign and Commonwealth Affairs how many entry clearance officers there are in(a) Bombay and (b) New Delhi. [18308]

  Mr. Fatchett
  Bombay currently has 10 Entry Clearance officers (ECOs) and 2 Entry Clearance Managers (ECMs). New Delhi has 12 ECOs, 2 ECMs and a full time Head of Immigration (who is also the Consul).

  Mr. Vaz
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on the application for admission of Mr. Sayed Muhamed Azim Nazis in Bombay (reference E/97/3255). [18311]

  Mr. Fatchett
  We have asked our High Commission in Bombay to provide a detailed account of the position. My noble Friend the Parliamentary Under-Secretary of State for Foreign and Commonwealth Affairs will write to the hon. Member within one week of receiving that account.

  Mr. Vaz
  To ask the Secretary of State for Foreign and Commonwealth Affairs what is the average length of time taken in(a) Bombay and (b) New Delhi to dispatch an explanatory statement followed a refusal of entry clearance in 1997. [18309]

  Mr. Fatchett
  In 1997 the average time taken to despatch an explanatory statement following a refusal of entry clearance in Bombay and New Delhi are two months in both cases.

  Mr. Vaz
  To ask the Secretary of State for Foreign and Commonwealth Affairs how many representations he has received from(a) hon. Members and (b) others concerning the operation of the entry clearance office in (i) Bombay and (ii) New Delhi. [18307]

  Mr. Fatchett
  Our correspondence statistics are not broken down in such a way as to be able to give precise figures of representations on the operation of the entry clearance offices in Bombay and New Delhi.

  South Africa (Murders)
  Mr. Loughton
  To ask the Secretary of State for Foreign and Commonwealth Affairs how many British citizens were murdered in South Africa in the last 12 months; and what measures he plans to take to promote the protection of British nationals resident in or visiting South Africa. [18216]

  Mr. Fatchett
  Eight British citizens have been reported to British missions in South Africa as murdered in the last 12 months. There are approximately 1.2 million Britons living in South Africa; and some 200,000 Britons visit each year. This Department has a duty to protect their interests and to provide them with relevant information about threats to their personal safety. In South Africa this is undertaken by consular staff at the six British missions
  121
  there and by the provision of Travel Advice. Since February 1997 Travel Advice on South Africa has been warning potential visitors about the high level of violent crime there. It also advises against visiting isolated areas throughout South Africa and names specific locations in the major cities where care should be taken.

  World Summit for Children
  Mr. Livingstone
  To ask the Secretary of State for Foreign and Commonwealth Affairs what assessment he has made of the World Summit for Children project; and if he will make a statement. [18482]

  Mr. Fatchett
  The 1990 Summit focused international attention on the plight of millions of children who are victims of poverty, neglect, cruelty and exploitation. Implementation of the Summit Plan of Action requires a universal effort by governments, the United Nations, other international and regional organisations and all sectors of civil society. We support the follow up work of the United Nations, including to promote implementation of the Convention on the Rights of the Child.

  Mr. Livingstone
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement concerning the action Her Majesty's Government has taken to implement Clause 22 of the Declaration of the United Nations World Summit for Children 1990. [18481]

  Mr. Fatchett
  We fully support implementation of paragraph 22 of the Plan of Action for Implementing the World Summit Declaration. The United Kingdom makes a major contribution to promoting the rights of children in especially difficult circumstances. This includes support for UN organisations such as the UN High Commission for Refugees (UNHCR), the UN Children's Fund (UNICEF) and the International Labour Organisation (ILO).

  EU Delegations
  Sir Richard Body
  To ask the Secretary of State for Foreign and Commonwealth Affairs, pursuant to his answer of 24 July 1997,Official Report, column 704–05, what were the total costs of European Commission delegations to third countries for 1996. [18500]

  Mr. Doug Henderson
  In 1996, the total expenditure of Commission Delegations in third countries was 194,558,200 ecu (£132.8 million—November 1997 exchange rate).

  Republic of Slovakia
  Mr. Cox
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on human rights in the Republic of Slovakia. [18576]

  Mr. Doug Henderson
  Slovakia is party to the International Convention on Civil and Political Rights, the European Convention on Human Rights and has ratified the Framework Convention on National Minorities. We expect Slovakia to abide by its commitments under these instruments. We are also encouraging the Slovak Government to address the shortcomings in democratic standards identified in the Commission's Opinion on Slovakia's application for EU membership.

  Nuclear Materials (Transport)
  Mr. Chaytor
  To ask the Secretary of State for Foreign and Commonwealth Affairs what assessment he has made of the proliferation risks posed by the use of mixed oxide fuel by European Union countries and its transport from European Union suppliers to Japan. [18491]

  Mr. Fatchett
  The proliferation risks posed by the use of Mixed Oxide Fuel (MOX) by European Union countries and its transport from EU suppliers to Japan are assessed as being extremely low. Indeed, the use of MOX fuel reduces proliferation risks by gradually reducing plutonium stockpiles.

  Albania
  Mr. Keetch
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will list each planned visit(a) by British Ministers to Albania and (b) by Albanian Ministers to the United Kingdom. [18475]

  Mr. Fatchett
  There will be an opportunity for substantial discussion at Ministerial level when the Albanian Prime Minister, Fatos Nano, visits Britain from 14 to 17 December. We intend to continue regular Ministerial contacts but no dates have been fixed either for visits by British Ministers to Albania or further visits by Albanian Ministers to the UK.

  Immigration
  Mr. Rooney
  To ask the Secretary of State for Foreign and Commonwealth Affairs when a decision will be made on the visa application by Abdul Rehman, Islamabad High Commission ref. IMM/E2002. [18832]

  Mr. Fatchett
  We have asked our High Commission in Islamabad to provide a detailed account of the position. My noble Friend the Parliamentary Under-Secretary of State for Foreign and Commonwealth Affairs will write to the hon. Member within one week of receiving that account.

  EU Agreements
  Mr. Howard
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will list the precedents for bilateral agreements between an EU member state and the EU Presidency being concluded after the hearings at a summit. [18671]

  Mr. Doug Henderson
  At negotiations such as the IGC, it is not unusual for the Presidency to reach tentative understandings with a Member State on how to handle a point of key concern to them. But such understandings would normally be considered subsequently by the full meeting.

  Mr. Howard
  To ask the Secretary of State for Foreign and Commonwealth Affairs, pursuant to his oral statement on 25 November 1997,Official Report, column 754, when he was first informed of the bilateral agreement between Spain and the Dutch Presidency. [18669]

  Mr. Doug Henderson
  We first learned of the change to the text when we received a revised Treaty text after the Amsterdam summit on 19 June.

  Mr. Howard
  To ask the Secretary of State for Foreign and Commonwealth Affairs pursuant to his oral statement
  123
  of 25 November 1997, Official Report, column 754, when the bilateral agreement between Spain and the Dutch Presidency of the EU was concluded. [18668]

  Mr. Doug Henderson
  We believe that the text reflected discussions in the margins of the Amsterdam European Council on 16–17 June.

  Mr. Howard
  To ask the Secretary of State for Foreign and Commonwealth Affairs if another EU member state can block the UK acceding to the Schengen Acquis. [18672]

  Mr. Doug Henderson
  Unanimity is required where the UK and Ireland apply to take part in a measure within the existing Schengen Acquis. The Declaration on Article 4 of the Protocol, integrating the Schengen Acquis, makes provision for the Council to seek the opinion of the Commission before it decides on a request from the UK or Ireland to take part in some or all of the provisions of the Schengen Acquis. Other Member States also undertake to make their best efforts to allow the UK or Ireland to participate. The UK cannot be blocked from opting into proposals and initiatives which build upon the Schengen Acquis.

  Mr. Howard
  To ask the Secretary of State for Foreign and Commonwealth Affairs pursuant to his oral statement of 25 November 1997,Official Report, column 754, what representations he made to the Presidency of the European Union about the bilateral agreement between Spain and the Dutch Presidency; and when. [18670]

  Mr. Doug Henderson
  The UK made a number of representations on this matter at Ministerial and official level.

  Council of Europe
  Mr. Hancock
  To ask the Secretary of State for Foreign and Commonwealth Affairs what action he proposes to take in response to Recommendation 1335 (1997) of the Parliamentary Assembly of the Council of Europe. [18366]

  Mr. Foulkes
  I have been asked to reply.

  We are closely monitoring the situation of displaced persons in the Transcaucasus. United Kingdom assistance has concentrated on promoting livelihood security through strengthened co-ordination of humanitarian aid, improved targeting of vulnerable groups and stronger dissemination of international humanitarian law. The Department for International Development has also funded quick impact income generation projects as well as relief items. The total value of UK humanitarian aid since the beginning of 1996 has exceeded £4.3 million.

  A UK assessment mission to the Transcaucasian countries is due within the next couple of months and Recommendation 1335 of the Parliamentary Assembly of the Council of Europe will be taken into consideration when drawing up our strategy.

  European Voluntary Service For Young People
  Mr. Gill
  To ask the Secretary of State for Foreign and Commonwealth Affairs what discussions he has had with national youth organisations in the United Kingdom over the European Voluntary Service for Young People as set out in Corn (97) 347; what his Department's policy is in respect of Article 1(2) as modified by the European 124
  Parliament; to what extent personal security will be taken into account as concerns article 2(1a); what is entailed in the reference to analysis and dissemination of data in article 5.3(2); and if he will make a statement. [18094]

  Dr. Howells
  I have been asked to reply.

  I attended the European Council of Youth Ministers in Luxembourg on 28 October, at which a common position was reached on the Commission's draft proposal for a European Voluntary Service for Young People, subject to a UK Parliamentary Scrutiny Reserve. I refer the hon. Member to the reply I gave to my hon. Friend the Member for Hemsworth (Mr. Trickett) on 19 November, Official Report, column 186.

  The Commission's proposal states specifically that the activities undertaken by young people under this programme will no way replace potential or existing paid jobs; the other points of detail raised will be addressed with other Member States when the precise arrangements for the Programme are being discussed over the next few months.

  The Government are committed to seeing this programme under way as early as possible. The Government agree with Article 1(2) of the draft proposal.

  Officers of the Department have had general discussions with the British Youth Council about this programme, and we will draw on our experience of the pilot phase in determining the exact arrangements for the new EVS Programme.

  Arms Export Licences (Indonesia)
  Mr. Letwin
  To ask the Secretary of State for Foreign and Commonwealth Affairs what arms have been licensed for export to Indonesia since 1 May; which arms have been denied such a licence; and on what grounds. [16076]

  Mrs. Beckett
  I have been asked to reply.

  The Export Control Organisation's computer databases have been interrogated and the following results obtained.

  Between 2 May and 13 November, decisions were taken on 27 applications for standard or open individual licences to export to Indonesia goods controlled under entries in Part III of Schedule I to the Export of Goods (Control) Order 1994 (the so-called "Military List"). The entry in the relevant legislation under which the export of goods is controlled is known as their rating.

  Decisions on applications for standard individual export licences during the period

  Rating

  Number of licences granted covering goods with this rating

  Number of applications refused covering goods with this rating

  ML1

  0

  2

  ML4

  2

  0

  ML5

  1

  0

  ML6

  0

  1

  ML7

  1

  0

  ML10

  5

  0

  ML11

  11

  0

  ML13

  1

  0

  ML14

  1

  1

  Total

  22

  4

  125

  Decisions on applications for open individual export licences (OIELs) during the period

  Rating

  Number of licences granted covering goods with this rating

  Number of applications refused covering goods with this rating

  ML13

  11

  0

  1 This OIEL was issued for the export to any destination, including Indonesia, of certain goods for use by specified persons working in the media.

  However, this information should be considered in light of the answer given on 30 October 1997, Official Report, columns 256–58, by my hon. Friend the Minister for Small Firms, Trade and Industry to my
  126
  hon. Friend the Member for Don Valley (Caroline Flint).

  In addition to the above, goods on the Military List may have been exported to Indonesia during the period concerned under the following Open General Export Licences (OGELs): OGEL (technology for military goods), OGEL (military surplus vehicles), OGEL (export after repair: military goods) and OGEL (export after exhibition: military goods). I am arranging for copies of all current OGELs to be placed in the Library of the House.

  The decision to refuse the applications listed above were made after careful consideration of each case against the criteria announced to the House by my right hon. Friend the Foreign Secretary on 28 July 1997, Official Report, columns 26–29.

NORTHERN IRELAND

  Tax Advice
  Mr. Malcolm Bruce
  To ask the Secretary of State for Northern Ireland what is the policy of her Department on the purchase of tax avoidance advice; and if she will make a statement. [13272]

  Mr. Murphy
  [holding answer 5 November 1997]: The policy is that when tax advisers are used it should only be to enable Northern Ireland departments to fulfil their statutory tax obligations rather than for tax avoidance purposes.

  Parades and Marches
  Mr. McGrady
  To ask the Secretary of State for Northern Ireland (1) what was the total cost of policing the marches, demonstrations and associated disturbances during July and August; [15046]

  (2) what was the total cost of policing the parades which took place in Northern Ireland from 1 April to 30 September. [15052]

  Mr. Ingram
  Policing marches and demonstrations is part of normal police duties and as such separate costings for these activities are not held centrally.

  Terrorist Offences
  Mr. Trimble
  To ask the Secretary of State for Northern Ireland how many persons have been charged with terrorist offences other than those in connection with paramilitary beatings in 1997. [16032]

  Mr. Ingram
  Between 1 January 1997 and 2 December 1997, a total of 334 persons were charged with terrorist type and Serious Public Order offences within Northern Ireland.

  Glassdrummond Band
  Mr. Trimble
  To ask the Secretary of State for Northern Ireland pursuant to her Answer of 7 November,Official Report, column 692, what was the rank of the officer to whom notice was given by the Glassdrummond Band on 2 November. [17031]

  Mr. Ingram
  The rank of the officer to whom notice was initially given by the Glassdrummond Band on 2 November 1997 was Reserve Constable. The Constable consulted with his Sergeant who granted permission.

  Appointments
  Mr. William Ross
  To ask the Secretary of State for Northern Ireland if she will list(a) those public bodies to which she makes appointments, (b) the number of persons whom she appoints and the total number of the members of each body, (c) the period of each appointment, (d) the remuneration of each appointment and (e) the sums of public money available to each body in the last year for which figures are available. [17321]

  Mr. Murphy
  Information relating to parts(a), (b), (d) and (e) of the question can be found in the Cabinet Office
  128
  publication "Public Bodies 1996". The 1997 version of this document will be available on 16 December 1997. Information in the form requested at (c) is currently being assembled, and will be made available as soon as that exercise has been completed.

  Union Flag
  Mr. John D. Taylor
  To ask the Secretary of State for Northern Ireland pursuant to her answer of 20 November 1997,Official Report, column 272, who made the decision not to fly the Union flag at the Southern Area Health and Social Services Board, Tower Hill, Armagh, on 9 November; and if she will make a statement. [17820]

  Mr. Worthington
  A letter was sent to all Health and Social Services Boards on 1 May 1997 advising them of the days in 1997 on which the Union Flag should be flown on Central Government Buildings. There is, however no requirement for the Boards to fly the Union flag on these dates. It is at the discretion of each organisation whether the flag should be flown on those buildings occupied by their staff.

  There was no specific decision made to fly or not to fly the Union Flag at the Southern Health and Social Services Board Tower Hill, Armagh on 9 November 1997.

  District Cancer centers
  Rev. Martin Smyth
  To ask the Secretary of State for Northern Ireland what plans are in place to train the skilled staff required for the district cancer centers. [17765]

  Mr. Worthington
  [holding answer 25 November 1997]: The Cancer Working Group (CWG) Report "Cancer Services—Investing for the Future" recommended a minimum target of 13 consultants in non-surgical oncology by the year 2005. Currently there are eight consultant clinical oncologists in post. To move towards the recommended target the number of trainees in Clinical Oncology has been increased from four to five in 1997–98. Also, a new training post in Medical Oncology is planned for next year.

  Prostheses
  Mr. Peter Robinson
  To ask the Secretary of State for Northern Ireland what was the shortest period spent on a waiting list for(a) non-fundholder and (b) fundholder patients for the fitting of a prosthesis following the amputation of an arm in the last year for which figures are available. [17896]

  Mr. Worthington
  No one has had to wait longer than the three week timescale for the fitting of a prosthesis during the past 12 months.

  Mr. Peter Robinson
  To ask the Secretary of State for Northern Ireland how many prostheses the Eastern Health and Social Services Board has contracted for in the current financial year; and what funds have been committed to purchase these services. [17903]

  Mr. Worthington
  The information is not available in the form requested. The Eastern Health and Social Services Board's contract with Green Park Healthcare
  129
  Trust is for prosthetic services not the provision of a specified number of prostheses. The value of the contract in the current financial year is £1,005 million.

  Mr. Peter Robinson
  To ask the Secretary of State for Northern Ireland what is the longest current waiting time for(a) non-fundholder and (b) fundholder patients for the fitting of a prosthesis following the amputation of (i) an arm and (ii) a leg. [17898]

  Mr. Worthington
  No one is currently waiting outside the three week timescale for the fitting of a prosthesis.

  Mr. Peter Robinson
  To ask the Secretary of State for Northern Ireland if she will make a statement on the allocation of resources of the Eastern Health and Social Services Board for the purchase of clinical procedures for(a) the fitting of a prosthesis following the amputation of a leg and (b) breast reconstruction following a mastectomy; and what account was taken of policy appraisal and fair treatment guidelines in determining these allocations. [17895]

  Mr. Worthington
  It is for the Eastern Health and Social Services Board to ensure that sufficient resources are allocated to purchase the level of services necessary to meet the needs of its population. The Board requires that all patients are treated on the basis of clinical priority.

  Mr. Peter Robinson
  To ask the Secretary of State for Northern Ireland what account the Eastern Health and Social Services Board took of the Government's Policy Appraisal and Fair Treatment Guidelines in deciding on the allocation of resources for the purchase of procedures for the fitting of a prosthesis following the amputation of a leg; and what steps were taken to ensure that women and men were treated equally in the purchase of these services. [17911]

  Mr. Worthington
  When allocating resources for the fitting of prostheses, the Board requires that all patients are treated on the basis of clinical priority.

PRESIDENT OF THE COUNCIL

  Drugs Tsar
  Mr. Clifton-Brown
  To ask the President of the Council if she will make a statement on the recent appointment of a drugs tsar. [17131]

  Mrs. Ann Taylor
  Keith Hellawell will take up his post early in the New Year. His immediate priorities will be to review existing action against drug misuse across the board and to submit proposals to Ministers for a new strategy as quickly as possible, aimed at tackling drug problems through effective enforcement, treatment and education.

  Mrs. Ballard
  To ask the President of the Council if she will make a statement on the current programme of work being undertaken by her Inter-Departmental Committee on Drugs. [17132]

  Mrs. Ann Taylor
  It is not normal practice to give details of the work of Cabinet Committees, but the Committee will in due course be considering plans for a130
  new anti-drugs strategy, on the advice of the UK Anti-Drugs Co-ordinator.

  Mr. Loughton
  To ask the President of the Council what assessment she has made of the adequacy of the budget proposed for the office of Drugs Tsar in relation to the purposes intended; and if she will make a statement about how that money will be spent. [18218]

  Mrs. Ann Taylor
  The UK Anti-Drugs Co-ordinator and his Deputy are special advisers to the Government. Accordingly they have no direct responsibility over any budget. The issue of resources for the Co-ordinator's work will be examined further as the Government consider plans for the next phase of the anti-drugs strategy.

  Public Appointments
  Mr. Vaz
  To ask the President of the Council how many public appointments she has made since 1 May; and how many and what percentage of these(a) received remuneration and (b) are of (i) Afro-Caribbean and (ii) Asian origin. [16784]

  Mrs. Ann Taylor
  My Department is responsible for the formal procedures leading to a large number of appointments by the Crown, the Privy Council and myself, the majority of which are part-time and unpaid. Since 1 May I have made nine appointments to the governing bodies of Higher Education institutions and have been involved in a further six such appointments. All of these appointments are unpaid. Additionally I have been involved in six unpaid appointments to statutory medical and similar bodies. Information about ethnic origin cannot be provided since to do so would risk identifying individuals without their consent. My right hon. Friend the Chancellor of the Duchy of Lancaster has provided information for all departments in an aggregated form.

  Prayers
  Mr. Fabricant
  To ask the President of the Council if she will meet the Speaker's Chaplain to discuss Prayers preceding the day's business. [17133]

  Mrs. Ann Taylor
  While I would be happy to meet the Speaker's Chaplain to discuss the temporal aspects of modernisation of the House, the content of Prayers is a matter for Madam Speaker.

  Sitting Hours
  Mr. Tyler
  To ask the President of the Council what plans she has for reform of the hours which the House sits; and if she will make a statement. [17134]

  Mrs. Ann Taylor
  The hon. Member will be aware of the significant change to sitting hours achieved since the Jopling report was implemented in 1994. The Modernisation Committee is looking again at this matter.

  Special Standing Committees
  Mr. Malcolm Bruce
  To ask the President of the Council what representations she has received concerning increasing the use of Special Standing Committees. [17121]
  131
  Mrs. Ann Taylor
  The use of Special Standing Committees was mentioned in the debate on modernisation on 13 November 1997,Official Report, columns 1061–1129. I have not received any more recent representations.

  Chamber Modernisation
  Mr. Harvey
  To ask the President of the Council what plans she has relating to the redesign of the Chamber. [17126]

  Mrs. Ann Taylor
  None. I told the House on 15 July 1997,Official Report, column 152 that I did not think the House would be willing to change its layout unless there was a broad measure of agreement to do so.

  Passive Smoking
  Mr. Alan Simpson
  To ask the hon. Member for Roxburgh and Berwickshire, representing the House of Commons Commission, if he will make a statement on the responsibilities of the Commission in relation to passive smoking; and what actions are being taken in consequence. [17125]

  Mr. Kirkwood
  The Commission is responsible for the terms and conditions of the staff of the House and their working environment. Currently individual heads of the six House departments seek to agree an acceptable smoking policy, including passive smoking, with staff. The Board of Management is carrying out a review of this policy, at the request of the Commission.

  A policy on smoking in shared areas of the parliamentary estate, such as corridors and lifts, is a matter primarily for the Administration Committee. Smoking policy in restaurants is a matter for the Catering Committee. Smoking in the offices of hon. Members and their staff is a matter for Members themselves.

INTERNATIONAL DEVELOPMENT

  Publicity and Advertising
  Mr. Malcolm Bruce
  To ask the Secretary of State for International Development what is her estimate of the total expenditure on all forms of publicity and advertising by(a) her Department, (b) its agencies and (c) non-departmental public bodies for (i) 1993–94, (ii) 1994–95, (iii) 1995–96, (iv) 1996–97, (v) the 1997–98, year to date, (vi) the 1997–98, full year estimate and (vii) the 1998–99 planned expenditure. [15265]

  Mr. Foulkes
  [holding answer 12 November 1997]: The amount spent on publicity by the Department for International Development (MD) (ODA in previous years) was:

  1993–94: £1.20 million

  1994–95: £1.35 million

  1995–96: £1.27 million

  1996–97: £1.30 million

  1997–98 to date: £0.62 million

  132

  1997–98 full year estimate: £1.30 million

  1998–99 planned expenditure has not yet been agreed

  DFID does not carry out any advertising for publicity purposes. Recruitment advertising in these years amounted to:

  1993–94: £472,263.37

  1994–95: £727,707.66

  1995–96: £625,928.42

  1996–97: £665,276.68

  1997–98 to date: £815,093.77

  1997–98 full year estimate: £1.40 million

  1998–99 planned expenditure has not yet been agreed

  The amount spent on NRI publicity expenditure is as follows:

  1994–95: £56,000

  1995–96: £56,000

  The figures for 1993–94 are not available.

  On 1 May 1996 ownership of NRI was transferred to the University of Greenwich.

  Public Appointments
  Mr. Vaz
  To ask the Secretary of State for International Development how many public appointments she has made since 1 May; and how many and what percentage of these(a) receive remuneration and (b) are of (i) Afro-Caribbean and (ii) Asian origin. [16787]

  Mr. Foulkes
  One unremunerated appointment has been made since 1 May.

  The information about ethnic origin cannot be provided since to do so would risk identifying individuals without their consent. My right hon. Friend the Chancellor of the Duchy of Lancaster has provided information for all departments in an aggregated form.

  Overseas Travel
  Mr. Malcolm Bruce
  To ask the Secretary of State for International Development if she will list each of the overseas trips made by herself and other members of her ministerial team since 2 May, specifying in each case(a) the participating Minister or Ministers, (b) the destination of the trip, (c) the purpose of the trip and (d) the cost of the trip; and if she will make a statement. [15264]

  Mr. Foulkes
  [holding answer 12 November 1997]: My right hon. Friend the Secretary of State for International Development and I have made a total of 20 trips overseas since 2 May. A breakdown is shown in the attached tables. The precise cost of each trip is not identifiable separately except at disproportionate cost. The total cost of the Secretary of State's trips is £53,845 (this will not include all the costs of the Ottawa visit). The total cost of my overseas visits is £31,802 (this does not include all the costs of my trip to Ukraine).
  133

  Overseas trips made by Clare Short, Secretary of State for International Development since 2 May 1997

  Date

  Country

  Purpose

  4–5 June

  Luxembourg

  EU Development Council

  8–10 June

  Switzerland

  Humanitarian Forum

  22–24 June

  USA (New York)

  UN General Assembly Special Session

  1 July

  France

  Bilateral discussions with French Government; Ceremony to mark UK rejoining UNESCO

  15–19 September

  Bangladesh

  Review DFID Programmes

  19–23 September

  Hong Kong

  Attend IMP/IBRD Annual Meetings

  23–25 September

  Japan

  Bilateral discussions with Japanese Government

  6–10 October

  Kenya, Uganda and Rwanda

  Review DFID Programmes

  21 October

  Brussels

  Bilateral discussions with Belgian Government

  22 October

  Paris

  Attend UNESCO Conference

  27–29 October

  Sweden and Norway

  Attend Seminar on International Solidarity and Globalisation (Stockholm) and International Conference on Child Labour (Oslo).

  9–10 November

  Brussels

  Attend General Affairs Committee

  19–20 November

  Strasbourg

  Attend European Parliament

  27–28 November

  Brussels

  Attend Development Council

  2 December

  Ottawa

  To sign the Convention on Anti-Personnel Landmines

  Overseas trips made by George Foulkes, Parliamentary Under-Secretary of State for International Development since 2 May 1997

  Date

  Country

  Purpose

  20 to 22 May

  Canada

  Caribbean Development Bank Annual Meeting

  4 to 5 June

  Luxembourg

  EU Development Council

  26 to 31 July

  Botswana and South Africa

  Commonwealth Education Ministers Conference; visits to UK-funded development projects and bilaterals with Botswana and South African Government Ministers

  31 August to 2 September

  Montserrat and Antigua

  Official talks with Governments of Montserrat and Antigua

  6 to 7 October

  Italy

  UN Conference on Convention to Combat Desertification, Rome

  12 to 13 October

  Switzerland

  UNHCR Executive Committee, Geneva

  23 to 26 November

  Ukraine

  Visit to Know-How Fund Project and bilaterals with Ministers

  Former Soviet Union (Aid)
  Mr. Hancock
  To ask the Secretary of State for International Development if she will make a statement on the level of(a) UK bi-lateral aid and (b) multi-lateral aid funded in part by Her Majesty's Government in each of the last two years to (i) Armenia, (ii) Azerbaijan and (iii) Georgia. [18361]

  Mr. Foulkes
  The levels of bilateral and estimated multilateral aid to Armenia, Azerbaijan and Georgia during the last two years are as set out below:

  (a) Total bilateral aid

  £thousand

  1995–96

  1996–97

  Armenia

  546

  1,122

  Azerbaijan

  1,651

  1,093

  Georgia

  1,517

  1,851

  (b) UK share of net Multilateral disbursements.

  Net Official Development Assistance (oda) is an internationally comparable aid statistics and it is available only by calendar year. Multilateral figures are estimates of the UK share through multilateral agencies.

  Latest available information is for 1995.

  £ million

  Armenia

  6.1

  Azerbaijan

  4.6

  Georgia

  6.2

CULTURE, MEDIA AND SPORT

  Museums (Lottery Grants)
  Mr. Denis Murphy
  To ask the Secretary of State for Culture, Media and Sport if he will list(a) the number of grant applications received for museums, (b) the number of museums which have been awarded Lottery grants,(c) the amount each successful museum has received and (d) the ratio of successful/unsuccessful applications regions by region since the commencement of the National Lottery. [17155]

  Mr. Banks
  As at 21 November the National Lottery distributing bodies have announced awards worth almost £311 million to 225 museum projects throughout the UK. The following table 1 provides a breakdown, by distributing body, of applications and awards to museums. Table 2 shows the regional success rate to applications from museums. I have arranged for a full list of awards to museums to be placed in the Libraries of the House.

  Information on Lottery awards is now available on the Department's website www.lottery.gov.uk.

  Table 1

  Distributing body

  A Number of applications for museums

  B Number of museums awarded Lottery grants

  Arts: England

  65

  24

  Arts: Scotland

  12

  12

  Arts: Northern Ireland

  1

  1

  Arts: Wales

  8

  5

  135

  Table 1

  Distributing body

  A Number of applications for museums

  B Number of museums awarded Lottery grants

  Sports: England

  —

  —

  Sports: Scotland

  —

  —

  Sports: Northern Ireland

  —

  —

  Sports: Wales

  —

  —

  Heritage Lottery Fund

  770

  180

  Charities Board

  —

  —

  Millennium Commission

  1—

  3

  Total

  856

  225

  1 The Millennium Commission does not keep information on unsuccessful applications by project type.

  Table 2

  Per cent.

  Region

  Arts Success rate

  Heritage Success rate

  London

  44.44

  59.52

  North West

  50.00

  68.00

  North East

  —

  58.33

  Yorkshire and Humberside

  57.14

  57.58

  Eastern

  28.57

  50.00

  East Midlands

  100.00

  25.00

  West Midlands

  66.67

  33.33

  South West

  75.00

  61.90

  South East

  0.00

  48.00

  Merseyside

  —

  33.33

  England total

  53.19

  53.26

  Scotland

  100.00

  53.19

  Wales

  62.50

  75.00

  Northern Ireland

  100.00

  70.00

  Green Belt (Carrington Moss)
  Mr. Brady
  To ask the Secretary of State for Culture, Media and Sport (1) what discussions he has had with directors of Manchester United regarding its application to build on green belt land at Carrington Moss; [17328]

  (2) what representations he has received regarding Manchester United's application for planning permission to build on green belt land at Carrington Moss; [17326]

  (3) if he will list those organisations and individuals who have made representations to him (a) in favour and (b) against Manchester United's planning application to build on green belt land at Carrington Moss. [17327]

  Mr. Banks
  [holding answer 24 November 1997]: My Department has received no representations about Manchester United's planning application, and I have had no discussions with the Directors of the club on this subject. The planning application itself is a matter for my right hon. Friend the Secretary of State for the Environment, Transport and the Regions to consider.

  Cricket
  Mr. Gordon Prentice
  To ask the Secretary of State for Culture, Media and Sport what proposals he has to establish a network of centers of excellence for cricket. [17937]
  136
  Mr. Banks
  We announced our proposals for the United Kingdom Sports Institute on 14 November. The headquarters will be part of a network of facilities throughout the United Kingdom. Many sports, including cricket, have indicated their desire to establish their own sports specific academies, as part of the Institute network. We are keen to see good proposals come forward for Lottery funding.

  Tourism
  Mr. Fearn
  To ask the Secretary of State for Culture, Media and Sport what data he has collated on the percentage of total employment accounted for by the tourism industry. [18170]

  Mr. Tom Clarke
  The latest available figures show that tourism accounts for approximately 7 per cent. of total employment in Great Britain.

  Mr. Fearn
  To ask the Secretary of State for Culture, Media and Sport what his Department is doing to encourage the provision of training for employees in the tourist industry. [18166]

  Mr. Tom Clarke
  My Department is already working with the industry, and the Department for Education and Employment, to encourage employee training in the tourism, hospitality and leisure industries. Training is essential if these sectors are to have a world class work force of skilled individuals who can provide excellent service to meet consumer expectations. A working group of the Tourism Forum will be developing further ideas to promote training in the industry.

  Mr. Fearn
  To ask the Secretary of State for Culture, Media and Sport what data he has collected on Britain's international ranking in terms of international tourism earnings. [18169]

  Mr. Tom Clarke
  World Tourism Organisation figures show the United Kingdom as fifth in the world in terms of tourism earnings in 1996.

  Tobacco Advertising
  Mr. Bob Russell
  To ask the Secretary of State for Culture, Media and Sport if darts will be treated as a recognised sport for the purposes of the tobacco advertising ban. [18153]

  Mr. Banks
  The proposed EU Directive would ban all advertising through sponsorship, including darts events. It also proposes a phase-out period to allow alternative sponsors to be found. The Government will actively support efforts to secure alternative sponsors.

  Visitors (London)
  Mr. Fearn
  To ask the Secretary of State for Culture, Media and Sport what data he has collated on the number of United Kingdom visitors to London in the most recent available year. [18165]

  Mr. Tom Clarke
  The UK Tourism Survey indicated that in 1996, there were 12.2 million visits to London by UK residents who stayed at least one night.

  Low Pay
  Mr. Chidgey
  To ask the Secretary of State for Culture, Media and Sport if he will list, by regions defined by the
  137
  boundaries of the regional government offices, the lowest hourly rate paid by her Department to (a) full-time employees, (b) part-time employees, (c) persons employed under personal contract and (d) persons employed by firms undertaking contracted-out services for central. [18112]

  Mr. Tom Clarke
  The Department for Culture, Media and Sport has no offices outside central London.

  The lowest hourly rate paid to full-time or part-time staff is £4.78p. This is paid to staff in grade D (Lower) (equivalent Administrative Assistant) who are mainly employed on administrative support activities.

  The only persons employed under personal contracts in this Department are senior staff, the lowest hourly rate being £18.69.

  The rates of pay of staff employed by firms undertaking contracted out services for the Department is a matter for the companies concerned.

EDUCATION AND EMPLOYMENT

  Higher Education Funding
  Mr. Coaker
  To ask the Secretary of State for Education and Employment what steps he(a) has taken and (b) proposes to take to inform prospective students of the changes in student and higher education financing. [17589]

  Dr. Howells
  We have sent leaflets on the new student support arrangements to all schools with sixth forms, sixth form colleges, further and higher education institutions, careers services and student unions. We are running a free telephone helpline to handle enquiries about the arrangements and to respond to requests for further copies of the leaflets. To date, over half a million leaflets have been requested. For mature students, parents and others who might not be aware of our leaflets, we are running national adverts in the press and on the radio to publicise the free phone number. Also, my right hon. Friend the Secretary of State has written to sixth formers and college students to encourage them to consider higher education in the future and to clear up any misunderstanding that they may have about what we are proposing. In the new year, we shall be issuing the annual student grants and loans booklet, which, amongst other things, will set out the grant and loan rates for 1998–99 and will give more details about the financial contribution expected from parents at differing levels of income.

  Home-School Contracts
  Mr. Don Foster
  To ask the Secretary of State for Education and Employment how many responses were received to the home-school contracts proposals in the White Paper "Excellence in Schools" and the consultation letter dated 8 August; how many(a) teacher organisations and (b) organisations representing the views of parents supported the introduction of home-school contracts; and if he will make a statement. [17763]

  Ms Estelle Morris
  [holding answer 25 November 1997]: Some 650 of the 3,500 respondents to the White Paper commented on our proposals for home-school
  138
  agreements; 73 organisations commented on the details given in the Department's letter of 8 August. Taking the responses as a whole, four out of the six teacher associations supported the proposal that all schools should have written home school agreements. Of the six parent organisations who commented, three were opposed to home-school agreements and three expressed support for the principle but did not feel they should be made a requirement. 148 of the parents who returned the tear-off section in the White Paper summary leaflet indicated their support for home-school agreements.

  Cerebral Palsy
  Mr. Loughton
  To ask the Secretary of State for Education and Employment what special educational and welfare assistance is available to children suffering from cerebral palsy. [18147]

  Ms Estelle Morris
  It is the responsibility of local education authorities, schools and other local agencies (including health authorities and social services departments) to determine the support needed for individual children, in accordance with the guidance in the Code of Practice on the identification and assessment of special educational needs. The Green Paper on Special Educational Needs, "Excellence for all children", published in October, seeks views on ways in which the present arrangements might be improved for children with all types of special educational needs.

  Cycling
  Mrs. Dunwoody
  To ask the Secretary of State for Education and Employment if he will list those local education authorities which have ceased to provide cycling proficiency courses. [18175]

  Mr. Byers
  [holding answer 28 November 1997]: The information requested is not collected centrally.

  Low Pay
  Mr. Chidgey
  To ask the Secretary of State for Education and Employment if he will list, by regions defined by the boundaries of the regional government offices, the lowest hourly rate paid by his Department to(a) full-time employees, (b) part-time employees, (c) persons employed under personal contract and (d) persons employed by firms undertaking contracted-out services for central government offices, listing the job title in each case. [18116]

  Dr. Howells
  In London, the lowest rate paid by the Department is £4.91 an hour; £3.59 per hour is the lowest hourly rate paid by the Department in all other regions.

  These rates apply to all staff directly employed by the Department. Staff at this level do a variety of jobs including filing, photocopying and processing correspondence.

  Rates of pay for people employed by firms undertaking contracted out services are a matter for the companies concerned.

  Waiver Clauses
  Dr. Gibson
  To ask the Secretary of State for Education and Employment if he will make it his policy
  139
  that fixed-term contract research staff (a) employed and (b) funded by his Department will not be required to sign waiver clauses in their employment contract. [18629]

  Dr. Howells
  There are no research staff currently employed on fixed term contracts by my Department. However, for fixed term contracts of one year or more, the standard DfEE terms includes a waiver to exclude claims for unfair dismissal on expiry of the contract. The Department has no plans to remove this waiver.

  The terms and conditions of staff employed by organisations funded by the Department are the responsibility of the individual employer.

  Class Sizes
  Mr. Don Foster
  To ask the Secretary of State for Education and Employment what Percentage and how many primary school pupils were in classes of over (i) 30, (ii) 36 and (iii) 40 in January in each local education authority and in total; and what was the actual and Percentage change in numbers compared with January 1996 in each local authority and in total. [18807]

  Mr. Byers
  The available information is shown in the following table.

  Numbers and Percentages of pupils in classes by size taught by one teacher in maintained primary schools in each local education authority area in England: 1996 and 1997

  Position in January each year

  1996

  31 or more

  36 or more

  41 or more

  Pupils

  Per cent.(1)

  Pupils

  Per cent.(1)

  Pupils

  Per cent.(1)

  City of London

  0

  0.0

  0

  0.0

  0

  0.0

  Camden

  447

  5.2

  37

  0.4

  0

  0.0

  Greenwich

  1,412

  8.0

  0

  0.0

  0

  0.0

  Hackney

  664

  4.9

  0

  0.0

  0

  0.0

  Hammersmith

  1.036

  13.2

  0

  0.0

  0

  0.0

  Islington

  982

  7.4

  0

  0.0

  0

  0.0

  Kensington and Chelsea

  187

  3.8

  0

  0.0

  0

  0.0

  Lambeth

  857

  5.5

  0

  0.0

  0

  0.0

  Lewisham

  917

  5.2

  0

  0.0

  0

  0.0

  Southwark

  2,051

  10.7

  72

  0.4

  0

  0.0

  Tower Hamlets

  859

  5.8

  37

  0.2

  0

  0.0

  Wandsworth

  2,383

  16.5

  404

  2.8

  62

  0.4

  Westminster

  544

  7.9

  36

  0.5

  0

  0.0

  Barking

  1,603

  10.6

  272

  1.8

  0

  0.0

  Barnet

  1,848

  8.8

  200

  1.0

  48

  0.2

  Bexley

  8,821

  42.7

  148

  0.7

  0

  0.0

  Brent

  2,259

  12.0

  206

  1.1

  95

  0.5

  Bromley

  11,850

  50.6

  186

  0.8

  0

  0.0

  Croydon

  6,341

  24.4

  258

  1.0

  0

  0.0

  Ealing

  5,508

  24.5

  262

  1.2

  44

  0.2

  Enfield

  8,840

  41.0

  36

  0.2

  0

  0.0

  Haringey

  948

  5.7

  0

  0.0

  0

  0.0

  Harrow

  3,833

  24.3

  36

  0.2

  0

  0.0

  Havering

  5,678

  28.7

  235

  1.2

  50

  0.3

  Hillingdon

  4,820

  25.8

  459

  2.5

  41

  0.2

  Hounslow

  5,674

  34.4

  678

  4.1

  41

  0.2

  Kingston upon Thames

  7,095

  70.1

  485

  4.8

  47

  0.5

  Merton

  3,955

  30.9

  395

  3.1

  51

  0.4

  Newham

  2,381

  9.8

  204

  0.8

  52

  0.2

  Redbridge

  9,060

  52.7

  542

  3.2

  0

  0.0

  Richmond upon Thames

  2,309

  22.3

  0

  0.0

  0

  0.0

  Sutton

  4,235

  32.8

  367

  2.8

  0

  0.0

  Waltham Forest

  3,282

  18.4

  0

  0.0

  0

  0.0

  Birmingham

  25,642

  26.3

  1,601

  1.6

  157

  0.2

  Coventry

  7,638

  28.3

  530

  2.0

  0

  0.0

  Dudley

  6,618

  26.9

  1,229

  5.0

  775

  3.2

  Sandwell

  11,812

  41.5

  1,543

  5.4

  83

  0.3

  Solihull

  8,403

  44.0

  915

  4.8

  0

  0.0

  140

  Numbers and Percentages of pupils in classes by size taught by one teacher in maintained primary schools in each local education authority area in England: 1996 and 1997

  Position in January each year

  1996

  31 or more

  36 or more

  41 or more

  Pupils

  Per cent.(1)

  Pupils

  Per cent.(1)

  Pupils

  Per cent.(1)

  Walsall

  7,241

  31.1

  890

  3.8

  45

  0.2

  Wolverhampton

  6,762

  30.9

  1,078

  4.9

  233

  1.1

  Knowsley

  5,254

  29.2

  655

  3.6

  52

  0.3

  Liverpool

  12,051

  26.0

  590

  1.3

  0

  0.0

  St. Helens

  5,563

  37.7

  1,203

  8.1

  83

  0.6

  Sefton

  10,670

  42.5

  993

  4.0

  0

  0.0

  Wirral

  6,987

  23.7

  482

  1.6

  0

  0.0

  Bolton

  11,719

  49.7

  2,795

  11.8

  535

  2.3

  Bury

  6,968

  43.4

  843

  5.3

  0

  0.0

  Manchester

  9,687

  22.8

  1,719

  4.0

  582

  1.4

  Oldham

  9,434

  43.5

  994

  4.6

  178

  0.8

  Rochdale

  8,316

  43.0

  629

  3.3

  41

  0.2

  Salford

  6,997

  30.6

  1,247

  5.5

  314

  1.4

  Stockport

  8,247

  32.8

  1,202

  4.8

  117

  0.5

  Tameside

  11,508

  53.0

  956

  4.4

  0

  0.0

  Trafford

  9,389

  48.9

  1,103

  5.7

  0

  0.0

  Wigan

  11,087

  42.5

  2,385

  9.2

  127

  0.5

  Barnsley

  8,677

  42.3

  751

  3.7

  152

  0.7

  Doncaster

  9,609

  35.1

  1,739

  6.4

  0

  0.0

  Rotherham

  5,732

  24.6

  422

  1.8

  0

  0.0

  Sheffield

  11,181

  28.0

  1,497

  3.7

  229

  0.6

  Bradford

  11,449

  34.3

  1,597

  4.8

  43

  0.1

  Calderdale

  6,331

  34.3

  341

  1.8

  45

  0.2

  Kirklees

  14,395

  44.3

  1,993

  6.1

  139

  0.4

  Leeds

  21,455

  33.3

  3,110

  5.1

  244

  0.4

  Wakefield

  10,673

  37.7

  1,602

  5.7

  52

  0.2

  Gateshead

  2,443

  14.4

  116

  0.7

  0

  0.0

  Newcastle upon

  Tyne

  6,792

  33.1

  1,055

  5.1

  49

  0.2

  North Tyneside

  4,897

  31.7

  575

  3.7

  50

  0.3

  South Tyneside

  4,067

  27.6

  736

  5.0

  99

  0.7

  Sunderland

  4,148

  15.1

  185

  0.7

  0

  0.0

  Isles of Scilly

  0

  0.0

  0

  0.0

  0

  0.0

  Avon

  26,647

  34.4

  1,587

  2.0

  44

  0.1

  Bath and NE Somerset3

  —

  —

  —

  —

  —

  —

  City of Bristol3

  —

  —

  —

  —

  —

  —

  North Somerset3

  —

  —

  —

  —

  —

  —

  South Gloucestershire3

  —

  —

  —

  —

  —

  —

  Bedfordshire

  11,867

  30.4

  2,598

  6.7

  482

  1.2

  Berkshire

  18,309

  30.5

  1,414

  2.4

  46

  0.1

  Buckinghamshire

  22,753

  37.6

  3,772

  6.2

  372

  0.6

  Cambridgeshire

  18,065

  31.8

  1,026

  1.8

  0

  0.0

  Cheshire

  32,225

  37.3

  4,051

  4.7

  142

  0.2

  Cleveland

  13,869

  23.6

  2,630

  4.5

  0

  0.0

  Hartlepool3

  —

  —

  —

  —

  —

  —

  Middlesborough3

  —

  —

  —

  —

  —

  —

  Redcar and Cleveland3

  —

  —

  —

  —

  —

  —

  Stockton on Tees3

  —

  —

  —

  —

  —

  —

  Cornwall

  14,936

  37.5

  1,325

  3.3

  41

  0.1

  Cumbria

  11,382

  28.2

  1,332

  3.3

  111

  0.3

  Derbyshire

  41,217

  52.0

  10,344

  13.0

  722

  0.9

  Devon

  28,078

  34.8

  3,032

  3.8

  128

  0.2

  Dorset

  19,654

  44.5

  1,360

  3.1

  86

  0.2

  Durham

  19,881

  38.0

  1,987

  3.8

  167

  0.3

  East Sussex

  20,971

  42.4

  1,056

  2.1

  0

  0.0

  Essex

  34,741

  27.6

  804

  0.6

  109

  0.1

  Gloucestershire

  14,246

  32.1

  630

  1.4

  0

  0.0

  Hampshire

  44,938

  34.5

  2,532

  1.9

  47

  0.0

  Hereford and Worcester

  13,225

  27.2

  1,138

  2.3

  150

  0.3

  Hertfordshire

  23,396

  29.0

  729

  0.9

  0

  0.0

  Humberside

  27,832

  35.0

  4,410

  5.5

  229

  0.3

  East Riding of Yorkshire3

  4—

  4—

  —

  —

  —

  —

  City of Kingston Upon Hull

  —

  —

  —

  —

  —

  —

  North East Lincolnshire3

  —

  —

  —

  —

  —

  —

  North Lincolnshire3

  —

  —

  —

  —

  —

  —

  Isle of Wight

  2,243

  31.1

  115

  1.6

  0

  0.0

  141

  Numbers and Percentages of pupils in classes by size taught by one teacher in maintained primary schools in each local education authority area in England: 1996 and 1997

  Position in January each year

  1996

  31 or more

  36 or more

  41 or more

  Pupils

  Per cent.(1)

  Pupils

  Per cent.(1)

  Pupils

  Per cent.(1)

  Kent

  44,212

  33.8

  1,012

  0.8

  89

  0.1

  Lancashire

  54,099

  44.5

  7,918

  6.5

  41

  0.0

  Leicestershire

  21,784

  28.8

  2,546

  3.4

  224

  0.3

  Lincolnshire

  13,962

  27.9

  1,184

  2.4

  42

  0.1

  Norfolk

  13,224

  22.0

  780

  1.3

  43

  0.1

  Northamptonshire

  11,089

  22.4

  612

  1.2

  42

  0.1

  Northumberland

  8,478

  43.3

  1,445

  7.4

  0

  0.0

  North Yorkshire

  18,663

  32.1

  2,120

  3.6

  140

  0.2

  York

  4—

  —

  —

  —

  —

  —

  North Yorkshire3

  —

  —

  —

  —

  —

  —

  Nottinghamshire

  32,931

  38.9

  4,733

  5.6

  212

  0.3

  Oxfordshire

  10,608

  25.7

  1,207

  2.9

  0

  0.0

  Shropshire

  13,425

  38.2

  1,308

  3.7

  102

  0.3

  Somerset

  13,649

  37.3

  809

  2.2

  41

  0.1

  Staffordshire

  32,163

  35.7

  5,891

  6.5

  539

  0.6

  Suffolk

  7,940

  18.2

  472

  1.1

  0

  0.0

  Surrey

  14,197

  19.9

  360

  0.5

  45

  0.1

  Warwickshire

  17,566

  40.7

  1,558

  3.6

  44

  0.1

  West Sussex

  14,447

  26.7

  333

  0.6

  0

  0.0

  Wiltshire

  15,128

  30.8

  773

  1.6

  0

  0.0

  England

  1,260,551

  31.8

  1E+05

  3.3

  9,435

  0.2

  Position in January each year

  1997

  31 or more

  36 or more

  41 or more

  Pupils

  Per cent.(1)

  Pupils

  Per cent.(1)

  Pupils

  Per cent.(1)

  City of London

  0

  0.0

  0

  0.0

  0

  0.0

  Camden

  698

  8.0

  0

  0.0

  0

  0.0

  Greenwich

  2,126

  12.0

  111

  0.6

  0

  0.0

  Hackney

  824

  5.7

  0

  0.0

  0

  0.0

  Hammersmith

  1,106

  14.5

  37

  0.5

  0

  0.0

  Islington

  702

  5.4

  0

  0.0

  0

  0.0

  Kensington and Chelsea

  219

  4.2

  0

  0.0

  0

  0.0

  Lambeth

  1,192

  7.6

  0

  0.0

  0

  0.0

  Lewisham

  1,207

  6.7

  36

  0.2

  0

  0.0

  Southwark

  1,748

  8.8

  0

  0.0

  0

  0.0

  Tower Hamlets

  1,047

  6.3

  40

  0.2

  0

  0.0

  Wandsworth

  2,299

  15.3

  503

  3.4

  49

  0.3

  Westminster

  479

  7.1

  38

  0.6

  0

  0.0

  Barking

  2,022

  12.8

  347

  2.2

  0

  0.0

  Barnet

  2,456

  11.3

  232

  1.1

  0

  0.0

  Bexley

  9,314

  44.6

  145

  0.7

  0

  0.0

  Brent

  2,383

  12.6

  251

  1.3

  95

  0.5

  Bromley

  13,110

  55.3

  289

  1.2

  0

  0.0

  Croydon

  7,042

  26.1

  556

  2.1

  0

  0.0

  Ealing

  5,258

  22.4

  148

  0.6

  0

  0.0

  Enfield

  9,965

  46.0

  72

  0.3

  0

  0.0

  Haringey

  851

  4.9

  38

  0.2

  0

  0.0

  Harrow

  3,663

  22.4

  0

  0.0

  0

  0.0

  Havering

  5,763

  28.9

  393

  2.0

  137

  0.7

  Hillingdon

  5,212

  28.1

  320

  1.7

  45

  0.2

  Hounslow

  4,907

  29.1

  456

  2.7

  0

  0.0

  Kingston upon Thames

  6,682

  66.2

  75

  0.7

  0

  0.0

  Merton

  3,676

  28.5

  279

  2.2

  89

  0.7

  Newham

  3,021

  12.5

  151

  0.6

  0

  0.0

  Redbridge

  8,074

  45.7

  361

  2.0

  0

  0.0

  Richmond upon Thames

  2,671

  24.7

  36

  0.3

  0

  0.0

  Sutton

  5,222

  40.3

  222

  1.7

  0

  0.0

  Waltham Forest

  2,639

  14.8

  36

  0.2

  0

  0.0

  Birmingham

  24,848

  25.7

  1,389

  1.4

  206

  0.2

  Coventry

  8,641

  31.4

  679

  2.5

  0

  0.0

  Dudley

  6,904

  27.1

  1,215

  4.8

  466

  1.8

  Sandwell

  12,606

  44.1

  1,129

  3.9

  186

  0.7

  Solihull

  8,478

  43.3

  954

  4.9

  0

  0.0

  Walsall

  7,527

  31.6

  557

  2.3

  0

  0.0

  Wolverhampton

  8,169

  37.9

  859

  4.0

  0

  0.0

  142

  Position in January each year

  1997

  31 or more

  36 or more

  41 or more

  Pupils

  Per cent.(1)

  Pupils

  Per cent.(1)

  Pupils

  Per cent.(1)

  Knowsley

  5,820

  32.6

  663

  3.7

  171

  1.0

  Liverpool

  12,581

  27.3

  1,036

  2.3

  44

  0.1

  St. Helens

  6,270

  40.8

  1,420

  9.3

  43

  0.3

  Sefton

  9,634

  38.2

  511

  2.0

  0

  0.0

  Wirral

  6,747

  23.1

  555

  1.9

  0

  0.0

  Bolton

  11,422

  49.0

  2,449

  10.5

  372

  1.6

  Bury

  7,178

  44.3

  844

  5.2

  0

  0.0

  Manchester

  10,615

  25.1

  1,719

  4.1

  896

  2.1

  Oldham

  10,645

  48.3

  1,343

  6.1

  169

  0.8

  Rochdale

  9,004

  45.5

  1,176

  5.9

  42

  0.2

  Salford

  7,043

  30.8

  829

  3.6

  232

  1.0

  Stockport

  9,446

  37.0

  1,324

  5.2

  0

  0.0

  Tameside

  11,566

  53.4

  868

  4.0

  50

  0.2

  Trafford

  9,693

  49.8

  1,020

  5.2

  0

  0.0

  Wigan

  11,098

  42.3

  2,397

  9.1

  45

  0.2

  Bamsley

  9,082

  43.9

  1,035

  5.0

  104

  0.5

  Doncaster

  10,052

  35.0

  1,505

  5.2

  0

  0.0

  Rotherham

  8,094

  34.2

  712

  3.0

  0

  0.0

  Sheffield

  11,261

  27.6

  1,762

  4.3

  47

  0.1

  Bradford

  13,443

  39.4

  2,101

  6.2

  224

  0.7

  Calderdale

  6,185

  33.2

  330

  1.8

  0

  0.0

  Kirkless

  15,730

  47.7

  2,942

  8.9

  137

  0.4

  Leeds

  22,031

  35.0

  2,529

  4.0

  0

  0.0

  Wakefield

  12,198

  41.2

  1,978

  6.7

  52

  0.2

  Gateshead

  2,112

  12.5

  185

  1.1

  0

  0.0

  Newcastle Upon

  Tyne

  6,904

  33.6

  925

  4.5

  146

  0.7

  North Tyneside

  4,779

  30.7

  655

  4.2

  101

  0.6

  South Tyneside

  3,996

  27.8

  725

  5.0

  52

  0.4

  Sunderland

  5,023

  18.4

  375

  1.4

  0

  0.0

  Isles of Scilly

  33

  21.2

  0

  0.0

  0

  0.0

  Avon

  4—

  4—

  4—

  4—

  4—

  4—

  Bath and North East Somerset3

  3,579

  28.5

  313

  2.5

  60

  0.5

  City of Bristol3

  9,905

  31.8

  635

  2.0

  84

  0.3

  North Somerset3

  4,675

  33.0

  148

  1.0

  0

  0.0

  South Gloucestershire3

  9,563

  45.1

  694

  3.3

  0

  0.0

  Bedfordshire

  12,890

  33.4

  2,461

  6.4

  382

  1.0

  Berkshire

  18,680

  31.6

  1,462

  2.5

  88

  0.1

  Buckinghamshire

  23,085

  37.9

  3,537

  5.8

  240

  0.4

  Cambridgeshire

  20,831

  36.2

  1,643

  2.9

  0

  0.0

  Cheshire

  33,630

  38.7

  4,217

  4.8

  87

  0.1

  Cleveland

  —

  —

  —

  —

  —

  —

  Hartlepool3

  2,833

  29.5

  418

  4.4

  0

  0.0

  Middlesbrough3

  3,700

  24.1

  822

  5.4

  0

  0.0

  Redcar and Cleveland3

  4,576

  30.7

  720

  4.8

  0

  0.0

  Stockton-on-Tees3

  4,507

  24.1

  984

  5.3

  0

  0.0

  Cornwall

  16,082

  40.2

  1,587

  4.0

  0

  0.0

  Cumbria

  11,984

  29.4

  1,133

  2.8

  180

  0.4

  Derbyshire

  44,864

  55.2

  12,889

  15.9

  651

  0.8

  Devon

  31,181

  38.1

  2,898

  3.5

  86

  0.1

  Dorset

  22,462

  50.2

  1,089

  2.4

  0

  0.0

  Durham

  21,429

  40.7

  2,212

  4.2

  127

  0.2

  East Sussex

  23,330

  45.7

  756

  1.5

  0

  0.0

  Essex

  38,831

  29.9

  1,566

  1.2

  214

  0.2

  Gloucestershire

  15,280

  33.9

  896

  2.0

  45

  0.1

  Hampshire

  47,671

  35.8

  2,527

  1.9

  44

  0.0

  Hereford and Worcester

  12,527

  24.9

  981

  1.9

  139

  0.3

  Hertfordshire

  27,264

  32.6

  1,204

  1.4

  0

  0.0

  Humberside

  —

  —

  —

  —

  —

  —

  East Riding of Yorkshire3

  10,254

  40.1

  2,288

  9.0

  133

  0.5

  City of Kingston upon Hull

  10,164

  39.5

  1,829

  7.1

  0

  0.0

  North East Lincolnshire3

  6,228

  39.6

  732

  4.6

  99

  0.6

  North Lincolnshire3

  4,932

  36.2

  821

  6.0

  104

  0.8

  Isle of Wight

  1,639

  22.5

  220

  3.0

  0

  0.0

  Kent

  47,339

  35.7

  757

  0.6

  106

  0.1

  Lancashire

  58,388

  47.3

  10,409

  8.4

  99

  0.1

  Leicestershire

  22,862

  29.8

  3,254

  4.2

  408

  0.5

  Lincolnshire

  14,644

  28.6

  1,667

  3.3

  0

  0.0

  Norfolk

  13,402

  21.6

  256

  0.4

  0

  0.0

  Northamptonshire

  13,015

  25.7

  855

  1.7

  41

  0.1

  Northumberland

  8,314

  42.7

  1,747

  9.0

  0

  0.0

  143

  Position in January each year

  1997

  31 or more

  36 or more

  41 or more

  Pupils

  Per cent.(1)

  Pupils

  Per cent.(1)

  Pupils

  Per cent.(1)

  North Yorkshire

  4—

  4—

  4—

  4—

  4—

  4—

  York3

  4,961

  35.5

  412

  2.9

  0

  0.0

  North Yorkshire3

  15,129

  33.7

  1,470

  3.3

  133

  0.3

  Nottinghamshire

  38,340

  44.5

  7,160

  8.3

  583

  0.7

  Oxfordshire

  13,090

  31.3

  1,158

  2.8

  0

  0.0

  Shropshire

  13,545

  37.8

  1,804

  5.0

  0

  0.0

  Somerset

  14,096

  37.8

  1,653

  4.4

  0

  0.0

  Staffordshire

  31,492

  34.8

  5,481

  6.1

  437

  0.5

  Suffolk

  8,520

  19.3

  257

  0.6

  0

  0.0

  Surrey

  15,007

  20.5

  893

  1.2

  0

  0.0

  Warwickshire

  17,493

  42.9

  1,738

  4.3

  43

  0.1

  West Sussex

  15,337

  27.4

  403

  0.7

  0

  0.0

  Wiltshire

  16,245

  32.5

  988

  2.0

  0

  0.0

  England

  1,344,231

  33.4

  1E+05

  3.6

  8,813

  0.2

  Numbers and Percentages of pupils in classes by size taught by one teacher in maintained primary schools in each local education authority area in England: 1996 and 1997

  Position in January each year

  change

  31 or more

  36 or more

  41 or more

  Pupils

  Per cent.2

  Pupils

  Per cent.2

  Pupils

  Per cent.2

  City of London

  0

  0.0

  0

  0.0

  0

  0.0

  Camden

  251

  2.8

  -37

  -0.4

  0

  0.0

  Greenwich

  714

  4.0

  111

  0.6

  0

  0.0

  Hackney

  160

  0.8

  0

  0.0

  0

  0.0

  Hammersmith

  70

  1.3

  37

  0.5

  0

  0.0

  Islington

  -280

  -2.0

  0

  0.0

  0

  0.0

  Kensington and Chelsea

  32

  0.5

  0

  0.0

  0

  0.0

  Lambeth

  335

  2.1

  0

  0.0

  0

  0.0

  Lewisham

  290

  1.5

  36

  0.2

  0

  0.0

  Southwark

  -303

  -1.8

  -72

  -0.4

  0

  0.0

  Tower Hamlets

  188

  0.6

  3

  0.0

  0

  0.0

  Wandsworth

  -74

  -1.1

  99

  0.5

  -13

  -0.1

  Westminster

  -65

  -0.9

  2

  0.0

  0

  0.0

  Barking

  419

  2.2

  75

  0.4

  0

  0.0

  Barnet

  608

  2.5

  32

  0.1

  -48

  -0.2

  Bexley

  493

  1.9

  -3

  0.0

  0

  0.0

  Brent

  124

  0.6

  45

  0.2

  0

  0.0

  Bromley

  1,260

  4.6

  103

  0.4

  0

  0.0

  Croydon

  701

  1.7

  298

  1.1

  0

  0.0

  Ealing

  -250

  -2.1

  -114

  -0.5

  -44

  -0.2

  Enfield

  1,125

  5.0

  36

  0.2

  0

  0.0

  Haringey

  -97

  -0.7

  38

  0.2

  0

  0.0

  Harrow

  -170

  -2.0

  -36

  -0.2

  0

  0.0

  Havering

  85

  0.2

  158

  0.8

  87

  0.4

  Hillingdon

  392

  2.3

  -139

  -0.7

  4

  0.0

  Hounslow

  -767

  -5.3

  -222

  -1.4

  -41

  -0.2

  Kingston Upon Thames

  -413

  -3.9

  -410

  -4.0

  -4.1

  -0.5

  Merton

  -279

  -2.3

  -116

  -0.9

  38

  0.3

  Newham

  640

  2.7

  -53

  -0.2

  -5.2

  -0.2

  Redbridge

  -986

  -7.0

  -181

  -1.1

  0

  0.0

  Richmond Upon Thames

  362

  2.5

  36

  0.3

  0

  0.0

  Sutton

  987

  7.6

  -145

  -1.1

  0

  0.0

  Waltham Forest

  -643

  -3.6

  36

  0.2

  0

  0.0

  Birmingham

  -794

  -0.6

  -212

  -0.2

  49

  0.1

  Coventry

  1,003

  3.0

  149

  0.5

  0

  0.0

  Dudley

  286

  0.1

  -14

  -0.2

  -309

  -1.3

  Sandwell

  794

  2.6

  -414

  -1.5

  103

  0.4

  Solihull

  75

  -0.7

  39

  0.1

  0

  0.0

  Walsall

  286

  0.4

  -333

  -1.5

  -4.5

  -0.2

  Wolverhampton

  1,407

  7.0

  -219

  -0.9

  -233

  -1.1

  Knowsley

  566

  3.3

  8

  0.1

  119

  0.7

  Liverpool

  530

  1.3

  446

  1.0

  44

  0.1

  St. Helens

  707

  3.2

  217

  1.1

  -4.0

  -0.3

  Sefton

  -1,036

  -43

  -482

  -1.9

  0

  0.0

  Wirral

  -240

  -0.6

  73

  0.3

  0

  0.0

  Bolton

  -297

  -0.7

  -346

  -1.4

  -163

  -0.7

  Bury

  210

  0.9

  1

  0.0

  0

  0.0

  144

  Numbers and Percentages of pupils in classes by size taught by one teacher in maintained primary schools in each local education authority area in England: 1996 and 1997

  Position in January each year

  Change

  31 or more

  36 or more

  41 or more

  Pupils

  Per cent.2

  Pupils

  Per cent.2

  Pupils

  Per cent.2

  Manchester

  928

  2.3

  0

  0.0

  314

  0.8

  Oldham

  1,211

  4.8

  349

  1.5

  -9

  -0.1

  Rochdale

  688

  2.5

  547

  2.7

  1

  0.0

  Salford

  46

  0.1

  -418

  -1.8

  -82

  -0.4

  Stockport

  1,199

  4.3

  122

  0.4

  -117

  -0.5

  Tameside

  58

  0.4

  -88

  -0.4

  50

  0.2

  Trafford

  304

  0.9

  -8.3

  -0.5

  0

  0.0

  Wigan

  11

  -0.2

  12

  0.0

  -8.2

  -0.3

  Barnsley

  405

  1.6

  284

  1.3

  -4.8

  -0.2

  Doncaster

  443

  -0.1

  -234

  -1.1

  0

  0.0

  Rotherham

  2,362

  9.7

  290

  1.2

  0

  0.0

  Sheffield

  80

  -0.4

  265

  0.6

  -182

  -0.5

  Bradford

  1,994

  5.1

  504

  1.4

  181

  0.5

  Calderdale

  -146

  -1.1

  -11

  -0.1

  0.5

  -0.2

  Kirklees

  1,335

  3.3

  949

  2.8

  -2

  0.0

  Leeds

  576

  -0.3

  -581

  -1.1

  -244

  -0.4

  Wakefield

  1,525

  3.5

  376

  1.0

  0

  0.0

  Gateshead

  -331

  -1.8

  69

  0.4

  0

  0.0

  Newcastle Upon

  Tyne

  112

  0.4

  -130

  -0.7

  97

  0.5

  North Tyneside

  -18

  -1.0

  80

  0.5

  51

  0.3

  South Tyneside

  -7.1

  0.1

  -11

  0.0

  -4.7

  -0.3

  Sunderland

  875

  3.3

  190

  0.7

  0

  0.0

  Isle of Scilly

  33

  21.2

  0

  0.0

  0

  0.0

  Avon

  4—

  4—

  4—

  4—

  4—

  4—

  Bath and North

  East Somerset3

  4—

  4—

  4—

  4—

  4—

  4—

  City of Bristol3

  4—

  4—

  4—

  4—

  4—

  4—

  North Somerset3

  4—

  4—

  4—

  4—

  4—

  4—

  South Gloucestershire3

  4—

  4—

  4—

  4—

  4—

  4—

  Bedfordshire

  1,023

  3.0

  -137

  -0.3

  -100

  -0.2

  Berkshire

  371

  1.0

  48

  0.1

  42

  0.1

  Buckinghamshire

  332

  0.3

  -235

  -0.4

  -132

  -0.2

  Cambridgeshire

  2,766

  4.4

  617

  1.1

  0

  0.0

  Cheshire

  1,405

  1.4

  166

  0.2

  -55

  -0.1

  Cleveland

  4—

  4—

  4—

  4—

  4—

  4—

  Hartlepool3

  4—

  4—

  4—

  4—

  4—

  4—

  Middlesborough3

  4—

  4—

  4—

  4—

  4—

  4—

  Redcar and Cleveland3

  4—

  4—

  4—

  4—

  4—

  4—

  Stockton-on-Tees3

  4—

  4—

  4—

  4—

  4—

  4—

  Cornwall

  1,146

  2.7

  262

  0.6

  -41

  -0.1

  Cumbria

  602

  1.2

  -199

  -0.5

  69

  0.2

  Derbyshire

  3,647

  3.3

  2,545

  2.8

  -71

  -0.1

  Devon

  3,103

  3.3

  -134

  -0.2

  -42

  -0.1

  Dorset

  2,808

  5.7

  -271

  -0.6

  -86

  -0.2

  Durham

  1,548

  2.7

  225

  0.4

  -40

  -0.1

  East Sussex

  2,359

  3.3

  -300

  -0.7

  0

  0.0

  Essex

  4,090

  2.3

  762

  0.6

  105

  0.1

  Gloucestershire

  1,034

  1.7

  266

  0.6

  45

  0.1

  Hampshire

  2,733

  1.3

  -5

  0.0

  -3

  0.0

  Hereford and Worcester

  -698

  -2.3

  -157

  -0.4

  -11

  0.0

  Hertfordshire

  3,868

  3.6

  475

  0.5

  0

  0.0

  Humberside

  —

  —

  —

  —

  —

  —

  East Riding of Yorkshire3

  —

  —

  —

  —

  —

  —

  City of Kingston Upon Hull

  —

  —

  —

  —

  —

  —

  North East Lincolnshire3

  —

  —

  —

  —

  —

  —

  North Lincolnshire3

  —

  —

  —

  —

  —

  —

  Isle of Wight

  -604

  -8.6

  105

  1.4

  0

  0.0

  Kent

  3,127

  1.9

  -255

  -0.2

  17

  0.0

  Lancashire

  4,289

  2.8

  2,491

  1.9

  58

  0.0

  Leicestershire

  1,078

  0.9

  708

  0.9

  184

  0.2

  Lincolnshire

  682

  0.7

  483

  0.9

  -42

  -0.1

  Norfolk

  178

  -0.4

  -524

  -0.9

  -43

  -0.1

  Northamptonshire

  1,926

  3.2

  243

  0.4

  -1

  0.0

  Northumberland

  -164

  -0.6

  302

  1.6

  0

  0.0

  North Yorkshire

  —

  —

  —

  —

  —

  —

  York3

  —

  —

  —

  —

  —

  —

  North Yorkshire3

  —

  —

  —

  —

  —

  —

  Nottingham

  5,409

  5.6

  2,427

  2.7

  371

  0.4

  145

  Numbers and Percentages of pupils in classes by size taught by one teacher in maintained primary schools in each local education authority area in England: 1996 and 1997

  Position in January each year

  Change

  31 or more

  36 or more

  41 or more

  Pupils

  Per cent.2

  Pupils

  Per cent.2

  Pupils

  Per cent.2

  Oxfordshire

  2,482

  5.6

  -49

  -0.2

  0

  0.0

  Shropshire

  120

  -0.5

  496

  1.3

  -102

  -0.3

  Somerset

  447

  0.5

  844

  2.2

  -41

  -0.1

  Staffordshire

  -671

  -0.9

  -410

  -0.5

  -102

  -0.1

  Suffolk

  580

  1.1

  -215

  -0.5

  0

  0.0

  Surrey

  810

  0.6

  533

  0.7

  -45

  -0.1

  Warwickshire

  -73

  2.2

  180

  0.7

  -1

  0.0

  West Sussex

  890

  0.7

  70

  0.1

  0

  0.0

  Wiltshire

  1,117

  1.7

  215

  0.4

  0

  0.0

  England

  83,680

  1.6

  14,122

  0.3

  -622

  0.0

  1 Number of pupils in classes taught by one teacher expressed as a Percentage of all pupils in classes taught by one teacher.

  2 Percentage of pupils in 1997 minus Per centage of pupils in 1996.

  3 No comparable data for new Unitary authorities.

  4 Not applicable.

  Mr. Don Foster
  To ask the Secretary of State for Education and Employment what was the average size of single teacher classes in primary schools in January in each local education authority and in total; and what was the actual and Percentage change in numbers compared with January 1996 in each local education authority and in total. [18869]

  Mr. Byers
  The information is shown in the following table.

  Average size of classes taught by one teacher in maintained primary schools in each local education authority area in England: 1996 and 1997

  Position as at January each year

  Change1

  Number

  Percentage

  1996

  1997

  1996–97

  1996–97

  City of London

  26.8

  26.0

  -0.8

  -2.8

  Camden

  27.3

  27.1

  -0.1

  -0.5

  Greenwich

  25.5

  26.0

  0.4

  1.7

  Hackney

  26.1

  26.1

  -0.1

  -0.2

  Hammersmith

  26.1

  25.3

  -0.8

  -2.9

  Islington

  26.2

  26.6

  0.3

  1.2

  Kensington and Chelsea

  24.4

  25.3

  0.9

  3.7

  Lambeth

  24.6

  25.2

  0.6

  2.5

  Lewisham

  25.7

  26.1

  0.3

  1.3

  Southwark

  26.2

  26.4

  0.3

  1.0

  Tower Hamlets

  25.8

  26.2

  0.4

  1.7

  Wandsworth

  25.4

  25.8

  0.4

  1.4

  Westminster

  24.9

  24.2

  -0.7

  -3.0

  Barking

  26.7

  27.0

  0.3

  1.3

  Barnet

  26.3

  26.2

  -0.1

  -0.3

  Bexley

  28.6

  28.8

  0.1

  0.5

  Brent

  26.7

  26.5

  -0.2

  -0.7

  Bromley

  28.7

  28.5

  -0.2

  -0.8

  Croydon

  28.3

  28.3

  0.0

  0.0

  Ealing

  27.2

  27.1

  -0.1

  -0.5

  Enfield

  28.5

  29.1

  0.6

  1.9

  Haringey

  27.0

  26.9

  -0.1

  -0.4

  Harrow

  27.8

  27.5

  -0.3

  -1.0

  Havering

  27.9

  27.9

  0.0

  0.0

  Hillingdon

  26.6

  27.2

  0.6

  2.2

  Hounslow

  27.3

  26.8

  -0.5

  -1.7

  Kingston upon Thames

  30.0

  29.4

  -0.7

  -2.3

  Merton

  28.1

  27.3

  -0.8

  -2.8

  146

  Average size of classes taught by one teacher in maintained primary schools in each local education authority area in England: 1996 and 1997

  Position as at January each year

  Change1

  Number

  Percentage

  1996

  1997

  1996–97

  1996–97

  Newham

  27.9

  27.9

  0.1

  0.3

  Redbridge

  29.0

  28.4

  -0.6

  -2.1

  Richmond upon Thames

  26.7

  27.2

  0.6

  2.1

  Sutton

  27.3

  28.1

  0.8

  2.8

  Waltham Forest

  26.4

  26.6

  0.2

  0.7

  Birmingham

  27.8

  27.7

  0.0

  -0.1

  Coventry

  27.2

  27.6

  0.4

  1.3

  Dudley

  26.9

  26.5

  -0.4

  -1.4

  Sandwell

  28.6

  28.9

  0.3

  1.0

  Solihull

  28.2

  27.9

  -0.3

  -1.0

  Walsall

  26.0

  26.2

  0.2

  0.8

  Wolverhampton

  26.5

  26.9

  0.4

  1.6

  Knowsley

  27.6

  27.7

  0.1

  0.3

  Liverpool

  26.8

  26.8

  0.0

  0.0

  St. Helens

  27.5

  27.8

  0.3

  0.9

  Sefton

  27.5

  27.6

  0.1

  0.3

  Wirral

  26.4

  26.3

  -0.1

  -0.4

  Bolton

  28.5

  28.9

  0.4

  1.5

  Bury

  28.3

  28.3

  0.0

  -0.1

  Manchester

  27.0

  27.2

  0.2

  0.9

  Oldham

  28.6

  29.3

  0.6

  2.2

  Rochdale

  29.2

  29.6

  0.5

  1.6

  Salford

  27.4

  27.3

  -0.1

  -0.4

  Stockport

  27.7

  27.8

  0.1

  0.3

  Tameside

  29.3

  29.3

  0.0

  0.0

  Trafford

  28.7

  28.9

  0.3

  1.0

  Wigan

  28.2

  28.5

  0.3

  1.0

  Barnsley

  28.2

  28.9

  0.6

  2.2

  Doncaster

  28.2

  28.1

  -0.1

  -0.5

  Rotherham

  26.9

  27.7

  0.8

  3.0

  Sheffield

  26.8

  26.9

  0.1

  0.5

  Bradford

  27.9

  28.3

  0.4

  1.3

  Calderdale

  27.7

  28.0

  0.2

  0.8

  Kirklees

  28.7

  29.0

  0.3

  1.2

  Leeds

  28.1

  28.3

  0.2

  0.6

  Wakefield

  28.0

  28.2

  0.2

  0.7

  Gateshead

  25.9

  25.8

  -0.1

  -0.3

  Newcastle upon

  Tyne

  27.7

  27.6

  -0.1

  -0.3

  North Tyneside

  27.0

  27.1

  0.0

  0.1

  South Tyneside

  26.8

  27.0

  0.2

  0.8

  Sunderland

  25.6

  26.0

  0.3

  1.3

  Isles of Scilly

  13.7

  17.3

  3.6

  26.3

  Avon

  27.7

  2—

  2—

  2—

  Bath and North east Somerset3

  2—

  27.0

  2—

  2—

  City of Bristol3

  2—

  27.2

  2—

  2—

  North Somerset3

  2—

  27.8

  2—

  2—

  South Gloucestershire3

  2—

  28.5

  2—

  2—

  Bedfordshire

  27.1

  27.4

  0.3

  1.2

  Berkshire

  27.3

  27.5

  0.2

  0.6

  Buckinghamshire

  27.8

  27.9

  0.1

  0.3

  Cambridgeshire

  27.8

  28.2

  0.4

  1.4

  Cheshire

  27.4

  27.5

  0.0

  0.0

  Cleveland

  26.9

  2—

  2—

  2—

  Hartlepool3

  2—

  28.0

  2—

  2—

  Middlesbrough3

  2—

  26.5

  2—

  2—

  Redcar and Cleveland3

  2—

  27.4

  2—

  2—

  Stockton on Tees3

  2—

  26.8

  2—

  2—

  Cornwall

  27.3

  27.3

  0.0

  0.0

  Cumbria

  26.0

  26.3

  0.2

  0.9

  Derbyshire

  28.9

  29.3

  0.3

  1.1

  Devon

  27.2

  27.4

  0.2

  0.9

  Dorset

  27.7

  28.2

  0.5

  1.7

  147

  Average size of classes taught by one teacher in maintained primary schools in each local education authority area in England: 1996 and 1997

  Position as at January each year

  Change1

  1996

  1997

  Number 1996–97

  Percentage 1996–97

  Durham

  28.4

  28.5

  0.0

  0.1

  East Sussex

  27.7

  28.2

  0.5

  1.8

  Essex

  26.9

  27.3

  0.4

  1.6

  Gloucestershire

  27.2

  27.4

  0.2

  0.8

  Hampshire

  27.8

  27.9

  0.1

  0.3

  Hereford and Worcester

  25.9

  26.0

  0.2

  0.6

  Hertfordshire

  26.7

  27.1

  0.4

  1.5

  Humberside

  27.9

  2—

  2—

  2—

  East Riding of Yorkshire3

  2—

  28.3

  2—

  2—

  City of Kingston Upon Hull3

  2—

  28.8

  2—

  2—

  North East Lincolnshire3

  2—

  28.1

  2—

  2—

  North Lincolnshire3

  2—

  27.7

  2—

  2—

  Isle of Wight

  26.9

  25.9

  -1.0

  -3.9

  Kent

  27.7

  28.0

  0.2

  0.9

  Lancashire

  28.4

  28.8

  0.3

  1.2

  Leicestershire

  26.7

  26.7

  0.0

  -0.1

  Lincolnshire

  26.7

  26.9

  0.1

  0.5

  Norfolk

  26.0

  25.9

  -0.1

  -0.3

  Northamptonshire

  26.5

  27.0

  0.4

  1.6

  Northumberland

  27.1

  27.0

  -0.1

  -0.5

  North Yorkshire

  26.3

  2—

  2—

  2—

  York3

  2—

  27.6

  2—

  2—

  North Yorkshire3

  2—

  26.3

  2—

  2—

  Nottinghamshire

  28.3

  28.7

  0.4

  1.5

  Oxfordshire

  26.8

  27.2

  0.3

  1.2

  Shropshire

  27.3

  27.4

  0.1

  0.4

  Somerset

  27.3

  27.6

  0.3

  1.1

  Staffordshire

  27.7

  27.5

  -0.2

  -0.8

  Suffolk

  25.1

  25.0

  -0.1

  -0.4

  Surrey

  25.8

  26.2

  0.4

  1.6

  Warwickshire

  27.9

  28.5

  0.6

  2.3

  West Sussex

  26.8

  26.8

  0.0

  0.2

  Wiltshire

  27.1

  27.2

  0.1

  0.4

  England

  27.3

  27.5

  0.2

  0.6

  1 Rounding of components may cause discrepancies in number and Percentage changes.

  2 Not applicable.

  3 No comparable data for new unitary authorities.

  European Voluntary Service for Young People
  Mr. Gill
  To ask the Secretary of State for Education and Employment what study his Department has undertaken of possible promotional usage of the European Voluntary Service for Young People; what steps his Department will take to ensure that the activities involved do not substitute for existing paid jobs; and if the minimum wage will apply to the service. [18835]

  Dr. Howells
  I have been asked to reply. I attended the European Council of Youth Ministers in Luxembourg on 28 October, at which a common position was reached on the Commission's draft proposal for a European Voluntary Service for Young People, subject to a UK Parliamentary Scrutiny Reserve. I refer the hon. member to the reply I gave to my hon. Friend the Member for Hemsworth (Mr. Trickett) on 19 November 1997,Official Report, column 186.
  148
  The Commission's proposal states specifically that the activities undertaken by young people under this programme will in no way replace potential or existing paid jobs; the other points of detail raised will be addressed with other Member States when the precise arrangements for the Programme are being discussed over the next few months.

  The Government is committed to seeing this programme under way as early as possible. The Government agrees with Article 1(2) of the draft proposal.

  Officers of the Department have had general discussions with the British Youth Council about this programme, and we will draw on our experience of the pilot phase in determining the exact arrangements for the new EVS Programme.

AGRICULTURE, FISHERIES AND FOOD

  Dietary Supplements
  Mr. Mitchell
  To ask the Minister of Agriculture, Fisheries and Food what consultations he had with right hon. and hon. Members prior to taking the decision to introduce restrictions on the retail sale of higher dose vitamin B6 supplements; and what plans he has to meet right hon. and hon. Members to discuss the decision prior to laying the necessary statutory instrument. [17818]

  Mr. Rooker
  There was no consultation with right hon. and hon. Members prior to the Government taking the decision to introduce restrictions on the sale of dietary supplements containing vitamin B6. I have responded to each and every right hon. and hon. Member who has contacted me. Every request for a meeting has been agreed to.

  Mr. David Atkinson
  To ask the Minister of Agriculture, Fisheries and Food what steps his Department is taking to promote consumers' rights of access to safe vitamin, mineral and other dietary supplements of their choice,(a) in the United Kingdom, (b) in the European Union and (c) elsewhere; and what plans he has to meet representatives of (i) Consumers for Health Choice and (ii) the Society for the Promotion of Nutritional Therapy to discuss these matters. [18081]

  Mr. Rooker
  The Government believes that consumers' access to supplements should only be restricted where this is necessary on safety grounds. This view has been made clear in the UK's formal response to the EU Commission discussion document on the addition of vitamins and minerals to food and food supplements and in discussions on the draft Codex guidelines for supplements containing vitamins and minerals.

  I have no plans to meet representatives of either Consumers for Health Choice or the Society for the Promotion for Nutritional Therapy to discuss these matters, nor have I received any request from these bodies for such meetings.

  Big Cats
  Mr. Keith Simpson
  To ask the Minister of Agriculture, Fisheries and Food if his Department has
  149
  responsibility for co-ordinating government responsibility for big cats. [17871]

  Mr. Morley
  A number of Departments have responsibilities in relation to "big cats". This Department is concerned with the safety of livestock, the Home Office for the safety of people and the Department of the Environment, Transport and the Regions for the legal keeping of such animals by, for example, zoos and circuses. These Departments co-ordinate their actions according to the circumstances of the case.

  Mr. Keith Simpson
  To ask the Minister of Agriculture, Fisheries and Food how many sightings of big cats in Norfolk have been reported to his Department since 1993. [17872]

  Mr. Morley
  I am aware that, in common with several other areas, there have been a number of alleged sightings of "big cats" in the Norfolk area. However, I am not aware of any attacks on farm livestock attributed to "big cats" in the Norfolk area being reported to this Department.

  Mr. Keith Simpson
  To ask the Minister of Agriculture, Fisheries and Food what compensation is available to farmers in the event of livestock being killed or injured by "big cats". [17873]

  Mr. Morley
  There are no funds available to pay compensation to farmers in the event of livestock being killed or injured by "big cats".

  Set-aside
  Mr. Cox
  To ask the Minister of Agriculture, Fisheries and Food if he will estimate the amount of public funding in 1997 for land put into set-aside. [18142]

  Mr. Morley
  Payments for land set aside under the Arable Area Payments Scheme (AAPS) are funded from the European Community Budget. Based on provisional figures for claims under the 1997 Scheme, payments for land set aside in England are expected to be about £80 million. Land entered into certain environmental schemes can also be set aside for the purposes of the Scheme but does not attract any payment under the AAPS; farmers do, however, receive payments for meeting the conditions of the environmental scheme concerned.

  Cattle Tagging
  Mr. Loughton
  To ask the Minister of Agriculture, Fisheries and Food what measures have been taken with regard to the new system for cattle tagging to be introduced in 1998; what assistance has been offered to farmers; and if he will make a statement. [18138]

  Mr. Rooker
  Double tagging of all cattle born or imported into the UK will become mandatory from 1 January 1998. The Department's officials issued an information note on this to farmers in August 1997, and are in close touch with representatives of the livestock industry and eartag manufacturers about the new arrangements.

  Flooding
  Mr. Loughton
  To ask the Minister of Agriculture, Fisheries and Food what assistance is available to farmers for change of agricultural use where current practices may give rise to flooding of adjoining residential areas. [18139]

  Mr. Morley
  There are schemes available to encourage farmers to convert arable land to grassland which may help to ameliorate run off from agricultural land; for example farmers can choose to enter eligible land into set-aside. Additional incentives may be available to farmers in Environmentally Sensitive Areas (ESAs) to convert arable fields into permanent grass. The ESA scheme also provides capital grants for the creation or re-instatement of dykes and ditches and for the construction of water penning structures.

  Ministry grant aid might be available towards the cost of flood alleviation works undertaken by the Environment Agency or local authorities if those bodies could devise an engineered solution to the flooding problem which met established criteria.

  Vacant Farm Buildings
  Mr. Tom King
  To ask the Minister of Agriculture, Fisheries and Food what estimate he has made of the number of(a) empty and (b) unused farm buildings. [18322]

  Mr. Morley
  The Department collects no information on the number of empty or unused farm buildings.

  Farming (Young People)
  Mr. Gordon Prentice
  To ask the Minister of Agriculture, Fisheries and Food what steps he is taking to encourage young people to enter farming. [18529]

  Mr. Morley
  I refer my hon. Friend to the reply I gave to my hon. Friend the Member for Clwyd, South (Mr. Jones) on 19 November 1997,Official Report, column 230.

  Cattle Passport Scheme
  Mr. Laurence Robertson
  To ask the Minister of Agriculture, Fisheries and Food what his Department's policy is towards passports for calves, in respect of(a) charges and (b) the timescale of registration; what changes his Department is planning to the scheme; and if he will make a statement. [18393]

  Mr. Rooker
  I announced on 12 November that the Government had decided to charge for the new computerised cattle tracing system via cattle passports. However decisions have yet to be taken about whether to charge for the temporary calf passport as well as the full cattle passport and as to how the movements of animals with temporary calf passports will be recorded on the cattle tracing system.

SCOTLAND

  NHS White Paper
  Mr. David Stewart
  To ask the Secretary of State for Scotland when he expects to publish the White Paper on the national health service. [17098]
  151
  Mr. Galbraith
  Our White Paper on the future of the NHS in Scotland will be published shortly.

  Ms Osborne
  To ask the Secretary of State for Scotland what discussions he has held with professional health staff regarding the forthcoming White Paper on the NHS. [17101]

  Mr. Dalyell
  To ask the Secretary of State for Scotland what discussions he has held with the health professionals regarding the forthcoming White Paper on the NHS. [17106]

  Mr. Galbraith
  I have had discussions with the Scottish Council of the British Medical Association, the Royal College of Nursing, the STUC and with Scottish representatives of the NHS Confederation on the future of the NHS in Scotland. I also received a number of written representations from health professionals and associations. Their views were taken into account when preparing the White Paper.

  Scottish Parliament
  Mr. Lansley
  To ask the Secretary of State for Scotland what consultations he has had with Edinburgh district council on the site of the proposed Scottish Parliament.

  Mr. Dewar
  The Scottish Office is working closely with the City of Edinburgh Council in considering the location of the Scottish Parliament.

  Mr. Blunt
  To ask the Secretary of State for Scotland what assessment he has made of the cost implications of each of the potential locations for a Scottish Assembly. [17102]

  Mr. McLeish
  The estimated costs of providing a building for the Scottish Parliament at three potential locations in Edinburgh are being drawn up at present by independent consultants. The transport and environmental impacts are also being assessed.

  Mrs. Ewing
  To ask the Secretary of State for Scotland when he expects to announce the location of the Scottish Parliament. [17109]

  Mr. McLeish
  My right hon. Friend hopes to announce his decision on the location of the Scottish Parliament building around the turn of the year.

  Dr. Fox
  To ask the Secretary of State for Scotland what is the current estimate for the cost of the proposed Scottish Parliament building. [18157]

  Mr. McLeish
  As is explained in the White Paper "Scotland's Parliament", the cost is dependent upon the site that is eventually chosen. The estimated costs of providing a building for the Scottish Parliament at locations in Regent Road, Leith and Haymarket are presently being drawn up by independent consultants.

  Mr. Gorrie
  To ask the Secretary of State for Scotland if he will place in the Library representations made to him by Historic Scotland about the siting of the Scottish Parliament on Calton Hill. [17630]

  Mr. McLeish
  [holding answer 1 December 1997]: No such representations have been made. Historic Scotland, as an executive agency within The Scottish Office, is fully and directly involved in the process of advising Ministers on the selection of a location for the Scottish Parliament.
  152
  Mr. Salmond
  To ask the Secretary of State for Scotland when he expects to announce the date of the first Scottish Parliamentary election. [17103]

  Mr. Dewar
  The timing of elections is being considered. I will make a further statement in due course.

  Public Transport
  Mr. Savidge
  To ask the Secretary of State for Scotland what plans he has for increasing the role of public transport in urban and rural areas. [17104]

  Mr. Chisholm
  We intend to publish a White Paper in the spring setting out an effective, integrated and environmentally sustainable transport policy appropriate to the needs of Scotland. This will take account of the responses to the consultation document issued last August. Our proposals, which will recognise the important role of improved public transport will be published in the White Paper.

  Inward Investment
  Mr. Alasdair Morgan
  To ask the Secretary of State for Scotland what discussions he has had recently with the President of the Board of Trade concerning inward investment policy. [17105]

  Mr. Wilson
  I refer the hon. Member to the oral answer I gave earlier to the hon. Members for Banbury (Mr. Baldry) and for North Wiltshire (Mr. Gray).

  Land Reform
  Ms Roseanna Cunningham
  To ask the Secretary of State for Scotland what plans he has for land reform in Scotland. [17108]

  Mr. Dewar
  I refer the hon. Lady to the answer I gave to my hon. Friend the Member for Inverness, East, Nairn and Lochaber (Mr. Stewart), on 30 October 1997,Official Report, column 875.

  Household Incomes
  Mr. Fallon
  To ask the Secretary of State for Scotland what adjustments he will make within the Scottish block to reflect the level of household income in Scotland. [17110]

  Mr. Dewar
  None.

  Glasgow City Council
  Mr. Galloway
  To ask the Secretary of State for Scotland when he last met the Glasgow city council to discuss its economic situation; and if he will make a statement. [17111]

  Mr. Chisholm
  My right hon. Friend and I met the Leader of Glasgow city council on 18 November and had a useful discussion on the economic situation and a range of other matters.

  NHS Bureaucracy
  Miss Begg
  To ask the Secretary of State for Scotland what progress has been made in reducing bureaucracy into he NHS in Scotland. [17112]
  153
  Mr. Galbraith
  Health Boards and Trusts were recently instructed to submit action plans for reducing further the costs of bureaucracy. The plans have still to be fully evaluated and the likely savings and administrative improvements determined.

  Trunk Road Improvements
  Mr. Home Robertson
  To ask the Secretary of State for Scotland if he will make a statement on his review of trunk road improvement projects. [17113]

  Mr. Chisholm
  The Strategic Review of the Trunk Road network, which I announced on 19 July this year, is a key part of our overall review of transport in Scotland, the results of which we intend to publish next year as a White Paper. The review is developing a revised framework for the appraisal of new trunk road schemes consistent with the integrated transport strategy to be set out in the White Paper.

  The revised appraisal system will allow schemes to be assessed against the criteria of integration, accessibility, economy, safety and environmental impacts. Public transport solutions will be fully considered alongside new road building proposals. Scottish Office officials are currently developing the assessment criteria in parallel with colleagues from the Department of the Environment, Transport and the Regions.

  Number of students in higher education by year, mode and level

  Full-time

  Part-time

  Year

  Total

  Postgraduate

  Undergraduate

  Total

  Postgraduate

  Undergraduate

  1992–93

  120,483

  13,095

  107,388

  46,700

  8,638

  38,062

  1993–94

  132,509

  13,848

  118,661

  47,220

  9,918

  37,302

  1994–95

  142,722

  15,428

  127,294

  59,158

  17,701

  41,457

  1995–96

  145,634

  16,127

  129,507

  69,570

  21,089

  48,481

  1996–971

  148,380

  14,512

  133,868

  60,179

  18,050

  42,129

  Projection 1998–992

  163,140

  14,372

  148,768

  60,183

  18,926

  41,257

  1 Figures for 1996–97 are provisional.

  2 Projections submitted to the Garrick Committee.

  Regional Policy
  Mr. St. Aubyn
  To ask the Secretary of State for Scotland when he next plans to attend an EC Council of Ministers meeting to discuss policy towards the regions. [17116]

  Mr. Dewar
  There is no formal Council devoted to regional policy. I plan to attend an Informal meeting of Regional Policy and Spatial Planning Ministers in Glasgow on 8–9 June as part of the UK Presidency of the EU Council of Ministers.

  School Buildings
  Mr. Jim Murphy
  To ask the Secretary of State for Scotland what new resources are being provided to improve the fabric of Scotland's schools in the current financial year. [17117]

  Mr. Wilson
  £8.9 million.
  154
  The roads review is taking into account the full range of factors, including traffic growth, which will give rise to pressure for further major improvements over the trunk road network in Scotland.

  We shall undertake public consultation early next year on the emerging findings of the review and it is expected that the outcome of the review will be announced in the Summer of 1998.

  Public Expenditure
  Mrs. May
  To ask the Secretary of State for Scotland if he will make a statement on per capita spending levels in Scotland. [17114]

  Mr. Dewar
  Identifiable General Government Expenditure in Scotland was £4,614 per head in 1995–96, the last year for which complete figures are available.

  Higher Education
  Mr. Ian Bruce
  To ask the Secretary of State for Scotland how many students there were in higher education in Scotland in each of the past five years; and what estimate he has made of the number for the academic year 1998–99. [17115]

  Mr. Wilson
  The total number of students (full-time and part-time) in Higher Education in Scotland, for the last five years available, is provided in the following table. The latest published projections for 1998–99 are also included.

  Secondary Education
  Mr. David Marshall
  To ask the Secretary of State for Scotland what plans he has to improve secondary school education in Scotland; and if he will make a statement. [17118]

  Mr. Wilson
  Education is at the heart of this Government and raising standards is the key priority. Under our initiative to raise standards in Scottish schools, each school will have clear, realistic and achievable targets for improvement. Implementation will be overseen by my Action Group on Standards in Scottish Schools, membership of which is widely drawn from within and beyond education.

  In September, with the endorsement of the Action Group, we issued for consultation a strategy paper for the development of a framework of school targets in key areas with national introduction in the school year 1998–99.

  155
  The outcome of consultation will be discussed at the next meeting of the Action Group on 15 December.

  In addition, full implementation of the 5–14 curriculum development programme, including national testing, in the first two years of secondary school will contribute to improvement. The programme should be in place by 1999.

  Higher Still—a new system of qualifications and assessment—will also contribute to improvement. Higher Still will be introduced in Scottish secondary schools and in further education colleges in 1999. It will replace the existing system of Highers, National Certificates, GSVQs and Certificates of Sixth Year Studies with a single system covering vocational and general education and offering courses at five different levels. This will provide better continuity and progression for all students and will play an important role in raising standards. Group awards will be available to encourage coherent programmes of study and set benchmarks for overall attainment and competence in the core skills—information technology, numeracy, communication, problem solving skills and working with others.

  Local Enterprise Agencies
  Mr. Donohoe
  To ask the Secretary of State for Scotland what plans he has to change the role of local enterprise agencies. [17119]

  Mr. Wilson
  The role of the local enterprise companies will take account of the strategies of Scottish Enterprise and Highlands and Islands Enterprise.

  The local enterprise companies will also have a major role to play in the delivery of the New Deal.

  Further Education
  Mrs. Ray Michie
  To ask the Secretary of State for Scotland how many students from Argyll and Bute(a) attended full-time undergraduate education at universities or equivalent bodies, (b) attended full-time education as mature students and (c) were in receipt of further education awards in the last year for which figures are available. [17599]

  Mr. Wilson
  Data on the number of undergraduates studying full-time in Scottish Higher Education Institutions are available only on the basis of the Old Regional Council boundaries and are therefore not available for Argyll and Bute. In 1995–96 there were 28,860 full-time undergraduate students in Scottish Higher Education Institutions from the Strathclyde Region.

  The number of mature entrants studying full-time in Scottish Higher Education Institutions from Argyll and bute in 1995–96 is also not available. The number of mature entrants from the Strathclyde Region in 1995–96 was 2,491.

  The number of mature entrants studying full-time in Scottish Further Education Colleges is set out in the table.
  156

  Mature1 entrants studying full-time in Scotland

  Argyll and Bute

  Strathclyde

  Higher Education Undergraduate2 Entrants in Further Education Colleges

  45

  3,920

  Further Education Entrants in Further Education Colleges

  61

  4,298

  1Mature entrants are aged 21 years and over.

  2Undergraduate includes first degree and other higher education qualifications.

  Around 150 students from Argyll and Bute (around 8,500 from Strathclyde) received local authority bursaries for further education courses in 1995–96.

  University Students
  Mr. Welsh
  To ask the Secretary of State for Scotland what Percentage of students from England, Wales and Northern Ireland starting undergraduate courses at Scottish universities for each of the last four years were given direct entry into the second year. [17844]

  Mr. Wilson
  [holding answer 27 November 1997]: Figures for the last three years are shown in the table below. Figures on a consistent basis are not available for 1993–94.

  Proportion of all undergraduate entrants to Scottish Higher Education Institutions entering directly to the second year of their course

  Per cent.

  1994–95

  1995–96

  11996–97

  Students from:

  England

  11

  8

  6

  Wales

  14

  7

  7

  Northern Ireland

  12

  11

  7

  1 Figures for 1996–97 are provisional.

  Mr. Welsh
  To ask the Secretary of State for Scotland what Percentage of degree courses at Scottish universities allow for direct entry for(a) A-level, (b) CSYS and (c) HNC/HND students to the second year of the course. [17845]

  Mr. Wilson
  [holding answer 27 November 1997]: This information is not held centrally. The report of the Scottish Standing Committee of the National Committee of Inquiry into Higher Education noted that this was a matter for individual institutions, and recommended that Scottish Higher Education Institutions examine the scope for a greater proportion of students to enter directly into the second year.

  Student Tuition Fees
  Mr. Welsh
  To ask the Secretary of State for Scotland what assistance will be given to students beginning courses in 1998 lasting longer than four years towards their tuition fees for the additional years. [17846]
  157
  Mr. Wilson
  [holding answer 27 November 1997]: Eligible Scottish domiciled students will not be required to pay the £1,000 tuition fee for the final year of any degree course where that course is one year longer than the comparable course offered at institutions in England and Wales.

  In addition, eligible Scottish domiciled medical and dental students will be relieved of paying the £1,000 tuition fee for the fifth and subsequent years of their courses. They will thus be on equal footing with their counterparts domiciled elsewhere in the UK.

  Mr. Welsh
  To ask the Secretary of State for Scotland if he will ensure that the means test level for the payment of full tuition fees is the same in Scotland as in England. [17851]

  Mr. Wilson
  [holding answer 27 November 1997]: Yes.

  Mr. Welsh
  To ask the Secretary of State for Scotland what plans he has to offer loans to students to cover the cost of their tuition fees; and if he will make a statement. [17852]

  Mr. Wilson
  [holding answer 27 November 1997]: On 23 July, the Government announced that new students commencing higher education from 1998–99 onwards will be liable to contribute up to £1,000 towards their tuition, and that maintenance grants and the current loan arrangements will be replaced by loans on income contingent repayment terms. Loans will not be available specifically to cover tuition fees. However, for those students who are liable to contribute toward the costs of tuition, their entitlement to loans will be increased to ensure that no student has access to less funds for maintenance under the new system than they would have had under the existing system. This arrangement is the same in Scotland, as elsewhere in the UK.

  School Transport
  Mr. Kirkwood
  To ask the Secretary of State for Scotland what guidance he has recently issued to Scottish local authorities regarding their duties to provide school transport for pupils under the Education Acts; and what plans he has to review that guidance. [17205]

  Mr. Wilson
  [holding answer 1 December 1997]: Guidance on the statutory duties and powers of local authorities on the provision of school transport was contained in The Scottish Office Education Department Circular No. 5/95, issued on 24 May 1995; The Scottish Office Development Department Circular No. 17/1996, issued on 30 April 1996 and The Scottish Office Education and Industry Department Circular No. 8/96, issued on 19 September 1996. My right hon. Friend has no plans to review that guidance.

  Mr. Kirkwood
  To ask the Secretary of State for Scotland if he will list those Scottish local authorities which currently provide a level of school transportation beyond that required in the Education Acts. [17207]

  Mr. Wilson
  [holding answer 1 December 1997]: Education authorities have a statutory duty under section
  158
  51 of the Education (Scotland) Act 1980 to provide school transport as they consider necessary. This gives them wide discretion to take account of individual circumstances in each case. The Table below indicates the criteria used by each education authority in school session 1996–97 in determining provision of free transport or transport facilities. Information for 1997–98 school session is not yet available. In addition, all authorities provided free transport for children with special educational needs, and almost all authorities took account of medical and personal circumstances or hazardous road conditions to provide transport in individual cases.

  Education authority

  Distance criteria applied

  Aberdeen City

  2 miles (Primary) 3 miles (Secondary)

  Aberdeenshire

  1 mile (Primary) 2 miles (Secondary)

  Angus

  2 miles (Primary) 3 miles (Secondary)

  Argyll and Bute

  Statutory walking distance

  Clackmannanshire

  1 mile (under 8) 2 miles (8 and over)

  Dumfries and Galloway

  Statutory walking distance

  Dundee City

  Statutory walking distance

  East Ayrshire

  Statutory walking distance

  East Dunbartonshire

  1 mile (Primary) 2 miles (Secondary)

  East Lothian

  2 miles all pupils

  East Renfrewshire

  1 mile (Primary) 2 miles (Secondary)

  Edinburgh City

  Statutory walking distance

  Falkirk

  1 mile (under 8) 2 miles (8 and over)

  Fife

  1 mile (Primary) 2 miles (Secondary)

  Glasgow City

  1 mile (Primary) 2 miles (Secondary)

  Highland

  Statutory walking distance

  Inverclyde

  Statutory walking distance

  Midlothian

  Statutory walking distance

  Moray

  2 miles all pupils

  North Ayrshire

  Statutory walking distance

  North Lanarkshire

  1 mile (Primary) 2 miles (Secondary)

  Orkney Islands

  1 mile all pupils in Winter and Easter terms

  Perth and Kinross

  Statutory walking distance

  Renfrewshire

  Less than the statutory walking distance (but not specified)

  Scottish Borders

  2 miles (Primary) 3 miles (Secondary)

  Shetland Islands

  1½ miles in Winter months

  South Ayrshire

  1 mile (Primary) 2 miles (Secondary)

  South Lanarkshire

  1 mile (Primary) 2 miles (Secondary)

  Stirling

  1 mile (under 8) 2 miles (8 and over)

  West Dunbartonshire

  Less than the statutory walking distance (but not specified)

  West Lothian

  2 miles (Primary) 3 miles (Secondary)

  Western Isles

  1 mile all pupils

  The statutory walking distance is defined under section 42(4) of The Education (Scotland) Act 1980 as being two miles for pupils under eight years of age and three miles for all other pupils. The statutory walking distance is defined for the purposes of reasonable excuse, i.e., it is considered a reasonable excuse for parents not to send their children to their designated school if no arrangements are made for them under section 51 of the 1980 Act. Section 51 does not itself set any distance beyond which transport should be provided.

  Non-domestic Rates
  Mr. Ernie Ross
  To ask the Secretary of State for Scotland what the non-domestic rate poundage for Scotland will be in 1998–99. [19209]

  Mr. Dewar
  It will be 47.4p, the same as in England.

  New Deal
  Mr. Browne
  To ask the Secretary of State for Scotland what plans he has to allow local flexibility in the implementation of the New Deal. [17107]

  Mr. Wilson
  There will be significant flexibility within the overall national New Deal framework which allows for local solutions and partnerships which reflect local circumstances. Flexibility is therefore a prominent feature of the process.

TRADE AND INDUSTRY

  Export Licences
  Mr. Redwood
  To ask the President of the Board of Trade how many export licence applications are currently awaiting determination at the Department of Trade and Industry. [16142]

  Mrs. Beckett
  [holding answer 14 November 1997]: Licences to export strategic goods are issued by the President of the Board of Trade and the Export Control Organisation (ECO) of my department is the licensing authority. The ECO circulates all relevant individual licence applications to other Government Departments with an interest, as determined by them in line with their policy responsibilities. The Departments from which advice is sought include the Foreign and Commonwealth Office, the Ministry of Defence and the Department for International Development.

  ECO management data on the processing of licence applications are compiled on the basis of four-week periods. At 17 October 1997, a total of 2,184 applications were awaiting a decision; these applications comprised applications for new standard or open individual licences to export strategic goods and applications for the renewal or amendment of existing individual licences. This compares with 2,085 outstanding applications at the end of October 1996. ECO is also the licensing authority for goods whose export is only controlled because of UN trade sanctions but data on the number of applications awaiting a decision are not compiled as most decisions are subject to UN authorisation, which can take some time.

  Recommended Retail Prices
  Mr. Redwood
  To ask the President of the Board of Trade what is her Department's policy on the recommended retail prices for(a) newspapers, (b) books and (c) pharmaceutical products. [17558]

  Mrs. Beckett
  [holding answer 24 November 1997]: Recommended retail prices are not contrary to competition law unless specifically proscribed. They have not been proscribed for these products.

  Amsterdam Treaty
  Mr. Streeter
  To ask the President of the Board of Trade if her Department will undertake a study of potential costs to business of proposals contained in the final text of the Treaty of Amsterdam as concerns the(a) competitiveness of British industry and (b) foreign inward investment; and if she will make a statement. [17079]
  160
  Mrs. Beckett
  [holding answer 24 November 1997]: The Amsterdam Treaty represents a very satisfactory outcome for the UK. My Department will not undertake a separate study of potential costs of the Treaty but of course any legislative proposals consequential of the adoption of the treaty will be assessed carefully in terms of costs and benefits to business.

  Power Generation
  Mr. Redwood
  To ask the President of the Board of Trade how many new(a) gas-fired power stations and (b) other types of power station are awaiting licence determination at her Department; and what total capacity they represent. [18324]

  Mrs. Beckett
  Of the 28 applications currently before the Department;

  (i) 22 relate to new gas fired stations (CCGT and CHP) totalling 8.2 GW of new capacity;

  (ii) 5 relate to dual firing with gas of existing coal or oil power stations using 5.9 GW of existing capacity;

  (iii) 1 relates to a windfarm.

  Coal Industry
  Mr. Redwood
  To ask the President of the Board of Trade what plan she has to increase regional aid in areas affected by coal closures. [17957]

  Mrs. Beckett
  [holding answer 27 November 1997]: The Government recognise that communities hit by pit closures face distinctive problems. We have therefore established a Coalfield Task Force which will identify and develop a programme of action to assist coal closure areas.

  Mr. Redwood
  To ask the President of the Board of Trade what tonnage of coal she estimates is displaced by a 1,200 MW gas-fired power station. [18042]

  Mrs. Beckett
  [holding answer 27 November 1997]: The impact of a new gas fire station will depend on its mode of operation, the competitive position of other stations and the level of demand that is required to be met. If run at baseload a 1,200 MW station might generate some 8–9 TWh of electricity per year. If it were fully to displace a coal fired station also running at baseload, as would have been the case for new plant five years ago when a substantial amount of coal fired plant ran at baseload, it would be likely to displace about 3.5 million tonnes of coal per year.

  In today's market place displacement may be less than this if, as is possible, the new plant now displaces other plant rather than coal. Such impacts are complex and cannot now be more precisely assessed.

  Funeral Industry
  Mr. Chidgey
  To ask the President of the Board of Trade, pursuant to her Answer of 19 November 1997,Official Report, column 192, if she will list (a) the possible options for consumer protection which the Minister for Competition and Consumer Affairs has discussed with the Director General of Fair Trading regarding pre-paid funerals and (b) the actions further to protect consumers which she is discussing with Treasury ministers; and if she will make a statement. [18038]
  161
  Mr. Nigel Griffiths
  [holding answer 27 November 1997]: I have discussed a number of options with the Director-General of Fair Trading, and with Treasury Ministers.

  There are two possible approaches to this issue. One would be to introduce a completely new regulatory regime, for the pre-paid funerals sector. The other involves bringing pre-paid funerals under an existing regulatory regime. Whichever approach is chosen, our objectives are to ensure that there will be sufficient financial provision available so that those consumers who have purchased their funerals in advance get the funerals for which they have paid, and to address the questions of transparency in marketing practices. Consideration of the various options is continuing at official level. It would be premature to make any further statement at this stage.

  Post Office Closures
  Mr. Cox
  To ask the President of the Board of Trade how many(a) main post offices and (b) sub-post offices have been closed in each of the last three years in the United Kingdom. [18167]

  Mr. Ian McCartney
  I understand from the Post Office that closures of post offices in the United Kingdom in the last three financial years have been as follows:

  Main post offices closed

  Main post offices converted to agency status

  sub-post offices closed

  1994–95

  —

  101

  115

  1995–96

  —

  46

  193

  1996–97

  —

  47

  163

  The numbers of sub-post offices closed are net of new openings.

  Toys (Safety)
  Mr. Baker
  To ask the President of the Board of Trade what assessment she has made of(a) the levels of phthalates present in children's toys on sale in the United Kingdom and (b) the level of danger these may present to children; and if she will make a statement. [17781]

  Mr. Nigel Griffiths
  [holding answer 27 November 1997]: The DTI is at present carrying out research to develop procedures for testing the levels of exposure to phthalates from PVC toys in the light of criticism of current European guidance test methods, which show no evidence that Tolerable Daily Intakes (TDIs) are being exceeded. I am advised that the concentration of phthalates in children's toys is not a satisfactory indication of the exposure of children to these chemicals. This can be assessed by determining the migration of phthalates from these products. The Department of Health has advised, in the light of the most recent research conducted on phthalates, that there are unlikely to be any health risks to children from phthalates in toys and teething rings provided that exposure does not exceed the relevant TDIs for phthalates set by the EC Scientific Committee for Food. This advice takes account of all available information on the possible effects of phthalates, including recent studies concerning oestrogenic activity.
  162
  Mr. Baker
  To ask the President of the Board of Trade if she will ban the sale of toys containing cyclobutanone. [17920]

  Mr. Nigel Griffiths
  [holding answer 28 November 1997]: 1 have no plans to do so. I am advised that cyclobutanone does not appear to be used to any great extent, if at all, in toy production. The essential safety requirements in the Toy (Safety) Regulations 1989 requires toy manufactures to supply toys that are safe when used as intended to be used or in a foreseeable way. Any chemical used in toys must comply with this requirement.

  Minimum Wage
  Jacqui Smith
  To ask the President of the Board of Trade what is the current level of the minimum wage in EU countries, the USA and Japan in pounds sterling per hour, calculated in current exchange rates. [18567]

  Mr. Ian McCartney
  My Department does not systematically collect information on all countries. What information is available, is set out in the following table:

  1997 local currency minimum wages in selected countries and their pounds sterling hourly equivaent converted at current exchange rates

  Country

  Local currency rate1

  £ equivalent at 31 October 1997 current rate

  Belgium

  44,185 Belgian Francs per month

  24.61

  France

  39.43 French Francs per hour

  4.02

  Greece

  5,746–6,321 Drachma per day

  31.61–1.77

  Luxembourg

  46,275–55,520 Luxembourg Francs per month

  24.33–5.79

  Netherlands

  2,243 Guilders per month

  24.29

  Portugal

  56,700 Escudo per month

  21.20

  Spain

  2,221 Pesetas per day

  31.16

  USA

  5.15 Dollars per hour

  3.17

  Japan

  4,521–5,252 Yen per day

  32.99–3.48

  1 Local currency minimum wages as known at 28 July 1997. The definition of the minimum wage varies across countries. Also, exemptions may apply for some workers and different rates may apply for youth workers.

  2 Monthly rate converted to hourly rate assuming employees work 39 hour week for 49 weeks in the year.

  3 Daily rate converted to hourly rate assuming employees work 7¾ hours per day.

  Mr. Chidgey
  To ask the President of the Board of Trade what representations she has received on the potential for a national minimum wage to result in wage inflation. [18104]

  Mr. Ian McCartney
  I have received a number of representations which referred to the possible effects of the National Minimum Wage, including the impact on wage inflation.

  Mr. Chidgey
  To ask the President of the Board of Trade what advice she has sought and from whom on the advantages and disadvantages of establishing a regionally varied minimum wage based on the precedents established by the wages councils. [18103]
  163
  Mr. Ian McCartney
  From 1986 to their abolition in 1993 each Wages Council, in fact, set a single minimum basic hourly rate, which applied to all adult workers covered. The Low Pay Commission will take into account regional concerns expressed in the evidence it receives when formulating its recommendation on a single national minimum rate.

  Mr. Chidgey
  To ask the President of the Board of Trade what representations have been made to the Low Pay Commission calling for the introduction of a regionally varied minimum wage; and how many of these called for a regionally varied minimum wage based on precedents established by the wages councils. [18102]

  Mr. Ian McCartney
  The Low Pay Commission is an independent body. The representations it receives are a matter for the Commission.

  Part-time Workers
  Mr. Martyn Jones
  To ask the President of the Board of Trade what changes she has introduced to the conditions governing part-time workers in the United Kingdom since May; and if she will make a statement. [18409]

  Mr. Ian McCartney
  The Government have accepted the Social Chapter which will mean that part time and full time workers in the UK will be able to benefit from its measures. We have undertaken to implement the Part Time Work Directive once it has been agreed by the other member states. This will prohibit less favourable treatment of part-timers and promote part-time job opportunities. It will thus contribute to the flexible organisation of work while at the same time ensuring that part-timers receive the same contractual and statutory benefits as full-timers.

  Low Pay
  Mr. Chidgey
  To ask the President of the Board of Trade if she will list, by regions defined by the boundaries of the regional government offices, the lowest hourly rate paid by her Department to(a) full-time employees, (b) part-time employees, (c) persons employed under personal contract and (d) persons employed by firms undertaking contracted-out services for central government offices, defining the job title in each case. [18110]

  Mr. Ian McCartney
  In London, the lowest rate paid by the Department is £5.16 an hour. £3.84 per hour is the lowest hourly rate paid by the Department in all other English regions and Scotland. In Wales, the lowest hourly rate of pay is £3.70 in a Departmental Agency where a pay award is pending.

  These rates apply to all staff at the relevant level directly employed by the Department. Staff at this level do a variety of jobs including filing and photocopying.

  Rates of pay for persons employed by firms undertaking contracted out services are a matter for the companies concerned.

  Plutonium
  Mr. Coaker
  To ask the President of the Board of Trade if she will published the international guidelines on the management of civil plutonium. [19121]
  164
  Mr. Battle
  I have today placed in the Library of the House a copy of a document recently agreed among an informal group of nine countries, including the United Kingdom, entitled "Guidelines for the Management of Civil Plutonium". The UK has informed the International Atomic Energy Agency of its intention to adopt these guidelines.

  The background to the guidelines has been a general wish by some countries to improve transparency and public confidence in the management of national holdings of civil plutonium. Agreement was reached in the informal group, comprising the United Kingdom, the United States, China, Russia, France, Germany, Japan, Belgium and Switzerland, to publish guidelines that would provide an internationally-accepted framework for the management of civil plutonium. Under the guidelines, participating countries accept a new commitment to publish occasional statements explaining their national strategies for nuclear power and the nuclear fuel cycle, and, against that background, their general plans for managing national holdings of plutonium, together with annual figures for their holdings of unirradiated plutonium and of plutonium contained in spent fuel as at the end of each calendar year.

  The UK has for the past 11 years published information on its national holdings of civil plutonium annually as at 31 March. In keeping with the guidelines, the UK will in future be publishing such information annually as at 31 December, as this will facilitate international comparisons on a consistent basis.

  I have also today placed in the Library of the House a copy of the first set of figures for the UK under the new format showing national holdings as at 31 December 1996. Figures for our holdings as at 31 December 1997 will be published in June 1998.

  Training and Enterprise Councils
  Mr. Cotter
  To ask the President of the Board of Trade what steps are taken to ensure that money intended for training which is routed through TECs is used for the correct purposes. [16529]

  Dr. Howells
  I have been asked to reply.

  The primary responsibility for ensuring that public money is properly protected rests with TECs. The Permanent Secretary wrote on 23 October to all TEC Chairs to emphasise the importance of good financial controls between TECs and their training providers. Additionally the newly established Training Inspectorate will assess the quality of training provision right at the point of delivery.

DUCHY OF LANCASTER

  Departmental Information
  Mr. Matthew Taylor
  To ask the Chancellor of the Duchy of Lancaster if he will place in the library a copy of the internal departmental guidance on the dissemination of information; and if he will make a statement. [16294]

  Mr. Kilfoyle
  A revised version of the Code of Practice on Access to Government Information was published by the Office of Public Service in January 1997.
  165
  I have made arrangements for copies of internal departmental guidance issued in February 1997 to the members of staff within the Cabinet Office and Office of Public Service to be placed in the libraries of the House.

CABINET OFFICE

  Millennium Experience
  Mr. Maude
  To ask the Minister without Portfolio if he will make a statement on the role of Sir Cameron Mackintosh in the Millennium Experience exhibition, indicating his remuneration. [16766]

  Mr. Mandelson
  Sir Cameron Mackintosh agreed, in June 1997, to advise the New Millennium Experience Company in respect of the arena show. He agreed to do this without remuneration.

  Mr. Maude
  To ask the Minister without Portfolio if he will ensure that no(a) members of the Board and (b) other employees of the New Millennium Experience Company benefit financially from contracts made by the company. [16765]

  Mr. Mandelson
  The New Millennium Experience Company is incorporated under the Companies Act and its Board members are subject to the duties of directors under company law. Additionally, all Chairman and Members of the Boards of non-departmental public bodies, a status applying to the NMEC, are required to comply with the requirements of the "Code of Best Practice for Board Members of Public Bodies" which was published following the 1992 Cadbury Report.

  The NMEC Board operates under statutory requirements and best practice in respect of all its business, including contract decisions. I am confident that the individuals involved and the systems in place ensure that there is no room for personal financial benefit from the award of contracts.

  As regards employees, the NMEC's Employee Handbook is an extension of terms and conditions of employment and precludes any financial gain of this kind. Contravention of these provisions would represent gross misconduct and could lead to dismissal.

  Mr. Maude
  To ask the Minister without Portfolio if the Advisory Committee on Advertising was consulted over the appointment of M and C Saatchi in respect of the Millennium Experience. [16764]

  Mr. Mandelson
  No.

  Mr. Maude
  To ask the Minister without Portfolio how long advertising agencies were given to tender for the New Millennium Experience Company contract; and what factors governed the length of the consultation period. [16763]

  Mr. Mandelson
  There were 43 calendar days between the date of the advertisement in the Official Journal of the European Communities and the submission of bids. Interested companies were given 10 days within which to submit a request to pre-qualify. This request had only to contain standard corporate information—company profile, management structure and responsibilities, CVs for lead personnel and other staff, case histories of three projects of similar or analogous nature, scope of services, turnover
  166
  and billings for the previous three years and the forecast for 1997, and experience of previous work for Government and other public sector bodies.

  Following six days of consideration of the requests to pre-qualify, NMEC shortlisted those companies it considered should be invited to tender (ITT) and invitations were issued. The shortlisted companies were required to respond to the ITT with bids within 27 days.

  These procedures were pursued in accordance with domestic and European regulations governing open competitive tendering. Under European procurement rules accelerated procedures can be undertaken. With the agreement of Treasury Solicitor the NMEC adopted accelerated procedures for the communications contract because of the urgency arising from need to prepare for the launch of the Millennium Experience's National Programme.

  Mr. Maude
  To ask the Minister without Portfolio when the New Millennium Experience Company appointed M and C Saatchi to conduct its advertising. [16762]

  Mr. Mandelson
  The New Millennium Experience Company announced the appointment of M and C Saatchi on 22 August to develop and implement an integrated communications campaign including advertising, having received approval from the Millennium Commission on 21 August.

  Mr. Maude
  To ask the Minister without Portfolio what is the role of(a) Mr. Bill Muirhead and (b) Mr. Jeremy Sinclair in the New Millennium Experience Company; what is their remuneration; when each was appointed; and what role they played in the appointment of M and C Saatchi as the advertising agency for the company. [16761]

  Mr. Mandelson
  Neither Bill Muirhead nor Jeremy Sinclair has a role in the New Millennium Experience Company (NMEC). They currently receive not remuneration from NMEC nor have they received any in the past. Mr. Muirhead and Mr. Sinclair assisted the Company (then called Millennium Central Ltd.) on a part-time basis as acting, unpaid communications advisers until June 1997 when they stood down from the role. Neither took any part in the competitive tendering process—from drawing up and preparing the brief, to selecting a communications advertising agency.

  Mr. Gordon Prentice
  To ask the Minister without Portfolio when the Millennium Dome is scheduled for completion; and when the Millennium Experience will be fully operational. [16971]

  Mr. Mandelson
  The construction of the Millennium Dome is scheduled for completion in September 1998. The Experience will open on 31 December 1999.

  Mr. Gordon Prentice
  To ask the Minister without Portfolio what compensation has been paid to the original contractor for the supply of the covering of the Millennium Dome. [17525]

  Mr. Mandelson
  None. Negotiations between the New Millennium Company and the contractor under the terms of the original contract are continuing.
  167
  Mr. Maude
  To ask the Minister without Portfolio what contingency plans he has made in respect of the Millennium Experience for the possibility that the Jubilee Line might not be fully operational by January 2000. [17590]

  Mr. Mandelson
  London Underground Ltd. have assured me that the Jubilee Line Extension will be able to cope with the number of visitors anticipated by the New Millennium Experience and that it will be open in good time to do so.

TREASURY

  Tax and National Insurance Revenue
  Helen Jones
  To ask the Chancellor of the Exchequer what estimates he has made of the average tax and national insurance revenue generated each year by(a) a full-time job and (b) a part-time job. [16895]

  Dawn Primarolo
  [holding answer 20 November 1997]: In 1995–96, the latest financial year for which final receipts are available, the total revenue for income tax was £68,049 million and the total number of income tax payers was 25.8 million, giving an average income tax contribution of £2,640 per annum. The total revenue from national insurance contributions in 1994–95, the latest year for which the number of people paying contributions is available, was £37,863 million and the total number of people who paid contributions was 24.2 million, giving an average national insurance contribution of £1,565. It is not recorded whether these contributions were for full or part-time work.

  Mr. Webb
  To ask the Chancellor of the Exchequer pursuant to his answer of 13 November 1997,Official Report, columns 620–21, what would be the effect on the number of people of working age who face combined marginal rates of withdrawal of tax, national insurance contributions and means-tested benefits of (a) under 50 per cent., (b) 50 to 59 per cent., (c) 60 to 69 per cent., (d) 70 to 79 per cent., (e) 80 to 89 per cent. and (f) 90 per cent. or above of introducing a 10 pence starting rate of income tax on (i) the first £1,000, (ii) the first £1,500 and (iii) the first £2,000 of taxable income if no other changes were made to the tax and benefit system. [16900]

  Dawn Primarolo
  [holding answer 20 November 1997]: As the Chancellor has made clear, the Government are determined that the working poor should benefit from any move to a 10p income tax rate. They are therefore considering what action is necessary on tapers and other features of the benefit system to ensure that a lower starting rate of income tax benefits all the low-paid.

  Mr. Jack
  To ask the Chancellor of the Exchequer if tax payers on the basic or higher rates of tax will benefit fully from the reduction in tax to be paid upon the introduction of a 10p starting rate of tax. [18412]

  Dawn Primarolo
  [holding answer 1 December 1997]: When the Chancellor introduces a 10p rate of tax, anyone whose starting rate of tax becomes 10p will benefit from its introduction.

  Economic and Monetary Union
  Mr. Mitchell
  To ask the Chancellor of the Exchequer if he will list the regulatory authorities responsible for the licensing and operation of banks and credit institutions in the even of UK entry to EMU. [17523]

  Mrs. Liddell
  The regulatory authorities responsible for authorising banks and other credit institutions would not change in the event of the UK joining the single currency.

  Harmful Tax Competition
  Mr. Gibb
  To ask the Chancellor of the Exchequer pursuant to his answer of 19 November 1997,Official Report, column 235, what his policy on the use of the veto on the EU Commission's proposals on "A Package to Tackle Harmful Tax Competition" (COM (97) 564). [17584]

  Dawn Primarolo
  [holding answer 24 November 1997]: Direct taxation is primarily a matter for Member States at national level. Proposals for action at the Community level, including those in the Commission's Communication on harmful Tax Competition (COM (97) 564) are considered on their own merits, but must respect the principles of subsidiarity and unanimity.

  Labour Market Statistics
  Mrs. Ballard
  To ask the Chancellor of the Exchequer what conclusions the Office for National Statistics has reached on the presentation of labour market statistics. [18027]

  Mrs. Liddell
  The information falls within the responsibility of the Chief Executive of the Office for National Statistics. I have asked him to arrange for a reply to be given.

  Letter from Tim Holt to Mrs. Jackie Ballard, dated December 1997:
  The Chancellor of the Exchequer has asked me to reply, as the Director of the Office for National Statistics (ONS), to your recent question on the presentation of labour market statistics.
  In the summer, ONS launched a wide-ranging public consultation about the future of labour market statistics. The results of the consultation were published in October's edition of the ONS publication Labour Market Trends, a copy of which is available in the House of Commons Library.
  As the Director of ONS I am responsible for deciding the form, coverage and timing of release of ONS statistics. I expect to make an announcement about ONS proposals for labour market statistics early in the New Year.

  Pension Funds
  Sir Richard Body
  To ask the Chancellor of the Exchequer what representations he has received on the use of interest on European Community pension funds to finance Community activities. [18490]

  Mrs. Liddell
  None. The pension scheme for staff of the Community Institutions is unfunded, so there is no accumulated fund earning interest. Payments are charged against the Community Budget, and contributions are treated as revenue, as they occur.

  Unemployment
  Mr. Willetts
  To ask the Chancellor of the Exchequer if he will provide a breakdown of the 20 per cent. of working age households who are not working into households made up of(a) students and trainees, (b) disabled people, (c) couples where one person is a pensioner, (d) single parents and (e) others. [18513]

  Mrs. Liddell
  [holding answer 1 December 1997]: The information requested falls within the responsibility of the Chief Executive of the Office for National Statistics. I have asked him to arrange for a reply to be given.

  Letter from Tim Hill to Mr. David Willetts, dated 2 December 1997:
  The Chancellor of the Exchequer has asked me to reply, as Director of the Office for National Statistics (ONS), to your recent question asking for a breakdown of workless households into various categories including disabled people.
  Regrettably, I am unable to reply immediately because the data concerning disabled people are not yet available.
  The focus and number of questions in the health and disability module of the Labour Force Survey (LFS) questionnaire changed in spring 1997 to reflect the provisions of the Disability Discrimination Act 1995. As with any significant change in a part of the survey, the results needed to be evaluated before the data could be released. This review is now complete and the data will be publicly available from 17 December.
  The new module has introduced a sizeable discontinuity which makes comparisons with earlier periods unsuitable. This is why it would not be appropriate to answer the question with data from the previous quarter (Winter 1996–97).
  I will write to you again after these data are publicly released.

  Funeral Industry
  Mr. Chidgey
  To ask the Chancellor of the Exchequer if he will estimate the number of permanent jobs in the United Kingdom that are(a) directly and (b) indirectly related to the funeral industry. [18294]

  Mrs. Liddell
  [holding answer 1 December 1997]: The information requested falls within the responsibility of the Chief Executive of the Office for National Statistics. I have asked him to arrange for a reply to be given.

  Letter from Tim Holt to Mr. David Chidgey, dated 2 December 1997:
  The Chancellor of the Exchequer has asked me to reply, as the Director of the Office for National Statistics, to your recent question on direct and indirect employment in the funeral industry.
  Information from the Annual Employment Survey show there were 15,200 employees in funeral and related activities in Great Britain at September 1996.
  No information is available identifying the number of these jobs which are permanent, nor other jobs indirectly related to the funeral industry.

  Low Pay
  Mr. Pond
  To ask the Chancellor of the Exchequer if he will list for April 1997 the number and proportion of manual, non-manual and all full-time employees on adult rates earning less than(a) £174.85, (b) £233.13 and (c) £249.97 per week excluding overtime for (i) men, (ii) women and (iii) both sexes for (1) each county and unitary authority in England, (2) each unitary authority in Wales, (3) each London borough, (4) each unitary
  170
  authority in Scotland, (5) Great Britain as a whole, (6) England as a whole and (7) each Government office region. [18277]

  Mrs. Liddell
  The information requested falls within the responsibility of the Chief Executive of the Office for National Statistics. I have asked him to arrange for a reply to be given.

  Letter from Tim Holt to Mr. Chris Pond, dated 2 December 1997:
  The Chancellor of the Exchequer has asked me to reply, as the Director of the Office for National Statistics, to your recent question on earnings.
  The available information, from the New Earnings Survey April 1997, is given in the attached tables. These tables are voluminous and copies of them are being placed in the Library of the House rather than reproduced in Hansard.

  Mr. Chidgey
  To ask the Chancellor of the Exchequer if he will list, by regions defined by the boundaries of the regional government offices, the lowest hourly rate paid by his Department to(a) full-time employees, (b) part-time employees, (c) persons employed under personal contract and (d) persons employed by firms undertaking contracted-out services for central government offices, defining the job title in each case. [18109]

  Mrs. Liddell
  The Treasury has no offices outside central London. The lowest hourly rates paid to full-time, part-time and short-term appointment employees are as follows:

  Lowest hourly rates in £s

  Full-time employees

  5.47

  Part-time employees

  5.95

  Short-term appointments1

  4.34

  1 Staff on fixed-term appointments and casual staff who are appointed on short-term contracts for periods of up to 12 months.

  The rates above are paid to a small number of staff most of whom are engaged on clerical and administrative support work.

  The hourly rates for staff employed by firms undertaking contracted out services for the department are a matter for the companies concerned.

  Mr. Chidgey
  To ask the Chancellor of the Exchequer how many employees in each of the regions defined by the boundaries of the regional government offices are paid an hourly rate of(a) less than £1.50, (b) between £1.50 and £2, (c) between £2 and £2.50, (d) between £2.50 and £3 and (e) between £3 and £3.50. [18105]

  Mrs. Liddell
  The information requested falls within the responsibility of the Chief Executive of the Office for National Statistics. I have asked him to arrange for a reply to be given.

  Letter from Tim Holt to Mr. David Chidgey, dated 2 December 1997:
  The Chancellor of the Exchequer has asked me to reply, as the Director of the Office for National Statistics, to your recent question on earnings.
  The available information, from the New Earnings Survey April 1997, is given in the attached table.
  171

  Percentage of people with an hourly rate (excluding overtime)

  Government Office Region

  Less than £1.50

  Between £1.50 and £2

  Between £2 and £2.50

  Between £2.50 and £3

  Between £3 and £3.50

  North East Region

  0.2

  0.3

  0.7

  1.3

  5.9

  North West Region

  0.2

  0.3

  0.5

  1.1

  4.6

  Merseyside Region

  0.1

  0.1

  0.1

  1.7

  4.5

  Yorkshire and The Humber Region

  0.3

  0.4

  0.5

  1.3

  5.2

  East Midlands Region

  0.2

  0.3

  0.3

  1.5

  4.4

  West Midlands Region

  0.3

  0.4

  0.6

  1.4

  4.3

  South West Region

  0.4

  0.3

  0.4

  1.3

  4.4

  Eastern Region

  0.3

  0.3

  0.5

  1.1

  3.3

  London

  0.2

  0.1

  0.3

  0.5

  1.4

  South East Region

  0.3

  0.4

  0.5

  0.8

  2.8

  Wales

  0.3

  0.3

  0.5

  1.3

  5.1

  Scotland

  0.3

  0.5

  0.5

  1.1

  4.3

  Notes:

  Wage ranges per hour are constructed thus: between £1.50 and £2 means equal to, or greater than £1.50 but less than £2 per hour and so on throughout the distribution.

  All employees on adult rates, whose pay for the survey pay period was unaffected by absence.

  Source:

  New Earnings Survey, April 1997 (GB).

  Exchange Rate
  Mr. Gill
  To ask the Chancellor of the Exchequer if he will assess the benefits of linking sterling to the US dollar. [18840]

  Mrs. Liddell
  No.

DEFENCE

  Espionage
  Mr. Alan Johnson
  To ask the Secretary of State for Defence if he will establish an inquiry into the role of officials in advising Ministers about the use of Hull trawlers for espionage and counter-espionage. [16688]

  Dr. Reid
  I do not believe this is necessary.

  Mr. Alan Johnson
  To ask the Secretary of State for Defence if he will make a statement about the use of trawlers for espionage and counter-espionage in the late 1960s and 1970s. [16690]

  Dr. Reid
  A very limited number of trawlers assisted the Government in specific intelligence gathering in the 1960s and early 1970s.

  At the time there was also a scheme whereby Royal Navy officers gained sea going experience in merchant ships, including deep sea trawlers. All RN personnel were encouraged to report back any opportunity sightings of interest, as indeed were the trawlermen themselves.

  Animal Experiments
  Mr. Flynn
  To ask the Secretary of State for Defence (1) how many procedures resulting in the deaths of animals carried out(a) at Potion Down and (b) elsewhere in the last five years were undertaken on behalf of (i) other countries and (ii) other EU countries; [17618]

  (2) how many procedures on animals carried out at (a) Porton Down and (b) elsewhere, have resulted in the deaths of (i) rodents, (ii) pigs and (iii) monkeys and apes in each of the last five years; and what estimate he has made of these figures for each of the next five years; [17617]
  172
  (3) what is his estimate of the numbers of procedures on animals carried out at (a) Porton Down and (b) elsewhere, that will result in the deaths of animals in each of the next 10 years. [17619]

  Mr. Spellar
  [holding answer 25 November 1997]: This is a matter for the Chief Executive of the Defence Evaluation and Research Agency (DERA). I have asked the Chief Executive to write to my hon. Friend.

  Letter from John Chisholm to Mr. Paul Flynn, dated 2 December 1997:
  I have been asked to reply to your three recent questions requesting information on the numbers of procedures on animals carried out at Porton Down and elsewhere which result in the death of the animals. I am answering all three questions in this letter.
  You asked how many procedures resulting in the death of animals are likely to take place in the next ten years. It is not possible to predict the number of such procedures as the size of the programme is based on MOD's research requirements which are reassessed on a yearly basis. However, as Chief Executive of the Defence Evaluation and Research Agency (DERA) which carries out most of this work, I can predict that procedures on animals may well increase in the short term as DERA scientists at Porton Down are involved in a continuing programme to develop more effective protection against biological weapons.
  You also requested the numbers of procedures which have resulted in the deaths of rodents, pigs and monkeys for the past five years. The number of procedures involving these species carried out by DERA at Porton Down, which undertakes most of this work for the MOD, during each of the last five years are listed in the table below.

  Year

  Rodents

  Pigs

  Monkeys

  1992

  3,791

  132

  72

  1993

  5,976

  109

  36

  1994

  6,844

  102

  17

  1995

  8,112

  48

  17

  1996

  10,129

  48

  14

  Information on the number of procedures resulting in the deaths of such animals as a result of research conducted elsewhere is not held centrally and could only be provided at disproportionate cost.
  It is not possible to predict the numbers of deaths for the next five years for the reason given above.

  173
  All animals are disposed of humanely using an approved method under Schedule I of the Animals (Scientific Procedures) Act 1986 at the end of procedures in accordance with the specific Home Office licences.
  Your third question asked about procedures on animals undertaken on behalf of other countries, including EU countries during the last five years. DERA has not undertaken any research projects on behalf of other countries in the last five years which have involved the use of animals.
  DERA does, however, take part in collaborative research programmes which involve a sharing of data from experiments.. This can prevent the duplication of experiments and may well help reduce the numbers of animals used in defence research.
  I hope this is helpful.

  Mr. Baker
  To ask the Secretary of State for Defence how many animals were used in experiments carried out at Porton Down in each year since 1967(a) in total, (b) by species and (c) by category of experiments. [17919]

  Guinea

  Non-human

  Year

  Dog

  Pig

  Hamster

  Horse

  Mouse

  Pig

  Rabbit

  Rat

  Goat

  Sheep

  Cattle

  Chick

  primate

  1Other

  Total

  1980

  49

  8,012

  0

  0

  5,318

  74

  469

  3,619

  0

  28

  0

  0

  199

  3

  17,771

  1981

  90

  7,078

  0

  0

  7,916

  90

  207

  1,670

  0

  20

  0

  0

  137

  15

  17,223

  1982

  193

  7,718

  0

  0

  3,783

  71

  204

  1,107

  0

  28

  0

  0

  145

  181

  13,430

  1983

  167

  6,488

  0

  0

  952

  75

  135

  1,249

  0

  71

  0

  0

  186

  148

  9,471

  1984

  99

  4,833

  0

  0

  2,530

  93

  172

  2,529

  0

  100

  0

  0

  277

  274

  10,907

  1985

  57

  2,007

  0

  0

  2,098

  55

  186

  1,760

  0

  105

  0

  0

  269

  40

  6,577

  1986

  31

  598

  0

  0

  1,461

  40

  282

  3,690

  0

  47

  0

  0

  249

  0

  6,398

  1987

  8

  393

  0

  7

  1,719

  25

  239

  5,602

  0

  186

  0

  0

  117

  11

  8,307

  1988

  0

  1,024

  0

  1

  962

  11

  194

  5,681

  0

  87

  1

  0

  164

  6

  8,131

  1989

  4

  804

  0

  0

  1,570

  54

  151

  6,275

  0

  92

  1

  0

  64

  2

  9,017

  1990

  0

  670

  0

  50

  2,070

  86

  126

  4,827

  70

  113

  0

  1

  80

  0

  8,093

  1991

  0

  306

  0

  46

  1,148

  102

  133

  4,190

  0

  120

  1

  2

  31

  0

  6,079

  1992

  0

  231

  0

  44

  1,319

  132

  132

  2,472

  0

  105

  0

  1

  72

  0

  4,506

  1993

  0

  354

  0

  16

  3,069

  109

  136

  2,907

  0

  70

  0

  0

  36

  0

  6,697

  1994

  0

  364

  0

  0

  4,946

  102

  16

  1,898

  0

  73

  0

  0

  17

  0

  7,416

  1995

  0

  495

  0

  0

  6,706

  48

  39

  1,406

  0

  36

  0

  0

  17

  0

  8,747

  1996

  0

  792

  42

  0

  7,701

  48

  19

  2,428

  0

  53

  0

  0

  14

  0

  11,097

  1 Includes animals not normally returned as species, e.g. ferrets and gerbils.

  Note:

  Numbers of procedures carried out on animals from 1980 to 1996, by species and year, as returned to the Home Office by CBD Sector.

  The current legislative requirements governing the use of animals in scientific experiments, the Animals (Scientific Procedures) Act, came into effect in 1986. Prior to this date all non-human primates were returned to the Home Office as "monkeys". Therefore, for the period 1986–96, we have incorporated the figures for Rhesus monkeys and marmosets into "non-human primates" for comparative purposes.
  As far as the categories of experiments are concerned, it is the auspices of this Act that the categories are defined on individual project licences; prior to 1986 they were classified in a different manner. The Home Office does not require the numbers of procedures returned annually to be related to the categories stated on individual project licences. We do not, therefore, have these figures readily available and this information could only be provided at disproportionate cost.
  I hope that the information we have been able to provide is helpful.

  Mr. Baker
  To ask the Secretary of State for Defence what factors underlie the increase in the numbers of animal experiments carried out at Porton Down between 1992 to 1997; and if he will make it his policy to review the range of experiments undertaken with a view to reducing their number [17921]
  174
  Mr. Spellar
  [holding answer 28 November 1997]: This is a matter for the Chief Executive of the Defence Evaluation and Research Agency (DERA). I have asked the Chief Executive to write to the hon. Member.

  Letter from John Chisholm to Mr. Norman Baker, dated 2 December 1997:
  As Chief Executive of the Defence Evaluation and Research Agency which has responsibility for the Chemical and Biological Defence (CBD) Sector at Porton Down, I have been asked to respond to your question about animal experiments.
  CBD Sector has attempted to locate all of the information which you have requested. However, during the period from 1967 to 1980, records on the numbers and species of animals used for experimental work were returned to the Home Office by the individual Home Office project licence holders, and were not collated centrally. The information for this period could, therefore, only be provided at disproportionate cost. We can, however, provide data on the numbers and species of animals involved in experiments from 1980 to 1996, shown in the table below.

  Mr. Spellar
  [holding answer 28 November 1997]I refer the hon. Member to the answer I gave to my hon. Friend the Member for Brent, East (Mr. Livingstone) on 25 November 1997,Official Report, column 500.

  Soviet Navy
  Mr. Gordon Prentice
  To ask the Secretary of State for Defence when trawlers were last used by his Department to track and monitor the former Soviet Navy. [18530]

  Dr. Reid
  The use by the Ministry of Defence of a very limited number of fishing trawlers for specific intelligence gathering operations against the former Soviet Navy ceased in 1973.

  Territorial Army
  Mr. Cox
  To ask the Secretary of State for Defence how many(a) men and (b) women are serving in the Territorial Army. [18168]

  Dr Reid
  As at 1 October 1997(a) 45,867 men and (b) 8,386 women were serving in the TA. The figures exclude 1,394 male and 11 female Non-Regular Permanent Staff (NRPS).
  175
  Ms Walley
  To ask the Secretary of State for Defence how many Territorial Army officers there were in each of the last five years; what is the projected number for 1998; and if he will make a statement. [18364]

  Dr. Reid
  The number, or strength, of Territorial Army (TA) officers, as at 1 April in each of the last five years was as follows:

  1993: 7,272

  1994: 6,903

  1995: 6,459

  1996: 6,173

  1997: 6,131.

  The officer establishment of TA officers planned for 1 April 1998 is 6,825, but the actual strength on that date will depend largely on recruitment and retention factors.

  The Department is currently reviewing the future size and shape of the Regular and Reserve Forces as part of the on-going Strategic Defence Review.

  Armed Forces (Women)
  Mr. Cox
  To ask the Secretary of State for Defence how many women are serving in each of the United Kingdom armed forces. [18578]

  Dr. Reid
  I refer my hon. Friend to the monthly "Tri-Service Personnel Statistics", the most recent edition of which was published on 27 November 1997, a copy of which is in the Library of the House.

  Fast Jets (Servicing)
  Mr. Gordon Prentice
  To ask the Secretary of State for Defence what steps he is taking to ensure that fast jets are serviced according to the highest standards. [18531]

  R Irish (HS FT)

  R Irish (HS PT)

  Battalion

  Establishment

  Strength

  Under-manning

  Establishment

  Strength

  Under-manning

  3 R Irish

  676

  555

  121

  563

  472

  91

  4 R Irish

  631

  516

  115

  510

  427

  83

  5 R Irish

  419

  367

  52

  326

  221

  105

  7 R Irish

  469

  414

  55

  402

  329

  73

  8 R Irish

  407

  365

  42

  320

  291

  29

  9 R Irish

  466

  413

  53

  315

  239

  76

  Total

  3,068

  2,630

  438

  2,436

  1,979

  457

  Figures as at 31 October 1997.

  Royal Yacht
  Mr. Laurence Robertson
  To ask the Secretary of State for Defence what plans he has for Her Majesty's Yacht Britannia. [18394]

  Mr. George Robertson
  I refer the hon. Member to the oral answer I gave my hon. Friend the Member for Greenock and Inverclyde (Mr. Godman) yesterday,Official Report, column 6.

  Low Pay
  Mr. Chidgey
  To ask the Secretary of State for Defence if he will list, by regions defined by the
  176
  Dr. Reid
  The RAF continually reviews its quality control and contracting processes to ensure that all of its aircraft are serviced in ways which meet the exacting quality standards which are required.

  Agencies (Civilian Employees)
  Mr. Hancock
  To ask the Secretary of State for Defence how many civilian employees there are within the(a) defence agencies and (b) defence executive agencies; and what is the projected number of civilian employees over the next three years. [18528]

  Mr. Spellar
  All defence agencies are Next Steps agencies and no distinction is now made between defence agencies and what were one defence executive agencies. At 1 October 1997 some 61,400 permanent and 1,400 casual full-time equivalent civilian personnel worked in defence agencies. This represented 58 per cent. of permanent and 52 per cent. of casual Ministry of Defence civilian personnel at that date. While it is anticipated that there will be a small reduction of about 5 per cent. in the overall number of civilian personnel employed by the Ministry over the next three years (including Defence agencies), no separate estimates are available for defence agencies.

  Royal Irish Regiment
  Mr. Donaldson
  To ask the Secretary of State for Defence what is the current(a) full-time and (b) part-time establishment of the Royal Irish Regiment broken down by battalion; and by how much each battalion is under establishment. [18488]

  Dr. Reid
  The establishment of the 1st Battalion The Royal Irish Regiment is 611, comprising General Service soldiers only. At 31 October it was 136 under establishment.

  The information requested with regard to the six Home Service Battalions is set out in the table.

  boundaries of the regional government offices, the lowest hourly rate paid by his Department to (a) full-time employees, (b) part-time employees, (c) persons employed under personal contract and (d) persons employed by firms undertaking contracted-out services for central government offices, defining the job title in each case. [18117]

  Mr. Spellar
  The information requested in respect of civilian staff is given in the following table. Most staff employed by MOD are paid either London or national rates of pay. The table therefore gives two figures for each of(a), (b) and (c). We do not hold information about the pay of staff employed by companies undertaking contracts for the department.
  177

  London (£)

  National (£)

  (a) Full time1

  4.03

  3.36

  (b) Part time2

  4.59

  3.82

  (c) Personal contract

  3—

  3—

  1 The figures quoted relate to administrative assistants. In London, these are paid a minimum of £8,593 a year (including £736 recruitment and retention allowance) working 41 hours gross; and £7,344 in the national area working 42 hours a week gross.

  2 Annual pay rates used for calculating part-time pay are the same as for full-time staff, but hourly rates are then calculated on net 36 (London) and 37 (national) hours a week as part-timers have no paid lunch break.

  3"Personal contract" is taken here to mean staff on standard fixed term appointments. The minimum pay rates for such staff are the same as for full-time or part-time staff.

  In the case of the Armed Forces, pay is based on recommendations made by the independent Armed Forces Pay Review Body (AFPRB) and published annually. The 1997 Report (Cmnd 3537) is available in the Library of the House. There is no regional variation in the basic pay of the Armed Forces, whose pay is based on daily, not hourly rates.

  General Pinochet
  Mr. Corbyn
  To ask the Secretary of State for Defence what meetings representatives of his Department have had with General Pinochet concerning sales of defence equipment to Chile in the last two years; and if he will make a statement. [17837]

  Mr. Spellar
  [holding answer 26 November 1997]Since 1 May 1997, no representatives of my Department have had meetings with General Pinochet concerning the sale of defence equipment to Chile. I am advised, however, that in December 1996 the then Secretary of State for Defence met General Pinochet during his official visit to Chile.

HEALTH

  Public Appointments
  Mr. Vaz
  To ask the Secretary of State for Health how many public appointments he has made since 1 May; and how many and what Percentage of these(a) receive remuneration and (b) are of (i) Afro-Caribbean and (ii) Asian origin. [16775]

  Mr. Milburn
  My right hon. Friend the Secretary of State for Health has made 435 public appointments since 1 May 1997. Of these, 85 per cent. are remunerated. The information about ethnic origin cannot be provided since to do so would risk identifying individuals without their consent. My right hon. Friend the Chancellor of the Duchy of Lancaster has provided information for all departments in an aggregated form in his reply to my hon. Friend on 28 November 1997,Official Report, column 669.

  Kidderminster Hospital
  Mr. Gill
  To ask the Secretary of State for Health what the catchment area is of Kidderminster hospital; and how many people are within it. [17181]
  178
  Mr. Milburn
  The catchment area of Kidderminster hospital and how many people are within it as reported by the hospital are as follows:

  Population served (approximately)

  Worcestershire

  106,000

  Shropshire

  12,000

  Other:

  South Staffordshire, Dudley, Hereford

  6,000

  Total

  123,000

  Note:

  Figures do not sum due to rounding.

  Source:

  Kidderminster General Hospital.

  Pathology Services (Kent)
  Dr. Ladyman
  To ask the Secretary of State for Health what progress has been made by the Kent and Canterbury Hospitals NHS Trust to achieve Good Laboratory Practice accreditation in respect of pathology services. [17788]

  Mr. Boateng
  We understand from the Kent and Canterbury Hospitals National Health Service Trust that the departments of Haematology and Blood Transfusion, Clinical Biochemistry, Microbiology and Haemophilia applied for Clinical Pathology Accreditation in February 1997. Provisional approval was granted and a formal inspection is scheduled for January 1998. The Trust is also striving towards the attainment of the Good Laboratory Practice (GLP) standard.

  Clinical laboratories generally seek accreditation by Clinical Pathology Accreditation (UK) Limited (CPA) rather than GLP accreditation. The former was developed specifically for clinical laboratories, whereas the latter is much more relevant to laboratories involved in clinical trials work.

  Dr. Ladyman
  To ask the Secretary of State for Health what progress has been made by the Kent and Canterbury Hospitals NHS Trust to address the recommendations of the 1995 report Review of Pathology Services at Kent and Canterbury Hospitals NHS Trust. [17787]

  Mr. Boateng
  We understand from Kent and Canterbury Hospitals National Health Service Trust that the report highlighted a number of specific departmental issues to be addressed:Of the 17 general issues, 12 have been fully implemented, five partially implemented.
  Of the seven Haematology issues, four have been fully implemented and three partially implemented.
  Of the five Chemistry issues, two have been fully implemented and three not implemented (these require further dialogue with neighbouring Trusts).
  Of the six Microbiology issues two have been fully implemented and four not implemented (these require further dialogue with neighbouring Trusts).
  Of the seven Histology issues, two have been fully implemented, four partially implemented and one not implemented (this requires further work by SKHT).

  The overall recommendations (options) were as follows:

  1. The options of doing nothing or of sending the work out to an external agency were rejected by the trust as being impractical and not in the best interests of the trust.

  179
  This was accepted by the trust.

  2. Although refurbishment of the current Pathology facility would be possible we believe that this exercise would only lead to a moderate and intermediate term improvement in Pathology services, at relatively high cost. It is also clear that it would not be possible to perform all those Pathology functions that ought to be carried out on site in the refurbished structure.
  This was not implemented by the trust, as refurbishment was not a cost effective long term solution.

  3. The most appropriate way of improving Pathology services is to plan and construct a new Pathology facility on site. This ensures the provision of an essential service and this development would have the potential of attracting technical and medical staff of the highest calibre. There would also be significant opportunities in marketing Pathology services externally as the development, once established, would be exceptionally competitive.
  This was not implemented by the trust, for reasons outlined under 2, and demonstrated ability to recruit staff at high calibre.

  4. A new development would incorporate the latest technologies in term of automated equipment and robotics, which would significantly reduce day to day costs. This would also enable a full assessment of staff functions and skill mix to be performed.
  This was not implemented by the trust, for reasons outlined under 2 and 3.

  The refurbishment was completed in April 1997. Refurbishment addressed outstanding Health and Safety issues and enabled the Pathology laboratories to apply for Clinical Pathology Accreditation (CPA). CPA was then considered desirable by the local purchaser and became a requirement from April 1998.

  Dr. Ladyman
  To ask the Secretary of State for Health what research has been published by the Pathology Services of the Kent and Canterbury Hospitals NHS Trust, other than the Haemophilia center, since 1995. [17790]

  Mr. Boateng
  We understand from Kent and Canterbury Hospitals National Health Service Trust that Medical and Scientific staff employed by the Trust Pathology Directorate have published in a variety of national and international journals since 1995.

  In addition, presentations at national meetings by staff employed within the Pathology Directorate have been published in abstract form. My hon. Friend is advised to contact the Kent Postgraduate center at Canterbury for a complete list of current and forthcoming publications.

  A full list of the recent publications will also be available in the Trust's Research and Development Annual Report, 1997.

  London Strategic Review
  Mr. Simon Hughes
  To ask the Secretary of State for Health what period for consultation there will be between the publication of the report by the independent advisory panel of the London Strategic Review, and the publication of the Government's response to this report. [17737]

  Mr. Milburn
  We will be announcing details of the publication in due course.

  Worthing and Southlands NHS Trust
  Mr. Peter Bottomley
  To ask the Secretary of State for Health if he will name the non-executives serving the 180
  Worthing and Southlands National Health Service Trust in September and November, listing their occupations; when he intends to announce re-appointments or appointments; and for what reasons he did not make his decisions earlier. [18119]

  Mr. Milburn
  The non-executive members of the board in September were as follows:

  Member

  Occupation

  Mr. Geoffrey Withrington (Chair)

  Managing Director

  Miss Thrine Hely

  Project Manager and Business Consultant

  Mr. Graham Hill

  Former Policeman

  Ms Barbara Myers

  Media Specialist

  Mr. Paul Savage

  Retired Chartered Accountant

  Professor Michael Whiting

  Consultant Chiropodist and University Dean

  The terms of office of Mr. Hely, Ms Myers, Mr. Savage and Professor Whiting came to an end on 31 October. My right hon. Friend the Secretary of State subsequently wrote on 25 November inviting four candidates to serve on the board for terms of three and four years. All four have now accepted the invitations to serve, as a result of which the new board is as follows:

  Member

  Occupation

  Mr. Geoffrey Withrington (Chair)

  Managing Director

  Mr. Graham Hill

  Former Policeman

  Mr. Paul Savage

  Retired Chartered Accountant

  Mrs. Lindy Stannard

  Teacher

  Mrs. Nicola Thompson

  Financial Services Officer

  Professor Michael Whiting

  Consultant Chiropodist and University Dean

  As a consequence of our commitment to introduce new criteria for appointments and to widen the pool of candidates, some appointments have unfortunately been delayed. We recognise the importance of giving serving and newly appointed board members advance notice of appointments and we expect to be able to achieve this in future appointment rounds.

  Anaesthetists
  Mr. Pike
  To ask the Secretary of State for Health what changes are proposed in the regulations governing entry to the Specialist Register for Anaesthetists to conform with the European Specialist Medical Qualifications Order 1995; and if he will make a statement. [17951]

  Mr. Milburn
  Entry to the Specialists Register is governed by the European Specialist Medical Qualifications Order 1995. There are no specific or separate arrangements for Anaesthetists.

  The Government are considering amendments to the Order to introduce greater flexibility in the transitional provisions for assessing doctors for entry to the Specialist Register. The proposed amendments to the Order would apply to all medical specialities.

  Leukaemia
  Mr. McGrady
  To ask the Secretary of State for Health what action the Government plan in response to the report from the Independent Advisory Committee on the Medical Aspects of Radiation concerning the incidence of leukaemia among children whose fathers have been exposed to radiation at work. [17891]

  Ms Jowell
  The study to consider any possible effects on the health of the offspring of parents occupationally exposed to radiation was funded by the Department of Health and the Health and Safety Executive in response to recommendations from the Government's independent advisory Committee on Medical Aspects of Radiation in the Environment (COMARE). The findings of the study were referred to COMARE and their statement has been placed in the Library. COMARE agree with the authors that there is no evidence of a link between radiation dose in parents prior to conception and the incidence of leukaemia or non-Hodgkin Lymphoma in their children. COMARE will reserve further comment until the results of a further study, which is investigating the health of all the children born to workers in a large part of the nuclear industry, is completed. The study is expected to be published early next year.

  The Government are committed to investigating the causes of leukaemia and will continue the programme of radiation protection research and seek guidance from COMARE about the direction of any additional future research. They will also continue to require employers to keep radiation exposures as low as reasonably practicable.

  North and East Devon Health Authority
  Mr. Harvey
  To ask the Secretary of State for Health what plans he has to improve patient care in(a) North and East Devon Health Authority and (b) Northern Devon Healthcare NHS Trust. [18219]

  Mr. Milburn
  It is the responsibility of North and East Devon Health Authority and local National Health Service trusts, including Northern Devon Healthcare NHS Trust, to work together to ensure that the residents of the health authority receive the best possible patient care. Improving the overall quality of patient care will be an underpinning theme of our plans for replacing the internal market, which we shall be publishing shortly.

  New Drugs
  Mr. Kidney
  To ask the Secretary of State for Health what measures he proposes to improve scrutiny of new drugs before their clearance for routine use in the NHS; over what timescale; and if he will make a statement. [18486]

  Mr. Milburn
  We are currently considering these issues.

  NHS Charter
  Dr. Naysmith
  To ask the Secretary of State for Health what progress has been made towards developing a new NHS charter. [18484]

  Mr. Milburn
  We announced on 8 October that Greg Dyke, chairman and chief executive of Pearson Television would lead the work to develop a new National Health 182
  Service Charter. Mr. Dyke met with his team of advisers, drawn from health professions, patient representative and user groups, trade unions, the NHS and other organisations on 10 November. The King's Fund has also been commissioned to undertake some evaluation work on the current Patient's Charter. The plan is to publish a draft Charter next summer.

  Breast Cancer Treatment
  Mr. Stinchcombe
  To ask the Secretary of State for Health what additional funding is being provided for (i) breast specialist units, (ii) oncologists and (iii) breast care nurses in the NHS. [18521]

  Mr. Boateng
  Ten million pounds of additional money is being used specifically on breast services. The extra funding is supporting over 300 initiatives around the country to improve the diagnosis and treatment of breast cancer. Particular emphasis has been given to supporting projects that give rapid access to diagnostic services through the provision of "one stop" clinics, speeding access to treatment by reducing waiting times and the provision of high quality care delivered in line with published guidance by specialist multi-professional, multi-disciplinary teams.

  Low Pay
  Mr. Chidgey
  To ask the Secretary of State for Health if he will list, by regions defined by the boundaries of the regional government offices, the lowest hourly rate paid by his Department to(a) full-time employees, (b) part-time employees, (c) persons employed under personal contract and (d) persons employed by firms undertaking contracted-out services for central government offices, defining the job title in each case. [18114]

  Ms Jowell
  Department of Health staff are paid within national paybands. The minimum of the lowest payband is £8,000 per annum. This represents an hourly rate of £3.74 in London, where staff work 41 hours a week and £3.65 elsewhere, where staff work 42 hours. The figures for part-time staff are £4.26 and £4.14. The Department holds no record of salaries paid to persons employed by firms undertaking contracted-out work, nor is anyone employed under a personal contract.

  Terminally Ill Patients
  Mr. Ashton
  To ask the Secretary of State for Health (1) what estimate he has made of the average number of terminally ill patients in the United Kingdom; [18676]

  (2) what is the average monthly total of patient deaths in hospices; [18678]

  (3) how many hospice beds for terminally ill patients are available in the United Kingdom; [18677]

  (4) what is the average monthly total of deaths of patients on palliative care. [18679]

  Mr. Boateng
  The National Council for Hospice and Specialist Palliative Care Services defines as terminally ill those people"with active and progressive disease for which curative treatment is not possible or not appropriate and from which death can reasonably be expected within twelve months".
  183
  "Ordinary and day case admissions for England" and "Outpatients and ward attenders for England" contain data on Finished Consultant Episodes and Outpatient Attendances under the main specialty function of Palliative medicine. Copies are available in the Library. These data do not include all terminally ill patients as some of these patients may be receiving treatment in a variety of settings, including the voluntary sector, and information is not collected centrally on the number of patients who are terminally ill at any one time.

  There are about 60,000 admissions to hospices and palliative care units in the United Kingdom every year. There are approximately 29,000 deaths in hospice and palliative care units (both voluntary sector and NHS), giving an approximate monthly figure of 2,500 deaths. (Data provided by the Hospice Information Service). Whilst it is possible to give figures for the number of in-patient deaths in the NHS under the care of a palliative care specialist, many other patients who die under the care of the NHS will have received some palliative care. The palliative care approach should inform the care of all NHS patients. The following table shows the number of deaths for patients receiving treatment from a consultant in palliative medicine in the NHS.

  Main specialty—Palliative medicine: Estimated number of episodes ending in death (discharge method = 4) by month of admission, NHS hospitals, England

  1994–95

  1995–961

  April

  212

  241

  May

  219

  279

  June

  226

  259

  July

  161

  247

  August

  205

  279

  September

  228

  279

  October

  188

  273

  November

  212

  275

  December

  237

  298

  January

  256

  303

  February

  196

  268

  March

  218

  273

  Total

  2,559

  3,274

  Notes:

  1These figures are provisional.

  Data in this table are grossed for coverage.

  Source:

  Department of Health, Hospital Episode Statistics (HES).

  According to information from the Hospice Information Service there were 3,134 hospice and palliative care beds (both NHS and voluntary sector) in the United Kingdom in January 1997, of these 595 were in NHS managed units.

  Wheelchairs
  Mr. Vaz
  To ask the Secretary of State for Health what is the current average NHS waiting time for a wheelchair; how many applications for wheelchairs have been made for each NHS trust in the last 10 years; and if he will make a statement. [18304]

  Mr. Boateng
  Information on applications or waiting times for wheelchairs is not collected centrally. Information on the number of wheelchairs issued by individual health authority Wheelchair Services is available in"Wheelchairs and artificial limbs—England", copies of which are available in the Library.

  Personal Social Services
  Mr. Trickett
  To ask the Secretary of State for Health what money is allocated in the Standard Spending Assessment for personal social services for 1998–99. [18866]

  Mr. Dobson
  £7,814.651 million will be distributed by Personal Social Services Standard Spending Assessments in 1998–99, compared with £7,392.117 million in 1997–98. Total Standard Spending on Social Services (including specific and special grants) will be £8,292.969 million in 1998–99, compared with £7,846.030 million in 1997–98 plans; an increase of 5.7 per cent.

  Mr. Trickett
  To ask the Secretary of State for Health what specific and special grants and what capital resources he is making available to local authorities for personal social services in 1998–99. [18867]

  Mr. Dobson
  The information is as follows:

  £ million

  Specific grants will be available in 1998–99 for:

  AIDS and HIV services

  13.7

  Services for alcohol and drugs misusers

  2.5

  Mental illness services

  73.3

  Social services training

  35.5

  A special grant will be available in 1998–99 for:

  Community care services

  350

  Services for unaccompanied asylum seeking children

  3

  The capital grant for secure accommodation for young people will be £8.2 million in 1998–99.

  Annual capital guidelines of £45 million will be notified to local authorities. Supplementary credit approvals will again be available for mental illness services (£11.6 million) and AIDS/HIV services (£3.1 million).

  Special Transitional Grant
  Mr. Trickett
  To ask the Secretary of State for Health what plans he has for the special transitional grant in 1998–99. [18868]

  Mr. Dobson
  There will be a Special Transitional Grant of £350 million in 1998–99 for community care services. Unlike previous years, councils will not be required to spend 85 per cent. of the grant in the independent sector. It will, however, have a condition requiring local authorities to work closely with the National Health Service and to spend a part of the money on preventing people being unnecessarily in hospital, or being unnecessarily in residential or nursing home care following discharge from hospital.

  Departmental Report
  Mr. Simon Hughes
  To ask the Secretary of State for Health if he will update table 2.1 of his departmental report. [18626]
  185
  Mr. Milburn
  Table 2.1 will be updated in the next Department of Health Departmental Report. Such information as is currently available will be placed in the Library.

SOCIAL SECURITY

  Independent Tribunal Service (Wales)
  Mr. Alan Williams
  To ask the Secretary of State for Social Security what is the current waiting period for a hearing with the independent tribunal service in Wales; what plans she has to reduce waiting times; and if she will make a statement. [13765]

  Mr. Keith Bradley
  Appeals to Social Security Tribunals in Wales which were cleared in the first quarter of this year took on average 28.7 weeks to clear in the first quarter of this year took an average 28.7 weeks to clear. The comparable figure for Great Britain is 29.9 weeks.

  We are determined to reduce the current delays and complexity in the appeals system. On 9 July we introduced the Social Security Bill, which paves the way for the creation of an active modern Social Security system. The Bill includes several measures which will enable us to provide a quicker, simpler and more efficient appeals service for customers.

  My right hon. Friend the Secretary of State will take personal responsibility for the administration of the appeals system, set and publish demanding targets to shorten the time it takes for appeals to be heard and report on the results.

  Supported Housing
  Mr. Burstow
  To ask the Secretary of State for Social Security (1) pursuant to her answer of 10 November 1997,Official Report, column 456, what assessment she has made of partial capacity benefit as a means of assisting disabled people to gain employment; [16359]

  (2) pursuant to her oral Answer to the hon. Member for Roxburgh and Berwickshire (Mr. Kirkwood) of 17 November 1997, Official Report, columns 2–3, what assessment her Department has made of the role which a partial capacity benefit could play in the New Deal for disabled people. [17540]

  Mr. Denham
  The Government's view is that work is the best form of welfare. Many people with disabilities or long-term health problems want to do some work and the aim of the Welfare to Work programme for sick and disabled people is to allow them to do so. We wish to develop ways to give sick and disabled people the advice, help and support they need to achieve their aspirations and to move towards financial independence.

  As part of our welfare to work proposals, which will improve opportunities for sick and disabled people, we are also considering what changes might be made to the benefit system to improve work incentives and reduce disincentives.

  Benefits
  Mr. Duncan Smith
  To ask the Secretary of State for Social (1) what measures she proposes to take account of 186
  the gap between recent rises in benefits and the current rate of inflation; and what will be the source of any increase in funding; [16725]

  (2) what will be the impact on Government spending plans of the increase in her Department's expenditure arising from increases in inflation since 1 May. [16729]

  Mr. Field
  I refer to the hon. Member to the reply I gave the hon. Member for Gordon (Mr. Bruce) on 5 November 1997,Official Report, column 247.

  Mr. Truswell
  To ask the Secretary of State for Social Security if she will set out the new rates of benefit proposed from April 1998. [19161]

  Ms Harman
  I have reviewed Social Security benefits in accordance with section 150 of the Administration Act 1992. My proposals for the revised rates of benefit are set out in the schedule. The new rates will take effect in week beginning 6 April 1998.

  The statutory instruments to implement the changes will be laid before both Houses for debate in the new year.

  My right hon. Friend the Secretary of State for Northern Ireland proposes to introduce similar changes for Northern Ireland.

  National Insurance benefits will be uprated in line with the annual increase in the Retail Prices Index (RPI) up to September, which this year is 3.6 per cent.

  Jobseeker's allowance and income-related benefits will generally rise by 2.4 per cent. in line with the increase in the Rossi index. The Rossi index is RPI less certain housing costs.

  The total cost of uprating for 1998–99 will be £2.45 billion.

  The key points of my review are as follows:

  Retirement pension
  The basic rate of retirement pension will be increased by £2.25 to £64.70 for a single person and by £3.60 to £103.40 for couples.

  Child benefit
  The rate for the eldest child will be increased to £11.45. The rate for each subsequent child is increased to £9.30.

  Income support
  The couple rate of income support for those aged 80 and over will increase by £2.75 to £117.90.

  War pensions
  War pensions will be increased in line with the RPI.

  Earnings top-up
  Benefit rates for the pilot Earnings top-up scheme will be increased by the Rossi index.

  Benefits for lone parents
  The higher rate for lone parents in child benefit will be £17.10, and the higher rates of family premium in income support and jobseeker's allowance will be £15.75 and in housing benefit and council tax benefit will be £22.05.

  Non-dependent deductions
  New rates of deduction in respect of non-dependents living in the household are shown in the schedule. The rate of deduction for housing benefit, income support and income based jobseeker's allowance in respect of those not in work, or with gross income below £78, remains unchanged.
  187
  Protecting benefits from inflation underlines our commitment to the elderly and the most vulnerable in society.

  Schedule of main proposed Social Security Benefit Rates—April 1998 (Weekly rates unless otherwise shown)

  Old rates 1997

  New rates 1998

  Attendance Allowance

  higher rate

  49.50

  51.30

  lower rate

  33.10

  34.30

  Child Benefit

  —only, elder or eldest for whom child benefit is payable (couple)

  11.05

  11.45

  —only, elder or eldest for whom child benefit is payable (lone parent)

  17.10

  17.10

  —each subsequent child

  9.00

  9.30

  Child's Special Allowance

  see note on Child Dependency Increase

  11.20

  11.30

  Council Tax Benefit Personal allowances

  single

  18 to 24

  38.90

  39.85

  25 or over

  49.15

  50.35

  lone parent—18 or over

  49.15

  50.35

  couple—one or both over 18

  77.15

  79.00

  Dependent Children

  birth to September following 11th birthday

  16.90

  17.30

  from September following 1lth birthday to September following 16th birthday

  24.75

  25.35

  from September following 16th birthday to day before 19th birthday

  29.60

  30.30

  Premiums

  family

  10.80

  11.05

  family (lone parent rate)

  22.05

  22.05

  pensioner

  single

  19.65

  20.10

  couple

  29.65

  30.35

  pensioner (enhanced)

  single

  21.85

  22.35

  couple

  32.75

  33.55

  pensioner (higher)

  single

  26.55

  27.20

  couple

  38.00

  38.90

  disability

  single

  20.95

  21.45

  couple

  29.90

  30.60

  severe disability

  single

  37.15

  38.50

  couple (one qualifies)

  37.15

  38.50

  couple (both qualify)

  74.30

  77.00

  disabled child

  20.95

  21.45

  carer

  13.35

  13.65

  Allowance for personal expenses for claimants in hospital

  higher rate

  15.60

  16.20

  lower rate

  12.50

  12.95

  Non-dependant deductions aged 18 or over and in remunerative work

  —gross income: £250 or more

  4.00

  6.00

  —gross income: £200–£249.99

  3.50

  5.00

  —gross income: £116–£199.99

  3.00

  4.00

  —gross income less than £116

  1.50

  2.00

  others, aged 18 or over

  1.50

  2.00

  188

  Schedule of main proposed Social Security Benefit Rates—April 1998 (Weekly rates unless otherwise shown)

  Old rates 1997

  New rates 1998

  Alternative maximum Council Tax Benefit

  second adult on Income Support or income based Jobseeker's Allowance second adult's gross income:

  25 per cent. of Council Tax

  —under £116

  15 per cent. of Council Tax

  —£116 to £151.99

  7.5 per cent. of Council Tax

  Capital

  upper limit

  16,000.00

  16,000.00

  amount disregarded

  3,000.00

  3,000.00

  child's limit

  3,000.00

  3,000.00

  upper limit for permanent resident of RC/NH

  16,000.00

  16,000.00

  amount disregarded for permanent resident of RC/NH

  10,000.00

  10,000.00

  Tariff income

  £1 for every complete £250 or part thereof between amount of capital disregarded and capital upper limit

  Earnings disregards

  where disability premium awarded

  15.00

  15.00

  various specified employments

  15.00

  15.00

  lone parent

  25.00

  25.00

  where the claimant has a partner

  10.00

  10.00

  single claimant

  5.00

  5.00

  where carer premium awarded

  15.00

  15.00

  childcare charges

  60.00

  60.00

  Other income disregards

  maintenance disregard

  15.00

  15.00

  war disablement pension and war widow's pension

  10.00

  10.00

  certain voluntary and charitable payments

  20.00

  20.00

  student loan

  10.00

  10.00

  student's covenanted income

  5.00

  5.00

  income from boarders:

  —

  —

  disregard the fixed amount (£20) plus

  —

  —

  50 per cent. of the balance of the charge

  20.00

  20.00

  30 Hour Adult Allowance in DWA

  10.55

  10.80

  30 Hour Adult Credit in FC

  10.55

  10.80

  Expenses for subtenants

  furnished or unfurnished

  4.00

  4.00

  where heating is included, additional

  9.25

  9.25

  Dependency Increases

  Adult Dependency Increases For spouse or person looking after children, with; retirement pension on own insurance, long term incapacity benefit, unemployability supplement

  37.35

  38.70

  Severe Disablement allowance

  22.40

  23.20

  invalid care allowance

  22.35

  23.15

  short-term incapacity benefit if beneficiary over pension age

  35.90

  37.20

  maternity allowance/short-term incapacity benefit

  29.15

  30.20

  Child Dependency Increases, with; short-term incapacity benefit at the higher rate and long—term incapacity benefit, invalid care allowance severe disability allowance, higher rate industrial death benefit, unemployability supplement and short—term incapacity benefit if beneficiary over pension age

  11.20

  11.30

  The Overlapping Benefits Regulations provide for the rate of child dependency increases, guardian's allowance and child special allowance to be adjusted where the increase or allowance is payable for the eldest eligible child for whom child benefit is also payable. The weekly rate of the increase or allowance is reduced by the differential (less the 75p derived from the October 1991 increase in child benefit) between the rate

  189

  Schedule of main proposed Social Security Benefit Rates—April 1998 ( Weekly rates unless otherwise shown)

  Old rates 1997

  New rates 1998

  of child benefit payable for the oldest eligible child and that payable for a subsequent child.

  Disability Living Allowance Care Component

  Highest

  49.50

  51.30

  Middle

  33.10

  34.30

  Lowest

  13.15

  13.60

  Mobility Component

  Higher

  34.60

  35.85

  Lower

  13.15

  13.60

  Disability Working Allowance Adult allowance

  Single people

  49.55

  50.75

  Couples/Lone Parents

  77.55

  79.40

  30 hours Allowance

  10.55

  10.80

  Child allowance

  from birth

  12.05

  12.35

  from September following 11 th birthday

  19.95

  20.45

  from September following 16th birthday

  24.80

  25.40

  Child allowance for children with protected rates

  age 11 before 7th October 1997

  19.95

  20.45

  age 16 before 7th October 1997

  24.80

  25.40

  age 18 before 7th October 1997

  34.70

  35.55

  Applicable amount (i.e. taper threshold)

  Single People

  57.85

  59.25

  Couples/Lone Parents

  77.15

  79.00

  Disabled Child's Allowance

  20.95

  21.45

  Capital

  upper limit

  16,000.00

  16,000.00

  amount disregarded

  3,000.00

  3,000.00

  child's limit

  3,000.00

  3,000.00

  Tariff income

  £1 for every complete £250 or part thereof between amount of capital disregarded and capital upper limit

  Disregards

  maintenance disregard

  15.00

  15.00

  war disablement pension and war widow's pension

  10.00

  10.00

  certain voluntary and charitable

  payments

  20.00

  20.00

  student loan

  10.00

  10.00

  student's covenanted income

  5.00

  5.00

  income from boarders:

  disregard the fixed amount (£20)

  plus 50 per cent, of the balance of the charge

  20.00

  20.00

  childcare charges

  60.00

  60.00

  Expenses for subtenants

  furnished or unfurnished

  4.00

  4.00

  where heating is included, additional

  9.25

  9.25

  Earnings Rules

  Invalid Care Allowance

  50.00

  50.00

  Therapeutic earnings limit

  46.50

  48.00

  Industrial injuries unemployability

  supplement permitted earnings level (annual amount)

  2,418.00

  2,496.00

  War pensioners' unemployability supplement permitted earnings level (annual amount)

  2,418.00

  2,496.00

  190

  Schedule of main proposed Social Security Benefit Rates—April 1998 (Weekly rates unless otherwise shown)

  Old rates 1997

  New rates 1998

  Adult dependency increases with short-term incapacity benefit where claimant is

  (a) under pension age

  29.15

  30.20

  (b) over pension age

  35.90

  37.20

  maternity allowance

  29.15

  30.20

  retirement pension, long-term incapacity benefit, Severe Disablement Allowance, unemployability supplement where dependent

  (a) is living with claimant

  49.15

  50.35

  (b) still qualifies for the tapered earnings rule

  45.09

  45.09

  retirement pension, long-tem incapacity benefit and unemployability supplement where dependant not living with claimant severe disablement allowance where dependant not living with claimant

  37.35

  38.70

  severe desablement allowance where dependant not living with claimant

  22.40

  23.20

  invalid care allowance

  22.35

  23.15

  Child dependency increases

  level at which CDIs are affected by earnings of claimant's spouse or partner for first child

  135.00

  140.00

  for each subsequent child

  17.00

  18.00

  Family Credit

  Adult credit

  47.65

  47.65

  30 hours credit

  10.55

  10.80

  Child credits

  from birth

  12.05

  12.35

  from September following 11th birthday

  19.95

  20.45

  from September following 16th birthday

  24.80

  25.40

  Child credits for children with protected rates

  age 11 before 7th October 1997

  19.95

  20.45

  age 16 before 7th October 1997

  24.80

  25.40

  age 18 before 7th October 1997

  34.70

  35.55

  Applicable amount (i.e: threshold)

  77.15

  79.00

  Capital

  upper limit

  8,000.00

  8,000.00

  amount disregarded

  3,000.00

  3,000.00

  Child's limit

  3,000.00

  3,000.00

  Assumed income from capital

  £1 for every £250 or part of £250 between amount of capital disregarded and capital upper limit

  Disregards

  maintenance disregard

  15.00

  15.00

  war disablement pension and war widow's pension

  10.00

  10.00

  certain voluntary and charitable

  payments

  20.00

  20.00

  student loan

  10.00

  10.00

  student's covenanted income

  5.00

  5.00

  income from boarders: disregard the fixed amount (£20) plus 50 per cent. of the balance of the charge

  20.00

  20.00

  childcare charges

  60.00

  60.00

  Expenses for subtenants

  furnished or unfurnished

  4.00

  4.00

  where heating is included, additional

  9.25

  9.25

  Guardian's Allowance

  11.20

  11.30

  see note on Child Dependency Increase

  191

  Schedule of main proposed Social Security Benefit Rates—April 1998 (Weekly rates unless otherwise shown)

  Old rates 1997

  New rates 1998

  Hospital Downrating

  20 per cent. rate

  12.50

  12.95

  40 per cent. rate

  25.00

  25.90

  Housing benefit

  Personal allowances

  single

  16 to 24

  38.90

  39.85

  25 or over

  49.15

  50.35

  lone parent

  under 18

  38.90

  39.85

  18 or over

  49.15

  50.35

  couple

  both under 18

  58.70

  60.10

  one or both over 18

  77.15

  79.00

  Dependent children

  birth to September following 11th birthday

  16.90

  17.30

  from September following 11th birthday to September following 16th birthday

  24.75

  25.35

  from September following 16th birthday to day before 19th birthday

  29.60

  30.30

  dependent children with protected rates age 18 before 1st/7th April 1997

  38.90

  39.85

  Premiums

  family

  10.80

  11.05

  family (lone parent rate)

  22.05

  22.05

  pensioner

  single

  19.65

  20.10

  couple

  29.65

  30.35

  pensioner (enhanced)

  single

  21.85

  22.35

  couple

  32.75

  33.55

  pensioner (higher)

  single

  26.55

  27.20

  couple

  38.00

  38.90

  disability

  single

  20.95

  21.45

  couple

  29.90

  30.60

  severe disability

  single

  37.15

  38.50

  couple (one qualifies)

  37.15

  38.50

  couple (both qualify)

  74.30

  77.00

  disabled child

  20.95

  21.45

  carer

  13.35

  13.65

  Allowance for personal expenses for claimants in hospital

  higher rate

  15.60

  16.20

  lower rate

  12.50

  12.95

  Non-dependant deductions rent rebates and allowances

  aged 25 and over, in receipt of Income Support or income based job Seeker's Allowance

  192

  Schedule of main proposed Social Security Benefit Rates—April 1998 (Weekly rates unless otherwise shown)

  Old rates 1997

  New rates 1998

  aged 18 or over, not in remunerative work or

  —gross income less than £78

  7.00

  7.00

  aged 18 or over and in remunerative work

  —gross income: less than £78

  7.00

  7.00

  —gross income: £78 to £115.99

  13.00

  16.00

  —gross income: £116 to £151.99

  17.00

  22.00

  —gross income: £152 to £199.99

  33.00

  36.00

  —gross income: £200.00 to £249.99

  36.00

  41.00

  —gross income: £250.00 and above

  39.00

  45.00

  Service charges for fuel

  heating

  9.25

  9.25

  hot water

  1.15

  1.15

  lighting

  0.80

  0.80

  cooking

  1.15

  1.15

  Amount ineligible for meals three or more meals a day single claimant

  17.55

  17.95

  each person in family aged 16 or over

  17.55

  17.95

  each child under 16

  8.85

  9.05

  less than three meals a day single claimant

  11.65

  11.95

  each person in family aged 16 or over

  11.65

  11.95

  each child under 16

  5.85

  6.00

  breakfast only—claimant and each member of family

  2.10

  2.15

  Capital

  upper limit

  16,000.00

  16,000.00

  amount disregarded

  3,000.00

  3,000.00

  child's limit

  3,000.00

  3,000.00

  upper limit for permanent resident of RC/NH

  16,000.00

  16,000.00

  amount disregarded for permanent resident of RC/NH

  10,000.00

  10,000.00

  Tariff income

  £1 for every complete £250 or part thereof between amount of capital disregarded and capital upper limit

  Earnings disregards

  where disability premium awarded

  15.00

  15.00

  various specified employments

  15.00

  15.00

  lone parent

  25.00

  25.00

  where the claimant has a partner

  10.00

  10.00

  single claimant

  5.00

  5.00

  where carer premium awarded

  15.00

  15.00

  childcare charges

  60.00

  60.00

  Other income disregards

  maintenance disregard

  15.00

  15.00

  war disablement pension and war widow's pension

  10.00

  10.00

  certain voluntary and charitable payments

  20.00

  20.00

  student loan

  10.00

  10.00

  student's covenanted income

  5.00

  5.00

  income from boarders:

  disregard the fixed amount (£20) plus

  50 per cent. of the balance of the charge

  20.00

  20.00

  30 hour. adult allowance in DWA

  10.55

  10.80

  30 hour. adult credit in FC

  10.55

  10.80

  Expenses for subtenants

  furnished or unfumished

  4.00

  4.00

  where heating is included, additional

  9.25

  9.25

  193

  Schedule of main proposed Social Security Benefit Rates—April 1998 (Weekly rates unless otherwise shown)

  Old rates 1997

  New rates 1998

  Incapacity Benefit

  Long-term incapacity benefit

  62.45

  64.70

  Short-term incapacity benefit (under pension age)

  lower rate

  47.10

  48.80

  higher rate

  55.70

  57.70

  Short-term incapacity benefit (over pension age)

  lower & higher rate

  59.90

  62.05

  Increase of long-term incapacity

  benefit for age

  higher rate

  13.15

  13.60

  lower rate

  6.60

  6.80

  Invalidity Allowance (Transitional)

  higher rate

  13.15

  13.60

  middle rate

  8.30

  8.60

  lower rate

  4.15

  4.30

  Income Support

  Personal Allowances

  single

  under 18—usual rate

  29.60

  30.30

  under 18—higher rate payable in specific circumstances

  38.90

  39.85

  18 to 24

  38.90

  39.85

  25 or over

  49.15

  50.35

  lone parent

  under 18—usual rate

  29.60

  30.30

  under 18—higher rate payable in specific circumstances

  38.90

  39.85

  18 or over

  49.15

  50.35

  couple

  both under 18

  58.70

  60.10

  one or both 18 or over

  77.15

  79.00

  dependent children

  birth to September following 11th birthday

  16.90

  17.30

  from September following 11th birthday to September

  following 16th birthday

  24.75

  25.35

  from September following 16th birthday to day before 19th birthday

  29.60

  30.30

  Residential Allowance

  except Greater London

  56.00

  57.50

  Greater London

  62.00

  64.00

  Premiums

  family

  10.80

  11.05

  family (lone parent rate)

  15.75

  15.75

  pensioner

  single

  19.65

  20.10

  couple

  29.65

  30.35

  pensioner (enhanced)

  single

  21.85

  22.35

  couple

  32.75

  33.55

  pensioner (higher)

  single

  26.55

  27.20

  couple

  38.00

  38.90

  disability

  single

  20.95

  21.45

  couple

  29.90

  30.60

  severe disability

  single

  37.15

  38.50

  couple (one qualifies)

  37.15

  38.50

  couple (both qualify)

  74.30

  77.00

  disabled child

  20.95

  21.45

  carer

  13.35

  13.65

  194

  Schedule of main proposed Social Security Benefit Rates — April 1998 Weekly rates unless otherwise shown)

  Old rates 1997

  New rates 1998

  Maximum amounts for accommodation and meals in residential care homes old age

  208.00

  213.00

  very dependent elderly

  240.00

  247.00

  mental disorder (not handicap)

  220.00

  225.00

  drug/alcohol dependence

  220.00

  225.00

  mental handicap

  250.00

  257.00

  physical disablement

  (a) (under pension age)

  285.00

  292.00

  (b) (over pension age)

  208.00

  213.00

  others

  208.00

  213.00

  maximum Greater London increase

  41.00

  44.00

  nursing homes

  mental disorder (not handicap)

  312.00

  319.00

  drug/alcohol dependence

  312.00

  319.00

  mental handicap

  318.00

  325.00

  terminal illness

  311.00

  318.00

  physical disablement

  (a) (under pension age)

  352.00

  359.00

  (b) (over pension age)

  311.00

  318.00

  others (including elderly)

  311.00

  318.00

  maximum Greater London increase

  46.00

  49.00

  Amounts for meals where these cannot be purchased within the accommodation (Daily Rate)

  breakfast

  1.10

  1.10

  midday meal

  1.55

  1.55

  evening meal

  1.55

  1.55

  Allowances for personal expenses for claimants in

  private and voluntary residential care and nursing homes

  personal expenses

  14.10

  14.45

  dependent children

  (a) under 11

  5.80

  5.95

  (b) 11 to 15

  8.45

  8.65

  (c) 16 to 17

  9.80

  10.05

  (d) age 18

  14.10

  14.45

  hospital

  higher rate

  15.60

  16.20

  lower rate

  12.50

  12.95

  local authority (Pt III)

  accommodation

  62.45

  64.70

  of which, personal expenses

  14.10

  14.45

  Allowances for personal expenses for claimants in:

  the Polish home Ilford Park maximum amount for accommodation and meals

  352.00

  359.00

  personal expenses for claimant

  17.35

  17.35

  personal expenses for partner

  17.35

  17.35

  personal expenses for dependent children

  (a) under 11

  5.80

  5.95

  (b) 11 to 15

  8.45

  8.65

  (c) 16 to 17

  9.80

  10.05

  (d)18

  15.55

  15.55

  Housing costs deduction for non-dependants: aged 25 and over, in receipt of income support

  aged 18 or over, not in work or —gross income less than £78

  7.00

  7.00

  aged 18 or over and in remunerative work:

  —gross income: £78 to £115.99

  13.00

  16.00

  —gross income: £116 to £151.99

  17.00

  22.00

  —gross income: £152 to £199.99

  33.00

  36.00

  —gross income: £200.00 to £249.99

  33.00

  41.00

  —gross income: £250.00 and above

  33.00

  45.00

  195

  Schedule of main proposed Social Security Benefit Rates—April 1998 (Weekly rates unless otherwise shown)

  Old rates 1997

  New rates 1998

  Deduction for direct payments arrears of housing, fuel and water costs

  council tax and fines default, and

  2.50

  2.55

  deductions for child maintenance (standard)

  5.00

  5.10

  deductions for child maintenance (lower)

  2.50

  2.55

  Arrears of Community Charge

  court order against claimant

  2.50

  2.55

  court order against couple

  3.90

  3.95

  Maximum rates for recovery of over payments

  ordinary overpayments

  7.50

  7.65

  where claimant convicted of fraud

  10.00

  10.00

  Reduction in benefit for strikers

  26.50

  27.00

  Capital

  upper limit

  8,000.00

  8,000.00

  amount disregarded

  3,000.00

  3,000.00

  child's limit

  3,000.00

  3,000.00

  upper limit for permanent resident of RC/NH

  16,000.00

  16,000.00

  amount disregarded for permanent resident of RC/NH

  10,000.00

  10,000.00

  Tariff income

  £1 for every complete £250 or part thereof between amount of capital disregarded and capital upper limit

  Disregards

  standard earnings

  5.00

  5.00

  couples' earnings

  10.00

  10.00

  higher earnings

  15.00

  15.00

  war disablement pension and war widow's pension

  10.00

  10.00

  voluntary and charitable payments

  20.00

  20.00

  student loan

  10.00

  10.00

  student's covenanted income

  5.00

  5.00

  income from boarders: disregard the fixed amount (£20) plus 50 per cent. of the balance of the charge

  20.00

  20.00

  Expenses for subtenants

  furnished or unfurnished

  4.00

  4.00

  where heating is included, additional

  9.25

  9.25

  Industrial Death Benefit

  Widow's pension

  higher rate

  62.45

  64.70

  lower rate

  18.74

  19.41

  Industrial Disablement Pension

  18 and over, or under 18 with dependants

  100 per cent.

  101.10

  104.70

  90 per cent.

  90.99

  94.23

  80 per cent.

  80.88

  83.76

  70 per cent.

  70.77

  73.29

  60 per cent.

  60.66

  62.82

  50 per cent.

  50.55

  52.35

  40 per cent.

  40.44

  41.88

  30 per cent.

  30.33

  31.41

  20 per cent.

  20.22

  20.94

  Under 18

  100 per cent.

  61.90

  64.15

  90 per cent.

  55.71

  57.74

  80 per cent.

  49.52

  51.32

  70 per cent.

  43.33

  44.91

  60 per cent.

  37.14

  38.49

  50 per cent.

  30.95

  32.08

  40 per cent.

  24.76

  25.66

  30 per cent.

  18.57

  19.25

  20 per cent.

  12.38

  12.83

  196

  Schedule of main proposed Social Security Benefit Rates—April 1998 (Weekly rates unless otherwise shown)

  Old rates 1997

  New rates 1998

  Maximum life gratuity (lump sum)

  6,720.00

  6,960.00

  Unemployability Supplement

  62.45

  64.70

  plus where appropriate an increase for early incapacity

  higher rate

  13.15

  13.60

  middle rate

  8.30

  8.60

  lower rate

  4.15

  4.30

  Maximum reduced earnings allowance

  40.44

  41.88

  Maximum retirement allowance

  10.11

  10.47

  Constant attendance allowance

  exceptional rate

  81.00

  84.00

  intermediate rate

  60.75

  63.00

  normal maximum rate

  40.50

  42.00

  part-time rate

  20.25

  21.00

  Exceptionally severe disablement allowance

  40.50

  42.00

  Invalid Care Allowance

  37.35

  38.70

  Jobseekers Allowance

  Contribution based JSA—rates

  under 18

  29.60

  30.30

  18 to 24

  38.90

  39.85

  25 or over

  49.15

  50.35

  Income-based JSA—personal allowances

  under 18

  29.60

  30.30

  18 to 24

  38.90

  39.85

  25 or over

  49.15

  50.35

  lone parent

  under 18—usual rate

  29.60

  30.30

  under 18—higher rate payable in specific circumstances

  38.90

  39.85

  18 or over

  49.15

  50.35

  couple

  both under 18

  29.60

  30.30

  both under 18, one disabled

  38.90

  39.85

  both under 18, with responsibility for a child

  58.70

  60.10

  one under 18, one 18–24

  38.90

  39.85

  one under 18, one 25+

  49.15

  50.35

  both 18 or over

  77.15

  79.00

  dependent children

  birth to September following 11th birthday

  16.90

  17.30

  from September following 11th birthday to September following 16th birthday

  24.75

  25.35

  from September following 16th birthday to day before 19th birthday

  29.60

  30.30

  Residential Allowance

  except Greater London

  56.00

  57.50

  Greater London

  62.00

  64.00

  Premiums

  family

  10.80

  11.05

  family (lone parent rate)

  15.75

  15.75

  pensioner

  single

  19.65

  20.10

  couple

  29.65

  30.35

  pensioner (enhanced)

  couple

  32.75

  33.55

  pensioner (higher)

  single

  26.55

  27.20

  couple

  38.00

  38.90

  disability

  single

  20.95

  21.45

  couple

  29.90

  30.60

  197

  Schedule of main proposed Social Security Benefit Rates—April 1998 (Weekly rates unless otherwise shown)

  Old rates 1997

  New rates 1998

  severe disability

  single

  37.15

  38.50

  couple (one qualifies)

  37.15

  38.50

  couple (both qualify)

  74.30

  77.00

  disabled child

  20.95

  21.45

  carer

  13.35

  13.65

  Maximum amounts for accommodation and meals in residential care homes

  mental disorder (not handicap)

  220.00

  225.00

  drug/alcohol dependence

  220.00

  225.00

  mental handicap

  250.00

  257.00

  physical disablement (a) (under pension age)

  285.00

  292.00

  others

  208.00

  213.00

  maximum Greater London increase

  41.00

  44.00

  nursing homes

  mental disorder (not handicap)

  312.00

  319.00

  drug/alcohol dependence

  312.00

  319.00

  mental handicap

  318.00

  325.00

  terminal illness

  311.00

  318.00

  physical disablement

  (a) (under pension age)

  352.00

  359.00

  others (including elderly)

  311.00

  318.00

  maximum Greater London increase

  46.00

  49.00

  Amounts for meals where these cannot be purchased within the accommodation (Daily Rate)

  breakfast

  1.10

  1.10

  midday meal

  1.55

  1.55

  evening meal

  1.55

  1.55

  Allowances for personal expenses for claimants in

  Private and Voluntary residential care and nursing homes

  personal expenses

  14.10

  14.45

  dependent children

  (a) under 11

  5.80

  5.95

  (b) 11 to 15

  8.45

  8.65

  (c) 16 to 17

  9.80

  10.05

  (d) age 18

  14.10

  14.45

  hospital

  higher rate

  15.60

  16.20

  lower rate

  12.50

  12.95

  local authority (Pt III) accommodation

  62.45

  64.70

  of which, Personal Expenses

  14.10

  14.45

  Housing costs

  deduction for non-dependents: aged 25 and over, in receipt of income support or income based job seekers allowance;

  aged 18 or over, not in remunerative work or

  —gross income: less than £78

  7.00

  7.00

  aged 18 or over and in remunerative work

  —gross income: less than £78.00

  7.00

  7.00

  —gross income: £78 to £115.99

  13.00

  16.00

  —gross income: £116 to £151.99

  17.00

  22.00

  —gross income: £152 to £199.99

  33.00

  36.00

  —gross income: £200.00 to £249.99

  33.00

  41.00

  —gross income: £250.00 and above

  33.00

  45.00

  Deduction for direct payments

  Deductions from JSA (IB)

  arrears of housing, fuel and water costs council tax and fines default, and

  2.50

  2.55

  198

  Schedule of main proposed Social Security Benefit Rates—April 1998 (Weekly rates unless otherwise shown)

  Old rates 1997

  New rates 1998

  Deductions for Child Maintenance deductions for child maintenance (standard)

  5.00

  5.00

  deductions for child maintenance (lower)

  2.50

  2.50

  Arrears of Community Charge

  court order against claimant

  2.50

  2.50

  court order against couple

  3.90

  3.95

  Deductions from JSA (continued)

  Arrears of Community Charge, Council Tax and fines

  Age 16–17

  9.86

  10.10

  Age 18–24

  12.96

  13.28

  Age 25+

  16.38

  16.78

  Maximum deduction for arrears of Child Support Maintenance

  Age 16–17

  9.86

  10.10

  Age 18–24

  12.96

  13.28

  Age 25+

  16.38

  16.78

  Maximum rates for recovery of overpayments

  ordinary overpayments

  7.50

  7.65

  where claimant convicted of fraud

  10.00

  10.00

  Reduction in benefit for strikers

  26.50

  27.00

  Capital

  upper limit

  8,000.00

  8,000.00

  amount disregarded

  3,000.00

  3,000.00

  child's limit

  3,000.00

  3,000.00

  upper limit for permanent resident of RC/NH

  16,000.00

  16,000.00

  amount disregarded for permanent resident of RC/NH

  10,000.00

  10,000.00

  Tariff income

  £1 for every complete £250 or part thereof between amount of capital disregarded and capital upper limit

  Disregards

  standard earnings

  5.00

  5.00

  couples earnings

  10.00

  10.00

  higher earnings

  15.00

  15.00

  war disablement pension and war widow's pension

  10.00

  10.00

  voluntary and charitable payments

  20.00

  20.00

  student loan

  10.00

  10.00

  student's covenanted income

  5.00

  5.00

  income from boarders:

  disregard the fixed amount (£20) plus 50 per cent. of the balance of the charge

  20.00

  20.00

  Expenses for subtenants

  furnished or unfurnished

  4.00

  4.00

  where heating is included, additional

  9.25

  9.25

  Maternity Allowance

  lower rate

  48.35

  50.10

  higher rate

  55.70

  57.70

  Pneumoconiosis Byssinosis, Workmen's Compensation and other schemes

  Total disablement allowance and major incapacity allowance (maximum)

  101.10

  104.70

  Partial disablement allowance

  37.35

  38.70

  Unemployability supplement plus where appropriate increases for early incapacity

  62.45

  64.70

  higher rate

  13.15

  13.60

  middle rate

  8.30

  8.60

  lower rate

  4.15

  4.30

  199

  Schedule of main proposed Social Security Benefit Rates—April 1998 (Weekly rates unless otherwise shown)

  Old rates 1997

  New rates 1998

  Constant attendance allowance

  exceptional rate

  81.00

  84.00

  intermediate rate

  60.75

  63.00

  normal maximum rate

  40.50

  42.00

  part-time rate

  20.25

  21.00

  Exceptionally severe disablement allowance

  40.50

  42.00

  Lesser incapacity allowance

  maximum rate of allowance

  37.35

  38.70

  based on loss of earnings over

  49.50

  51.30

  Retirement Pension

  Category A or B

  62.45

  64.70

  Category B(lower)—husband's insurance

  37.35

  38.70

  Category C or D-non—contributory

  37.35

  38.70

  Category C(lower)-non—contributory

  22.35

  23.15

  Additional pension

  Increase by: 3.60 per cent.

  Increments to:

  Basic and additional pensions

  Increase by 3.60 per cent.

  Contracted out deductions (CODs)

  (Pre April '88 earnings)

  Graduated Retirement Benefit (GRB)

  Increments to CODs (April 1988-April 1996 earnings)

  Additional increase 0.6 per cent. to that paid by schemes

  [3.0 per cent, paid by schemes]

  Graduated Retirement Benefit (unit) (pence)

  8.11

  8.40

  Graduated Retirement Benefit (Inherited)

  Increase by: 3.60 per cent.

  Addition at age 80

  0.25

  0.25

  Severe Disablement Allowance

  Basic rate

  37.75

  39.10

  Age-related addition (from December 1990)

  higher rate

  13.15

  13.60

  middle rate

  8.30

  8.60

  lower rate

  4. 15

  4.30

  Statutory Maternity Pay

  Earnings threshold

  62.00

  64.00

  Lower rate

  55.70

  57.70

  Statutory Sick Pay

  Earnings threshold

  62.00

  64.00

  Standard rate

  55.70

  57.70

  War Pensions

  Disablement Pension (100 per cent. rates)

  officer (£ per annum)

  5,594.00

  5,797.00

  other ranks

  107.20

  111.10

  Age allowances

  40 per cent.-50 per cent.

  7.15

  7.40

  over 50 per cent, but not over 70 per cent.

  11.05

  11.45

  over 70 per cent, but not over 90 per cent.

  15.75

  16.30

  over 90 per cent.

  22.10

  22.90

  Disablement gratuity

  specified minor injury (minimum)

  682.00

  707.00

  specified minor injury (maximum)

  5,100.00

  5,284.00

  unspecified minor injury (minimum)

  284.00

  294.00

  unspecified minor injury (maximum)

  6,632.00

  6,871.00

  Unemployability allowance personal

  66.25

  68.65

  adult dependency increase

  37.35

  38.70

  increase for first child

  9.90

  9.90

  increase for subsequent children

  11.20

  11.30

  Invalidity allowance higher rate

  13.15

  13.60

  200

  Schedule of main proposed Social Security Benefit Rates—April 1998 (Weekly rates unless otherwise shown)

  Old rates 1997

  New rates 1998

  middle rate

  8.30

  8.60

  lower rate

  4.15

  4.30

  Constant attendance allowance

  exceptional rate

  81.00

  84.00

  intermediate rate

  60.75

  63.00

  normal maximum rate

  40.50

  42.00

  part-time rate

  20.25

  21.00

  Comforts allowance

  higher rate

  17.40

  18.00

  lower rate

  8.70

  9.00

  Mobility supplement

  38.55

  39.95

  Allowance for lowered standard of occupation (maximum)

  40.44

  41.88

  Exceptionally severe disablement allowance

  40.50

  42.00

  Severe disablement occupational allowance

  20.25

  21.00

  Clothing allowance (£ per annum, maximum)

  137.00

  142.00

  Education allowance (£ per annum) (maximum)

  120.00

  120.00

  War widow's pension

  Widow (private)

  81.00

  83.90

  Widow (NCO)

  81.25

  84.20

  Widow—Officer (£ per annum maximum)

  5,010.00

  5,190.00

  Childless widow u-40 (private)

  18.74

  19.41

  Childless widow u-40 (NCO)

  19.02

  19.70

  Childless widow u-40 (Officer maximum £s per annum)

  5,010.00

  5,190.00

  Supplementary Pension age allowance

  52.80

  54.70

  (a) age 65 to 69

  9.25

  9.60

  (b) age 70 to 79

  17.75

  18.40

  (c) age 80 and over

  26.45

  27.40

  children's allowance

  increase for first child (adjusted for child benefit increase)

  14.15

  14.25

  increase for subsequent children

  15.45

  15.65

  Orphan's pension

  increase for first child (adjusted for child benefit increase)

  15.90

  16.05

  increase for subsequent children

  17.20

  17.45

  Unmarried dependant living as (spouse maximum)

  78.95

  81.85

  Rent allowance (maximum)

  30.65

  31.75

  Adult orphan's pension (maximum)

  62.45

  64.70

  Widower's pension private (maximum)

  81.00

  83.90

  officer (£ per annum) maximum

  5,010.00

  5,190.00

  Widow 's Benefit

  Widow's payment (lump sum)

  1,000.00

  1,000.00

  Widowed mother's allowance

  62.45

  64.70

  Widow's pension

  standard rate

  62.45

  64.70

  age-related

  age 54 (49)

  58.08

  60.17

  53 (48)

  53.71

  55.64

  52 (47)

  49.34

  51.11

  51 (46)

  44.96

  46.58

  50 (45)

  40.59

  42.06

  49 (44)

  36.22

  37.53

  201

  Schedule of main proposed Social Security Benefit Rates—April 1998 (Weekly rates unless otherwise shown)

  Old rates 1997

  New rates 1998

  48 (43)

  31.85

  33.00

  47 (42)

  27.48

  28.47

  46 (41)

  23.11

  23.94

  45 (40)

  18.74

  19.41

  Note:

  For deaths occurring before 11 April 1988 refer to age-points shown in brackets.

  Earnings top-up (ETU) rates

  Old rates 1997

  New rates 1998

  Scheme A

  Credit

  Couple

  47.65

  48.80

  Single 25 and over

  28.75

  29.45

  Single under 25

  23.35

  23.90

  For working 30 hrs + pw

  10.55

  10.80

  Applicable amount (i.e., taper threshold)

  Couple

  77.15

  79.00

  Single 25 and over

  59.70

  61.15

  Single under 25

  49.45

  50.65

  Scheme B

  Credit

  Couple

  57.50

  58.90

  Single 25 and over

  28.75

  29.45

  Single under 25

  23.35

  23.90

  For working 30 hrs + pw

  10.55

  10.80

  Applicable amount (i.e., taper threshold)

  Couple

  77.15

  79.00

  Single 25 and over

  77.15

  79.00

  Single under 25

  77.15

  79.00

  Both schemes

  Capital

  upper limit

  8,000.00

  fixed rates

  amount disregarded

  3,000.00

  Tariff income

  £1 for every complete £250 or part thereof between amount of capital disregarded and capital upper limit

  fixed rate

  War Pensions
  Mr. Ben Chapman
  To ask the Secretary of State for Social Security how many United Kingdom civilians employed in war-related work have received war pensions for asbestosis since 1967; and what factors led to their award. [16714]

  Mr. Denham
  The information is not available and could be obtained only at disproportionate cost.

  It is unlikely that any award of War Pension in respect of asbestosis has been made to any civilian. However, a civilian may be entitled to a war pension if he was disabled as a result of his work as a member of a civil defence organisation or under the other provisions of the Personal Injuries (Civilians) Scheme.
  202
  Broadly, under those other provisions, an award of war pension may be made where disablement is caused either by enemy action or by action taken to combat or repel an imagined attack by the enemy during World War Two.

  Compensation might be available under the industrial injuries scheme, via an employer's liability insurance or, for an ex-civilian employee of the Ministry of Defence, from that Department.

  Benefit Reviews
  Mr. Burstow
  To ask the Secretary of State for Social Security if the conclusions of the Department's benefit by benefit review will be taken into account in(a) the Department's study of public expenditure and (b) the Treasury's review of tax and benefits. [17037]

  Mr. Field
  The Government are committed to a far-reaching overhaul of the Social Security system that will modernise the welfare state and prepare it to meet the challenges of the twenty-first century.

  My right hon. Friend the Chief Secretary to the Treasury announced the Comprehensive Spending Review being co-ordinated across Government on 11 June 1997, Official Report, column 1143–57. The Department of Social Security's review will be based on our clear objectives of promoting work incentives, reducing poverty and welfare dependency and strengthening community and family life. It will also consider how best the system can be reformed to contribute to the achievement of Government objectives including the need for restraint in public expenditure. The Review is expected to take about a year to complete.

  The review of tax and benefits, headed by Martin Taylor, Chief Executive of Barclays Bank, involves officials from the Treasury, the Department for Education and Employment, the Inland Revenue and the DSS. There has been close liaison between the tax benefit review and the DSS Comprehensive Spending Review.

  Mr. Burstow
  To ask the Secretary of State for Social Security which Minister is responsible for co-ordinating her Department's benefit by benefit review; and when, and by what means, she expects its conclusions to be reported to the House. [18810]

  Mr. Field
  I refer the hon. Member to the reply my right hon. Friend the Prime Minister gave to him on 20 November 1997,Official Report, columns 406–07.

  Income Support
  Mr. Burstow
  To ask the Secretary of State for Social Security how the extra money for pensioners on income support will be distributed. [18738]

  Mr. Denham
  Precise operational arrangements will depend on the Regulations currently being drafted. Regulations will be laid as soon as possible.

  "The Law Relating to Social Security"
  Mr. Rooney
  To ask the Secretary of State for Social Security when "The Law Relating to Social Security" was withdrawn from circulation; and what are her plans for replacing it. [18833]

  Mr. Field
  "The Law Relating to Social Security", or "Blue Books", is still available from the Stationery Office and bookshops. Three amendments have been issued this year.

  Ex-servicemen (Hearing Review)
  Mr. Burstow
  To ask the Secretary of State for Social Security what representations she has received on her review of the Government's decision on the aging effect of bilateral sensori-neural hearing in respect of former members of the armed forces. [18839]

  Economic planning region1

  Full-time employees2

  Part-time employees3

  Employees under personal contract4

  Lowest hourly rate £

  Grade

  Lowest hourly rate

  Grade

  Lowest hourly rate £

  Grade

  Scotland

  3.26

  Administrative assistant

  3.43

  Administrative assistant

  3.26

  Administrative assistant

  Northern

  3.26

  Administrative assistant

  3.39

  Administrative assistant

  3.26

  Administrative assistant

  Yorkshire and Humberside

  3.26

  Administrative assistant

  3.26

  Administrative assistant

  3.26

  Administrative assistant

  North West

  3.26

  Administrative assistant

  3.26

  Administrative assistant

  3.26

  Administrative assistant

  East Midlands

  3.35

  Administrative assistant

  3.43

  Administrative assistant

  3.26

  Administrative assistant

  West Midlands

  3.26

  Administrative assistant

  3.28

  Administrative assistant

  3.26

  Administrative assistant

  Wales

  3.26

  Administrative assistant

  3.36

  Administrative assistant

  3.26

  Administrative assistant

  East Anglia

  3.26

  Administrative assistant

  3.95

  Administrative assistant

  3.26

  Administrative assistant

  South East

  3.26

  Administrative assistant

  3.26

  Administrative assistant

  3.26

  Administrative assistant

  South West

  3.28

  Administrative assistant

  3.28

  Administrative assistant

  3.26

  Administrative assistant

  North Ireland

  4.93

  Administrative assistant

  4.45

  Support Grade Band 2

  —

  Overseas

  3.72

  Administrative assistant

  4.14

  Support Grade Band 2

  3.42

  Administrative assistant

  1. Hourly rates include allowances and includes staff on payroll as at 30 September 1997 in their current substantive grade.

  2. Except for staff in the Senior Civil Service the department does not employ staff on a personnel contractual basis. Staff shown in column four are casual staff and those on fixed term appointments.

  New Deal
  Mr. Burstow
  To ask the Secretary of State for Social Security if he will list the allocations in each of the next four years for programmes under the New Deal for Disabled People. [18809]

  Mr. Denham
  No decisions have been taken on the allocation, in each of the next four years, of the £195 million set aside for the New Deal for Sick and Disabled People.

  Wisconsin Project
  Mr. Burns
  To ask the Secretary of State for Social Security, pursuant to her answer of 25 November 1997,Official Report, column 538, (1) if she will make a statement on her discussions with an official from Wisconsin on matters relating to (a) welfare and (b) compulsion for lone parents seeking work; [18673]

  (2) if she will publish the agenda and minutes to her meeting with an official from Wisconsin about welfare policy. [18674]

  Mr. Gibb
  To ask the Secretary of State for Social Security if she will make a statement on the meetings with officials from Wisconsin that she had during the summer. [15755]
  204
  Mr. Denham
  We have received 36 representations from hon. Members and 46 from national organisations and members of the public.

  Low Pay
  Mr. Chidgey
  To ask the Secretary of State for Social Security if she will list, by regions defined by the boundaries of the regional government offices, the lowest hourly rate paid by her Department to(a) full-time employees, (b) part-time employees, (c) persons employed under personal contract and (d) persons employed by firms undertaking contracted-out services for central government offices, defining the job title in each case. [18111]

  Mr. Field
  The information is not available in the format requested. Such information as is available is as follows:

  Mr. Keith Bradley
  My right hon. Friend the Secretary of State had one meeting with an official from Wisconsin who was in this country for a Conference at which both were due to speak. There was no formal agenda. The official concerned described the various changes made to the welfare system in Wisconsin over the past several years, gave an informal assessment of their effect and described what she saw as the main lessons to be drawn about the process of implementing major change in this area.

  Child Support Agency
  Mr. Hinchliffe
  To ask the Secretary of State for Social Security if she will ensure the Child Support Agency does not reply to an hon. Member's inquiry relating to a constituent's case with a copy of its response to the constituent. [18225]

  Mr. Keith Bradley
  We are determined to ensure that the Child Support Agency provides an efficient and effective service to all its customers, including their representatives.

  The administration of the Child Support Agency is a matter for the Chief Executive, Mrs. Faith Boardman. She will write to my hon. Friend.
  205
  Letter from Mrs. Faith Boardman to Mr. David Hinchliffe, dated 1 December 1997:
  I am replying to your Parliamentary Question to the Secretary of State for Social Security about replies from the Child Support Agency to inquiries from Members of Parliament.
  The Agency's policy in dealing with an inquiry from an MP is to provide a full, up-to-date and accurate reply to the issues raised. Each case is treated individually and the Agency aims to answer correspondence in line with the Departmental target of responding within 20 days.
  In the course of dealing with children's maintenance, correspondence between the Agency and customers is to be expected, and indeed necessary. Where this coincides with an inquiry from the customer's MP on their behalf, in order to be as helpful as possible and to ensure that the full facts are available, the Agency may copy relevant letters to the MP particularly where an identical issue has been raised by the constituent both directly with the Agency and through their MP. This has proved to be a useful, cost-effective and efficient mechanism, which helps avoid any misunderstanding and ensures that the MP is fully aware of what has been said to their constituent.
  I am very conscious that there are still far too many justified complaints about the standards of basic customer contact and the service we provide. Over the next few years, I am committed to bringing high quality levels of performance to every part of our operation as a matter of routine, thereby reducing the number of complaints received and enhancing the public perception of the Agency.
  I hope this is helpful.

  National Insurance Contributions
  Mr. Trickett
  To ask the Secretary of State for Social Security if she has completed her review of national insurance contributions of 1998–99. [19162]

  Ms Harman
  I have completed the annual review under Section 141 of the Social Security Administration Act 1992. My proposals will take effect from 6 April 1998.

  Employers and employees
  In line with the Social Security Contributions and Benefits Act 1992, the lower earnings limit for Class 1 contributions is to be raised to £64 a week. It is set at the level of the Basic Retirement Pension rate for a single person from April 1998, rounded down to the nearest pound.
  The upper earnings limit is to be raised to £485 a week which is slightly less than 7½ times the new basic pension rates as provided by the Social Security Contributions and Benefits Act 1992. These new earnings limit will replace the current ones of £62 and £465 respectively.
  Employees whose earnings reach the lower earnings limit will continue to pay an initial contribution of 2 per cent. of that limit and standard rate contributions of 10 per cent. on that portion of their earnings which exceeds the lower but not the upper earnings limit.
  The contribution rates for employers will remain unchanged at 3 per cent., 5 per cent., 7 per cent. and 10 per cent. respectively, as will the earnings brackets for the three lower rates.

  Not contracted out employees and their employers
  Neither employees nor employers will have to pay any contributions if earnings are less than £64 a week. Employees whose earnings do not exceed £465 (the former upper earnings limit) will pay 16 pence a week less in contributions than at present. This is
  206
  because a further £2 of their weekly earnings will be subject to the 2 per cent. rate rather than 10 per cent. For employees with earnings above £465 the maximum possible increase will be £1.84 a week.
  There will be no change for employers where earnings are £64 or more a week.

  Contracted-out employees and their employers
  Employees whose earnings do not exceed £465 (the former upper earnings limit) will pay 13 pence a week less in contributions than at present. This is because a further £2 of their weekly earnings will be subject to the 2 per cent. rate rather than 8.4 per cent. For employees with earnings above £465 the maximum possible increase will be £1.55 a week.

  Employers who operate a Contracted-Out Salary Related Scheme (COSR)
  Where earnings are between £64 and £465 employers will pay 6 pence a week extra. This is due to the increase in the lower earnings limit which means that a further £2 of earnings is not subject to the contracted-out rebate. Where earnings are more than £465 a week employers will pay £54 pence a week less. This is mainly due to the increase in the upper earnings limit which means that a further £20 of earnings is subject to the contracted-out rebate.

  Employers who operate a Contracted-Out Money Purchase Scheme (COMP)
  Where earnings are between £64 and £465 employers will pay 3 pence a week extra. This is due to the increase in the lower earnings limit which means that a further £2 of earnings is not subject to the contracted-out rebate. Where earnings are more than £465 a week employers will pay 27 pence a week less. This is mainly due to the increase in the upper earnings limit which means that a further £20 of earnings is subject to the contracted-out rebate.

  Self-employed people
  The flat rate Class 2 contribution will be raised by 20p to £6.35 a week.
  Self-employed people with profits less than a specified amount. known as the small earnings exception limit, can apply to be excepted from paying Class 2 contributions. This limit will be raised by £110 to £3,590.
  There will be no change to the rate of Class 4 contributions which will remain at 6 per cent. The annual limits of profits between which Class 4 contributions are paid will be raised to £7,310 and £25,220 from £7,010 and £24,180 respectively.
  Self-employed people who pay only Class 2 contributions will pay an extra £10.40 a year in 1998–99.
  For people with profits between £7,310 and £24,180 (the former upper profits limit) Class 4 contributions will be reduced by £18 a year assuming an unaltered level of profits. For those self-employed people with profits at or above the new upper profits limit the annual charge for Class 4 contributions will be £44.80 higher.

  Class 3 (Voluntary) contributions
  The rate of Class 3 contributions will be raised by 20p to £6.25 a week.

  National health service allocation
  The allocation to the National Health Service is unchanged at 1.05 per cent. from employees and 0.9 per cent. from employers.

  Treasury grant
  Although benefit expenditure from the National Insurance Fund will broadly match income. I need to ensure that the Fund maintains a prudent working balance throughout the coming year and, in accordance with Section 2(2) of the Social Security Act 1993, I propose to do so by means of a grant from the Treasury. I estimate that the maximum grant required will be approximately £800 million.
  I shall by laying a Draft Order before Parliament together with a report by the Government Actuary describing the effects of my proposals.

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

COT: Independence
Earl Baldwin of Bewdley Earl Baldwin of Bewdley asked Her Majesty's Government:
Whether they are satisfied with the independence of the Committee on Toxicity of Chemicals in Food, Consumer Products and the Environment in view of the extent of the links which its members have with the chemical industry.
The Minister of State, Department of Health (Baroness Jay of Paddington): My Lords, the Government have every confidence in the individual integrity of members of the Committee on Toxicity of Chemicals in Food, Consumer Products and the Environment, known as COT, and in the advice given by the committee. But the Government are concerned to ensure that other voices and opinions, such as those of consumer groups and other lay interests, are taken into account. We are looking at the best ways to achieve that.
Earl Baldwin of Bewdley: My Lords, I am very grateful to the noble Baroness for her reply, which perhaps goes a little distance towards dealing with the problem which I believe exists. Given that this committee has a brief, among other things, for looking at vitamin and mineral supplements and herbal remedies, which are often in direct commercial competition with pharmaceutical products, is she happy—it may be that, in view of her Answer, she is not altogether happy—with the situation where, at the latest listing, 15 out of the 19 members of this committee have declared a financial interest with chemical companies?
Baroness Jay of Paddington: My Lords, I believe that it is a question of getting the balance right on these committees. It is inevitable that many experts will have gained experience through their scientific knowledge and their toxicological skills in addressing issues which are funded through research supported by the pharmaceutical industry. I have looked in detail at the financial interests of the members of COT. Fewer in number than the noble Earl suggested have what is called a direct personal interest. Some have interests in terms of the funding of their research projects and the companies they are associated with. That is the reality of funding for most researchers working in universities and institutes. But as I said in my original Answer, we are concerned to see that other interests and other voices are represented in these considerations.
Earl Howe: My Lords, is not one of the difficulties with COT that it scrutinises all sorts of specialist issues in
1238
which the members do not necessarily have the appropriate expertise? Would it not be helpful to invite experts in the particular subject under discussion to add their own knowledge and experience to the committee's proceedings and thus make its pronouncements much more authoritative?
Baroness Jay of Paddington: My Lords, the noble Earl makes a very good point. In the discussions that are going on at the moment between various departments, such as the Department of Health, MAFF and the Medicines Control Agency, the point about taking individual evidence from experts who have a particular remit in areas which are under discussion is being considered. The noble Earl is right. There may be people who have a particular interest in subjects which are under discussion who need to be called in for those particular debates.
Lord Taylor of Blackburn: My Lords, can the Minister say how the members of the committee are appointed and what criteria do the department look for in appointing them?
Baroness Jay of Paddington: My Lords, members are appointed on the basis of their general expertise in particular areas, although as the noble Earl, Lord Howe, said, they may not have the specific interests which are necessary for some of the very detailed considerations. They are appointed on the basis of recommendations from the Public Appointments Committee, which is advised by the Chief Medical Officer.
Lord Rea: My Lords, does my noble friend agree that one of the reasons for the association of many medical scientists with the pharmaceutical industry is that funding for their research by independent bodies such as the universities or the Medical Research Council has been progressively cut over the past 18 years?
Baroness Jay of Paddington: My Lords, I would not necessarily want to comment on the assertion by my noble friend that research moneys have been cut in these areas. But as I said in my initial reply, it is a question of getting the balance right between those people who have a direct financial interest. However, those whose research may be funded means that they have a different financial relationship with the commercial companies involved.
The Countess of Mar: My Lords, does the noble Baroness accept that this Question has arisen out of what is rapidly becoming the Vitamin B6 fiasco? Does she recall that on 24th November, in reply to the noble Viscount, Lord Addison, the noble Lord, Lord Donoughue, said,
"Perhaps I may point out that one can get one's recommended daily dose of Vitamin B6 from the consumption of 12 pints of beer a day".—[Official Report, 24/11/97; col. 749.]
As it appears that he is promoting the nutritional benefits of beer, will the noble Baroness ask COT to review alcoholic drinks on the same basis as it reviewed

1239
Vitamin B6, with a view to limiting the retail sale to perhaps one glass a day over the counter and the rest to be prescribed by a doctor?
Baroness Jay of Paddington: My Lords, I am sure that my noble friend the Minister responsible for roads will find that a very attractive idea. When the noble Countess refers to the problems of the relative vitamin content of particular foodstuffs, I am reminded of the exchange that we had in your Lordships' House last week about the importance of folic acid. We discovered that 27 bananas a day had to be eaten to meet the sufficient nutrient requirement. I suspect that this is a question of where the interests of the food business and medical interests overlap. We have to be very clear in distinguishing what one looks at as regards food policy and what one looks at as regards clinical and medical therapy policy. I suspect that one of the things that my noble friend Lord Donoughue and other members of the Government representing MAFF and I would wish to look at is precisely where one draws the boundaries between those two.
Earl Baldwin of Bewdley: My Lords, will the noble Baroness recognise that it is not just the financial links that are a cause for concern, but that by their training, their experience, their peer group pressure and the culture that they work in, this tightly knit group of members of these expert committees are not always best equipped to give a balanced view? Will she accept that I am not impugning the integrity of individuals here, but rather the system that puts them in a false position?
Baroness Jay of Paddington: My Lords, I am sure that the noble Earl and I are at one in not wishing to impugn the integrity of anybody in this situation. The point that he has raised precisely refers back to that made by the noble Earl, Lord Howe, about the need to involve individual experts where there is a particular concern to address and where it is necessary to bring in people who may have a different background or specific expertise in a specific subject.

NHS Trusts: Executive Appointments
2.43 p.m.
Baroness Cumberlege Baroness Cumberlege asked Her Majesty's Government:
How many chairmen and non-executive directors of NHS trusts whose term of office expired on 31st October 1997 are still awaiting either valedictory letters or firm letters of reappointment.
Baroness Jay of Paddington: My Lords, the terms of office of 570 chairmen and non-executive directors of NHS trusts came to an end on 31st October. We have still to confirm 57—that is, 10 per cent.—of these appointments. We will be sending valedictory letters as soon as possible to all board members who have not been reappointed. We agree that there have been some unfortunate delays, but they have been caused by the
1240
Government's determination to open up the process of selecting people to serve on trust boards. That has led to 1,800 nominations from Members of Parliament and local authorities. I must point out that no trust board is, or has been, inquorate.
Baroness Cumberlege: My Lords, I thank the Minister for that Answer. I should like to make it clear that I appreciate the fact that any new Administration wishes to appoint people in whom they have confidence and who meet the Government's criteria. However, does the Minister recollect her reply to her noble friend Lord Taylor of Blackburn just six weeks ago when she said that she and her colleagues had been "a little dilatory" in making appointments? Does she not agree that it is not so much dilatory as deplorable that chairmen and non-executive directors have had to attend meetings not knowing whether that meeting is to be their last or whether they should continue to run their organisations, some of which have budgets in excess of £100 million? Does she agree that it is no wonder that waiting lists and waiting times have shot through the roof when there has been such uncertainty in the leadership of the NHS?
Baroness Jay of Paddington: My Lords, I am very surprised by the last point raised by the noble Baroness. We are trying to ensure that the organisation of trust boards more adequately represents the communities that they serve. Your Lordships may be interested to hear that at the moment approximately 70 per cent. of members of trust boards have what is loosely described as a "business background". That does not seem to have produced a very successful business outcome given the state of the NHS that we have inherited.
On the more general point about the criteria for assessing nominated candidates, perhaps I may advise the House that all candidates now have to meet a rather rigorous number of criteria in order to be considered; the appointments then have to be sifted; people have to he interviewed; regional chairmen have to make suggestions and recommendations at various levels and finally to the Secretary of State. It is a long process. As I said in my Answer, we realise that some of the delays have been unfortunate, but we think that the outcome is worth it.
Lord Taylor of Blackburn: My Lords, is my noble friend aware of the widespread congratulations that have been extended to the Government on the way in which they have appointed these new people and not merely followed political dogma? The Government have ensured that the best people are chosen to fill these positions.
Baroness Jay of Paddington: My Lords, I am grateful to my noble friend. As I said, there are now tight criteria, particularly relating to commitment to the NHS, involvement in the local community, and acceptance of a particular type of responsibility for the public ownership values and public sector ethos of the NHS. I believe that we have succeeded in meeting those criteria.
Earl Howe: My Lords, is the Minister aware that my noble friend Lady Cumberlege made an extremely

1241
pertinent point about waiting lists? It is precisely when leadership is absent that waiting lists and waiting times are all too easily prone to drift in the wrong direction. If there was a difficulty in making the appointments in a timely fashion, why did not the department simply extend the term of the incumbents by a month or two rather than leave the trusts without proper leadership?
Baroness Jay of Paddington: My Lords, we have done that. Some board members have been reappointed for a short period; for example, to take the board through a possible reconfiguration or through the winter. On the noble Earl's point about waiting lists, what is needed is leadership and that is precisely why on 18th November the Government announced a national strategy for dealing with waiting lists, which included setting up a national taskforce within the NHS with eight regional organisers deliberately tasked to look into waiting lists at their local level.
Lord Peyton of Yeovil: My Lords, is the Minister aware that a measure of courtesy shown by governments does them no harm?
Baroness Jay of Paddington: My Lords, I think that we have been extremely courteous. I apologise for the fact that the valedictory letters are still in the post. I have been directly involved in dealing with the individuals concerned with the appointments system and every exchange has been extremely courteous.
Baroness Robson of Kiddington: My Lords, having once upon a time been vaguely involved with the health service, may I ask the Minister why the appointments could not have been made more swiftly? I refer to the fact that it is now five months since the Government came to power. I know that five months is not very long, but the Department of Health has a department specifically to deal with reappointments and that work would not have stopped. I had hoped that the Government might have implemented their choices more speedily.
Baroness Jay of Paddington: My Lords, in view of the previous question, I hesitate to appear to be anything but extremely courteous to the noble Baroness whose extremely distinguished service to the NHS is well recorded. The point was precisely not to go solely through the Department of Health's appointments office but to cast the net much more widely. We asked individual Members of Parliament of all parties and all local authorities to make nominations. That resulted in 1,800 names coming forward—there were many others—all of which were worthy of consideration by local health authorities and regional chairmen.
Lord Hunt of Kings Heath: My Lords, is my noble friend aware that delay in making appointments to non-executive positions in the NHS has been a consistent feature over the past 10 to 15 years? Does my
1242
noble friend agree that the little extra care that is now being taken in making these appointments will pay dividends in the years ahead?
Baroness Jay of Paddington: My Lords, I am grateful to my noble friend Lord Hunt for his intervention given his considerable experience of looking at the health service on a national basis. That is precisely what we seek to achieve.
Baroness Seccombe: My Lords, is the Minister aware that some non-executive directors were telephoned from the region last Friday, which was at least four weeks after they had received the heartless letter? They were told that they would receive a letter. Believe it or not, 24 hours later they did receive a letter. It was identical to the one that they had received four weeks before, but this time it informed them that their contract would end on 30th November. Is the Minister aware of what is going on in Leeds? Does she have any confidence in the corporate affairs division that is based there?
Baroness Jay of Paddington: My Lords, I have a great deal of confidence in the corporate affairs division of the National Health Service Executive. I suspect that the noble Baroness is referring not to the national office but to the individual practices of regions. If she would care to write to me giving me specific examples of local regions I shall try to reply to her.
Lord Belstead: My Lords, can the Minister inform the House whether the appointments will be made by the end of this year?
Baroness Jay of Paddington: My Lords, as I said in my original Answer to the noble Baroness, there are two strands of appointment: those which formally came to an end at the end of October, of which there are only 57 outstanding appointments to be dealt with, and those which came to an end at the end of last week. Those are still being dealt with but we hope they will be completed by the end of the year.
Baroness Cumberlege: My Lords, the noble Baroness has referred to courtesy. Does she believe it is courteous that those who have spent a lifetime in the NHS, some chairing very complex organisations, should learn through their successors that they are not to be reappointed? I believe that that is the height of disregard for the tremendous commitment that people have made to the National Health Service, and it is disgraceful.
Baroness Jay of Paddington: My Lords, as I said in reply to a previous question, I suspect that the noble Baroness is referring to individual regional offices' practices of which I do not have detailed experience. If the noble Baroness will pass on that information to me I shall try to reply. As regards discourtesy, I am probably the wrong person at whom these accusations should be fired. I speak as someone who was appointed a health authority chairman five years ago but was politically vetoed by one of the predecessors of the noble Baroness.

Euro Currency and EMU
2.53 p.m.
Lord Randall of St. Budeaux Lord Randall of St. Budeaux asked Her Majesty's Government:
What constraints prevent British businesses from transacting business in euros prior to the United Kingdom's formal entry into European Monetary Union.
Lord Haskel: My Lords, there are very few constraints on UK firms transacting business in the euro. It is like any other foreign currency. Companies are able to use foreign currencies for a wide range of transactions in the United Kingdom.
Lord Randall of St. Budeaux: My Lords, I thank my noble friend for his most encouraging reply. Since there are few constraints on the early use of the euro, does my noble friend agree that it can bring enormous advantages not only to businesses but to the general public? Does he also agree that action needs to be taken to ensure that the country is prepared for its use?
Lord Haskel: My Lords, my noble friend is right to recognise that business was frustrated by lack of preparation. The Government have embarked on a number of initiatives. We have published two guides: one by my noble friend Lord Currie on the pros and cons of EMU and one on the practical implications for business. We have set up two groups: a business advisory group to provide a channel of communication between business and government and a standing committee to oversee the preparatory work in the private and public sectors. We have also set up a series of regional conferences for the New Year and carried out a number of other initiatives.
Lord Redesdale: My Lords, the noble Lord said that the euro is to be treated like any other foreign currency. In the opinion of the Government, is the euro a foreign currency?
Lord Haskel: My Lords, at present for the purposes of companies trading it will be dealt with on the same basis as a foreign currency until we decide whether to join the European Monetary Union.
Lord Beloff: My Lords, has the Minister read the article by Professor Martin Feldstein of Harvard in the current issues of Foreign Affairs in which he points out that the EMU is likely to prove a massive disaster? In the light of that, does the Minister agree that any businessman transacting business in that currency deserves to have his head examined?
Lord Haskel: My Lords, I am afraid that I have not read the article by Professor Feldstein but I shall certainly do so. Businessmen cannot take these decisions in isolation. They are dependent upon their customers,
1244
their suppliers, and what others in business do. If their customers or suppliers insist on using the euro those companies will have very little choice but to accept it.
Lord Barnett: My Lords, referring to the intervention of the noble Lord, Lord Beloff, does my noble friend agree that anyone foolish enough to disregard the euro would be equally mad?
Lord Haskel: My Lords, I agree entirely with my noble friend. Any company that disregarded the euro would put itself at a competitive disadvantage.
Lord Marsh: My Lords, does the noble Lord accept that a number of noble Lords are slightly puzzled by this exchange? All companies are used to dealing in different currencies, whether it be dollars or any other. For once I agree with the noble Lord, Lord Barnett. Whether or not the UK joins the European Monetary Union, what is so peculiar about companies using the euro if it is available?
Lord Haskel: My Lords, there are no difficulties at all in companies dealing with the euro, as they deal with dollars, francs or whatever.
Lord Bruce of Donington: My Lords, is my noble friend aware that the Question itself does not deal with transactions that are limited to the supply of and payment for services but refers to preventing,
"British business from transacting business"?
In view of the fact that some time may elapse before formal entry into economic and monetary union, is it not wise for Her Majesty's Government to give the usual warning that the value of the euro, like other currencies, can go down as well as up and that there are certain risks attached to the settlement of transactions in any currency, including the euro?
Lord Haskel: My Lords, my noble friend is absolutely right. The value of any currency can go up or down. The risk is the same for the euro as with any other currency.
Lord Mackay of Ardbrecknish: My Lords, is the noble Lord aware that I am as puzzled as the noble Lord, Lord Marsh, about this exchange? It appears to me that if the euro comes about the City and manufacturing industry will deal in it as they deal in the yen, the dollar or any other currency. I suspect that his noble friend was really asking whether the euro would be legal tender if this country did not join.
Lord Haskel: My Lords, it will be legal tender as any other foreign currency. Many British citizens will start to use the euro very soon. For example, if they use

1245
their credit cards on the Continent after the introduction of the euro it is likely that their accounts will be debited in euros.
Lord Swinfen: My Lords, does the Minister agree that all sound currencies are backed by a lender of last resort? Who will be the lender of last resort for the euro?
Lord Haskel: My Lords, I imagine that that will be a matter for the European bank.
Lord Stoddart of Swindon: My Lords, is my noble friend aware that what worries some of us about the Question is the assumption that we are going into the single currency?
Lord Plant of Highfield: No.
Lord Stoddart of Swindon: Yes indeed, my Lords, if one looks at the Question. There is an assumption there that we are going into Europe. Will my noble friend confirm that the government position is, first, that we shall not enter into the single currency until there is economic convergence; and, secondly, until after there has been a referendum of the British people?
Lord Haskel: My Lords, I can confirm that we need a period of stability and settled convergence before membership can be considered. There will be a referendum of the British people.
Lord Mackay of Ardbrecknish: My Lords, I return to my question about legal tender. I am aware that if I use my Visa card in Italy I can pay in lira, and I will then pay my bank in sterling. My question was: will the euro be legal tender in this country? Will I be able to go into a shop on my return and use euro notes rather than sterling? Those are my questions.
Lord Haskel: My Lords, not until we join the European single currency.

Business
3.1 p.m.
The Lord Privy Seal (Lord Richard): My Lords, at a convenient moment after 3.30 p.m., my noble friend Lady Farrington of Ribbleton will, with the leave of the House, repeat a Statement that is to be made in another place on local government revenue finance. That will be followed by my noble friend Lady Hollis of Heigham, who, again with the leave of the House, will repeat a Statement on social security uprating.

Crime and Disorder Bill [H.L.]
The Parliamentary Under-Secretary of State, Home Office (Lord Williams of Mostyn): My Lords, I beg to introduce a Bill to make provision for preventing crime and disorder; to create certain racially aggravated offences, and to abolish the rebuttable presumption that a
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child is doli incapax; to make changes to the criminal justice system; to make further provision for dealing with offenders; to make further provision with respect to remands and committals for trial and the release and recall of prisoners; to amend Chapter I of Part II of the Crime (Sentences) Act 1997 and to repeal Chapter I of Part III of the Crime and Punishment (Scotland) Act 1997; to make amendments, designed to facilitate, or otherwise desirable in connection with, the consolidation of certain enactments; and for connected purposes.
I beg to move that this Bill be now read a first time.
Moved, That the Bill be now read a first time.—(Lord Williams of Mostyn.)
On Question, Bill read a first time, and to be printed.

Committee of Selection
The Chairman of Committees (Lord Boston of Faversham): My Lords, I beg to move the Motion standing in my name on the Order Paper.
Moved, That the Lord Burnham be appointed a member of the Committee in the place of the Lord Chesham.—(The Chairman of Committees.)
On Question, Motion agreed to.

Procedure Committee: Select Committee
The Chairman of Committees: My Lords, I beg to move the second Motion standing in my name on the Order Paper.
Moved, on behalf of the Committee of Selection, That the Lord Burnham be appointed a member of the Select Committee in the place of the Lord Chesham.—(The Chairman of Committees.)
On Question, Motion agreed to.

Ceremony of Introduction: Select Committee
Lord Richard: My Lords, I beg to move the Motion standing in my name on the Order Paper.
Moved, That it is desirable that a Select Committee be appointed to consider alterations in the ceremony of Introduction and to make recommendations.—(Lord Richard.)
On Question, Motion agreed to.

Special Immigration Appeals Commission Bill [H.L.]
3.4 p.m.
Lord Williams of Mostyn: My Lords, I beg to move that the Commons amendments be now considered.
Moved, That the Commons amendments be now considered.—(Lord Williams of Mostyn.
On Question, Motion agreed to.

COMMONS AMENDMENTS
[The page and line refer to Bill (49) as first printed by the Commons.]

COMMONS AMENDMENT
1 After Clause 6, insert the following new clause—
APPEALS FROM THE COMMISSION
(".—(1) Where the Special Immigration Appeals Commission has made a final determination of an appeal, any party to the appeal may bring a further appeal to the appropriate appeal court on any question of law material to that determination.
(2) An appeal under this section may be brought only with the leave of the Commission or, if such leave is refused, with the leave of the appropriate appeal court.
(3) In this section "the appropriate appeal court" means—

(a) in relation to a determination made by the Commission in England and Wales, the Court of Appeal,

(b) in relation to a determination made by the Commission in Scotland, the Court of Session, and

(c) in relation to a determination made by the Commission in Northern Ireland, the Court of Appeal in Northern Ireland.

(4) In section 33(4) of the Immigration Act 1971, after "1993" there shall be inserted "or section (Appeals from the Commission) of the Special Immigration Appeals Commission Act 1997".")
Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 1. It may be helpful if I speak also to Amendments Nos. 2 and 4.
These amendments to the Bill will create a right of appeal from the Special Immigration Appeals Commission to the Court of Appeal on a point of law. The first new clause will provide an avenue of appeal from the Special Immigration Appeals Commission on a question of law where the commission has made a final determination of an appeal. The further appeal can be brought with the leave of either the commission or the Court of Appeal—and by either the appellant or the Secretary of State.
The appeal will be to the Court of Appeal if the commission makes its determination in England and Wales; to the Court of Session if it does so in Scotland; and to the Court of Appeal in Northern Ireland if it has been sitting in Northern Ireland. Experience of the cases considered by the three advisers suggests that most cases are likely to be heard in England.
This additional avenue of appeal on a point of law will mirror the existing arrangements for such a right of appeal in respect of decisions of the Immigration Appeal Tribunal which was introduced in the Asylum and Immigration Appeals Act 1993.
Having considered the point very carefully we have accepted that in the context of the new commission it would be more satisfactory for appellants to be able to have points of law dealt with on appeal to the Court of Appeal rather than dealt with by way of judicial review. The latter can, of course, involve consideration of points of law by both the High Court and the Court of Appeal. The fact that the commission itself will be chaired by a High Court judge adds weight to that argument.
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The second new clause and the other amendment made in the Commons are consequential. The second new clause simply ensures that the Lord Chancellor will be able to make rules which will govern the procedures to be followed when the commission receives applications for leave to appeal to the Court of Appeal.
The provision will be made in the same statutory instrument that will cover the other procedure rules provided for in Clause 5 of the Bill. The rules will be based very closely on existing provisions in the Asylum Appeals (Procedure) Rules 1996. As in those rules it will be made clear that the decision to grant leave will be able to be made by a single member of the commission. This would be the chairman or the other member specified in Schedule 1 to the Bill.
The amendment to Schedule 2 to the Bill is entirely technical. It will ensure that decisions taken by the Secretary of State will not be implemented while there is an appeal to the Court of Appeal pending.
I believe that these amendments represent an improvement to the Bill.
Moved, That the House do agree with the Commons in their Amendment No. 1.—(Lord Williams of Mostyn.)
Lord Henley: My Lords, I have just two brief points. First, I welcome the fact that the Government have come forward with these amendments. As the Minister will remember—I do not, because it was my noble friend Lady Blatch who was involved—these were suggestions pressed repeatedly by my noble friend when the Bill was originally in this House. As my noble friend made clear at the time, the paramount consideration must be the national security interest, to which all other matters should be subordinated.
As the Minister will remember—I think I can put it this way—he doggedly insisted that no appeal was necessary. He stated baldly that the decisions of the new independent tribunal would be binding on the Home Secretary. He said that it was the mark of a civilised society to give protection to suspected terrorists. Whether that was merely an excess of libertarian zeal or a refusal by a new government to accept arguments put forward by this unreformed Chamber is unclear.
We have had a remarkable and welcome U-turn. The Government have tabled their amendments to do what we in this place suggested—the very thing the Minister so firmly rejected. I welcome also the remarks of the Minister's colleague in another place, Mr. O'Brien. He specifically and graciously praised this House. He said that the amendments reflected to a considerable extent the detailed and worthwhile scrutiny that the Bill was given in the Lords and the concerns expressed by the Opposition about the importance of protecting national security.
Secondly, the Minister will remember that we are midway through our deliberations on the Human Rights Bill. One of the major concerns with which we dealt last week relating to Clauses 10, 11 and 12 was the fast-track process and the inability to amend orders coming from the Government after a declaration of

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incompatibility following a ruling by the European Court of Human Rights or one of our own courts where those rights have been domesticated.
This Bill, as we know, is the result of a decision by the European Court of Human Rights in the Chahal case. The Bill, as the Minister will appreciate, has had general support from all sides in this House and in another place, but, it needed amending, as the Minister admitted and the Government conceded by bringing forward these amendments in another place.
Will the Minister now accept that, had the procedures in the Human Rights Bill been in existence when the Government were trying to make an order to deal with this issue rather than using primary legislation, it would not have been possible to bring forward amendments of this kind and it would not have been possible to deal with this particular mischief? That is an issue to which we must return at the Report stage of the Human Rights Bill.
I ask the Minister and his noble and learned friend the Lord Chancellor—after his remarks yesterday, I am not sure whether he still is noble and learned or a right reverend Prelate—to consider seriously the points that I have made relating to Clauses 10, 11 and 12 and the fast-track process of the Human Rights Bill. As this Bill has shown, it will sometimes be necessary to make amendments in order to deal with problems of the kind that I have mentioned.
Lord Williams of Mostyn: My Lords, I am grateful for the welcome which the noble Lord, Lord Henley, has given to the amendments. Bearing in mind the context of our discussions at an earlier stage, it must be remembered that the amendments give a right of appeal on law and not on fact. That was the basis of the earlier discussion.
As regards the Human Rights Bill, the noble and learned Lord the Lord Chancellor made it plain that the fast-track procedure is an option. He also made it plain during the long hours we spent discussing these matters that the Government have an option of fast track or of introducing a Bill. Because the issues are delicate and difficult, we thought it right to listen to the argument put forward. We decided that an appeal on fact was not appropriate and that an appeal on law was appropriate. Having reached that decision, we brought forward the amendments in another place as soon as possible.
On Question, Motion agreed to.
COMMONS AMENDMENT
2 After Clause 6, insert the following new clause—
PROCEDURE ON APPEALS FROM THE COMMISSION
(".—(1) The Lord Chancellor may make rules regulating, and prescribing the procedure to be followed on, applications to the Special Immigration Appeals Commission for leave to appeal under section (Appeals from the Commission) above.
(2) Rules under this section may include provision enabling an application for leave to appeal to be heard by a single member of the Commission.
(3) The power to make rules under this section shall be exercisable by statutory instrument.
(4) No rules shall be made under this section unless a draft of them has been laid before and approved by resolution of each House of Parliament.")
Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 2.
Moved, That the House do agree with the Commons in their Amendment No. 2.—(Lord Williams of Mostyn.)
On Question, Motion agreed to.
COMMONS AMENDMENT
3 Clause 7, page 5, line 12, leave out subsection (5)
Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 3. This deletes the amendment inserted into the Bill by this House to avoid infringement of the privilege of the other place to control charges on public funds. As the House is aware, the Bill has some minor financial implications. Those implications are acceptable in another place. Therefore, it was proper for our amendment to be deleted.
Moved, That the House do agree with the Commons in their Amendment No. 3.—(Lord Williams of Mostyn.)
On Question, Motion agreed to.
COMMONS AMENDMENT
4 Schedule 2, page 7, line 38, at end insert—
("Construction of references to pending appeal
For the purposes of the Immigration Act 1971 as applied by paragraphs 1 to 3 above, an appeal under section 2 above shall be treated as pending during the period beginning when notice of appeal is duly given and ending when the appeal is finally determined or withdrawn; and an appeal shall not be treated as finally determined so long as a further appeal can be brought by virtue of section (Appeals from the Commission) above, nor, if such an appeal is duly brought, until it is determined or withdrawn.")
Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 4.
Moved, That the House do agree with the Commons in their Amendment No. 4.—(Lord Williams of Mostyn.)
On Question, Motion agreed to.

Education (Student Loans) Bill
3.12 p.m.
The Minister of State, Department for Education and Employment (Baroness Blackstone): My Lords, I beg to move that this Bill be now read a second time.
I would like right at the outset to make it clear to noble Lords that this Bill has nothing to do with the Dearing Report or the Government's response to it. Our proposals for the future of student funding have been brought before the House in the Teaching and Higher Education Bill which we will be debating soon.
The Bill before us today relates solely to the existing student loan regime and the debt we intend to sell to the private sector. That was the policy of the previous

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Administration. The debt sale process was already under way when we came to power. Our manifesto gave a clear commitment to staying within the spending plans of the previous government for two years. It is to ensure that we stay within those spending plans that we are continuing with this policy.
The Bill also serves to emphasise our commitment to the development of a wide range of public private partnerships. The Government currently bear the credit risk of the student loan book. The debt sale involves the transfer of that risk to private-sector financial institutions which are experienced both in dealing with such risk and the management of loans generally.
The debt sale will also make the concept of publicly funded student loans more readily understood by the financial markets. The previous Administration's attempt to involve the private sector in student loans through the ill-fated twin-track approach foundered because many of the financial institutions which might have participated did not fully comprehend the nature of student loans. It is our hope that this Bill and the debt sale it facilitates will lead to a greater understanding within the financial community of the nature of the student support system.
The Bill does not just smooth the path of the sale for the Government and the successful bidder, it also amplifies existing measures to protect borrowers. The Bill provides a range of protective measures. These include the freezing of loan conditions within the borrower's loan agreement; the power to set collection standards by which the debt purchaser must abide; and the appointment of an independent assessor to investigate and report on disputes between borrowers and lenders. I will return to these in a little more detail later.
The Bill will also serve to support our wider plans for education, based on raising standards, extending access, and ensuring high quality provision.
The Bill before us today provides in Clause 1 for the transfer of loans to the private sector. It deals with the assignment of loans and allows my right honourable friend the Secretary of State to make arrangements in connection with such assignments. These include payment of subsidy to debt purchasers, administrative provision in respect of assigned loans and the power to repurchase loans or to direct a further reassignment of them to a third party.
Clause 2 provides for the key terms of a loan agreement not to be changed by further regulations after the agreement has been made. It freezes the time and manner of repayment of the loan, the means of calculating the annual rate of interest payable on loans and the borrower's rights to deferment and cancellation.
Clause 3 puts the arrangements for the administration of loans on a contractual basis, like any other commercial loan, and not subject to the operation of public law functions.
Clauses 4 to 7 and the schedule provide for consequential amendments, commencement and territorial extent.
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The Bill has three main provisions. Clause 1 allows the Government to pay subsidies. These are necessary because student loans are in many respects unique. The loan scheme is only seven years old. Such a short track record makes the assessment of the risks involved difficult for the institutions bidding in the sale.
These loans bear no real interest rate. They are tied to the rate of inflation so that borrowers ultimately only repay in real terms the same amount as they took out in loans. What is more, borrowers earning less than 85 per cent. of average income can defer payments year on year and in some cases will have them cancelled if they reach specified age levels. These are not commercial loan terms, and they cannot therefore be sold on that basis.
Without a subsidy we would be able to sell loans for only a small percentage of their face value. We have decided to sell them at par—their full face value—and to subsidise the purchaser for some of the risk that is outside their control. The subsidy will also help offset some administrative costs. We are running a strong competition which will ensure that we obtain the lowest possible subsidy package. The four short-listed bidders will make their final bids in January indicating the level of subsidy that they would require. At the end of the competition we shall accept the best bid made.
Clause 1 of the Bill also allows the Government to buy back loans that we want to cancel for social policy reasons. These occur rarely and typically involve cases where severe disability makes the possibility of repayment unrealistic in practice. We believe that it would be unreasonable to put the burden of such loans on to the private sector. As a matter of public policy, it is right that that power should be held by my right honourable friend the Secretary of State.
Lastly, Clause 1 provides for an independent complaints procedure. Under the existing arrangements, borrowers have the right to take complaints about the administration of their loans to an independent assessor. The assessor's rulings are binding. We have ensured that borrowers whose loans are sold will continue to have the benefit of that right.
Clause 2 provides for the freezing of the terms of the loans when sold. Of those, the most important are the time and manner in which repayments are made; the method used in calculating the annual interest rate; and the borrowers' rights to deferment and cancellation. Significant variation of those terms—for example, if repayment terms were shortened or the interest rate payable on the loans changed—could have a major adverse financial impact on borrowers and debt purchasers. Those are risks outside the bidders' control. They would either seek to price that risk of change into their final bids or, alternatively, expect some other form of full compensation. Whichever was the case, the cost to the Government would be significant.
To avoid that position, Clause 2 provides for loan agreements to set out in detail the core terms on time and manner of repayments, the specific method used in setting the annual interest rate and deferment and cancellation. At present we discuss those matters when we debate the relevant regulations each year. As soon

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as the Bill becomes law, and before the sale transaction is completed, we shall make new regulations which will freeze the core terms for all loans. Not only will this protect the position of the debt purchasers; it will also afford protection to borrowers. The terms will be frozen as they were at the time the loan was taken out. That is just one protection we are putting in place for existing borrowers.
Clause 3 puts loans on a purely contractual basis, like any other commercial loan would be. Buyers understand the working of contract law and relevant consumer legislation. The clause removes the operation of public law functions from both the Student Loans Company—the lender—and subsequently from the debt purchaser. Under the existing legislation these functions can neither be transferred from the SLC, nor can decisions be made by the loans buyer. That makes for complex, unwieldy and expensive administration which would be unattractive to prospective purchasers who would probably not contemplate taking on the loans on that basis.
The transfer of loans to the private sector means that the responsibility for loans administration will fall to the debt purchaser, as owner of the debt. But I can reassure noble Lords that the Bill does not reduce the rights of borrowers. On the contrary, borrowers' rights will be protected through the sale agreement which will require the purchaser to meet the same collection standards as the Student Loans Company, as a minimum. Failure to abide by them could lead to legal action against the purchaser. Variations to these standards by the purchaser will not be allowed without written approval from my right honourable friend the Secretary of State. Any proposed changes by the purchaser would have to comply with the safeguards contained elsewhere in this Bill, and in existing consumer protection legislation in the Consumer Credit, Data Protection and Malicious Communications Acts.
Borrowers have no cause to fear. The existing deferment terms and lender's ability to deal with borrowers in financial difficulty will remain in place. There should be no need for any borrowers to default on their loan, but if they do they should expect to have legal action taken against them under the new arrangements in the same way as it is taken now.
Noble Lords may be concerned that private sector debt purchasers might seek to use the database or loan borrowers for other purposes such as cross selling financial products. I can assure them that the Bill specifically prevents any such data being provided or used for such purposes. The sale of a borrower's loan will not result in a flood of junk mail.
In conclusion, this is a technical Bill designed purely to enable us to complete the planned sale of student loans over two years. These sales are necessary for us to meet the manifesto commitment of living within existing spending plans this year and next. It makes the loan book sufficiently attractive through a subsidy package to attract reputable financial institutions to buy the debt, whilst at the same time protecting the interests of borrowers. We have run a vigorous competition which is now reaching its closing stages. We will accept the most competitive bid.
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The Bill will help to support our plans for raising educational standards, extending access and high quality provision. I commend the Bill to the House.
Moved, That the Bill be now read a second time.—(Baroness Blackstone.)
3.25 p.m.
Baroness Maddock: My Lords, like many who have gone before me in recent weeks I rise to address your Lordships for the first time and I do so with feelings which are a mixture of nervousness, excitement and awe.
In the short time that I have been here since I was introduced between my noble friends Lord Tope and Lady Hamwee, I have experienced nothing but kindness and warmth, not only from noble Lords but also from people who work in the House. I am glad to take the opportunity today to thank them all. In particular, I should like to thank those people who helped to make my introductory day here such a memorable and pleasant experience, not only for myself but also for my guests.
Before I took part in that ceremony I was asked by many people whether I was nervous. I said that, obviously, everybody wants things to go smoothly on such a day but unlike some of the other political arenas in which I have been, where I sometimes felt that people were just dying for me to make an escape, the impression I gained from the House of Lords was that everybody wanted things to go well. I have had no reason to change my views since then.
This is the third time I have risen to make a maiden contribution in a political debating chamber. It does not become any easier. Today I am only too aware of the awesome wealth of experience, knowledge and expertise that surrounds me here in the House of Lords.
I have chosen to make my maiden speech on the Education (Student Loans) Bill and so I must begin by declaring an interest. I have two daughters. One is in her second year at university and therefore has already taken out a loan. The other daughter is attempting to go back to university for a second time and I feel quite sure that she too will need to take out a loan.
I am aware also that maiden speeches are not expected to be overtly controversial but I have chosen to sit in the House of Lords as a Liberal Democrat and therefore I have a distinct viewpoint on the matter before us today. As has been said already, the Bill is primarily technical and seeks to facilitate the sale of the present student loans portfolio to the private sector. Strictly speaking, it has nothing to do with the Dearing proposals for higher education nor with the Government's intentions to require students to contribute to their tuition fees. However, I believe that there are consequences flowing from this Bill which arise in relation to those issues and I shall refer to them as I explain my reservations about the Bill.
First, I put on record that, like my Liberal Democrat colleagues in both Houses of Parliament, I have no philosophical objection to the principle of student loans or the involvement of the private sector in such a matter. I understand the need to control public borrowing and

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I recognise the valuable role which the private sector can play in that. That is a view shared by all major political parties now and, which is also important, it is a view shared by the Committee of Vice-Chancellors and Principals.
However, as I indicated, I have some concerns about the Bill and they fall into three main areas. First, the haste with which the Government have embarked upon the project; secondly, the detail of the Bill; and, thirdly, the fact that there appears to be little sign so far that any of the money from the sale of the loans portfolio will be used to alleviate some of the very severe funding problems that our institutes of higher education have at present.
I turn to my first point: haste. It is clear—it has been made even clearer today and it has been made clear in the past by Statements made by the Secretary of State for Education and Employment and by the Chancellor of the Exchequer—that going ahead with the sale of the student loan debt is absolutely critical for this Government if they are going to stick to the spending plans and limits of the previous government. Since that original pledge the Dearing Committee has reported and further proposals have been made for higher education. The Government are now going to remove any element of maintenance grants and many students will not receive help with their fees.
Therefore, in future years it is very obvious that students will need very much larger loans than they do currently. I know that this is a different matter from the present portfolio, but I believe that there would be some merit in not proceeding with the Bill, given those circumstances. It is clear that there will need to be further legislation in the area. In addition, I understand, like myself and my Liberal Democrat colleagues and, again, the Committee of Vice-Chancellors and Principals, that the Government do believe that the repayment of student loans should be income contingent. There is an opportunity here with the possibility of more generous loans to enable them to be repaid through a national insurance contribution scheme, or even a joint tax and national insurance scheme. That would also require further legislation.
There is also some doubt as to whether this is actually the best way of proceeding if the Government stick to the present repayment scheme as proposed with existing loans in the Bill.
I particularly draw noble Lords' attention to the views of Dr. Nicholas Barr, who is leader of the team from the London School of Economics which specialises in looking at student loans. He made it quite clear that in selling off the portfolio with the existing repayment scheme we were unlikely to get quite such a good deal as with a repayment scheme linked to national insurance. In fact, his opinion was that going ahead in a hasty way, while there are still such high levels of deferment, amounts to a waste of taxpayers' money. Although that view was put forward before Dearing reported, I believe that it still remains valid.
That brings me to my second area of concern; namely, the detail of the Bill or, on this particular point, perhaps I should say the lack of detail surrounding the conditions
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of sale. We have very little idea about what level of subsidy will be required for the private sector to take over the loans portfolio. I realise that there are competitive bids and therefore it is a far from simple matter.
When student loans were first introduced in 1990, the private sector was not really very interested in being involved. It was less than a year ago that the then Secretary of State for Education and Employment, the right honourable Member for Norfolk, South West, announced in a press release (after she had attempted, yet again, to tempt the private sector) that,
"in the event we have not been able to agree a deal which could meet their requirements"—
those of the private sector—
"at the right price for the taxpayer".
When in Opposition, the present Minister for schools standards said that any subsidy over 25 per cent. for the sale of the loans portfolio would be excessive.
I believe that we could see as much as a £1 billion in subsidy being paid to the private sector at a time when, as I said and others know, our higher education institutions are facing possibly some of the worst problems in funding that they have had in their history. What is more, there is every indication that £1 billion is far in excess of the amount of money that may be raised from the proposed tuition fees and any money that may go back into universities in the lifetime of this Parliament.
That brings me to my third concern. All the indications are that there is little prospect of what we hope will be £3 billion expected from the sale actually going back into the funding of higher education in this country. We need to look at that against the background of a 28 per cent. cut in student funding in the past six years and a cut in capital funding to universities last year of around 30 per cent. I should have welcomed the opportunity to talk now about the role of the public sector borrowing requirement. Those who know me will know that I have for long felt that we could deal with legislation and investment much more satisfactorily if we reformed the way that we deal with such matters. However, as this is my maiden speech perhaps I should leave that for another day.
I twice stood at the Bar of this Chamber to see your Lordships give consent to the Home Energy Conservation Act, which I sponsored as a Member of the other place. Little did I think that one day I would have the privilege of being a Member of this House. I look forward to working with all noble Lords and to being an active Member by taking part in the proceedings in your Lordships' House.
3.35 p.m.
Lord Baker of Dorking: My Lords, on behalf of all Members in the House, perhaps I may congratulate the noble Baroness on her admirable speech. Of course, I heard her speak many times in the other place. She was the Member for Christchurch and won a celebrated by-election there. She had the great misfortune, from her point of view, of her constituency being the only Conservative gain in the avalanche of 1st May.

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However, what is a loss to the House of Commons is certainly a gain for the House of Lords. I am sure that we shall hear the noble Baroness speak on education, with her immediacy and great knowledge, on many occasions.
I must apologise to the Minister. I missed the first three sentences of her opening remarks. I am sorry for that. However, I did hear the rest of her speech. I welcome the Bill and congratulate the Government on introducing it. That was not how my Bill to introduce student loans was greeted back in 1988: there was considerable doubt and hostility. I shall not embarrass the noble Baroness by quoting some of her eloquent words to describe the villainy of student loans in those days when she was the Master of Birkbeck College.
I am glad to see that the principle of student loans has been accepted; namely, that the cost of higher education should be shared in a tripartite way among the state, the family and the student. After all, the greatest beneficiary of higher education is the student and he or she should contribute in some way. The Government have built upon that in a Bill we shall be discussing later in this Session by extending the principle to fees. I shall not trespass into that area.
I congratulate the Minister because I was not able at the time to persuade the Treasury to do what she is now doing. I tried to persuade the clearing banks and the Governor of the Bank of England to run the loans scheme. I was sent off by the then Chancellor of the Exchequer, Nigel Lawson, with a much worse brief. I could not persuade the banks to do it; hence we had to set up the elaborate procedure that was eventually established.
The noble Baroness has succeeded in Clause 1. If I had been allowed to offer what is now in Clause 1 of this Bill. I could have done it from the beginning. This is a measure of privatisation where the person who buys cannot lose. I did not actually hear the word "privatisation" in the Minister's speech, although perhaps she used it in the three sentences that I missed. However, I suspect that she did not use it. This is the first measure of privatisation of this Government and is therefore to be warmly welcomed. It is not exactly selling the family silver, but it is quite good pewter. I hope that it will be followed by many other measures of privatisation.
I echo the words of the noble Baroness who has just made her maiden speech. I had hoped that there would be a statement from the Government that some of the proceeds of the sale of the loans portfolio would be ploughed back into higher education, as higher education certainly needs a considerable injection of funds. However, I am afraid that the Minister did not win that battle with the Treasury. The Treasury wants this for its public sector borrowing requirement, so I am afraid that there will be no money going back into higher education. That is a matter of very great regret. I believe that something should be put back into it. Moreover, when we come to debate the next Bill on the matter, I hope very much that the Government will be persuaded that this is a much better way to deal with loans, which will be much greater in the future because
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they will cover fees as well as loans taken out for living purposes, and that they should be collected in a different way.
Back in 1988 I was in favour of a graduate tax but I could not persuade the government of the day to go for that. I think that probably the best way of collecting these loans will be through a form of graduate tax. As I understand it, the Government will go some of the way on that measure as regards collecting some of the money through the Inland Revenue system. The noble Baroness nods. I congratulate her on that because I could not persuade the Inland Revenue to adopt that measure.
As far as I can see, this Government are a pushover as regards all kinds of measures which, in true Treasury orthodoxy, we were not able to secure. As she has gone half of the way on that, I hope that she will go the full way and espouse the idea of a graduate tax with suitable checks and balances. That would be the neatest way of dealing with this matter. With those reservations I welcome the Bill.
3.40 p.m.
Lord Montague of Oxford: My Lords, on this, the first occasion that I address this House I most sincerely thank noble Lords on both sides for the warmth of their individual welcomes. I wish also to thank the officials and staff of the House for their patience. Their guidance has been invaluable and I am most grateful for it.
In earlier capacities as chairman of the English Tourist Board and subsequently the National Consumer Council I had contact with many Members of this House. It is a pleasure to look forward to these cordial relationships being continued. Equally in my most recent post as Opposition representative on the Millennium Commission I had the good fortune to visit many applicants and to meet many noble Lords. Although some, I know, were rightly disappointed when a negative decision had to be taken, they still receive me with the same cordiality as those who were successful. That seems characteristic of the open-minded approach which I too hope to bring to the deliberations of this Chamber.
I am a businessman and a longstanding supporter of the Labour Party. Throughout my career I have felt it important to try to bring the business community and the Labour Party together. I started a manufacturing enterprise in the 1950s with a handful of employees in the East End of London which ultimately employed thousands of people in factories in most parts of the developed economies of the world.
It is because of the experience I gained during my 40 years of building this business that I was invited six years ago to be a governor of Oxford Brookes University where we have just under 12,000 students. Cited in the Times University Guide as top of the new universities, Oxford Brookes gained joint highest marks for research and the second highest for teaching due to the excellence of our staff. I chair the audit committee, perhaps because of my financial experience; hence my interest in the financial health of places of higher education.

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It is clearly welcome that the Government are continuing to think through sympathetically the wide issue of loans to students. However, that matter is not directly before us today. As we have heard, this Bill is to refinance to the private sector a major part of the existing student loans stock. Students will not be affected by these decisions. As we have heard, four banks have been shortlisted as potential buyers for the student loan book, all of them first-class banking houses.
What I wish to draw to your Lordships' attention today is an important financial facility which some of these same banks provide overseas, particularly in America, but not in the United Kingdom. I refer to private sector funding for the provision of buildings—universities' capital developments, particularly but not exclusively student residential accommodation. Until now some funds have been available from the Higher Education Funding Council for capital expenditure but this has been dramatically reduced from £350 million for the year 1995–96 to £181 million for the year 1998–99. That is a reduction over four years of some 50 per cent.
In the fairly recent past this has been supplemented by the eligibility of BES schemes for student residential accommodation. However, as we all know, there was some abuse of BES schemes which led to their being discontinued. At our university we had two of them. Nothing, however, has been created or, as far as I know, is even being considered to succeed them. The relevance of this to the student loans Bill is, as I said, that the banks which are offering to buy the loans have a speciality of making capital funds available. They do so with outstanding results. For example, the state of Rhode Island has never had a law school. The new Roger Williams School at Brown University was recently brought into being as a result of the funds it was able to obtain from a US Government sponsored, not owned, enterprise.
I am not for a moment suggesting that we should necessarily follow that model. I hope, however—I have informed the Minister about this—that the DfEE will study how the commercial sector, with the backing of the Government, might speed up initiatives to answer the capital expenditure needs of universities, particularly student residential accommodation requirements. There is, of course, an income flow from the rents which students pay which might be used for all or part of the necessary security.
I am aware of some of the private sector initiatives which the sector aspires to succeed. There are 12 which are the beneficiaries of HEFC feasibility funding, and that is welcome. However, I suspect that this is going to be difficult and slow for the immediate capital needs of universities. There is to be a half-day conference at the Café Royal on the morning of 12th December and I hope that it will help with some of the problems we face. Our university this year had initially insufficient beds for us totally to meet our policy of being able to provide on campus accommodation for all our first year students. We regard it as extremely important that all new students—most of whom are living away from home for the first time—should initially be housed on
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campus to ensure a partially supervised surrounding to ease their transition. Most universities have the same policy.
The number of full-time students in higher education is approximately 1 million and in further education 800,000. The Prime Minister recently announced that there will be 500,000 extra students in further and higher education by the year 2002. It is vital therefore that we continue capital investment as it takes so long to bring projects to fruition.
On Wednesday last I heard Sir Ron Dearing remind the Select Committee on Science and Technology that there is already a backlog of £450 million of university infrastructure expenditure that demands attention. Having identified a way of refinancing the student loan debt, I urge that we quickly apply our energy to finding answers to the capital expenditure needs of our universities.
3.48 p.m.
Lord Walton of Detchant: My Lords, it is my great pleasure and privilege to have the opportunity to congratulate the noble Lord, Lord Montague, on his persuasive, thoughtful and compelling maiden speech. The noble Lord has had a most distinguished career in business. Of course one must note with great interest that he became a commander of the most excellent Order of the British Empire at the unusually early age of 38. Many of his other contributions have been listed in the annals of your Lordships' House. As he said, he has been a representative on the Millennium Commission and, since 1990, president of the Economic and Industrial Relations Society. He is a vice-president of the Royal Albert Hall. I trust that he will have the opportunity of waving his baton and contributing to the debates in your Lordships' House on many future occasions.
As the noble Baroness has said, this Bill is essentially a technical measure. It relates to the transfer of responsibility, in a financial sense, for the student loans fund to the private sector. As the noble Lord, Lord Baker said, it is to be warmly welcomed. Like the noble Lord, Lord Montague, we all hope that the private finance initiative will be successful in undertaking the capital developments in the universities which we all wish to see and which are long awaited.
I have two principal queries to pose to the noble Baroness on the Bill. Under the present rules, the Government require that any loan should be set against the public sector borrowing requirement. As my friend, the Vice-Chancellor of my former university, the University of Newcastle-upon-Tyne, Mr James Wright, said in a letter to the Secretary of State at the beginning of October,
"This is a subject which experts in the universities have been raising with the government for several years now",
and in other countries, including at least one in the European Union—a different treatment is introduced without there being any apparent collapse in the system of public finance. It continues:
"The whole thrust of Government policy and the Dearing Report is to emphasise the importance of a large and effective system of higher education for the country's general well-being.

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It is … depressing to see the possibilities of investment in that system for the future benefit of the country frustrated by what at least some well-informed commentators see as an outdated financial theology".
I hope that the noble Baroness will be able to assure us that, under the present Government, the approach relating to the PSBR will be changed.
My second point of, I think, interest relates to the fact that I chaired the Hamlyn Foundation National Commission on Education which made a number of salient recommendations relating to the financing of the universities and higher education, and student loans. We were told repeatedly that the Government have always resisted the use of the tax or national insurance system to collect other funds. We were told that the Inland Revenue and the Treasury would never stand for it. In 1993, in our report, Learning to Succeed, we asked the justification for maintaining this position. The Government have the power to change those practices. Should they not do so in order to create a more acceptable and workable scheme? I refer to one that is far more acceptable to the students than the present system of having to write a cheque in repayment from time to time after they have graduated and are in employment. We did not propose a graduate tax along the Australian lines. That is a lifetime contribution to income tax. We proposed that a repayment of the loan should be made through the tax system once the individual had reached an acceptable level of income, with an arrangement to stop the clock if for any reason a woman may have a family, or someone may be temporarily unemployed—his income fell below a certain level. Our proposal was that the loan should be paid through the tax system until it had been totally paid off. Happily, that proposal was accepted by the Dearing Committee.
On 19th November at col. 566 of Hansard, I asked a question of the noble Lord, Lord Whitty. I was told, as the previous government had told us, that the income tax system was not there for debt collection. But, lo and behold, in the Teaching and Higher Education Bill, to be debated in your Lordships' House next week, under Clause 16 there is a provision that arrangements may be made for the collection and repayment of the loans with the assistance of the Inland Revenue. I warmly congratulate the Government on their change of heart and express the hope that that will be implemented.
In the light of that decision, perhaps I may ask the noble Baroness, Lady Blackstone, whether Clause 2 of the Bill will require an amendment to allow such a mechanism, or will regulations under Clause 2 suffice to allow that mechanism of repayment to be introduced?
With those few comments, I greatly welcome the Bill.
3.54 p.m.
Lord Davies of Oldham: My Lords, it is a pleasure to follow the contribution by the noble Lord, Lord Walton of Detchant. We all recognise the significance of the role the noble Lord played on the National Commission on Education, to which he made reference. Its work is bearing fruit in some developments of policy with regard to student support, which the Government will be putting forward in a Bill next week.
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I congratulate the maiden speakers on the strength and accuracy of their speeches and on the fact that they have chosen a debate on higher education to make their contributions. It signals how important the subject is to this House and to the welfare of the nation. I pay tribute to noble Lords for the large attendance in the House on a Bill which I regard as a somewhat sorry little measure.
The Bill is made necessary because the Government had a somewhat tawdry inheritance from the previous government. The reason for the Bill is straightforward. Inserted into the government spending plans and Budget projections in the last Conservative Budget was £1.5 billion for each of the next two years as the product of the sale of the student debt. Unless on coming into government we were to see a complete revolution in the national finances and a significant replacement of those figures there was no option but for the Government to pursue this measure. Arithmetic gives the same answer, whoever asks the question. The arithmetic stands up in terms of the Budget position.
Turning round state expenditure of this volume, and with the changes we wish to see during the progress of this Administration, will take a number of years. It is quite clear that in the short term certain paths are already well designated. The Government have clearly indicated—they will be made apparent in the presentation of the proposed Bill next week—the longer term post-Dearing arrangements for student finance. However, at present there needs to be an adjustment to take into account the necessity of raising the £1.5 billion in the next two Budgets from the sale of the immediate debt.
The problem is, as the last government found—the present Government inevitably inherited it—that there are certain difficulties with the product that is being sold. At the root of the problem has been the fact that criticisms of the student loans scheme related crucially to the organisation of the scheme and to the fact that students would have to repay over a short period of working life; namely, in their first five years of earning power once they had crossed the threshold. The result was that higher education teachers and students reacted with alarm to the Government's proposals. They were severely critical of them at that time. The scheme has not enjoyed even a two-thirds take-up by those students who were entitled to do so. Yet we reflect upon the fact that many students in higher education are in real need but are loath to participate in a scheme that until now has put a burden of debt round their necks which has to be repaid within the first five years of earning power.
The scheme got off to a somewhat rocky start. After a short time, the first chief executive left office after pressure when it was discovered that he was spending at least as much time running a private restaurant as attending to the needs of students in the student loans scheme; and at one period 7 per cent. of students failed to obtain their loans on time—that is, 35,000 students. That averaged 60 students for each Member of Parliament. I speak from bitter experience. In my constituency I think that all 60 students contacted me about their concerns. I am sure that that was the general experience in another place.

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The Government sought to sell this package in 1995 through the student loans legislation. They adopted the twin-track approach. We could never find in the City any real enthusiasm for their proposals at that time and we said so repeatedly at every stage of the Bill. The same criticisms were also voiced in this House when the Bill appeared before your Lordships, and of course they were proven right. In fact, the then government in 1995–96 were unable to sell that particular form of loan. Therefore, I have to say to the Minister that I recognise the constraints under which she works but I am not hugely optimistic about getting a good deal against such a flawed position.
I am reassured that the Bill contains important guarantees for students; namely, that the terms of their loans cannot be changed by the private lender and that the terms are guaranteed. This indicates that the Government, quite rightly, have a real interest in ensuring that students take out loans on proper terms which last throughout the period of the loan. I am also reassured that the independent assessor will remain in place to adjudicate if difficulties should arise. Indeed, some difficulties are bound to arise even if only in a small minority of cases.
On the whole, I regard this Bill as a somewhat mulish little measure, without pride of ancestry or any hope for posterity. It is only acceptable in as much as the Government have already guaranteed the future development of an entirely different scheme on different principles for students over a lifetime so that their loans will be repaid according to their ability to repay the considerable principal while the income continues.
I am also pleased that the loans will be collected through the Inland Revenue. Both proposals have been canvassed in significant circles within this nation for almost a decade and it is therefore with some delight that I congratulate the Government on having made rapid progress, the fruits of which we should see in a fairly short time. On that basis, though without enthusiasm, I accept the terms of this particular measure.
4.3 p.m.
Baroness Darcy de Knayth: My Lords, I should like to thank the Minister for her clear and comprehensive introduction to the Bill. I shall be quite brief because I just want to ask her a couple of questions about the special arrangements for students with disabilities; first, when calculating the income of disabled borrowers and, secondly, about exercising discretion over the terms of the repayment. I hope that the Minister will be able to give me some assurances that they will remain the same and we can thus avoid the need for a probing amendment being raised in Committee.
As things stand, special consideration is given to disabled borrowers. This was very much thanks to my noble friend Lord Henderson of Brompton who, during the passage of the 1990 Act, successfully divided the House at Third Reading, and to the other place, which gave the Bill a felicitous tweak and returned it to us in an improved condition. The amendments which followed included an arrangement that disability-related
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benefits would not be taken account of when calculating the income of the borrower to determine whether the level of income would bring the borrower over the repayment threshold of 85 per cent. of the average income. There is also Regulation 10, which allows the Student Loans Company to exercise discretion over the terms of repayment for disabled borrowers who make particular application to them.
At present the Student Loans Company states that all disabled people they are aware of are deferring payments because their income falls below the 85 per cent, but nobody that they know of is using the discretionary arrangements or indeed has asked for them under Regulation 10. It is not clear whether this is because they do not know about it because they do not need it, or whether it is because absolutely no disabled borrowers come over the threshold anyway; that is, the threshold that makes them eligible. Can the Minister give me an assurance that these arrangements will continue? This disability-related disregard is very important, bearing in mind the extra disabled living costs that people with disabilities face.
The discretionary arrangements under Regulation 10 may never have been used as yet, but they are nonetheless valuable and SKILL, which is the National Bureau for Students with Disabilities—and here I have to declare an interest as president of SKILL—states that it is most important that this arrangement should continue to be available. I hope that the Minister can respond positively and offer assurances that the terms for disabled borrowers will continue as before. I look forward to hearing her reply and, if we do need to explore the details, perhaps we could pursue the matter in Committee.
4.5 p.m.
Lord Desai: My Lords, this is a story of human imperfection. We must try our best to resolve the matter without too much trouble. As many noble Lords have already said, this is a modest Bill. If, as the noble Lord, Lord Baker, said, he had been luckier with the Treasury, and had the political situation been better, we would have started the student loan system on the basis that repayment of a contingent loan would have been collected by the Inland Revenue. That would have represented the best possible outcome, but that did not happen. That is yet to come in the future. In the meantime we have to look at the new Bill. It is like putting an unwanted child up for adoption: that is the best I can think of.
Again, in a better world, as the noble Baroness, Lady Maddock, said in her excellent maiden speech, would we need to do this yet? It seems to me that with a little bit more on the PSBR—with a billion here or a billion there—we could actually merge this into the new system and make the debts collectable by the Inland Revenue. That might mean a reduced amount of default and if subsidy were not necessary, we might manoeuvre the Student Loans Company into the next part of the loan enterprise and have an ideal solution.
However, the world is not made for ideal solutions: it is made for such solutions as we can find. So this modest Bill is with us now: it is the best we can do. As

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many other speakers have said, I hope that we can achieve three things. Obviously, we want to ensure that the current conditions of the loan are not altered, so that the borrowers may feel no anxiety. We hope that the lenders, the people who have bid for this loan company, are enterprising and good people and that they will offer a good price and require as little subsidy as possible. Lastly, we have to hope that, whatever happens, this sale gives the Government value for money. There is nothing more to say, because everything I was going to say has been said by other speakers.
4.8 p.m.
Baroness Carnegy of Lour: My Lords, unlike most previous speakers, I find it is not easy to form an opinion on this Bill. It is clearly right that the private sector, with its knowledge and expertise and available resources, should become involved to the greatest extent possible in the funding and organisation of student loans. At Second Reading in another place many of the nationalists disagreed with that principle and voted against, although I have to remind the noble Baroness, Lady Maddock, that by Third Reading the Liberal Democrats appeared to have changed their minds, and they, too, voted against.
This Bill continues, as my noble friend Lord Baker of Dorking reminded us—and he certainly should know—where the last Government left off, and I am sure that that is wise. But to judge, in the context of where we are now, whether the proposals are likely to work effectively and cost effectively for the student and the taxpayer, it seems to me that we need to know a good deal more than the text of the Bill tells us. From what the Minister told us this afternoon, final decisions are still some way off, but we need to know roughly, if not precisely, what order of subsidy private sector bodies will demand in order to enter the scheme. It seems that those private sector bodies are in a pretty strong position to make demands in their present negotiations since they know that the Chancellor requires, willy-nilly, £1.6 million from the deal this year and £1.5 million next year, perhaps partly for higher education but certainly for other purposes.
We need to know, if we are to judge the merits of the Bill, what order of subsidy will be necessary if the deals are to be made. But we need to know more than that, I suggest. As has been hinted at by other noble Lords, we need to know what the connection is between this Bill and the Teaching and Higher Education Bill which the House will debate next week. The Government have told us repeatedly—although the Minister did not say it today—that the two Bills are quite separate. I think I understood my noble friend Lord Baker to assume that to be the case, as did other noble Lords. But it is not stated in this Bill.
We need to know for certain whether the Bill is only concerned with loans to students already in the system and funded under the present regime, or whether the Bill is also establishing a framework for funding future loans to students who will enter higher education in the circumstances proposed by the Teaching and Higher Education Bill. If this Bill is intended in any way to establish a continuing framework then clearly future
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requirements for subsidy and thus for the cost-effectiveness to the taxpayer of the arrangements will be even harder to estimate than at present.
The added uncertainties for private sector lenders which the Teaching and Higher Education Bill funding proposals would bring are many and various. There are likely to be large unforeseeable changes in the demand for loans as a result of the ending of maintenance grants, if that comes about, and the introduction of means-tested tuition fees. If I read the Teaching and Higher Education Bill correctly, there will be considerable scope for political intervention in the arrangements, by government and by Parliament. A number of arrangements exist with the laudable aim of protecting students, but they make for great uncertainty for those who are granting the loans.
If the Bill's arrangements are set to continue into the future, those and other major uncertainties will mean risks for the private sector much greater than those which exist at present. So it seems to me that the subsidies required are likely to be very much greater. When the Minister replies, I wonder whether she could clarify that important point. Is it intended that this Bill and the regime it sets up will continue in force after the Teaching and Higher Education Bill comes into effect? We need to know the answer to that question.
The Government's own financial and manpower memoranda to the Bill show the main problems in assessing the merits and de-merits of the Bill. The second paragraph concerning the financial effects of the Bill admits openly that the increase in public expenditure will depend on the amount the Government receive for the sale of the loans and on the amount of subsidy required to achieve the sale. Over the page, on the effect on public service manpower, we read that the number of staff employed by the Student Loans Company "may increase a little". But any such increase would be more than offset, we are told, if the portfolio purchasers decided not to use the Student Loans Company to administer the loans. Those are considerable uncertainties and the financial and manpower memoranda are astonishingly vague.
Perhaps that is unavoidable, but the uncertainties are enormous. I presume that the House will give the Bill a Second Reading, and I shall certainly support it. But I hope that in addition to answering the questions that I and others have put to her today, the Minister will be able to provide us with more hard facts, at any rate before we come to Committee stage. Without them it will be difficult to assess the Bill.
4.16 p.m.
Lord Grantley: My Lords, I warmly congratulate the Government on introducing this very welcome privatisation Bill. On the surface it looks like a purely technical measure to facilitate the transfer of the funding of student loans from the Government to the private sector, to help the Government achieve their spending targets. But I do not believe that the Bill is either purely technical or just modest. On the contrary, I think it is revolutionary in its implications. Just as privatised industries have benefited from having their investment

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programmes freed from the constraints of the public sector borrowing requirement, so the privatisation of funding student loans could, over time, lead to a significant increase in the resources available to higher education, particularly when future generations of students come to realise what very good value the loans represent.
However, as a banker, I wish to focus this afternoon on the technical aspects, particularly with a view to protecting the interests of the taxpayer in relation to the amounts of subsidy the Government will have to pay after privatisation. As unfortunately I expect to be unable to participate in the remaining stages of the Bill, I hope I may be forgiven for raising a number of technical points today—dull points of detail. I shall not be in the least offended if there is a mass exodus of your Lordships towards the Tea Room.
I have reviewed the standard loan agreement which students currently enter into with the Student Loans Company. From a banking standpoint, it is a very curious document. The main oddity is that students pay interest by monthly capitalisation of principal at,
"such rates as appear to the Secretary of State to be requisite for maintaining the value [of the loan) in real terms".
The loan agreement says nothing about when or how often the Secretary of State will determine the interest rate or whether students have a right to notification every time it changes or what prices index will be used. I understand that in practice the Secretary of State expects to determine the interest rate once a year, using the Retail Prices Index, and to use the historic annual rate for the purpose of calculating interest to be capitalised in the year ahead. That is welcome clarification, but really those matters need to be set out in the loan agreements.
On a related matter, the monthly repayment of principal is to be calculated as a proportion of,
"the amount of the loan outstanding on the calculation date plus interest which will accrue during the period of repayment then remaining".
The oddity in this case is that interest "which will accrue" can only be estimated, since no one knows what will happen to the relevant prices index over the remaining period of the loan. On what basis will the Secretary of State perform that estimate and what will happen later on when actual inflation turns out, as it certainly will, to be different from estimated inflation?
Another curiosity—at least to my mind—is the independent complaints procedure outlined in Clause 1(5) of the Bill, whereby students will be able to make complaints to an independent assessor about the administration of their loans. That seems to me to be an unnecessary piece of window dressing. I have not come across a feature of that type in other loan agreements. It is generally accepted that, provided loan agreements are sufficiently clear, normal remedies are adequate. I should be interested to know why that may not be the case for student loans. I should also like to know what sort of complaints the Government have in mind and how many civil servants they expect the independent assessor to need in order to deal with them.
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I understand that a revised form of loan agreement will be forthcoming in the new year. I hope that the Government will pay careful attention to the views of competing financial institutions and their legal advisers on the documentation as a whole. In connection with the PFI programme, there were occasions when the last government failed to attach sufficient weight to those views, with the result that the PFI programme was delayed. I hope that this Government will avoid that mistake.
I notice that the Minister in another place said that the standard sale agreement with the purchaser will be placed in the Library in due course. I should be grateful if the noble Baroness could indicate when she expects that to happen.
The main factors which will influence the price that financial institutions are willing to pay for the loan portfolios are their assessment of the credit risk and, as important, the cost of administration. On the first point, the Bill's Explanatory and Financial Memorandum states that the amount of subsidy will be dependent inter alia on,
"the extent to which borrowers default on their loans".
The Notes on Clauses give some small clarification of that in stating that the subsidy payments which the Secretary of State is authorised to make under Clause 1(3),
"may take the form of … compensation for default to a particular level".
However, when introducing the Bill the noble Baroness said that the selling of loans will transfer to private sector financial institutions the credit risk currently borne by government. I had understood that that was one of the main objectives of the Bill and I should be grateful if the Minister could explain the apparent inconsistency between what she said and those other two statements.
My main concern is with the second point—the cost of administration. It must be borne in mind that the loan portfolios comprise a large number of relatively small value loans. The costs of administration could potentially be horrendous and it is crucial that the Government make every effort to make the system as simple as possible to administer. I am concerned that the previous government chose to use a floating rate of interest; namely, inflation. It would be much simpler to have a single fixed rate of interest applicable to all loans commencing in any one financial year and remaining unchanged over the life of the loan.
For example, if it is important to the Government that the interest rate should be based on average inflation, they could project the average inflation rate to the end of the loan period—let us say 3 per cent. a year—and then stipulate 3 per cent. as a fixed rate for all the loans commencing in that year. Besides the savings in administration, there would be other advantages. Students would be able to predict with certainty their future liabilities and the Government would be able, if they wished, to crystallise up front their liability to pay subsidy over time by the use of the interest rate SWAP

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market which they cannot do in the case of loans indexed to inflation as there is no market for SWAPs between inflation and market interest rates.
The interest equalisation system associated with fixed rate lending has long been deployed in the export finance market, in which I was active for some years. It was well understood by financial institutions and cheap to administer. I am sorry to see that Clause 2(4) of the Bill, which was introduced at the Report stage in another place without any debate, perpetuates the inflation linked system. I urge the Government to reconsider that matter on future loans.
The other point to be made on administration is that it will be cheaper for repayments to be made, where possible. through the payroll or through the Inland Revenue. I am delighted to hear that the Government have decided to accept the recommendation of the Dearing Report to use the Inland Revenue.
Student loans, like mortgage loans and credit card receivables, would seem to be a natural candidate for the securitisation market. In that market the normal procedure is to establish a vehicle company which issues debt securities to the public secured on receivables under the loan and, in this case, under the sale and subsidy agreement. The cost of such debt is often cheaper than in the banking markets as the securities are tradable and there is no need to pay the cost of using banks' balance sheets.
Another advantage of securitisation, where the securities are publicly listed, is that all the parties, including the Government, have a clear and objective bench mark for the pricing of future debt sales. I understand that there is a substantial track record of securitising student loans in the United States. I hope that the Government will avail themselves of the lessons of that experience.
My final point is that no student in his right mind will prepay the loan ahead of schedule as the interest rate is so attractive, being well below the rate at which the funds could be reinvested. In fact, it looks as though students will have a strong incentive to default as the loans are unsecured and there is no default interest rate. At present the only remedy that lenders have is acceleration, which may not be useful in the absence of enforceable security. Even richer ex-students may be unable to pay accelerated amounts.
What do the Government intend should happen if students who are able to repay choose not to do so? Will financial institutions be able to invoke cross-default clauses under other loans the students may have to those same institutions and to exercise any security thereunder? I suggest that in respect of future loans the best solution would be for the Government to insert a default interest rate into the loan agreement.
I shall be fascinated to see how the scheme works in practice and I wish the Government every success in the first round of sales.
4.26 p.m.
Lord Tope: My Lords, I must begin by declaring an interest which I fear may turn into a pecuniary interest in that both my sons have student loans.
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This has been an interesting debate, although somewhat briefer and more one-sided than I expected. However, it was characterised by two particularly good maiden speeches. I am sure that the noble Lord, Lord Montague, will forgive me if I concentrate mainly on the speech of my noble friend Lady Maddock. I do that not only because she is my noble friend, but because she is also my friend in the full meaning of that word: and not only because I agreed (not surprisingly) with every word she had to say, but perhaps for an even more personal reason of which even she may not be aware.
Twenty-five years ago this week I too was an unexpected by-election winner—one of those famous Liberal by-election victories of yesteryear, which was at that time a record swing against a Conservative government. My colleagues sitting alongside me may not be too pleased to hear that, but that was a record which lasted unbroken until the Christchurch by-election. Others have said that records are made to be broken and I can think of no better person to have broken that record than my noble friend.
I suspect that both of us, when we became by-election candidates, were not too certain of our arrival in the other place. At that time if anyone had suggested that either of us would be arriving in this place we would both have felt that the world had gone mad. However, we are both here. I am delighted that my noble friend is here. She made an excellent maiden speech which set out my party's position on this Bill, but not in a controversial way.
There have been times during the debate when I felt rather like an unwelcome guest at a cosy family party. Many speakers have welcomed the Bill. Indeed, I thought at times the noble Lord would tell us that he regretted being in the wrong government because this Government seem to have been managing better than that of which he had been a Member.
I do not welcome this Bill. I agree with the noble Lord, Lord Davies: it is a mulish Bill. For reasons which I understand, we have the Bill because the Government have put themselves in a straitjacket. It is an education Bill that does nothing for education. It is an education Bill that does nothing for students. The sole reason for the Bill, as indeed the Minister has explained, is to enable the Government to meet their own self-imposed expenditure restrictions. I understand that the Government have bound themselves to those expenditure restrictions. But others of us are not so bound, and we do not therefore need to welcome the Bill.
My noble friend Lady Maddock explained—and I shall echo—that the Liberal Democrats have no philosophical difficulty with the principle of student loans. Our concern today is that the loans which the Government are likely to offer students are not large enough to cover their real expenses and that they will still have to go cap in hand to commercial banks. Not only that, but there are students who are left outside the student loans system altogether as it is presently conceived. My party would want loans to be available to support part-time courses. We also think it is high

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time that consideration be given to offering them to those in further education who get no help at all at present.
We have no difficulty with the principle of student loans; nor is there necessarily anything wrong with involving the private sector, as the Bill proposes. However, I am concerned that the bargain basement sale that the Government are organising is selling the public short. Noble Lords will be familiar with the doctrine of caveat etnptor—let the buyer beware. I am bound to say that what we have here is more a case of caveat venditor—let the seller beware. I fear that we are about to throw away valuable assets. Indeed, if I recall correctly, the noble Lord, Lord Baker, said that it was a privatisation in which the buyer could not lose.
Under the proposals of the Bill the Secretary of State can pay any subsidy he likes to City buyers. He can guarantee any losses incurred through default. Our complaint this afternoon is that, despite our earlier protestations, the Bill still contains no measures to limit the extent of those subsidies. We are told by the Minister that we have a strong competition in relation to the student loans book. I seem to recall in an earlier debate on student loans hearing exactly the same from the government then sitting on those Benches. It is to be hoped that this time it is the case. In view of that, why are Ministers so cagey about the extent of the subsidies? We seem to be in the situation of having a product which is worth selling and yet we are cheerfully continuing to shower the customers with free offers. The Government have said that they will, at the proper time, publish the list of the bidding companies. I wonder whether the Minister is able to tell us when publication is likely to take place.
This might be acceptable were not the Government's spending plans so tight. But the student loan portfolio that is to be knocked down to the City at unrepeatable sale prices is a national asset worth £3.1 billion. I seem to recall howls of protests from the Labour Party in opposition when the National Grid and Railtrack were sold off at knock-down prices to the so-called "fat cats" of the City. Noble Lords may well wish to ask themselves what is the difference here.
We have asked that the subsidy should be kept down below one-quarter of the amount originally advanced. That is not an unreasonable or extreme request. It is in fact precisely the request that the Labour Party made when it was in opposition and it made its amendment to the 1995 Bill. It was reasonable then; and in view of the increased interest in the sale, it is even more reasonable now. If the subsidy is allowed by default, or by weak negotiation, to rise above that figure, we are talking of a loss to the taxpayer of perhaps £1 billion of the £3.1 billion involved. If this money is given away by the Minister, he is giving away money that could stave off for the lifetime of this Parliament the need to introduce tuition fees at all.
Other speakers have regretted the fact that none of the proceeds of the sale is going to benefit higher education. When that was first said, I noted that the Minister looked with either surprise or disagreement. I hope she is able to assure us that the proceeds of the sale, or at
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least some of the proceeds of the sale, will go to the benefit of higher education. However, I suspect that it is the other way around. Were it not for the proceeds of the sale, there would be even less money for higher education, or for education generally, as her department would be in deficit and cuts would have to be made elsewhere. That is not extra money for higher education. It is saving higher education from more cuts. That is a very important difference.
I want to repeat our plea that the Treasury takes seriously the proposal to alter its accounting procedures so that student loans are not counted as public spending. If that principle could be applied to the existing portfolio, we could perhaps reconsider whether to proceed at all with the second tranche of the £1.5 billion sale next year.
Finally, I want to refer to some of the questions asked by the noble Baroness, Lady Carnegy, with regard to the Bill to which we shall be giving a Second Reading next week—the Teaching and Higher Education Bill. Like, I am sure, other noble Lords, I have spent the past few days looking at the Bill and, as is sometimes my practice with the detective stories I read, I started at the back of the Bill. The last words of the Teaching and Higher Education Bill come in Schedule 3—the list of legislation to be repealed. The last words say that to be repealed is the Education (Student Loans) Act 1997—the whole Act. If next week we are to start the process of repealing what will be an Act to which today we are giving a Second Reading, I have to ask why we are here this afternoon. All I can say is that it is probable that the Bill before us today will last on the statute book for one of the shortest periods ever; and that, at least, is something we can welcome.
4.36 p.m.
Baroness Blatch: My Lords, I begin by joining other noble Lords in congratulating the noble Lord, Lord Montague of Oxford, and the noble Baroness, Lady Maddock, on their excellent maiden speeches. I know that the House will be anxious to hear them participate in our debates in future.
We generally welcome the Bill. As the noble Baroness, Lady Blackstone, said in setting out the terms of the Bill, it follows on from where the previous government left off; so much so that I suspect much of the Bill before the House today was in preparation when the noble Baroness took office, although, as a number of noble Lords have said, some interesting pieces have been added. It is entirely appropriate that the private sector should be given a role in managing the student loans system.
The noble Baroness used the strictures of the previous government's spending limits. That was offered as the only reason for the Bill. Like the noble Lord, Lord Tope, I want to continue to remind the Government that those limits were self-imposed. They are causing enormous tensions—and just a ripple of tension on the Back Benches opposite. But I have to say that, in another place, that self-imposition is certainly causing great tensions.

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I join my noble friend Lord Baker of Dorking in welcoming the Bill and would pose the question that the generous terms obviously agreed with the Treasury put the prospective purchasers in a "cannot lose" situation. It is not possible, as my noble friend Lady Carnegy pointed out, to tell from what the Minister said about the Bill whether the predicted income from the sale in each of the first two years can be realised. Are the Government on target for realising £1.6 billion, not next year—I say that to the noble Lord, Lord Davies of Oldham—but this year? Only 16 weeks are left of this financial year, yet the Government are committed to finding £1.6 billion in this financial year and £1.5 billion in the financial year 1998–99. I agree with my noble friend Lady Carnegy. We could do with more details in order to make a judgment as to where we are at this time.
The noble Baroness, Lady Blackstone, also referred to the twin-track approach—the public-private arrangements—considered by the previous government and provided for in the 1996 Act. However, it is a matter of record that, following negotiations, the twin-track model did not proceed; and—I might say to my noble friend Lord Baker—for the very reason that we were not able to be as generous. We were not able to convince the Treasury in the way that the noble Baroness and her colleagues have.
The noble Lord, Lord Davies of Oldham, used a rather unfortunate expression. I use it back at him. He said that the Government had a "tawdry inheritance" from the previous government. This Government inherited an extremely healthy economy which even the Chancellor of the Exchequer has now had to recognise.
The noble Lord, Lord Davies of Oldham, also referred to the repayment arrangements of the present system of student loans. He was quite wrong in what he said. Students are not required to repay their loans in the first five years of earning. No student is required to pay one penny of the loan until he or she is earning at or above 85 per cent. of the national average wage, which is between £16,500 and £17,000. There are not too many people who walk straight out of university into a job and earn that kind of money. If there are, then the terms of the loan are affordable. There are many students, even those who took out a loan in the first year of it coming into force, who have not yet paid. There may be some who will never pay because, from choice, they are operating in the low-income sector or because, unfortunately, they remain in that sector. So it is not right to say that in the first five years of earning, students are required to repay the loan.
The noble Baroness, Lady Blackstone, made clear that today is not the occasion to debate the Dearing Report and its consequences for future policy. I agree. Therefore, I shall resist what is a very great temptation. The debate will come next week.
There are a number of questions. First, when will the last loan payments under the existing system be paid to students? Secondly, what will be the future of the private sector company—a question posed in a slightly different form by my noble friend Lady Carnegywhich purchases the debt and which will be set up as a
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result of this Bill? Will it wither on the vine as and when the loans made to students under the present system are repaid'? The noble Lord, Lord Tope, had rather more of an eagle eye than I when poring over the Bill. He picked up that the measure will be repealed as a result of the Bill to be introduced into the House next week. It may be that that answers my question. This company will be set up in business but there will be repeal almost before the ink is dry on the contract. That cannot be the case because the students who are the subject of loans under the present system will go on paying back, not through the Inland Revenue System but through the present arrangements. It would be very interesting to discover how that is going to be managed. Does it mean that the purchasing companies, the banks, who will be picking up this business, will be buying a diminishing return?
Are we to assume, subject to parliamentary approval of this Bill and the subsequent secondary legislation, that the Inland Revenue will be solely responsible for the recovery of debt for loans under the new arrangements and that therefore no role whatever is envisaged for the private sector in the new arrangements? What progress has been made on pursuing the interest shown by the private sector? Can we have an update on the present position as regards the level of interest shown and the state reached in the negotiations? What will be the impact on the PSBR of the measures in this Bill? I have to ask, as a prerequisite for next week's debate, what is the expected impact on the PSBR of the new arrangements for student loans?
It depresses me to have to ask the question across the Dispatch Box but can we have copies of the letter sent by Mr. Blunkett, the Secretary of State, with the intention of calming the nerves of the student population, their parents and schools? I understand that a round robin letter has gone out. It has always been customary that copies of such correspondence are given to shadow Ministers. I, and I am sure, all noble Lords in the House would be grateful to have a copy of the letter.
I must use this opportunity to record very considerable disquiet about the lack of real information as regards loans, especially to those potential students applying now for places at university for the coming academic year, even given the letter that they have apparently received from the Secretary of State. They still do not know the detail of what they can expect when they take up their places in 1998-99. It is not good enough that they glean it from newspapers, perhaps as a result of a Question in this House or another place. It is important that they understand the details.
If I understand the position correctly, the Bill to be introduced next week will have to go through this House, followed by its passage in another place, with possible to-ing and fro-ing between the two Houses while the Bill is put into a form for Royal Assent. After that there will be secondary legislation which has to go before both Houses. That is going to take a very long time and will proceed well beyond the date when young people are making their choices and taking up places at university. I find that situation pretty unacceptable.
It is unlikely that on these Benches I shall be seeking to amend this Bill. I say that it is unlikely because I have learnt the hard way never to say never in politics.

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As a final point, we shall reserve our energies for the Teaching and Higher Education Bill, which is to be introduced next week, because, as the noble Lord, Lord Tope, said, this matter has a very short life indeed.
4.46 p.m.
Baroness Blackstone: My Lords, perhaps I may begin by congratulating the noble Baroness, Lady Maddock, and my noble friend Lord Montague of Oxford for their really excellent maiden speeches. I am sure that I speak for all Members of your Lordships' House when I say how much we enjoyed them and how much we look forward to hearing from them again in future debates.
A great many questions have been put to me in the course of this debate. Some of them have been of an extremely technical nature. I believe that the noble Lord, Lord Grantley, admitted that some of the points that he was raising were more appropriate as amendments for Committee stage. I endorse what he admitted. They were not really suitable points for a Second Reading debate. I hope that he will forgive me if I do not address some of the very technical issues that he raised. However, I shall of course write to him. He will be free to raise any of the questions at Committee stage if he is able to be present.
We have had a very interesting and useful debate, which has raised many broad and generous questions as is appropriate at a Second Reading of this kind. I am very grateful to the noble Baroness, Lady Blatch, and to the noble Lords, Lord Baker, Lord Walton of Detchant, and Lord Grantley, and also to my noble friends for welcoming this Bill with, in one or two cases, a little bit of hesitation. I am only sorry that the noble Lord, Lord Tope, was unable to welcome it. I believe that he was the exception in this debate.
Perhaps I may clear up something with the noble Baroness, Lady Carnegy of Lour. She questioned whether I had made it clear that this Bill was completely separate from the legislation that we shall be bringing in relating to the recommendations of the Dearing Report. I made it absolutely clear. I shall quote what I said so that we are all clear. I said,
"I would like right at the outset to make it clear … that this Bill has nothing to do with the Dearing Report or the Government's response to it. Our proposals for the future of student funding have been brought before the House in the Teaching and Higher Education Bill,"
which we are going to debate next week, as Members of your Lordships' House present today are aware. I want to make that absolutely clear. I also made it absolutely clear that the Bill before us today relates solely to the existing student loan regime and the debt that we intend to sell to the private sector. It does not in any way relate to the new regime. It is perhaps helpful that I make that clarification right at the very beginning.
Perhaps I may advise the noble Lord, Lord Baker, that he was wrong to suggest that I opposed the introduction of student loans in 1990 when he and his right honourable friend John MacGregor (who, I think, succeeded him) introduced the Education (Student Loans) Bill. I always said that I had nothing against the loans in principle, but I opposed the scheme that his
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government introduced because, among other reasons, the methods of collection seemed likely to be administratively difficult, top-heavy and would probably lead to substantial levels of default. It is important to distinguish between issues of principle and matters of detail.
I want to re-emphasise the fact that this is a straightforward Bill. We have made it clear that the receipts from the sale of student loans are crucial to enable us to meet inherited spending plans for the next two years. The Bill also emphasises our commitment to the development of public/private partnerships. I am glad that there has been so much support around the House for new and imaginative forms of public/private partnership.
As I mentioned earlier, the Bill provides safeguards for borrowers. It freezes the significant terms of their loan agreements, preventing purchasers from varying these key terms when the loans are sold. The Bill protects borrowers and ensures that the key terms of their loan agreements remain unchanged. I am grateful to my noble friend Lord Davies of Oldham for recognising that those safeguards are built into the Bill. The purchaser is also protected from costs arising from such changes to the key terms of loan agreements. Purchasers will price their bids effectively without having to take account of possible future changes to the terms of the loans.
My noble friend Lord Montague of Oxford raised the issue of the capital expenditure needs of our higher education institutions. He spoke persuasively about the issue of private sector involvement in the provision of new higher education facilities, particularly residential accommodation for students. As he will be aware, higher education institutions already lever in private funds to a considerable extent. I can say this as a former head of a higher education institution who raised a great deal of private money for that institution.
It is estimated that commercial borrowing by the higher education sector is around £1.6 billion. The noble Lord also referred to the private finance initiative. Three of the PFI "pathfinder" projects being supported by the Higher Education Funding Council for England include new student accommodation. The Government are also keen to encourage other forms of public/private partnerships. Officials from my department meet representatives of private sector companies, including those from the financial sector, on a regular basis. We want that to continue. If such companies have specific ideas about measures which could be taken to encourage further private sector investment in higher education, we would welcome them.
My noble friend Lord Montague also drew attention to the strains on the university research infrastructure. These are, of course, just one aspect of the overall higher education funding difficulties inherited by the Government, which the Dearing Report highlighted.
We have, however, moved swiftly to show that we are ready to tackle the general higher education funding problem to which several noble Lords referred. We have made clear that the savings from the introduction of tuition fees through the other Bill for students from

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better-off families would be used to improve quality, standards and opportunity for all in further and higher education. But it will, of course, take time for our proposals to begin to generate additional money, because there will be an initial increase in costs to public funds, as loans replace maintenance grants. This extra outlay will at first offset the yield from the introduction of tuition fees for students from better-off families. We shall debate that matter next week and there will be an opportunity to say more about it then.
In the meantime, the higher education funding councils have mounted a joint research equipment initiative, run with the help of the research councils, which has been successful in attracting matching private funding. For our part, we have already announced a package of measures which, taking account of the income from tuition fees, will allow an extra £165 million to be spent on higher education in 1998–99. This includes an additional £125 million for universities and colleges in England to maintain quality and to tackle the backlog of maintenance and equipment replacement. I hope that that reassures my noble friend Lord Montague. It will also allow a further £4 million for some limited expansion.
Since 1995 the HEFCE has received a single grant for recurrent and capital purposes. Universities and colleges have full flexibility to manage their recurrent and capital allocations from within their total grant. We have asked the funding council to encourage institutions to make appropriate provision to maintain and update their equipment and estates. I hope that that reassures my noble friend.
The noble Baroness, Lady Darcy de Knayth, referred to disabled borrowers. Our objective is to ensure under the new contractual arrangements that they should receive no less favourable treatment than at present. We are still looking at the details. We would be happy to consider any representations that she or any other Member of your Lordships' House may want to make on the issue. We shall make the precise details of the arrangements clear when the regulations for this Bill are published in the New Year. However, I hope that the noble Baroness will accept my assurance that the position of disabled borrowers will be fully protected. They will retain the right to favourable treatment just as now. As the noble Baroness mentioned, the existing special provisions have never been applied in the seven years of the scheme's existence. That is because disabled borrowers can usually defer on income grounds, so the special provisions have never been required. However, those provisions are, and will continue to be, in place.
A number of speakers, including the noble Lords, Lord Tope and Lord Grantley, and the noble Baroness, Lady Carnegy of Lour, will understand me when I say that at the moment we cannot reveal anything about the extent of the subsidy. After all, a commercial transaction is taking place and it would be quite wrong to reveal what the subsidy might be until those negotiations have been completed and the winner of the bidding process has been announced.
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Several noble Lords from all sides of the House asked about whether the proceeds of the sale can be used for higher education purposes. Again, as I made clear in my opening speech, the proceeds of the sale will be used to fill a hole in the PSBR which was left by the previous government. We shall however continue to work to make available additional funding for higher education based on our new proposals that we shall discuss next week. I hope that I shall be able to say a little more about it at that time.
The noble Lord, Lord Walton of Detchant, and the noble Baroness, Lady Maddock, asked about the treatment of student loans in the national accounts. The noble Lord, Lord Walton, was right to stress that the Dearing Committee recommended that the Government should examine alternative approaches to national accounting which did not treat loans in the same way as grants to students. We are actively exploring the issue of the treatment of student loans in the public accounts with the Treasury whose responsibility it is. However, any changes to existing accounting treatment would be required to be considered in the broader economic context.
The noble Lords, Lord Walton and Lord Baker, together with other noble Lords, referred to the collection of loans through the Inland Revenue. I am grateful for their support for our decision to collect the loans by this means. This Bill is not relevant to the collection of loans under the new scheme, but that can be discussed further next week. We believe that it is absolutely right and that it is the most efficient and effective way of collecting these loans. Pre-Dearing loans will continue to be collected on the existing mortgage-style basis, not through the Inland Revenue. I believe that that clarifies the relationship between this Bill and later legislation. I believe that it would be wrong to do anything other than this. Students understood the basis on which their existing mortgage-style loans would be repaid and it would not be right to change those arrangements retrospectively. All existing students will continue with their pre-Dearing mortgage-style loans. To allow existing students to have a mix of mortgage-style and new income-contingent loans would be extremely complex, cumbersome and difficult to administer.
The noble Lord, Lord Grantley, asked a number of questions about the interest rate. The interest rate is tied to inflation to ensure that the value of the loan is maintained in line with the provision laid down in the Education (Student Loans) Act 1990. It would not be possible to make such a change under this Bill. Loans were taken out by students on the basis that interest rates would be linked to inflation. One cannot change that retrospectively. In future, key terms will be set out in the loan agreement rather than in regulations. The independent assessor will continue to administer complaints as now. His terms of reference and the conditions under which he operates—for example, his conditions of appointment—are available in the Library of the House of Lords if the noble Lord, Lord Grantley, wishes to pursue the matter. I assure him that no civil servants are involved in the administration of these complaints.

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The noble Baroness, Lady Carnegy, asked about the use of the Student Loans Company as collector. If the debt purchaser is to take on the risk of the loans defaulting it must be free to choose the body that collects the loans. The debt purchaser is likely to choose the Student Loans Company because of its experience, but it will take its decision on the basis of its view of the cost of using the Student Loans Company and its efficiency.
I say to the noble Lord, Lord Tope, that the Government's adviser, Rothschilds bank, announced in the middle of last month the four short-listed bidders for the purchase of the student loan debt. That is already available.
The noble Baroness, Lady Blatch, asked several questions. At the beginning she said that she would resist the temptation to speak on next week's Bill. I am afraid that once or twice the temptation proved a little too much for her. I hope that she will forgive me if I do not go into details about next week, other than to say that I shall make available to her a copy of the letter which the Secretary of State has sent to all prospective students. I shall also make available to her the leaflets produced by the Department for Education and Employment to provide potential students who are interested in applying for places at university next year with details of the new scheme. I shall ensure that copies of both documents are placed in the Library and that the noble Baroness and the noble Lord, Lord Tope, who speaks for the Liberal Democrats in this matter, have copies of them.
The noble Baroness also asked whether, following the comments made by the noble Lord, Lord Tope, this Bill would be repealed. Yes, it will. This Bill relates to the existing student loan debt, not to a totally new system that will come into force when the Bill to be debated next week is enacted. The noble Baroness also asked when the last loan payment under the existing system would be made to students. The new scheme will be introduced for new students in October but all existing students will continue to have their loans paid under the present system.
Baroness Blatch: My Lords, I am grateful to the Minister for giving way. A question arises from what the noble Baroness said. What is the legal authority for the purchasing company to continue its work to recover the debt some years into the future of those who take out loans under the present system if that legal authority is removed by the repeal of this Bill in the next few weeks?
Baroness Blackstone: My Lords, this Bill will not repeal the role of the Student Loans Company in continuing to collect debt under the existing scheme. However, perhaps I may seek to clarify it further in writing for the noble Baroness.
I have tried to answer as many questions as I have been able in the time available to me. I have gone beyond my time. This Bill is a straightforward measure. It is about carrying forward the previous Government's
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policy to meet our key manifesto commitment to stick to the already announced spending plans. The receipts from the debt sale will ensure that we achieve this. Education is our key priority. The Bill will extend opportunities and ensure that we continue to make high quality provision, as was the policy of the previous Government. I look forward to the Opposition's support of the Bill at this and further debates in the House. I commend the Bill to the House.
On Question, Bill read a second time, and committed to a Committee of the Whole House.

Local Government Financial Settlement
5.8 p.m.
Baroness Farrington of Ribbleton: My Lords, with the leave of the House, I should now like to repeat a Statement which my right honourable friend the Deputy Prime Minister has made in another place about the local authority revenue finance settlement for England for 1998/99. The Statement is as follows:
"As you know, Madam Speaker. the Secretary of State comes before the House at about this time each year to make a statement about local authority finance for the following financial year. There will follow a period of consultation with local authorities and others and I will then bring a report to the House which, when approved, will finalise the arrangements.
"My Statement today is important to local authorities since it gives them firm information on which to make progress in setting their budgets.
"This Statement concerns England. My right honourable friend the Secretary of State for Wales will be making an announcement today and my right honourable friend the Secretary of State for Scotland will make an announcement very shortly.
"As this is the first such Statement of the new Parliament, I hope that it will be helpful if I put today's Statement into a wider context. We were elected on a manifesto which pledged us to a renewal of local government. We aim to achieve: re-invigoration of local democracy; a commitment to best value; a prospect of greater fairness and; increased local discretion allied to greater local accountability. We have made good progress so far, though we have still some way to go.
"We have set up a new central local partnership to help local and central government work in harmony. We have signed the Charter of Local Self Government which the previous Administration refused to sign. We have taken legislation to provide for the release of some £800 million in additional capital expenditure in England under our capital receipts initiative. This money will help the unemployed; build and refurbish homes for those in need; and support our wider New Deal objectives. We have put local authority public private partnerships on a clearer footing. We are supporting the Bill of the noble Lord, Lord Hunt, on local authority innovation.

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"We are discussing with the Local Government Association ways of renewing local democracy. We are decentralising decision making to the local level. We have introduced a Bill to give London a voice once again. Tomorrow we will publish our White Paper on regional development agencies, setting out how we will work with local government and others to revive the regions of England. And we will very shortly announce the pilot local authorities for our "best value programme". Finally we have started, in co-operation with the Local Government Association, a review of the system of local government finance.
"Each of those items is important in its own right. Taken together, they demonstrate that we really mean it when we talk about a new relationship and partnership with local government. All this in just seven months of government. But our full progress will be judged not in seven months but over a full five years of a Labour government.
"We will be issuing consultation papers starting later this year and, following consultation, a White Paper in the late spring. This new relationship follows many years when the previous government did not listen to local authorities and squeezed their expenditure year after year after year. Despite all this, local government has survived that period, I am glad to say. My aim is to build a strong partnership between central and local government to the advantage of our citizens and our communities.
"The first important element of the local authority settlement is my proposals for the Government's provision for spending by local authorities. In forming my proposals, I have of course considered the pressures which local authorities will face in the coming year—which are considerable—and I have listened carefully to the views of the Local Government Association. In line with these views, we have chosen in this settlement to concentrate on the policy priorities, which we set out in our manifesto and which were endorsed by the electorate—above all, education.
"We were elected on a pledge to stick to the previous government's public expenditure totals for 1998/99. Nevertheless, my right honourable friend the Chancellor of the Exchequer announced in his Budget on 2nd July that by careful consideration of the priorities for public expenditure we had been able to make available an extra £835 million for revenue expenditure in English schools in 1998/99. I can confirm today that we will provide an extra £835 million of revenue support grant for our schools. This means that none of the cost of this extra schools spending will fall on the council tax payer.
"We are also providing £662 million for local authorities for the education of four year-olds, following the abolition of nursery vouchers. I also propose to provide up to £130 million for the transitional costs of local government reorganisation, such as for the unitary authorities. We have also taken into account smaller changes which will take place in local government functions. Taken together, these factors mean that the Government's view is that the
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appropriate level of total standard spending (TSS) for local authorities in England in 1998/99 will be £48.2 billion.
"My right honourable friend the Secretary of State for Health will today be making a separate announcement on resources for community care. My right honourable friend the Home Secretary will today be making a separate announcement on resources for the police. Both are included in the figure 1 have just quoted. This £48.2 billion provides for an increase of £1.78 billion (or 3.8 per cent.) in local authority spending year on year. That is expected to he 1 per cent. above inflation, therefore allowing an increase in real terms, to reflect our key policy priorities.
"Education is the top priority for this Government and the nation. Raising standards in schools is not only a benefit to children. It is an investment in our country's future. Altogether we have made extra provision of £1.06 billion, or 5.7 per cent., to go into English schools in 1998/99. It can and should be spent in the classroom, reversing the years of neglect. This meets the pressures identified by the Local Government Association and enables a start to be made on raising educational standards, which we all are determined to see. That is a big step.
"Community care is another important area in which local authorities are facing up to the difficulties involved. Local authorities provide a vital service by looking after elderly and disabled citizens. We have maintained previous plans to make resources available in this area. We expect to see a reduction in the net costs of financing outstanding debt. So we have been able to make a larger than average increase in provision for some services, including a further £70 million for children's social services—the first substantial increase for three years. Fire services provide an essential and much appreciated service to the community. So I am pleased to announce that we have increased provision for the fire service by 4.8 per cent., within an overall increase for other services of 1.4 per cent. These other services include highways, libraries and the Probation Service.
"Now I want to turn to how much assistance local authorities will get from the business rates and the national tax payer which together give a total of £37.51 billion. That includes the £835 million extra to ensure that the cost of our extra provision for schools does not fall on council tax payers. It also includes £20 million extra to make possible the development of £200 million worth of local authority private finance projects. The business rate will be increased to 47.4 pence in the pound, as provided by the legislation, following the 3.6 per cent. increase in the September retail prices index. This means that we can distribute £12.52 billion of business rates to local authorities in 1998/99. I am today publishing the detailed basis for that distribution to local authorities.
"I propose that the revenue support grant should be £19.5 billion. In addition, some £5.49 billion of specific and special grants will be available. The total of revenue support grant for England on which I am consulting may need to be altered slightly as a result

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of consultation. The total may be increased, if it appears that less provision is needed for the transitional costs of local government reorganisation.
"I turn now, to the means of distributing revenue support grant. At its heart is the standard spending assessment for each authority. An authority's SSA is its share of the total provision for all authorities, taking account of its local circumstances. It is not a spending target.
"We were elected on a pledge to remove the unfairnesses which have dogged standard spending assessments since they were first introduced. We have discussed with local government during the summer a wide range of ideas for improving fairness. I am today announcing changes which are well founded in research evidence which respond to long-standing concerns of many local authorities and which remove the more blatant cases of unfairness.
"I first propose a new basis for assessing spending needs for the education of under-fives. The nursery voucher scheme was a wasteful and bureaucratic paper chase. The money released by its abolition will assist in our programme to make universal provision for 4 to 5 year-olds. The new distribution will recognise the number of pupils for whom local authorities currently provide. Authorities which need to expand their nursery education, and put forward sound plans for doing so, will be able to get an additional grant from the Department for Education and Employment. This is just one element of the national childcare strategy, of which after school clubs form another part.
"Secondly, I propose to tackle a piece of nonsense in the present formula. Currently some authorities have an incredible ranking on the measures of neediness. It is hard to believe that leafy Kingston upon Thames is as needy as beleaguered Barnsley. We have carried out with the Local Government Association a very thorough re-examination. We have at last applied explicit principles to these calculations. I believe the new measures of neediness which we are proposing are a clear improvement on what went before.
"Thirdly, I propose a new basis for the allocations for elderly residential social services. The formula has had a thorough overhaul using research commissioned by the Department of Health from the University of Kent. For the first time, it takes proper account of the changes in social services in the past five years following the introduction of community care.
"Fourthly, I propose a new treatment of debt incurred by local authorities before the current system was established in 1990. During the 1980s local authorities had a choice. They could either use capital receipts to pay off debt or they could use them to finance new capital expenditure. But in 1990 the previous government decided to penalise those who had chosen new capital expenditure during the previous decade. They treated everyone as if they had chosen to repay debt, whether they had done so or
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not. I am proposing to put right that wrong. I propose that we should reflect in the standard spending assessment each authority's actual debt as at 1990, if that improves its position.
"Finally, I have given priority to tackling the great unfairness whereby visitors and commuters were assumed to have the same economic and social characteristics as the residents of the authority they were visiting. This was an anomaly exposed time after time in this House. The previous government's formula treated people staying in the Ritz in London as if they were as deprived as the average local resident. Even the research on this commissioned by the central London authorities themselves, which were the greatest beneficiaries, did not recommend keeping the existing approach. So from next year we will get rid of this glaring injustice. We shall take account of visitors and commuters; but only fair account.
"I will mention only one of the many other proposals for changes which were pressed on me but which I have not taken up. It concerns the area cost adjustment. That is the means by which higher employment costs, particularly in London and the south east, are recognised in standard spending assessments. I do not believe the evidence is yet sufficiently clear enough to warrant a change this year. However, I am commissioning further research to see whether there is a sound basis upon which to consider changes for this time next year.
"The changes which I have outlined, with some smaller technical changes, are a big step towards making the grant system fairer, as we promised. These changes would have a large impact on council tax levels in some authorities, if the authorities do not adjust their spending accordingly. I accept that authorities and their council tax payers may need a period in which to adjust to these changes. So I propose to phase in changes in the way that standard spending assessments are calculated.
"I propose that "damping" or "phasing-in" of the larger corrections we have introduced should be limited to the equivalent of half the SSA reduction. This strikes a reasonable balance between the need for time to adjust and the need to get more fairness into the system. There will again be separate "phasing-in" schemes for police and non-police authorities.
"I also propose to repeat this year's scheme to phase in those council tax increases which are directly due to reorganisation. The scheme would "damp" such council tax increases which are above a threshold of £52 a year at band D, for authorities which are subject to reorganisation from April 1998. It would also provide continued damping for authorities reorganised in earlier years where they exceed a threshold of £104 a year at band D.
"Let me now turn to council taxes. We are examining in the local government finance review ways in which the fairness of the council tax might be improved. I do not propose to make any changes ahead of the results of that review. I expect that for

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the foreseeable future the council tax will remain the prime means by which local residents contribute to the cost of local services.
"Each year the Government identify a notional tax level for each valuation band. This is known as the council tax for standard spending. We do this to calculate a distribution of grants which would enable all authorities to provide a standard level of service for a similar council tax level, for a similarly valued property, whatever the differences in needs and resources. My proposals set this figure at £635 for a band D property. That reflects the previous government's plans to increase council tax by 7 per cent. This increase was built into the previous Administration's spending plans. That is not a prediction of the average level of council tax nor of the band D bills for individual authorities.
"The actual council taxes in individual authorities will vary considerably depending on their own spending decisions; their financing decisions; their collection performance; and their efficiency. No Secretary of State could predict those factors with a high degree of accuracy for individual authorities.
"This pressure on council tax is inherent in the public expenditure totals set by the previous government. We have sought to relieve pressures by a number of means, in particular by fully funding the £835 million extra for education. This extra funding for schools is worth £50 a year to the typical tax payer. But, as I made clear earlier, local authorities must give full weight to the burden on their tax payers when they come to set their budgets.
"We remain committed to the ending of crude and universal capping. But in the light of our public expenditure plans, as both the Chancellor and I made clear to the Local Government Association conference in July, capping will remain in place for 1998/99. We have provided extra money for schools. We cannot risk that being undermined by unplanned increases in spending.
"I am today announcing my provisional capping principles for 1998/99. I am also issuing proposals for the calculation of notional amounts for those authorities whose boundaries or functions will change from 1st April 1998. These include reorganised authorities and local education authorities affected by the abolition of the nursery voucher scheme. The notional amount is the base level from which I will measure the increase in budget in determining whether that increase is excessive. My provisional capping principles themselves make allowance for expenditure on community care which is being met in 1997/98 by the special transitional grant; and changing funding arrangements for the National Criminal Intelligence Service. Those adjustments are necessary to make a fair year-on-year comparison of budgets.
"I am making a number of changes to provisional capping principles this year. These will give local authorities more room to exercise local discretion and will help them to direct the additional provision for education to the schools for which it is intended.
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"Subject to the allowances I have already mentioned and other technical adjustments affecting individual authorities my proposals for capping are as follows. As in previous years, authorities whose base budgets are more than 12½ per cent. above their standard spending assessment will not be permitted any increase over their 1997/98 base budget. Nor will any other authority be allowed an increase which would take it beyond 12½ per cent. above its SSA. However, I propose to allow each class of authority to increase its base budget more than in recent years. That will be helped by changes to so-called "passporting" about which I shall tell the House. Let me just explain this term "passporting". In the past, the Government recognised increased spending needs on a particular service, but prevented councils from spending that money—through the capping system. That was a ridiculous situation. "Passporting" is designed to deal with that problem.
"Where an authority's standard spending assessment increases, that will follow through into its capping limit so the money can really be spent. The permitted increases I propose for classes of authority are as follows: for inner London boroughs, the City of London and shire districts, I propose that the year-on-year increase should be limited to 1½ per cent.; for outer London boroughs, metropolitan districts, county councils, unitary authorities and the Isles of Scilly, I propose that the increase should be limited to 3 per cent.; for police authorities outside London, I propose that the increase should be limited to 3.2 per cent.; for the London and metropolitan fire and civil defence authorities, I propose that the increase should be limited to 4½ per cent. For all classes of authority other than police, these year-on-year permitted increases are substantially greater than last year, particularly reflecting the extra provision we have made for schools.
"Shire districts have been treated especially harshly in recent years. So for shire districts I am permitting an increase in 1998/99 which will be three times more than in previous years. But I am going further than that.
"I can announce today that for all authorities (other than police authorities) budgeting up to 12½ per cent. above their standard spending assessment, I intend to "passport" the increases for all service blocks within the spending assessments. This will extend the benefits of passporting to shire districts for the first time. It will also be the first time that increases in highway maintenance, other services and capital financing blocks have been passported.
"These are important changes in the capping regime. They give greater discretion to local authorities. I do, however, expect local authorities to look carefully at their permitted increases, including passporting, and make a careful judgement about whether they need to make those increases in budget and whether their council tax payers can afford them. Many authorities have budgeted below their capping limit in the past. I have given local authorities extra room within which to exercise their discretion. I expect them to do just that.

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"These principles are necessarily provisional. I cannot take my firm decision on capping until authorities have set their budgets for 1998/99. When I come to take those decisions, I shall of course, take into account all relevant considerations.
"My department is today writing with the details of the settlement to every local authority in England. That package includes a consultation paper setting out how we propose to distribute central government support between authorities, including my proposals on standard spending assessments and damping. It sets out my provisional capping criteria, and includes my proposals for notional amounts. Copies of this package have been placed in the Vote Office and the Library.
"The package is large and some elements are very complex and precise. That is possibly unavoidable for a system which distributes huge sums of money among more than 400 local authorities with different needs and resources. The basis of the calculations has to be set out in detail to assure the House and local authorities that each authority is being treated in exactly the same way as others. We are reviewing how we might simplify the process in the longer term, while retaining that reassurance. I know that if we can make this whole exercise simpler, it will be much appreciated by Members of the House, local authorities and the general public. For the immediate future I plan to provide for the House before the Revenue Support Grant Report is debated in the New Year, a plain English guide to these aspects of local government finance.
"The proposals I have outlined today represent a substantial improvement on the settlement that local government could have expected, following the Budget of the last administration a year ago: there is £835 million extra provision for education; standard spending assessments will be made fairer; and local authorities will have more scope to exercise their discretion on budgets. This is a better and a fairer settlement than in previous years.
"Too often in the past two decades, central Government in Whitehall seemed to be waging war on local government in the town halls. When Labour was elected on 1st May, we declared it was time to bury the hatchet. Whatever the considerable difficulties we found—financial, social, or environmental—we would face them together, with local government, regardless of the party in charge in any particular town hall. In just seven months, we have taken the first steps in developing this new partnership. We will be judged on our full five-year programme; but the direction is right—the priorities are different.
"The Government believe in local democracy. This year and next will he tough financially. But we are firmly on the road to reinvigorate local democracy and restore a new and more positive relationship between central and local government".
My Lords, that concludes the Statement.
Lord Bowness: My Lords, first, I thank the noble Baroness, Lady Farrington of Ribbleton, for repeating the Statement made in another place earlier this afternoon. I should declare an interest as a member of a local authority. There is one aspect of this Statement which I support unequivocally and which cannot come too soon for me; that is the promised plain English guide to the system.
I believe that this is a Statement which will be greeted on reflection with some dismay by both council tax payers and local authorities. What we have heard this afternoon is a formula for reduced services at increased cost, particularly in view of the more relaxed approach to capping which is envisaged in this Statement and because of the extra costs which must be met by local government.
For Band D taxpayers, who are always taken as a guide, it is a Statement which envisages increases in some local authorities of up to 10 per cent. of council tax or £60 at Band D. I do not believe that Her Majesty's Government can seek to avoid taking responsibility for that by claiming that they are adhering to the expenditure plans of the previous administration. First, they are not; and secondly, it is indeed their responsibility.
What have this Government done for local government since May? They have imposed an additional burden on local government which is estimated at some £1 billion. How is that made up? Principally, price levels are higher. They will have risen by nearly 1.5 per cent. over this year and as estimated over next year, costing local government as a whole £0.5 billion. There have been five interest rate rises since May. Rates are up from 6 per cent. to 7.25 per cent. And the changes in the treatment of advanced corporation tax for pension funds is costing local government an extra £300 million per year. That is not my figure but a figure provided by the Local Government Association, which has a very firm and solid Labour majority. It is no good members of the Government saying that this provision will not take effect until 1999. Councils will want to take action now to deal with the deficit with which many are faced. To leave matters until 1999 will only make the situation worse.
The consequences are that council tax will rise as I have suggested. The claim that the Government have increased funds for education by £835 million is not precisely as it seems. It is money taken from reserves left by the previous government, which would have been applied to education as part of the annual spending round. The effect of higher inflation rates has reduced this to a worth of only £480 million.
I believe that a number of questions arise out of the Statement. For example, how are the Government going to ensure that the money is applied to education? Will the Minister call on her colleagues in Labour-controlled councils to ensure that the money is indeed spent on that? Last year it did not. Is it not the case that the Secretary of State has no existing powers to ensure that

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that happens? Is there not a risk that councils put under severe pressure by the settlement may spend the money elsewhere, especially as the Local Government Association has predicted that there will be a significant shortfall in the total standard spending for non-education services?
The £662 million for educating four year-olds is not new money for education; it is merely recycling money from the nursery vouchers scheme. I ask the Minister what information she can give the House regarding the changes to the methods of distribution. We need to know what the effect of those changes will be. Where will the gains and losses be felt? Is there a shift from the south and the south-east to the north? Is there a shift from rural areas to urban areas? I believe that the House will want to know the answers to those questions. Changes of this nature in the formulae never affect only one authority, were that ever to be the intention of governments. The system is not that sophisticated or sensitive.
The changes in the treatment of debt will, I believe, be a matter of rewarding councils which have run up debts and penalising those which have paid them off. That is on top of the local authorities' supplementary credit Act which has already given a new capacity to borrow rather than releasing the actual moneys, as stated yet again in the Statement this afternoon. The encouragement to increase debt can only be to the detriment of council tax payers in future years. Will not the changes in the "damping" mechanisms, which have been changed themselves, not lead to unacceptably high levels of council tax in many local authorities?
In opposition, the Government made much play of how they would encourage and support local authorities and local services. By this settlement, and in particular their own actions, they have put at risk social services and other local authority services, reduced the value of the benefits claimed to have been given to education and placed another burden on council tax payers, many of whom are just coming to terms with the succession of interest rate rises that they have suffered on their mortgages. It is extra taxation—I know that it is because this time last year the then Shadow Chancellor of the Exchequer described his estimate of council tax rises as "locally-driven tax rises", as did the then Leader of the Opposition. But in the "People's Britain" there were supposed to be no plans to increase tax at all. I say to the Minister that the council tax payers who will pay for the settlement will see it as another tax on the people.
Baroness Hamwee: My Lords, I, too, thank the Minister for repeating the Statement. She must feel something of a poacher turned gamekeeper, or perhaps I have that the wrong way round. Like the noble Lord, Lord Bowness, I must declare an interest as a serving member of a London borough. I have never seen the play "The Mousetrap", but I believe that it must be a little like the Statement—the script remains much the same year after year, despite the new cast. Therefore, it is inevitable that the response from these Benches will not be very different from that given to previous Tory
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settlements; namely, disappointment, verging on despair, combined with anger borne of frustration and pain at what is happening to local services.
The new Government have undoubtedly written a better prologue to the play, but they have stitched it on to rather the same substance. Indeed, the noble Baroness referred quite directly to the previous government's plans which, it appears, this Government may be applying even more toughly. Reference was made to the European Charter for Local Self-Government, but the combination of the grant system and capping envisaged in the Statement does not seem to me to amount to the autonomy envisaged by the charter. I take the opportunity to ask, as I have done previously in this House, when the Government intend to ratify the charter? I am sure that that is very close to the noble Baroness's heart.
The noble Baroness referred to capital receipts and used the word "release". I cannot help but respond that it is not a release; indeed, it is a new borrowing arrangement and local authorities understand that fact. Reference was also made to the recently ratified concordat, the framework for partnership between local and central government. I hope that the consultation referred to in the Statement will mean that, in the future, if real consensus is not reached between the two sides—because that may not be possible—then very constructive dialogue will be organised with both sides listening extremely carefully.
In the run-up to today's announcement, the Government will have been told of local authority concern for education. We have been told about the funding for education. I have to say that I contest the view that it is good news. The Local Government Association estimated in June that LEA spending next year needs to rise by £529 million to meet inevitable costs and to restore pupil-teacher ratios only to 1995 levels.
Pupil numbers are rising and we now have just under 500,000 five to seven year-olds in classes of over 30. If one adds to that approximately £515 million for inflation and the teachers' pay award, education spending needs to rise by £1,044 million just to maintain current standards, the allocation for which we have heard is £835 million from reserves. Local education authorities will be more than £200 million short of what they need to meet basic educational needs in 1998-99. I hope that the Minister will accept that a shortfall of that order means that local government aspirations for education cannot be met.
With regard to the under-fives, the proposals are not entirely easy to follow. My own authority has already declared an interest and I know that it is seriously concerned. It believes that it would lose over £1 million of under-five SSA with a change in the basis for distributing the majority of funding—that is, 30 per cent. of this sub-block. That seems an impossible shift of resources in a single year. It also seems to indicate that the cardinal rule of the SSA system—namely, that an authority's own policies should not influence the SSA—is one which may be on the way to being breached. In other words, it seems not to be the unalloyed joy and benefit suggested by the noble Baroness.

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Reference has also been made to community care. I am sure that the noble Baroness will accept that the previous government underfunded community care. That led to local authorities considering rationing, grasping the nettle and being open about it in a way we have not yet seen in the health service, although I believe the issues are rather similar. It appears that in this area six out of 10 authorities will have to increase their charges at a rate above inflation; four out of 10 will have to introduce charges for services which were previously free, which means restriction on access; and seven out of 10 will have to tighten eligibility criteria. That, too, means restriction of access. The police and fire services and those who provide a whole raft of environmental and protective services still believe that there are considerable shortfalls.
Many noble Lords will have received representations from local residents as well as from local authorities as to the effect on their services. Only last weekend I received a letter from a resident of Oxfordshire, an authority which has suffered substantially under the capping regime. The letter referred to library closures. I am sure that your Lordships, with your respect for language, the written word and information, will understand the impact these proposals will have on a lower order service such as libraries not falling within the "headline" topics of education and social services. Only today a report was published by the Rural Development Commission on the loss of services in rural communities. When I read about the loss of bus services, I could not help thinking that this is just the kind of service which local government, in partnership with other providers, would want to ensure is available for their communities. It seems to me that that kind of partnership is now even further restricted.
It is entirely right to refer to local taxation in the context of taxation overall. One has to mention council tax along with other taxes, especially income tax. In many ways council tax is less fair and less transparent than income tax. That makes it all the more important to admit that this settlement means that people will pay more for less and that, because of the capping and the decision to stick with Tory spending plans, the responsibility for cuts and for council tax rises rests squarely with central government and Whitehall and not with town halls.
Your Lordships will have detected a reaction from these Benches when leafy Kingston was mentioned. The noble Lord, Lord Tope, and I are its neighbours on either side. We have noticed that other boroughs, including, for instance, Wandsworth, have leafy bits too. I am not surprised by this reference. Perhaps Barnsley is to become the new Westminster! If I have understood correctly, I think I welcome the announcement about the change in the approach to debt. The noble Lord, Lord Bowness, took a rather more moralistic view on that than I might have done. In the light of the financial constraints of the past few years, one cannot look at the question of debt entirely as a moral issue aside from an economic one. I am not entirely surprised that the area
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cost adjustment has been postponed. I am beginning to think that that needs a mediator rather than a researcher to settle it.
I note, too, the references to damping. I think that that gives something away. Of course there will be losers through the settlement and that is admitted by the Government. They are leaving in place capping for the next year. I have some difficulty in understanding the passporting rules but they seem to indicate that there may be more ring fencing and more central control. If that is the case, I cannot welcome them.
In the Government's review of all this, and their proposal to issue a plain English guide, might now not be the time also to consider whether this Statement is an appropriate presentation? I believe that the Statement comprises 54 pages, although some of the pages contain only a few sentences. No one would deny that the procedure provides a superb platform for the Government. However, some noble Lords will have collected the Statement only minutes before it was made. It is an enormous package. The noble Baroness referred to the precision and complexity of the settlement. There is, of course, obscurity too in some of its elements, if I may dare to say so. Real consultation in the future might be better served through a different form of announcement.
Lord Hardy of Wath: My Lords—
Baroness Farrington of Ribbleton: My Lords, I hope that my noble friend will understand that the procedure is that I reply to the two Front Bench speakers and that there is then an opportunity for questions from other noble Lords. Certainly, the noble Baroness, Lady Hamwee, would find it not at all difficult to convince me, while I am at the Dispatch Box, that there is a better way to proceed. I am sure that, during the course of the review of local government finance, questions of presentation and the manner in which decisions are announced will form part of the discussion.
I begin with the points made by the noble Lord, Lord Bowness. I find it strange that he feels able to express dismay at an average increase which was definitely built into the published expenditure plans of the previous government as part of their commitment that a greater share of the cost of local services ought to be borne by the council tax payer rather than through central taxation which is then re-distributed through grant. He expressed concern about council tax payers having to pay even more because of extra spending. I remind the noble Lord that the Government are backing pound for pound the £835 million increase in education expenditure with extra grants.
The noble Lord asked how we would ensure that the additional money intended for education was spent on education. That is one of those catch-22 questions. If we were to say that it was being rigidly controlled from the centre, that would provide grist to the mill of the noble Baroness, Lady Hamwee, who sees even passporting as a dangerous extension of central control. Budget decisions are for local authorities, and that is as it should be. Both I and my right honourable friend the Secretary of State will want to draw the attention of local

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authorities to education and to the priority that it will be given by parents. I declare a former interest as one-time chair of an education authority in Lancashire. In my experience the first people to be aware of the additional money for education will be the many parents and parent governors who are not prepared quietly to sit back.
The noble Baroness, Lady Hamwee, referred to the increased money for education. I believe that she failed to note that the total year on year increase in the education budget is £1.06 billion, and that the £835 million was additional expenditure within that amount and therefore should be adequate to meet the needs she identified. The noble Lord, Lord Bowness, claimed that the nursery money was merely a question of recycling. What we are doing is returning money—so that it can be spent directly, without incurring unnecessary bureaucratic hoops and costs—to the people who ought to provide the service for all four year-olds whose parents wish them to have that education. Therefore it is not recycling money.
The noble Baroness, Lady Hamwee, asked whether the distribution of money would be in a manner that was fair to individual local authorities. I am sure that individual local authorities will check that aspect during the consultation period. The noble Baroness expressed concern, if I understood her correctly, about the degree to which there would be central control over bids for additional money to spend on the education service. We do not intend to allow local authorities, as they did under old local government finance systems, to claim money within their expenditure totals and central government grant for the provision of pre-school nursery education, and not use the money for that.
The noble Lord, Lord Bowness, asked about distribution. I refer him to the detail of the Statement. I believe that it clearly answers his question.
The noble Baroness, Lady Hamwee, referred to the issue of grants, capping and ratification of the charter. The Government will ratify the charter for local government when it is appropriate to do so. In their new partnership deal with local government the Government recognise that there need to be radical changes as the result of a thorough investigation of local government finance. It is because we intend to do that that the capping regime stays in place at present. But we shall give priority to ensuring that there is a proper, thorough review. We seek to achieve agreement between ourselves and local government in order to improve matters.
As regards the education budget, there is a 5.7 per cent. increase year on year. The noble Baroness, Lady Hamwee, sought to reintroduce a proposal which I understand was put to the electorate in the general election by her party: that the public should pay higher rates and that the money should be spent on education. This RSG settlement provides nearly £2 billion in total including the additional money for school buildings over and above the expenditure totals which we inherited. In that sense we have met an objective but have done so with the backing of the electorate who voted not to have such an increase in income tax.
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We do not deny that this is a difficult budget. That is inevitable. The Government wish to see firm and solid management of the economy at this stage so that at the end of five years we are able to consider the funding of local government services and the new relationship in the context of a sound economy.
From my experience, Barnsley, being the other side of the Pennines, would be happy to have the visitors and commuters who are present in some of the authorities in the south. My experience of people in Yorkshire is that they would happily say, "Yes, and we do not expect unfair additional treatment if we are doing so well."
6.5 p.m.
Lord Hardy of Wath: My Lords, does my noble friend accept that it is cause for considerable pleasure to hear that the Government seek to develop a new, fresh and much needed relationship with local government and that the blatant unfairnesses are being tackled? In that regard, and as a Yorkshireman from the best side of the Pennines, I wish to ask my noble friend whether Barnsley and the other Webber-Craig authorities—the smaller metropolitan areas of the north of England—have cause for a little relief after more than a decade of the unfairness and hardship they have experienced? That hardship and unfairness did not extend to the City of Westminster. Is there some satisfaction for those and other authorities which have experienced that unfairness? Has the difference between the City of Westminster authority and the remaining authorities substantially narrowed?
Baroness Farrington of Ribbleton: My Lords, I agree with my noble friend. It is a good position to be in. As an initial step in reviewing the way in which local authority SSAs and funding are calculated, we are looking at some of the more blatant examples of the system used by the previous government which was unfair to some authorities and excessively unfair to others.
Baroness Gardner of Parkes: My Lords, I believe it appropriate to ask my question in view of the previous Statement with which I cannot agree. Is the noble Baroness aware of the lengthy debate in this House when the national non-domestic rate was introduced? It now seems to be called the business rate. On that occasion it was pointed out that the City of London, the City of Westminster, Camden, and Kensington and Chelsea, each made a huge contribution because the total business rate which they had collected in the past had gone in its entirety directly to the Treasury. That was the reason for a degree of compensation to those inner London boroughs. The City of London was excluded and treated differently. The other boroughs received differential treatment to compensate them to some minor degree for the great amount that they had lost. I do not know whether the noble Baroness is aware of that debate. I participated in it at the time.
Is the noble Baroness aware that since 1991–92 the SSA per head in the City of Westminster has increased by less than the average for inner London boroughs? Is she also aware that within the City of Westminster there are significant areas of deprivation, and a much higher

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proportion of elderly aged over 85 and elderly living alone than in Hackney, Islington, Lambeth or Southwark? Can the noble Baroness confirm that some element of the SSA will continue to cover tourism? The noble Baroness mentioned areas fortunate enough to have tourists. Does she agree that there are costs in terms of additional street cleaning and provision of amenities associated with tourism? Tourists are not entirely a source of joy either to the local residents or to the council tax payers.
I have one further question which applies to any borough—in London or outside. Will the Government consider the need to recognise that special expenditure for refugees falls unfairly on certain areas and should be treated as a national expense? Can some help be given, either retrospectively or in advance, to those boroughs and areas involved in the high costs which apply to refugees?
Baroness Farrington of Ribbleton: My Lords, on asylum seekers, the Government recognise the difficulties of local authorities. In the short term the asylum seekers will be eligible for non-contributory social security benefits, where they have applied on arrival at the port of entry for asylum, and for assistance under the homelessness legislation. In the longer term, the Government are conducting a wide ranging review of asylum policy considering all aspects of the asylum process including the provision of accommodation and support. The aim is to identify need.
Behind the point raised by the noble Baroness is the question of whether SSA should apply in full to the cost of asylum seekers. It is not possible to reflect specifically asylum seekers in the framework of broad indicators used for SSAs, but numbers of asylum seekers are included in SSAs to the extent that they are reflected in the population estimate used in their calculation. In deriving the estimates for 1998–99 SSAs, the Registrar General changed the method of calculation to reflect more accurately the numbers of asylum seekers in the London area.
As to the range of questions put by the noble Baroness, I do not recollect the particular debate to which she refers with regard to national non-domestic rate, but I can reassure her that the levels of real deprivation among the population in authorities such as the City of Westminster will continue to be given fair treatment. What has changed as a result of the more blatant flaws in the previous system is the assumption not that there should not be account taken of those coming into such authorities in terms of commuters and tourists—those needs are taken into account—but to ensure that no assumption is made that if, for example (I use a figure for illustration) 20 per cent. of the City of Westminster's permanent population were deprived,
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that would be no reason for assuming that 20 per cent. of the commuting or tourist population were deprived. That is the adjustment that has been made.
Lord Evans of Parkside Lord Evans of Parkside rose—
Baroness Gardner of Parkes: My Lords, I am sorry but I should like to come back and ask a supplementary question?
Lord Evans of Parkside: A long time has been spent on this question.
Baroness Gardner of Parkes: We do have 20 minutes and I would like to ask a supplementary. Is the noble Baroness saying that no consideration is being given to the fact that this huge business rate, non-domestic rate, is going entirely to the Treasury? Is the City of Westminster to get no benefit for its council tax payers from that?
Baroness Farrington of Ribbleton: My Lords, all local authorities get benefit from the Treasury because the previous government nationalised the business rate. They nationalised it and ensured that it was then distributed by central government. We have said that we want to look at the situation and the circumstances in which it would be possible to consider returning that to local authorities and to local discretion. I have given an indication of the sorts of things that would have to be in place as part of that total change. I feel it is a little unfair to hold me to account for all the actions of the noble Baroness's party in government.
Lord Evans of Parkside: My Lords, will my noble friend accept my sincere congratulations on the way she presented the Statement to the House and answered questions? Local government finance is notoriously an appallingly difficult subject, surrounded by its own jargon. Frankly, the overwhelming majority of the population can make neither head nor tail of it. Is my noble friend aware that over the last five or six of my 23 years' representing St. Helens in the other place,I always spent a full day with the borough treasurer after he had devoted a whole weekend to going through masses of documents like those confronting us today to arrive at what the final settlement would mean to the borough of St. Helens? Is my noble friend aware that I am astonished when I still hear representatives of the Conservative Party get up and proclaim the unfair treatment that Westminster has received over the years?
Is my noble friend aware that if the borough of St. Helens had received precisely the same standard spending assessment and support grant as Westminster, not only would we have been able to provide the services entirely free of any charge but we would also have been able to send every single council tax payer a cheque for £750? That is a measure of the appalling unfairness in the circumstances. Is my noble friend also aware that much of the non-domestic rate of the borough of St. Helens was wiped out by successive Tory governments closing factories, collieries and other places that once employed thousands of people?

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Finally, can I say to my noble friend that I think that the Government have done a magnificent job in a short space of time in a notoriously difficult area. But will she ask her right honourable friend the Deputy Prime Minister to ensure that when the rate support grant settlement comes to us next year the Government will then have 12 months behind them and there will have been much more consultation with local authorities, so that next time round we will get a fair settlement which means that impoverished boroughs like St. Helens and others in the north of England will finally start to get a fair and honest deal from central government?
Baroness Farrington of Ribbleton: My Lords, as the noble Baroness, Lady Hamwee, referred to me as a poacher turned gamekeeper, my long experience in local government makes me hesitate to give a definite and categoric assurance of a particular date for ending a process of consultation between central and local government on the basis of future financial arrangements. We are fully committed to ensuring that a proper, fair and mutually respectful system is brought in as quickly as possible, in line with its being effective.
I understand the emotions. As I said earlier, I declare an interest, as a former Lancashire county councillor. None of us can doubt that there are high needs in areas in parts of local authorities such as the City of Westminster. We walk home at night past some of those needs. All that this settlement seeks to do is to ensure that those needs are recognised and met on a fair and equal footing, matching the percentage of needs existing in leafy Kingston with the percentage of needs in St. Helens. Fairness and equity is the hallmark of what we seek to do.
Lord Bridges: My Lords, may I, from these Benches, support the suggestion made by the noble Baroness, Lady Hamwee, that the extremely complicated nature of these statements makes their content rather difficult to digest, particularly if one does not have the benefit of a text. It seems to me, given the very complex gobbledegook language used, that it is difficult for those of us who are not versed in local government finance to understand fully. There might be some advantage in considering a different way of dealing with important Statements like this, for example, by the circulation of a printed text a day or so in advance so that we might have a rather more considered debate. I am aware that in this House a number of Members have expert knowledge of local government finance but I think we would be able to make a more considered and valuable contribution if we were given the opportunity to consider the matter shortly before speaking about it.
Baroness Farrington of Ribbleton: My Lords, I do take the point. Certainly, as I said in reply to an earlier question. I personally, at this moment, would like to see a different system in place. I am sure that particularly those Members of your Lordships' House who are still actively and individually involved in local government will ensure that the system of announcement and debate of the announcement will be considered. I understand
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that, apart from one year, this the first time for several years that the RSG settlement statement has actually been given in your Lordships' House.

Social Security Uprating
6.19 p.m.
The Parliamentary Under-Secretary of State, Department of Social Security (Baroness Hollis of Heigham): My Lords, with the leave of the House, I shall now repeat a Statement on the uprating of social security benefits and re-rating of national insurance contributions which has been made in another place by Mr. Keith Bradley, the Parliamentary Under-Secretary of State for Social Security. The Statement is as follows:
"With permission, I should like to make a Statement on the uprating of social security benefits and the re-rating of national insurance contributions for 1998–99. I should also like to report to the House on our objectives for reforming social security.
"This is the first benefits uprating announced by this Administration and unlike those of previous years it will not be marked by a long list of cuts to the welfare programme. Not that we are content with the size of the Budget. We cannot be complacent when despite growing prosperity, spending on social security has continued to grow. It now consumes one-third of government expenditure and is set to break through the £100 billion barrier before the end of the century. That is more than is collected in income tax, twice what is spent on the NHS and nearly three times what is spent on education.
"As importantly, we are not content with the way the money is spent. The huge cost that is our legacy has done so little to reduce the amount of poverty. The inability to harness social policy, to use it as a tool for change, has not only been the main driver of welfare spending, it has resulted in the greatest social division we have seen for generations.
"We are committed to breaking with the past. We are undertaking a systematic review of the welfare programme. This review is both necessary and timely. We need a modern welfare system to reflect modern circumstances.
"Our welfare to work programme will provide people with a route out of benefit dependency. And our comprehensive spending review will lead to the modernised system that we need. I will say more about this later.
"First, we have immediate business. The House knows we are required to review the rates of benefits and national insurance annually. Our intention for the year 1998–99 is to uprate most national insurance benefits, child benefit, benefits for disabled people and carers by 3.6 per cent. This is the increase in RPI in the year to September. War pensions will also be uprated by RPI.
"As in previous years, jobseekers' allowance and the main income-related benefits, will be uprated by the Rossi index, which at September had a year on year increase of 2.4 per cent. The Rossi index, as

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Members will know, is RPI less those elements for housing costs. It is a more appropriate index to use for the income-related benefits where housing costs are, in the main, met separately. Most rates of deductions in respect of non-dependants have been increased over and above inflation. This will reduce the benefit paid in respect of housing costs to claimants who have non-dependants living with them.
"Taking forward this measure allows us to reverse the previous Government's planned measure to extend the single room rent restriction. The withdrawal of the extension, which would have restricted housing benefit to those aged over 25, has been welcomed both inside and outside the House.
"This was a hard choice in maintaining our commitment to live within existing spending ceilings. It is important to remember that the mandate we so recently received was based on a manifesto which committed us to controlling public expenditure.
"Moving now to national insurance, we do not propose to increase the rates of Class 1 contributions paid by employees and their employers or the earnings brackets for the three lower rates of employers' contributions. The rates of Class 4 profits-related contributions paid by self-employed people will also remain unchanged. The lower earnings limit for Class 1 contributions will increase broadly in line with the basic rate of retirement pension, as will the upper earnings limit which applies to employees' contributions only. Similar increases apply to the lower and upper profits limits for Class 4 contributions. The weekly Class 2 contribution paid by self-employed people and the voluntary Class 3 contribution also increase in line with this formula.
"The cost of the uprating will be £2.45 billion. The maximum available Treasury grant for the National Insurance Fund will be set at £800 million. Most new rates of benefit and the changes made to national insurance contributions come into effect from 6th April next year. Schedules showing the new rates of benefit and the new rates of national insurance have been sent to all Members today.
"The most pressing need is to develop our approach to people of working age. They are responsible for the support of their children. Their actions while in work will determine how adequate their income will be in retirement. The best we can do for people of working age is to give them the opportunity to work. This is our first objective for welfare reform.
"The wage motivation to work is for most people compelling—with the best will in the world benefits can never be a substitute for earnings. Equally, there are also very strong non-wage motivations for working which in total reflect and influence the shape of society. Work enables people to be in the mainstream of society, to make their own contribution, to develop their potential, and to offer a positive role model for their children. Work also provides access to social networks, and access to new opportunities for advancement.
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"None of this is new. It could be argued that making work the best form of welfare has always been an objective of social policy. But the facts show that the current social security system fails actively to promote a return to work.
"The fact is that an indifference to social policy, and an assumption that unemployment is a price worth paying for economic success, have meant that millions of people have been set aside from the labour market and condemned to a life of dependency.
"Our objective is to root out worklessness, and to give all people of working age a chance of economic opportunity. That is why our New Deal programme extends beyond the unemployed. We also need to give lone parents and sick and disabled people a hand-up. And we need to make sure that where possible, work pays and that tax and benefit systems encourage and not deter work.
"That is why we have a Whitehall task force on tax and benefits to help deliver the Government's pledge to streamline and modernise the welfare system. It is why we are introducing a minimum wage. It is why we are looking carefully at every benefit to see whether it helps or hinders people in achieving their aspiration to be in work. We are seeking to recast totally the aim and operation of welfare, to make clear that work, rather than benefit payment, is the right solution both economically and socially, for people of working age. And we will continue to support those people who cannot work.
"The second group needing our attention are children. Our objective here is to ensure that all children are supported, wherever possible, by their working parents. Nearly 3 million children now live in workless households, a threefold increase since 1979. The best way to support these children is to ensure that their parents are working. They benefit from the lasting financial security that work ensures and from role models which help them to learn how they too can live independent lives when they grow up.
"Our new deal for lone parents is helping to tackle this problem by providing a comprehensive package of back-to-work help for lone parents. Effective childcare arrangements are vital as nine out of 10 lone mothers would work if they could afford childcare. This Government are committed to a national childcare strategy, which will help parents, especially women, to balance family and working life.
"Child support maintenance has a major part to play here. Receiving regular maintenance payments helps lone parents work, independently of all other powerful influences on their ability to work. And we must move to a point where an absent father's failure to provide proper financial support for his children is seen as socially unacceptable.
"Our ambitions do not stop at people of working age. It is also essential to help pensioners. On average, pensioners' incomes have grown over the last 20 years but the gap between the poorest pensioner and the richest has widened. And projections show that this gap will continue to widen unless urgent corrective action is taken.

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"Our objective is to promote financial security in retirement in a way which enables people to build up a stake in their own provision. It is clear that the difference between richer and poorer pensioners is a result of the extent to which the former have had access to second tier pension opportunities, and have taken advantage of the chance to save during their working lives. Secure income in retirement will be achieved when people of working age realise that the more they and their employers make contributions to their own pension, the greater will be the reward when they retire.
"Work, to fund savings, is the best form of pension provision. That is why we have launched the pensions review. That is why we are consulting on stakeholder pensions, and developing citizenship pensions. This will extend the opportunities for good value pensions to the 8 million people who are poorly serviced by the existing arrangements. It will also begin to address the current inequalities between the opportunities of women and men to have adequate pensions.
"We are also taking action to ensure fair treatment of pensions on divorce, giving greater rights to women who have contributed to the build-up of pension by supporting their husbands in the home. And we are determined to tackle the situation where nearly a million pensioners do not take up the income support to which they are entitled. We have already commissioned research to establish the reasons why they do not. And from April we will begin a number of pilot exercises to find out the best ways of delivering income support to older citizens.
"As the manifesto made clear, we believe pensioners should share fairly in the increasing wealth of the nation. This is not just a long-term aim. We have already reduced VAT on fuel and from next year will abolish the gas levy. This shows we will act quickly. And in his pre-Budget Statement the Chancellor announced the winter fuel payment, paying pensioners £20 and the poorest £50. These payments will be made in time for the winter fuel bills. They will be on top of the normal pensions payments which will be uprated next April, as I have already announced.
"We are a modernising government. We believe in bringing opportunities to all sections of the community equally, but also believe that these opportunities bring responsibilities. Our reforms will be guided by our objectives for the main groups we are seeking to help: welfare to work for those of working age; security for older citizens for now and in the future; and support for children.
"As the House knows, the orders introducing the new benefit rates and the main elements of national insurance require affirmative resolution. We look forward to the wide debate on our programme for social policy that occasion lends itself to. I commend this Statement to the House".
My Lords, that concludes the Statement.
6.32 p.m.
Lord Higgins: My Lords, the House is grateful to the noble Baroness for repeating the Statement made earlier this afternoon in another place, not least because she does so, I understand, at some personal inconvenience.
The annual uprating Statement is an important Statement and, indeed, one of the few fixed points in the annual financial timetable. Before we had a unified Budget we had an Autumn Statement, the uprating Statement in the autumn, and the Budget in the spring. We then moved to having a Budget, an Autumn Statement and the uprating Statement in the autumn. This year, because of the election, we find that we have a Budget in the spring, an uprating Statement in the autumn and no Autumn Statement at all. We are grateful for that.
I ask the noble Baroness one question which arose from her closing remarks with regard to the orders but relates also to an off-the-cuff remark made by the noble Lord, Lord McIntosh of Haringey, in response to a question from my noble friend Lady Hogg when he was commenting on the so-called "green" Budget. He cast some doubt on the future timing and also on whether there would continue to be a unified Budget. Can the noble Baroness confirm that the orders we are discussing will be debated in the spring and whether the Government have any further view as to how the timing of the Budget and these orders will be related?
In considering these matters one of the notable omissions of detail in the Statement is the question of the extra benefits which have been previously paid to lone parents. There was a reference to the welfare to work programme, as one might expect, and a strange categorical statement that,
"nine out of 10 lone mothers would work if they could afford childcare".
I was not clear what the source of that precise statement was.
The noble Baroness has a history in relation to lone parents. For example, in November 1995 she commended the idea of the lone parent premium and the single parent benefit and condemned the then government saying that they would deliberately make those families poorer. She went on to describe this measure as,
"vindictive, punitive and utterly wrong".—[Official Report, 29/11/95; col. 601.]
Yet, as I understand it, that is what the Government are now proposing to do. The noble Baroness went further. In only February of this year, referring to those benefits, she said,
"It is one of the very few benefits that do not trap a parent in dependency. So, lo and behold, the Government propose in future to remove it. Why? What on earth are the Government thinking of?"—[Official Report, 20/2/97; col. 850.]
Perhaps the noble Baroness can now tell us what it is that the Government are thinking of, because this is very much a reversal. She went on yet further and said:
"It is as simple as that, and the Government are removing one of the very few benefits that target help on lone parents without a means-testing penalty. It is batty".—[Col. 850.]

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Whether "batty" is an expression normally used in your Lordships' House, I do not know. But we are entitled to know why the noble Baroness thought it was batty in February and does not think it is batty in November.
The implication in the Statement is that it is somehow due to the fact that the Government are under severe spending restraints which were imposed by the present Chancellor when in opposition. He said that he would stick to the then government's spending limits. But those limits were perfectly well known at the time the noble Baroness made those statements. Therefore, the argument that it was because of tight spending limits or the need to restrain public expenditure is not one which stands up to examination. We need an explanation as to why there has been this change of policy.
In relation to new recipients of the benefits, because the benefits will be abolished there is no question of uprating them. As I understand it, the Government propose to freeze the benefits of those who are already in receipt of them. Is it the Government's policy to allow those benefits to wither on the vine or is it a temporary situation which they hope later to reverse? I hope the Baroness can tell us.
Can the noble Baroness confirm also whether it is the case that, taking all the benefits that are now to be paid to lone parents, even after this Statement, the total amount being expended on lone parents is actually less than it was before the Budget and before this Statement? I say again—the noble Baroness may have been distracted—what is the total amount, including the welfare to work programme and everything else, which is now being spent on extra benefits for lone parents? Is that total amount less, greater than, or the same as that which was previously announced? My understanding is that the overall amount is in fact less rather than more. If so, that is something that many of the interest groups particularly concerned with lone parents would wish to hear. I am not disputing the basic underlying policy; it is the question of why the reversal has taken place which one needs to consider.
I turn next to the question of what is happening within the spending limits mentioned. I was particularly puzzled by a Question asked in another place on public funding:
"what is [the] estimate of the additional expenditure by her Department, its agencies and other non-departmental bodies in (a) 1997–98 and (b) 1998–99 as a consequence of higher uprating for inflation than was assumed at the time of the November 1996 Budget".—[Official Report, Commons, 5/11/97; col. WA 247.]
Mr. Field replied:
"Higher inflation than expected in the 1996 Budget has no effect on 1997–98 benefit spending".
That is straightforward enough. He continued,
"1998–99 benefit rates will be announced shortly. Increases in line with prices would mean an increase in benefit spending of about £600 million above that assumed in the 1996 Budget. The Government are committed to staying within its overall spending plans".—[Col. WA247.]
There is a puzzle here which has not been cleared up by the Statement we have just heard. If I understand it correctly, there is to be uprating in line with prices or, in the other cases, with the Rossi index. Is it the case,
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or is it not, that another £600 million has been allocated? I found the answer in another place rather puzzling. It seemed to imply either that there would not be uprating in the traditional way or that there would be an increase in the amount spent. It is not clear from that answer to the question in another place what the position is.
At all events, as I understand it, it is the Government's intention, as set out in the Statement, to uprate the benefits in the way in which the noble Baroness has described; namely, in line with the RPI or, in other appropriate cases, in line with the Rossi index. The answer may be that some benefits are not to be uprated. Indeed, the noble Baroness's opening remarks referred to uprating "most" of the national insurance benefits. Perhaps she will specify precisely which ones are not to be uprated.
Perhaps I may make a more general point. The implication of the Statement seems to be that the Government are now committed to controlling public expenditure. That is not the formula which has normally been used. What the Government have done up to now is to say that they will stick to the spending limits which were produced by the previous government. These nuances are sometimes rather important. We ought to be clear. Has the noble Baroness just announced a change in the policy? Is the Government's commitment simply to controlling public expenditure; or are the Government still maintaining the position that they will stick to the spending limits imposed by the previous government? If there is a change, it is a matter of considerable interest to your Lordships.
I should like to turn now to some points about pensions. There is a rather odd change really. The implication of what the noble Baroness said was that better off pensioners seemed to be getting a better deal than those on lower pensions. It is worthwhile looking at the department's press release of only a few days ago. As part of the overall survey of those in the lower income groups, the department said:
"There were far fewer pensioners in the bottom quintile (20 per cent.) of the income distribution in 1994/95 than in 1979: on … conventions for adjusting household incomes for household size, pensioners accounted for 24 per cent … of the bottom quintile in 1994/95 compared with 41 per cent … in 1979".
In other words, the position of pensioners has significantly improved in relation to the population as a whole. Perhaps I have misunderstood it, but that seems to be what is being said. Where they stand in relation to other pensioners is another matter. However, it seems to be an unfortunate policy if the Government are to argue that the differential between one group of pensioners and another is what is important rather than seeking to raise the level of those at the bottom without affecting the position of the pensioners who are better off. There is no doubt at all—I do not want to labour this point because it has been made many times—that the position of many pensioners will be significantly affected by the measures taken in the Budget. That seems wholly inconsistent with the Statement that has just been made.
The noble Baroness will know that many people have been advised to invest in PEPs rather than in personal pensions. Indeed, a number of people have felt that PEPs are a better long-term investment than going in for

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an ordinary pension scheme. The PEP arrangement is good in that respect. However, if I understand correctly the press statement which was issued by the Treasury this afternoon, it is proposed that the amount that can be invested in a PEP is now to be limited to £50,000. There may be many people who by now have accumulated a greater amount than that and will be relying in their retirement on the fact that they will be able to use that amount to invest in an annuity.
It is not clear from the press statement but it is important to know—this will no doubt be taken up in the newspapers in the next few days—whether or not those who have invested more than £50,000 in a PEP in anticipation of their retirement rather than invested it in some other form of pension will be "grandfathered"; that is to say, whether, if they have more than £50,000 in a PEP now, they will be allowed to leave it in a PEP. Otherwise, they may well find—this may apply to someone who is just about to retire—that, as a result of the changes announced this afternoon by the Treasury, the sum available for buying an annuity is less than they expected: and at very short notice. Perhaps they will be retiring in just a few months' time. It is important that the noble Baroness should clarify that point before we go any further into the matter. The press release was not as clear as it might have been.
I have one final point. Is it not the case that, despite the upratings which were announced by the noble Baroness this afternoon, the overall changes in government spending plans and their proposals for a new tax credit scheme, which were announced in the "green" Budget by the noble Lord, Lord McIntosh of Haringey, only a few days ago, will penalise women and favour men? The Institute of Fiscal Studies has been looking at this issue and thinks it is a basic trend—and, for all I know, a basic policy—of the Government to introduce changes, the overall effect of which is to penalise women and to favour men.
I well recall many years ago, when we were looking at the benefits system, that we were extremely anxious that the amounts should be paid to the wife rather than to the husband. There are real problems when families are faced with a situation where money is paid to one spouse rather than to the other. Therefore, against the background of the Statement, it would be helpful to know whether it is the Government's intention to do this or whether it is simply an accidental effect.
In her closing remarks the noble Baroness said that we shall have further opportunities to go into these matters in greater detail. I hope that that will be so. We should be grateful also if she will clarify when these further debates are likely to take place.
Earl Russell: My Lords, I thank the Minister for repeating the Statement. I am sorry to learn that she has had to do so at personal inconvenience. I hope it is not too great.
The Minister has invited a wide-ranging debate. I shall respond to that invitation in a moment but, first, I must welcome the basic fact of the uprating, though like the noble Lord, Lord Higgins, I have a suspicious mind. I, too, would like to know what is meant by the
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words "most benefits". No doubt an answer will be forthcoming. I should particularly like to give a warm welcome to the news that the shared residence requirement on housing benefit for the over-25s is not going forward. I should like to repeat the thanks I have already given to the Minister personally for her part in that story, by which I am delighted. I should like to know, though, why nothing has been done towards closing the gap, on which the Minister and I have both detained the House in the past, between the rates of income support for over and under-25s.
I know that this point is not technically part of the Statement, but it relates so closely to it that I believe I am entitled to ask. Has there been any uprating of the youth training allowance and the youth training bridging allowance? The noble Baroness may perhaps remember that I ask this question every year. I hope that this Government are better at knowing the answer than the last one, as I have never before found a Minister who had an answer to that question when the time came.
There have been rumours in the press recently about possible changes to the national insurance lower earnings limit due to the effects of the poverty trap. I see nothing of that in the Statement. That may possibly be because it is being left for the Taylor review, which prompts the question of whether we have any indication when that review is likely to report. Most of the Statement is a report on the Government's objectives, and I listened to it with considerable interest. However, what we know is limited because it has been said that this Government have hit the ground reviewing, and while the reviews are still revolving we do not exactly know what the outcome will be. I am glad to say that I can agree with a considerable amount of the general framework of the objectives that have been set out.
I share the concern about the social security budget. We must all hope that we can find reasonable ways to reduce it. I agree with the factual observation about the failure to reduce poverty. I say to the Minister that the department should not be too self-abasing in taking responsibility for that failure to reduce poverty. That failure is essentially a failure of the amount of work in the economy and of the excessive flexibility, from the department's point of view, of that work. As I understand it, it is not a failure of the welfare system. It would be an improper act of self-abasement if the department were to take responsibility for it.
I am a little concerned about the straitjacket set by spending limits. I listened with interest to the questions of the noble Lord, Lord Higgins, on that aspect. I gave notice that I would ask why the Government have committed themselves to the previous government's spending limits and have done so with links of iron tougher than the previous government ever used.
The Statement refers to a mandate, but I remind the Minister of the opinion poll which appeared in the middle of the election campaign showing that 56 per cent. of those intending to vote Labour simply did not believe that it intended to observe these restraints. They believed, in the memorable words of

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Polly Toynbee, "Trust them—they are liars". I have never been one of those people, but when we talk about mandates we should not forget their existence.
I agree entirely with all that is said about the need for the opportunity to work. That is an analysis that I have been putting forward on this Bench ever since 1989. I am glad to see a government in place which shares it. But that again is not primarily a welfare issue. I do not believe, in any straightforward sense, that it is a fault of the welfare system that there is so little work. It has much more to do with the fashion for downsizing in industry. In a way, downsizing is freeloading on the public purse in just the same way as it would be if the public purse was asked to bear the cost of warehousing industry's unused raw materials. So, again, I do not believe that the department should be too self-abasing.
I agree about the importance of the principle that work should pay. I welcome the publication of the minimum wage Bill. I am extremely glad that it contains fewer exceptions than was feared at one stage. But I want to know why it is being argued that there should be a lower minimum wage for the under-25s. For reasons with which I am sure the Minister is familiar, I am not at all happy about that.
I become a little more worried when the Statement moves on from opportunities for work, with which I agree, to the desire to root out worklessness. That is a very curious phrase. It is at one and the same time utopian and draconian. It is remarkable how frequently those two concepts go together. We all want to reduce worklessness. If they were to root it out they would be the first government in recorded history to have done so. Indeed, I am reminded of the passage in 1066 And All That about the abolition of villains. Richard II was petitioned to abolish villains. He agreed and then put them all to death on the ground that they were villains. If one roots out worklessness it is going to take something like that to do it.
In fact, we have here something very like the language of Tudor economic policy—the distinction between the able-bodied poor who are to be whipped back to their parish and the aged and impotent poor for whom relief may be provided. The Minister knows as well as I do that that was a very difficult distinction to apply. It did not work very well.
The Statement talks about the fact that opportunities bring responsibilities. I agree profoundly with that if we take it as a rule of personal moral conduct. If we take it as a rule whereby moral judgment is passed over to the state and it decides which opportunities it is our duty to undertake, for me that is a very different matter indeed. People are very different from each other: they cannot all be moulded like plasticine into a particular social form. If the state attempts to do that for us it will inflict much unconscious cruelty and achieve a great deal less than it intends.
As regards the issue of single parents, I have asked the Minister before whether she can give an undertaking that single parents will not be compelled to work. I know that the Minister said on 3rd June that she does not favour any such policy, but I am becoming
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increasingly suspicious that the reduction of benefits, together with that being used, as Mr. Darling put it on "The World This Weekend" on Sunday, as an encouragement to work, means that we are getting somewhere very close indeed to compulsion by the back door. "Thou shalt not kill, but needst not strive officiously to keep alive". That concerns me very deeply.
The Minister knows that I am strongly in favour of the opportunity for single parents to work if they want to and if they are satisfied with the childcare arrangements available. But the right of parents to stay at home, particularly with young children, is a human fundamental. I would view with very great gravity anything that appeared to me to threaten that. I believe that the adequacy of childcare for a particular child—it must be for a particular child and not abstract—is something that parents must be left to judge for themselves. So if I begin to suspect that the deprivation is being used as a back-door compulsion my opposition will become much deeper than it has been up till now.
I have similar anxieties about the review of disability benefits and I would be very glad to be told that they are misplaced, because they may be. I entirely agree that it is a good thing that disabled people should work when they can. I agree that far more of them are able to work than we can give the opportunity to do so. I shall not soon forget one Greek island where a person unable to walk had been given the monopoly of selling cigarettes on the island and made himself an extremely good living. That is an individual fit of opportunity to person. Where one can achieve that, I like it. However, turning the pressure to work into something which comes close to conscription worries me considerably.
When talking about rooting out worklessness, one should not forget the problems of transport. The Minister knows that I have touched on this point many times previously, but if she looks in today's Guardian she will find a report from the Rural Development Commission which states that three out of four rural parishes in England have no daily bus and that 99 per cent. have no jobcentre or benefit office. That makes rooting out worklessness rather difficult.
Where one is asking people to do what they want to do, that is a proper use of the power of the state. Where one is helping them to achieve their own self-respect, that is a proper use of the power of the state. However, where one is undertaking a scheme of social engineering to fit people into a particular mould, that, like Plato's republic, is a world that may be beautiful to read about, but in which one would not want to live.
7 p.m.
Baroness Hollis of Heigham: My Lords, I welcome the comments of the two noble Lords who have spoken. I shall do my best to answer their questions. If, on checking the record, I find that I have inadvertently left any question unanswered—I hope that it will be inadvertence rather than any other reason—I shall write to them.

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Perhaps I may respond first to the noble Lord, Lord Higgins. The noble Lord asked first about the future timing, given the "green" Budget. This is a matter for the Chancellor, but I am told that we shall be debating the uprating order in February in the usual way.
Secondly, the noble Lord asked about the quoted statistic that nine out of 10 lone parents would work if only they had childcare. That information comes from research with which I am familiar, conducted by Bradshaw and Miller in 1990. The noble Lord has a point in suggesting that it has been slightly abbreviated, but it showed that lone parents wished to have the opportunity to enter work when their children were old enough or the childcare was in place. I repeat that that figure came from the 1990 research although later research subsequently reaffirmed it.
The noble Lord then referred to our debate in February 1997 in which I denounced the possibility of lone parents not being able to carry the higher rate of child benefit into work. The noble Lord asked whether there had been a U-turn. I am happy to assure him that there has been no U-turn because lone parents now on income support who enter work and go on to family credit will be able to take the higher rate of child benefit with them even if they are not currently claiming it because it has been subsumed within their income support level. If I may put it this way, they will be able to make a fresh claim after April 1998. Therefore, no such disincentive applies. Like the noble Lord, I should be worried if it did. I repeat that there has been no U-turn.
However, where there has been a change since the script of the previous Government, if I may put it that way, is that for the first time lone parents now have the opportunity of a New Deal. They are getting opportunities presented by a major expansion of childcare facilities—not just through the New Deal but through the announcement in the "green" Budget of £300 million which will allow not just the 35,000 children to enjoy after-school clubs as at present, but 1 million children in future. Too often when we talk of childcare, we focus on the nought to fives, but I am sure that we all recognise that childcare is also a real issue for those with children between the ages of five and 12 or 13. This is a major expansion; and, importantly, the minimum wage is also to come. All of those changes will serve to benefit lone parents and make the move into work an attractive possibility for her—it is usually a "her". Those are the changes since the previous government's strategy.
The noble Lord also asked how the sums work. If 1 understood him correctly, my answer is this: there has been a reduction of £400 million over the three years proposed in lone parent benefits. So far, that is being offset by the £200 million in the New Deal and the one-off strategy, mainly funded by lottery money, of £300 million in childcare under the "green" Budget. If 1 have misunderstood the noble Lord's point, I shall return to him to amplify my answer.
The noble Lord also asked about the £600 million. Again if I understood him correctly, he was asking how we balance the extra cost of inflation against staying
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within the spending limits. Clearly, estimates of future government spending are always subject to assumptions about the rate of inflation for the forthcoming year. As I understand it, if that assumption is wildly wrong—I defer to the noble Lord on this because I suspect that he knows much more about it than I do—the reserve is designed specifically to address those circumstances where there is a shortfall between forecast and outturn. I have no reason to think that that would not apply here, as elsewhere.
Like the noble Earl, Lord Russell, the noble Lord, Lord Higgins, went on to ask which national insurance benefits were not being uprated because the word used was "most" rather than "all". One now expects suspicious minds on the Opposition Benches, unlike previously. We were far less suspicious and far less cynical of the government's words! As I understand it, all national insurance benefits have been uprated except the Christmas bonus. However, the Chancellor has announced extra payments this winter which go beyond simple uprating. I refer, for example, to the money for the heating proposals.
The noble Lord asked about control of public expenditure and whether we are still reasserting our previous statement that we propose to stay within the spending limits of the previous government. Yes, we do so intend.
The noble Lord then asked a series of questions about pensioners and said that their position collectively, if I may put it that way, has improved in relation to that of the population as a whole. We have seen inequality widening within the pensioner group, but it is true that pensioners have been displaced in the lowest two deciles of households with below-average incomes. The reason that they have been displaced is good news for pensioners, but bad news for others. Pensioners have been displaced by workless households and, to some extent, lone parents. That is one reason why pensioners, relative to the rest of the population, have improved their position not only absolutely but also relatively. That is because, as we know, workless households have fallen well behind in terms of the growth in prosperity of the rest of the country. The noble Lord will understand that that is why we are so determined to expand opportunities for work for lone parents, disabled people and workless households alike. We know that it is their only path into prosperity.
Pensioners in real poverty remain those who are either on income support or, more to the point, who are entitled to income support but do not claim it. That is why we insisted, as I explained in the Statement, on undertaking research to find out exactly why some pensioners do not claim the benefits to which they are entitled and which would passport them on to other benefits. We need to know the number involved.
I shall have to write to the noble Lord on his point about PEPs. As I understand it, existing PEP holders will not be affected, but I shall have to write to the noble Lord because this is a Treasury matter and I shall need to check the position.
The noble Lord referred finally to the "purse to wallet" transfer behind the working family tax credit. He asked whether women would be disadvantaged as a

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result. We believe that women, like men, want and are entitled to enjoy access to work. Increasingly, as the married women's stamp comes through, so married women are able to enjoy the same opportunities as working men. It is worth reminding ourselves that something like 60 per cent. of all lower income households in work—that is, those enjoying family credit—are headed by a woman. The basic structural question of how such tax credits may be devised has yet to be determined, should the Chancellor accept the recommendations. As I have said, most lower-income households in work are headed by a woman and she would therefore be the recipient of any such tax credit in the future.
Perhaps I may move now to the points raised by the noble Earl, Lord Russell. The noble Earl referred to the dividing line of the age of 25 for differing rates of benefit, as he has over many years and I well understand where he is coming from. It applies in relation to benefits such as housing benefit, JSA and income support. It is an existing line and I am sure that the noble Earl will continue to be unhappy about it. In the past criticisms have been made of it. The presumption is that it reflects in a rough and ready way the difference between the replacement earnings lost and the costs incurred by people over and beyond that line. That is the explanation for it. I am also sorry to disappoint the noble Earl in that, like all my predecessors at this Dispatch Box, I do not know whether youth training will be uprated. However, unlike my predecessors, I assure the noble Earl that he will receive a written answer. If in future I am in the same position dealing with an uprating Statement I promise him faithfully that I shall know the answer.
The noble Earl also asked about the date of the Taylor review. As I understand it, it will inform the Spring Budget. The noble Earl dealt with the wider point about the failure of the welfare system and questioned whether the growth in social security expenditure damned the welfare system as such. I share his concerns and I wish that we had time to debate it more fully. In 1979 one penny in five of government expenditure went on social security; today it is one penny in three—more than is collected in income tax. The figure is £72 billion. Yet, one household in five is workless and the benefit system is disliked not only by those who pay for it but by those who receive it.
It is clear that much of the growth in expenditure since 1979 has been due to the failure of economic and social policies, such that even when employment figures improve many people who have low educational qualifications, those who are long-term unemployed, the disabled, lone parents and so on, remain beached because the tide has not floated them off the rocks of worklessness. That is why we need to renew and reform the welfare state based on opportunities for those who can, should and wish to re-enter work.
That takes me to some of the questions raised by the noble Earl about those who would do so. For example, he asked whether there would be a lower minimum wage for those below 25 and, if so, he would deplore it. No decisions have been made on that. The Low Pay
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Commission will make recommendations which will inform the Government's thinking in the spring. Like him, I would deplore the Tudor as I deplore the 1834 Poor Law. I rather sympathise with Speenhamland and in-work benefits. The reform of the welfare state under this Government could be said to be revisiting the justices of Speenhamland and Berkshire in a "read-across" way for the nation as a whole.
The noble Earl asked why we remained committed to the previous government's spending limits. The simple answer is that it was a manifesto commitment. The noble Earl said that 56 per cent of those who voted Labour did not believe that it would keep its manifesto commitments in that regard. We hope to prove that 56 per cent. of the population wrong by keeping our manifesto commitments and, as a result, restoring faith in the democratic process and going some way to meet head on the cynicism that affects voters when they enter the polling booth. For example, people believe that politicians are all alike; that politicians say what they need to say to get elected but do not keep their promises. That is not the view of the Prime Minister. I believe that in future we shall see very different policies from this Government.
The noble Earl went on to ask about lone parents. He asked that I give an undertaking that they would not be compelled to work. Compulsion is not the issue. Like him, I believe that parenting, whatever the age of the children, is as worthwhile and important a social contribution as working for wages in any economic situation. He pressed me about disability benefits and was also concerned about compulsion. The problem faced by disabled people is not one of compulsion but the current denial of opportunities that they experience. We know, because they tell us, that about I million disabled people wish to work but cannot do so for three reasons. The first reason is in part their poor health. That means that they cannot work a steady 35 hours a week. However, I hope that the labour market with its demand for flexible labour will be on their side so that with help they can re-enter the labour market.
Earl Russell: My Lords, I am most grateful for the noble Baroness giving way. Perhaps I may narrow down the area of difference between us. I agree with most of what the noble Baroness said, but my question is this. Will the disabled person have a share in saying whether something is an actual opportunity or will the Government tell him?
Baroness Hollis of Heigham: My Lords, what we shall offer to disabled people is what they tell us they want; namely, opportunities to move into work. Secondly, at the moment, those opportunities are blocked, sometimes by their health but at least as often by employers' perceptions. In that regard the Disability Discrimination Act will be an important tool. The third aspect is the benefits system. We want to go with the grain of their wish, which is to help them to overcome the hurdles that stand in their way. I repeat that compulsion is not the issue.
I have responded as fully as I can at this stage to the points raised by the noble Earl. If he wishes, I am very happy at a later point to respond more fully on this

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matter, perhaps by way of an Unstarred Question. However, I assure the noble Earl that, having been involved over recent weeks in meetings with disabled people about our welfare-to-work opportunities, in respect of which the Chancellor has made available £195 million, the bidding process enabling disability organisations and disabled people to spend that money to assist disabled people into work, will probably overwhelm us. As with lone parents, we are working with the grain of what people themselves want. They know that only work, in so far as they can do it, given their caring responsibilities and their health, is the best form of welfare for them. That is the basis of our renewal.

EU Gas Directive: ECC Report
7.16 p.m.
Lord Geddes Lord Geddes rose to move, That this House take note of the Report of the European Communities Committee on the EU Gas Directive (7th Report, Session 1997–98, HL Paper 35).
The noble Lord said: My Lords, I begin by declaring an interest, albeit perhaps a somewhat indirect one, through my non-executive involvement in a power generation company in some of whose stations gas is the prime energy source. I am most grateful that time has been found for a debate this evening so soon after the publication of the report of the European Communities Select Committee which stemmed from Sub-committee B's deliberations on the subject of the EU Gas Directive. I apologise to noble Lords that this has not given many much notice of the debate, but it was felt important to allow the House to consider the report and convey its view to the Government before the Government attend the next Energy Council meeting on Monday 8th December.
The history of this directive has been a long and painful process. Most of the single market was completed by the end of 1992, but energy was one of the few sectors left out. The Electricity Directive was given priority, and only once it was finally agreed, after months of apparent stalemate, in July last year, did attention return to gas.
Sub-committee B took evidence from 22 witnesses over a period of five weeks. Of those 22, 11 were oral witnesses. They included representatives from France, Germany, Spain, Norway and DGXVII. We were particularly grateful to those foreign witnesses who took the trouble to come and give evidence. Throughout our inquiry there was a problem keeping pace with a moving target. Since we started to look at the draft directive in June this year there has been a whole series of revised texts, under first the Dutch and then the Luxembourg presidencies. These are detailed in our report.
In the midst of these changes, we took evidence on 24th July from the Energy Minister, John Battle, MP. I take this opportunity to thank him again for the time he gave us and for the very high quality of his evidence.
By early October it looked as if a common position might be reached at the Energy Council on 27th October, so I wrote to the Minister on 16th giving
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him the sub-committee's provisional views. In the event, little progress was made, but (to quote from the formal conclusions of that meeting) the Council,
"confirmed its political willingness to reach a common position"
on the 8th. That is next Monday. Perhaps the Minister can say whether he still expects that to happen. If so, what has changed since October to make it possible? If not, will this be a high priority for the UK presidency starting on 1st January?
The background to our inquiry is that natural gas accounts for one fifth of the EU countries' total energy consumption, and use is growing, particularly for electricity generation. But gas-fired power stations account for only one eighth of all EU gas consumption. Nearly half is commercial and industrial use, and most of the rest is used for domestic heating and cooking.
Gas is a clean and efficient fuel. It is virtually sulphur-free and lower in other pollutants, including carbon dioxide, and so less harmful relative to global warming. But its energy density is only one thousandth that of oil, making it expensive to store and transport.
In 1995, the EU countries produced 60 per cent. of their gas from indigenous sources, principally the UK and the Netherlands. But the EU's import dependency is growing, and is expected to reach 45 per cent. in 2000 and 70 per cent. by 2020. Of the EU's imported gas, two-thirds comes from Russia and most of the rest from Algeria (much of it by tanker in liquefied form), with Norway a long way behind in third place.
It is obviously a cause for concern that Europe is becoming increasingly reliant on potentially unstable countries for a vital energy resource. We were fully aware that no directive can do much to alter this fact, but by creating a more flexible trading market it should improve security of supply—which has more to do with how many sources of supply are available and how easily one can be substituted for another than with whether those sources are indigenous or external.
From the UK's viewpoint a key factor will be the completion of the UK-Belgium Interconnector pipeline, scheduled for next year, which will connect the UK to the continental pipeline network. At least in the short term, the interconnector is likely to be used to export UK gas and we recognise in the report that this may—I emphasise "may"—cause domestic gas prices to rise. That is something upon which the Minister might wish to comment in his reply.
Britain can afford to take a fairly detached view. The Gas Act 1986 introduced competition in the supply of gas to industrial and commercial users; provided access rights to pipelines; and set up an independent regulator—Ofgas. With liberalisation now being extended to domestic consumers, Britain has already put in place a more competitive regime than anything envisaged by the draft directive. But British companies stand to gain from rights of access to continental customers, both as gas exporters and as pioneers of a competitive market. Liberalisation should also improve the EU's overall competitiveness. That is why we offer a general welcome to the directive in our report.

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We identify three significant issues in the report, and I shall deal with all of them. The first big question addressed by the directive is how much of the market should be opened to competition, and how quickly. It is already clear that the initial percentage will be around 30 per cent.—28 per cent. in the latest text, rising to 40 per cent. after five years and 45 per cent. after a decade.
Because the pattern of gas consumption differs widely between the member states, the draft directive also sets a minimum threshold beyond which a gas consumer would have the right to choose its gas supplier. Gas-fired power stations will all have that right, regardless of how much gas they consume. In the latest text, that threshold is set at 25 million cubic metres in the first stage—which would include only a few very large industrial users—falling to 15 million cubic metres after five years and to 5 million cubic metres after 10 years.
In our report we call for lower thresholds at stages 2 and 3—namely, 10 million cubic metres and 1 million cubic metres respectively—and for a shorter timescale—three years between stages rather than five years. Again, perhaps the Minister would be kind enough to comment upon our conclusions relative to those in the latest directive, and how the Government intend to deal with that question at the energy conference on 8th December.
The second significant issue relates to take-or-pay contracts. We recognised from an early stage that the issue of market opening cannot be detached from the difficult issue of so-called "take-or-pay" contracts. These are contracts between the major gas suppliers, mostly outside the EU, and gas companies in member states—mostly state-owned monopolies—which then distribute the gas to final customers. Under those contracts, gas companies agree to pay for agreed minimum quantities of gas every few months for the duration of the contract—which may be 20 years or more—and they must pay for the gas even if they do not actually take delivery of it (hence "take or pay").
In a monopoly situation, that suits both parties: the gas producers have the guaranteed income they need to invest in developing new fields and building pipelines; the member state gas companies have assured supplies to sell on to their customers. But liberalisation, as envisaged albeit modestly in the directive, threatens to turn this convenient arrangement into a millstone for the gas companies. With rival companies competing for their customers, the market price is likely to fall, and the former monopoly companies may find themselves unable to sell at a profit all the gas they are committed to paying for.
Contrica, one arm of what used to be British Gas, had just that problem, but it was made worse in its case by the inflexibility of the contracts to which it was committed. Most continental contracts have provisions allowing the price paid for gas to be re-negotiated in certain circumstances, and we argue in our report that greater use of such provisions could help to allay the fears of gas companies about the directive.
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The draft directive deals with the take-or-pay problem by offering derogations from the market opening provisions for companies which encounter serious difficulties as a result of their take-or-pay commitments. In the report, we accept that as reasonable so long as it applies only to take-or-pay contracts signed before it was clear that the gas market was going to be liberalised.
We were therefore dismayed that the text of the draft directive published by the Luxembourg presidency in July removed the distinction between those existing contracts and contracts signed more recently. That threatens to allow derogations to continue more-or-less indefinitely, making it difficult to see how a genuinely competitive market can ever be achieved.
When we took evidence from Mr. Battle in July, I put it to him that derogations for future take-or-pay contracts would, "drive a coach and horses" through the principle of the directive. Mr. Battle agreed and said that, unless future contracts were "very tightly controlled", the Government would be, "very sceptical about supporting them". He doubted, however, whether he could persuade other member states. Will the Minister indicate whether the Government have succeeded?
The third issue was that of transparency. The Minister also said in July that he wanted to see better transparency provisions in the directive, including a requirement for separate management of transportation and supply activities, unbundled accounts and so-called "Chinese wall" provisions to prevent large gas companies using information provided by other suppliers to benefit their own supply operations. Since then, the Luxembourg presidency has included in the directive clauses prohibiting transmission or distribution companies from
"abusing commercially sensitive information obtained from third parties in the context of providing or negotiating access to the system".
In the report, we call on the Government to press for further amendments, including, if possible, full management separation of transmission and supply activities. Do the Government believe it possible to achieve further changes to the draft directive? If not, how confident is the Minister that the directive as it stands will ensure fair access to the gas network? I should also be grateful if he would comment on the specific concerns that we raise in our report about the procedural aspects of the directive, which appear to offer pipeline owners too many opportunities for delay in granting access to rival companies.
It is my pleasant duty to conclude by offering considerable thanks to our special advisor, Michael Brothwood of the Denton Hall Energy Group and to Dr. Andrew Mylne, clerk to Sub-Committee B. This was his last inquiry before moving on to pastures new. I also thank his secretary, Jane Sanders. Too infrequently are secretaries thanked on occasions such as this. They do a sterling job in difficult circumstances. Finally, I thank all members of Sub-Committee B for the diligence which they displayed throughout our inquiry. I thank in particular the three members of the sub-committee who are speaking tonight. I beg to move.
Moved, That this House take note of the Report of the European Communities Committee on the EU Gas Directive (7th Report, Session 1997–98, HL Paper 35).—(Lord Geddes.)
7.30 p.m.
Lord Berkeley: My Lords, I apologise to the House for not being in my place when the debate started. As a member of Sub-Committee B, I welcomed the opportunity to study gas prices and deregulation across Europe. It confirmed that the attitude of different member states to deregulation, be it of gas, electricity or the railways, is similar. Some member states like it and some do not. The UK has already deregulated, which coloured much of our consideration in the committee.
I wish to cover two matters of considerable concern. They have already been mentioned by the noble Lord, Lord Geddes, and I shall be interested to hear my noble friend's comment in winding up. The first is the security of supply and the second is the price of gas to major consumers.
We heard evidence from Mr. Jonathan Stern, who for the past 10 years has been working on this subject for the Royal Institute of International Affairs at Chatham House. I and many of my colleagues on the sub-committee were impressed with his evidence. He stated that in the year 2020 70 per cent. of European gas supplies will be coming from outside Europe, mostly from Algeria and Russia, which are perhaps politically unstable. He went on to say:
"The concern one has in the case, for example, of a country like Turkey"—
Turkey is not within the European Union at present, but perhaps the comment applies to other countries—
"is that if there were a prolonged disruption of Russian gas they would have very considerable difficulty and turn off supplies to a lot of their gas customers".
The extent to which other supplies may be available depends partly on price and partly on the availability of a national grid. As we stated in our report, the availability of a free market would be advantageous, too. But the fact remains that, if 70 or 80 per cent. of energy supply can be turned off abruptly, most member states would wish to see some kind of contingency plan.
We in the UK are in a slightly different position because for the moment we are net producers of gas. However, one must question the situation in 20 years' time. I have a slight query about the wholesale rush away from coal which was started by the previous government. Furthermore, I am not sure about what will happen after thousands more jobs have been lost in the mines. I am sure that the Minister will have a response. 1 believe that we should have a contingency plan because we are acting with the rest of Europe with a European grid. If Russia, Algeria or any other country cuts out, we could be in trouble.
I turn to the major gas users, from whom we had interesting evidence. I wish to quote from Appendix 3, page 30, which shows that the UK's price to industry is the lowest within the EU. It is just about double that of Canada, with the USA falling somewhere in between.
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The same comment probably applies to household gas. Of course, if our price is the lowest, the price in the rest of the EU is much higher than the price in Canada or the USA.
The International Federation of Industrial Energy Consumers, the big companies which are energy-intensive users, told us that, out of their total production cost, 50 per cent. related to energy. Therefore, they go where the energy is cheap. Others told us that the big world multinationals do not like having too many plants in the same continent and they like to consolidate in some way. Therefore, we must find a way of encouraging these industries to stay in Europe, whether here or on the Continent. They will need cheaper gas if we are to achieve that, otherwise, they will go to the United States, Canada or somewhere else. I am convinced that, if the directive is implemented as outlined by the noble Lord, Lord Geddes, they will be assisted in staying.
I have a third concern. It was not clear from the evidence what the final result will be. When the directive is clarified, will it be enforced? We have many European regulations, and not only in this field, which are not enforced. It would be invidious to quote any in particular. My great fear is that whatever compromise is reached in the final text of the directive some will choose to ignore it completely. We may believe that it does not matter much in the UK. However, in terms of our industrial base we are very much part of the European scene. If there were a problem with such primary industries on the Continent we would feel the cold too. I should be grateful if the Minister would comment on EC policy on taking action against member states who do not enforce Community legislation.
Finally, I congratulate the noble Lord, Lord Geddes, on his excellent chairing of the sub-committee. It was intense, it was hard-working but it was occasionally fun. I hope that the report will find favour with the House and will be of interest to the community at large.
7.38 p.m.
Lord Haslam: My Lords, as a new member of Sub-Committee B, it was a pleasure to work under the chairmanship of my noble friend Lord Geddes on this complex problem. Many of the witnesses expressed doubts about the virtue of the proposed directive and no one believed that it would produce even a semblance of a level playing field across the Community. However, most witnesses accepted that on balance it is better to have a directive rather than to have none at all. Both the noble Lords, Lord Geddes and Lord Berkeley, referred to the question of security of supply, and I apologise for repeating some of those statistics but I believe that they are very important.
Some of the evident imperfections of the directive derive from the fact that there are only two major gas producers within the Community; namely, the United Kingdom and the Netherlands. Given that the dependency of the Community as a whole on supplies from Norway, Russia and Algeria is expected to rise to about 55 per cent. By 2010 and to 70 per cent. in 2020, it is clear that the import dependency of those member

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states without substantial gas production will be even higher, and in some cases will reach 100 per cent. The result will be that these other member states will welcome imports from the United Kingdom and the Netherlands with enthusiasm, as an alternative to the much less secure imports from politically unstable countries such as Russia and Algeria.
For example, British natural gas will soon be sold into Germany through the new interconnector pipeline, in which both British Gas and BP have major shareholdings. BP has also recently concluded a 15-year gas sales contract with Ruhrgas, the largest gas transmission company in Germany, in which BP has a 25 per cent. shareholding. Ruhrgas is obviously pleased to have this new source of a reliable gas supply and in no way views this as cross-border competition. Any normal competitive retaliation from Ruhrgas by supplying UK customers is, therefore, most unlikely. Also the existence of long-term take-or-pay contracts and the access problems to pipelines will further inhibit cross-border competition.
For these reasons I believe that the amount of meaningful cross-border competition likely to develop in the foreseeable future within the Community is absolutely minimal. On the positive side, however, the directive should help to stimulate domestic competition by creating a climate, which is favourable to the growth of liberalisation and which may well help some member states to overcome their domestic opposition to liberalisation. The UK gas industry can be proud of how it has set a shining example to the other member states by the way it has liberalised its domestic gas market.
Although it was not part of the sub-committee's remit, I must express some concern that for short-term benefits, we are willing to sell substantial quantities of UK gas to the continental markets. As the usage of gas in the UK has surged, our gas reserves have shrunk from 23 years in 1991 to 13 years by 1996, or 18 years if possible reserves are included. It is interesting that the German Government are still subsidising their coal industry and maintaining access to their coal reserves with a massive state aid of £4 billion per annum. This reflects one of their major concerns of becoming almost entirely dependent on imported gas from supplier countries, which are not only outside the community but which are also not in the "gile-edged category". Exporting our gas will bring the day nearer when we, too, are dependent on such sources. In extrernis we may yet again be subjected to a new OPEC-type regime!
Finally, returning to the gas directive, if one reflects on its objectives, it is clear that the outcome will fall well short of expectations, and in particular the ambitions of increased cross-border competition will prove largely cosmetic. On a school report basis the directive would probably in my view rate about three out of 10.
Having said that, it has been a great pleasure to serve on the sub-committee. I have enjoyed the rapport and differences which there have been between the members of the sub-committee and again, I thank the noble Lord, Lord Geddes, for his excellent chairmanship.
7.44 p.m.
Lord Bridges: My Lords, I was not a member of the sub-committee which prepared this report although I have served on it in the not-too-distant past. But in my position of current independence I am glad to welcome its appearance and the helpful analysis it makes of the European gas market, a subject of real importance. I thank, too, the noble Lord, Lord Geddes, for his clear and authoritative introduction to our debate this evening.
It should be noted that the report is concerned only with the way in which gas is distributed and marketed as part of the internal market regime in the European Union. It does not attempt to lay down the regime for a Community resource as it would if one were discussing agricultural goods or fish. Those are treated quite differently as resources belonging to the Community as a whole.
It is worth recalling that some attempts were made in the 1970s to classify energy as a Community resource but that idea was given up in the light of our implacable opposition. Indeed, I found myself at one unforgettable moment in the spearhead of our efforts to resist that attempt to make gas a Community resource when accompanying the then Prime Minister to a meeting of the European Council which was meeting in Maastricht, in, I suppose, 1980 or 1981. I was sent off at midnight to take part in a debate which lasted for several hours. I had to report to the Prime Minister on my success, or lack of it, at breakfast the following morning. My efforts had been successful but I was not complimented on my conduct because I had not been sufficiently firm.
It is useful to relate this subject to a wider and longer perspective of energy supplies in this country. A lot has happened in the past few decades. A generation ago, Britain was in the unique position as an energy producer and consumer. We drew the bulk of our energy supplies from a single resource—coal—which we had in abundance under our own control. However, because the industry was managed under a state monopoly—the Coal Board—and because of the great power wielded by a single trade union—the National Union of Miners—coal became an expensive source of energy at a time when oil was cheap and readily available. That had the effect of building high energy costs into our industrial structure.
The effect was particularly severe on energy-intensive industries; notably, electricity generation, cement, steel, fertilisers and ceramics. I suggest that that factor had a lot to do with our loss of competitive power in world markets in the 1950s and 1960s. The decision of the last government to break the coal monopoly has transformed that situation at a high social cost and, as others have pointed out, with a degree of loss of security. But we now enjoy a low-cost energy structure which is of wide benefit to consumers and many industries.
However, in continental Europe, little has changed. Energy supplies are either under the direct control of the state, perhaps most notably in France, or are conducted at strictly regulated prices. The report recommends that we should seek to end that regime by introducing energy contracts negotiated at arm's length and by separating gas production from companies transporting and selling gas to consumers.

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If policies on those lines were adopted, a commercial gas market would be created to the general benefit of all consumers. But for this country there is a delicate balance to be struck. The present condition of the European energy market gives British industry a competitive advantage in Europe wherever gas is a significant source of energy in industrial production. Adoption of the policies recommended in the report and under consideration by our partners would gradually remove that advantage, although it would have the positive effect of improving the competitive position of the continental European industry in the world market.
As the European market is our own largest export market, in this country we should benefit indirectly from that situation but I do not find it at all easy to weigh that balance. It would be extremely difficult to quantify. Nevertheless, although I do not expect our opinion to be adopted by our partners, I believe that we are right to point to the existence of an alternative policy and to the wider negative consequences of the current European modus operandi.
We should also note with care the likely consequences of the European gas connector referred to in paragraph 101, as has already been mentioned by other noble Lords. That too is a serious matter. With the gas connector, supplies in this country are likely to become somewhat constrained in the medium term. But I am in favour of a link with the continental gas grid since access to Siberian gas supplies, although not perhaps the most permanent source, would in normal times be very useful to us in offering an alternative source of supply when our own resource begins to taper off. Here I find the evidence of Clare Spottiswoode, Director General of Gas Supply, most impressive. I noted with particular interest her remark at question 189 (on page 45 of the report) that she saw the interconnector as a price dampening mechanism. I believe that to be a rather helpful way of looking at it.
It is rare, at present, for a European country to be able to draw on a choice of gas supplies, although I know that Italy does so as it deliberately chose to invest in pipelines connecting her national grid with both North Africa and Europe. There is, of course, the alternative source of liquified natural gas supplied by sea tankers, which was briefly mentioned by the noble Lord, Lord Geddes in his introduction. We were one of the pioneers of that business and we should perhaps take it into consideration today. I read that large contracts have lately been signed for the import of LNG by Japan from South East Asia.
It would be useful for us to have this technology and capability in reserve, given the large supplies of LNG available to European consumers in some African countries. I did not detect any reference to that aspect in the committee's report; perhaps I missed it. However, I suggest that it is something we might take rather more seriously than we have done in the recent past. The availability of LNG could well meet the contingency described by some noble Lords if supplies were interrupted from, say, Algeria or the Soviet Union. I should like to join other speakers in commending this extremely useful and informative report to the House.
7.51 p.m.
Lord Moynihan: My Lords, I intend to be brief, which will no doubt come as a great relief to your Lordships, not least because I have the privilege of summing up the subsequent debate and do not wish to keep either my colleagues or myself here at too late an hour this evening.
I should like, first, to declare an interest, in that I am a director of Ranger Oil, and am on the Phillips' Advisory Board as well as being chairman of CMA, the advisory group. Against that background and from my experience during my time as a Minister with responsibility for oil and gas in a previous government, I should like to congratulate noble Lords who sat on the committee on producing a really excellent report. I listened with interest to what the noble Lord, Lord Geddes had to say when introducing today's welcome debate. My only disagreement with the noble Lord would be on the impact on gas prices of the interconnector. I understood completely when he said that they may rise, but it is not my view that gas prices will rise.
If we look at two factors—first, the trading opportunities that the interconnector will generate, and, secondly, the overall supply-demand position in the UKCS gas market—I believe that we should he optimistic about pricing in the United Kingdom, not least because, so far as concerns gas, there is significant associated gas to come on stream in the coming years. There is, in particular, associated gas from the central North Sea fields and there are new fields in their own right coming on stream, such as Britannia. Then there are the carboniferous plays in the southern basin. I am one of those optimists who do not believe that the interconnector will only be an export route for UKCS gas in the short run. I happen to believe that it will be a long-term export route for UKCS gas. If one looks at the overall supply position, I am confident that that will be seen to be the case.
I listened most carefully to what the noble Lord, Lord Berkeley said in his speech. My reflections on that would be that, despite the tremendous political instability in the two countries that he mentioned—namely, Algeria and Russia—it has been notable that gas deliveries from both those markets have been remarkably constant. The question might be asked as to why that is so, especially when one sees the appalling effect of the civil war in Algeria. It is probably appropriate to reflect that both parties in a civil war, particularly the Algerian civil war, recognise the vital importance of the significant revenue flows that are generated from the export of gas. Therefore, I argue that any dislocation in the future would he very short lived; but it is a factor that we would be wise to build into a European gas policy.
I urge the Government to continue their policy of liberalisation of the gas market in all their dealings with Europe and, indeed, in their domestic dealings. I add to that the importance of completing the renegotiation of the FRIGG Treaty, an issue upon which I know they are in constant dialogue with our friends in Norway. I very much hope that the Government will be able to encourage the Norwegians to come to an early

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resolution on the matter. I believe that the resolution should serve as a template for intra-field pipelines across the median line. It could be an important template and a resolution of the issue would further liberalise the sector, which is something that the committee sought to achieve, and bring forward developments with what I consider to be interconnections rather than interconnectors, thereby bringing on marginal production which would otherwise not reach the market.
Without a shadow of a doubt, there are two most pressing issues which I hope the Government will take on board from the report and from the comments made this evening—namely, the need to be attached to market opening in their deliberations with their European colleagues, and, indeed, not just to market opening but also to ensure good progress thereafter. By the latter I mean that I hope the Government will foster larger steps than the presidency has proposed, seeking at least three years rather than the five years as proposed.
I believe that the take or pay proposals are in danger of blocking legislative moves towards liberalisation. Therefore, I very much hope that, so far as concerns market opening, the Government will have a strong resolve to push for a higher percentage than that which is currently negotiated. Like Centrica, I believe that an initial market opening well north of 25 per cent. is certainly worth while. As the Minister knows, if one compares the electricity directive with the gas directive, we are not on a level playing field. We should certainly be aiming to achieve a much higher percentage than that accepted in the electricity directive.
In conclusion, I hope that we can persuade member states as a matter of urgency to go further than the proposals which are currently before the House. I trust that the Minister will regard these words as a strengthening of what I understand to be the Government's resolve in what will be tough and critically important negotiations.
7.56 p.m.
Lord Skelmersdale: My Lords, it gives me great pleasure to follow my noble friend Lord Moynihan. With my chairman's permission, perhaps I may welcome him to our energy debates. My noble friend clearly has an enormous amount to offer. While he was speaking, I recalled the fact that I spent a few days in August in Uzbekistan which, of course, is a gas producer like Kazakstan, Turkmenistan and, indeed, that general central-Asian basin. Although gas currently tends to go east into Pakistan. India and China, there is no earthly reason why, when the time is right, it should not start to go west.
However, that is not what I want to talk about this evening. Given the lateness of the hour, I shall curtail my intended remarks, especially as regards my introduction. I am particularly grateful to my colleagues on the committee for allowing me to play a full part in this inquiry, possibly nudging against the Griffiths rules. If there is any complaint it is entirely my fault. Neither my chairman nor any other member of the committee shares any fault in that respect.
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With the exception of the noble Baroness. Lady Dean. we were all new to the subject—the noble Lord, Lord Bridges will remember this—as the committee reported in 1995 on the Commission's Green Paper on a European energy policy. Since then, we in the United Kingdom have almost achieved a complete free market in gas—something that our continental partners do not have, beset as they are by the monopolies of individual companies just as we had here between the 1960s and the 1980s. Perhaps I may say how delighted I am that Sir Denis Rooke, who masterminded the national grid for gas, was recently awarded a very high honour by Her Majesty the Queen.
Monopolies are by definition great protectors of their own interests, and state monopolies are the worst of the lot. It is hardly surprising then that the committee found that the most entrenched ones were those in the most developed countries, and those with no, or at best—like France—little gas of their own. The United Kingdom, Holland and Norway—a quasi-EC country, but one which obeys the rules through its arrangements with the Council of Ministers—are the only large scale producers. As my noble friend Lord Geddes said, most EC gas comes from Russia and Algeria, both of whom have ample supplies to sell, but unfortunately at a price which is considerably higher than it is here. Nonetheless there is more than enough to go round and I suggest that the supply is fairly secure although security is potentially unstable in the former case because of long and vulnerable pipelines and in the latter because of the political situation. That said, I have heard what my noble friend has just said on that matter. It is hardly surprising then that Europe as a whole wants access to United Kingdom, Norwegian and Dutch gas.
It is hardly surprising, too, that the big users of gas—the chemical companies and the electricity generators, in particular—wish to reduce their manufacturing costs, and that the Commission sees price barriers to trade for that reason. Its utopia of similar costs of production, whether in energy, wages, or raw materials, will lump all member states in the same boat and will make it inevitable that political integration will come if—and it is a big if—they ever achieve it. However, I must not be xenophobic. Indeed, I would not be a member of the committee if I was xenophobic about the Commission.
The industrial competitiveness of the Community as a whole, as against America, South East Asia, China or wherever, is a goal to be aimed at: hence this directive which intends to achieve common rules for the internal market in natural gas. Against this laudable objective. the Commission, as one expert said, faced "a carefully orchestrated campaign" of concerted opposition from the gas industry which,
"regarded the introduction of liberalisation as the equivalent to the end of civilisation-.
Looking back at recent history in this country, there are many who, in my children's words, would say, "Been there, Gran, done that, got the T-shirt". One must remember, however, that on the Continent the gas industry is hardly ever in the private sector. It is rigidly controlled by governments for all the reasons that we in this country believed in nationalised industries before

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the sea change of the 1980s. It takes political will to have free access to pipelines across borders or to have country X's supply firms use country Y's pipelines.
My noble friend Lord Haslam clearly believed some of our witnesses when they said that even though this was a minimalist directive, to have it was better than to have no directive at all, and that slowly pressure will build up from industry generally to change the situation. The noble Lord, Lord Berkeley, made the same point. The proof was the interconnector between Britain and Belgium. I know of contracts already signed for the supply of gas by Centrica, both in Belgium and in Germany, in anticipation of its coming on stream next year. Some sort of directive will be necessary to increase the penetration of that gas further into Europe.
What the Commission therefore needs to do is to make certain that derogations from the common use of pipelines are kept to the absolute minimum. This remains a major sticking point. I hope that goodwill prevails at the Energy Council next week. It should, I feel, be achievable if the Commission retains the lightest of possible touches on the tiller. If it gives the slightest clue that it will be heavy handed, I believe that the Energy Council on Monday will fail.
I refer to market opening. Over the past two years the basic premise has been agreed. However, the levels and speed are still a most contentious issue. We have had a fast reduction in this country—probably too fast—and to levels undreamt of still in the Community. In fact they will be undreamt of even at the end of the 10-year period described in the draft directive. There is no suggestion anywhere that a householder could purchase his gas from anywhere other than the national monopoly, unlike here where, within two years on the present plans, we shall see a competitive market across the whole spectrum. The draft directive goes to the other extreme and is so slow as to be meaningless. I believe that the report, suggesting as it does thresholds of 25, 10 and 1 million cubic metres of supply to a single customer per year, is so reasonable that it is in itself somewhat minimalist. Nonetheless, I believe that it is achievable and, most important, it is not too damaging to the supplier firms.
However, transparency of pricing is vitally important. I am not a believer in Chinese walls; there is too great a temptation to pass information between the transport arm and the selling arm in a single company. I am sure that Voltaire would agree, were he still alive, that in the United Kingdom we have the best of all possible worlds. Two separate companies, one for supply and one for transport, must be the ideal even if, as on the Continent, both will be state owned. That is certainly the case in the current state of play. There is also, in my view, little logic in a producing country having transport and production in the same firm. However, that is probably another matter and not really germane to the report.
As has been said, there is a short period between the production of this report and the Minister attending the Energy Council. If he does nothing else in his preparation I urge him to read and consider most carefully paragraph 114 on page 27. It is on these procedural points that this directive will founder, not on
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the apparently much bigger problem of "take or pay". Centrica has shown that even with the restrictive contracts which operate here, it is possible to renegotiate. It will be much easier on the Continent where we discovered that there are break points and clauses allowing changes depending on the costs of competitive fuels, and indeed for other reasons. As I say, I do not see them as an insurmountable problem although, like my colleagues on the committee, I do not like them in the first place and have never seen the need for them. I am afraid that the devil is in the detail of derogations. I wish the Minister all the best in resolving them for the benefit of all the gas using industries in the Community.
8.7 p.m.
Lord Ezra: My Lords, it is with a certain nostalgic feeling that I take part in this debate having been involved in the affairs of Sub-committee B many years ago, and for quite a long period. I am delighted to see that the noble Lord, Lord Geddes, is now leading that committee with such effectiveness, and that once again it has produced an excellent report.
I shall not repeat what other noble Lords have said in this well-informed debate in which brevity has been one of the keynotes. I shall try to follow that. Emphasis has rightly been placed on the importance of gas in the energy mix of the European Union. Emphasis has also been placed on the import dependence and the difficulty that that creates.
As to usage, the real growth is likely to be in the power station. I have always retained grave doubts about that. It is not so long ago that the Community prevented the use of gas in power stations and the reason was quite clear: gas is one of the best forms of primary energy available. If consumed directly, it can be used to the extent of 90 per cent. efficiency. Therefore one might well ask, why put it into a power station where the ultimate efficiency is 50 per cent.? It strikes me as a slightly odd quirk that we deprive ourselves of the full benefit of this valuable form of energy.
That leads me to another, related, matter which some noble Lords who are present may feel strongly about, and that is the progressive diminution of the coal industry in providing a necessary element of security. If I may diverge for a moment on that issue, it is a little odd that we in Britain, having the most efficient coal industry in the European Union, are reducing it at the fastest rate, while others are preserving their access to coal at higher cost. That may not directly relate to the subject under debate, but it is part of the issue of energy policy which I believe should be taken into account.
The specific issues which arise in connection with the directive have been well aired. There is the problem of the level of market opening. While there can he unending arguments about this, I believe that the 15 member countries are near achieving a resolution. I should be very surprised if they agree on anything less than has already been agreed in the electricity directive. Equally, there is the problem of take-or-pay contracts. We must recognise that those who produce gas in whatever country invest a great deal in that production;

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and they have to be covered by effective contracts. That applies as much in this country as it does elsewhere. There is a problem at present for the contracts of gas supply on the basis of field depletion which raises many issues in connection with the Competition Bill, with which the noble Lord, Lord Haskel, I, and others have been involved. We have to recognise the realities of the situation. Some measure of derogation for past contracts is justified, and we should take account of the nature of future contracts.
Access to the network, whether on a regulated or negotiated basis, has been carefully considered. In general, I imagine that it will be on a negotiated basis, as the regulatory system is relatively undeveloped at present on the Continent.
Transparency is another issue which has been mentioned. I doubt very much whether we shall achieve the total restructuring that we would like, but we should go as far as possible in accounting terms.
There is the interesting question of public service obligations. In Britain we no longer have this obligation. In the old days we had state owned coal, electricity and gas industries. They all had their public obligations to supply—to make sure that the energy was there when wanted. I am concerned that, under the new regime which our Conservative friends introduced progressively over recent years, that obligation has disappeared. It is felt that the market will provide the security. We have been going through an energy market which has been particularly beneficent in that sense. Any amount of energy has been available. But if things were to change who, ultimately, would be responsible? In law, no one in particular. On the Continent people think differently. We should have some sympathy with the view that a public obligation should be retained under the new arrangements.
I believe that the negotiating countries are very near agreement. I should be a little surprised if the agreement is not reached on 8th December. I very much hope that it will be. The nature of that agreement clearly will disappoint many in this country because we have moved so much faster. I believe that it does not matter too much how things are at the start because a momentum could develop which could push things forward.
I remind noble Lords of the electricity directive. The opening market figure was 22 per cent. When it comes into effect in 1999, it is likely to be 25 per cent. That suggests that there is an acceleration in these matters. The important thing is to start.
However, I very much regret one aspect. There is no mention in the directive, and therefore none in the report, of energy efficiency—the efficiency with which this prime form of energy should be used. In the legislation introduced for the privatisation of gas and electricity in this country, proper regard was paid to the need for efficiency. It has not been carried out as effectively as I should have liked, but at least regard was paid to that issue. I should like to see us pressing hard for something similar in the directive.
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I was reading the evidence involving the noble Lord, Lord Howie of Troon. He asked the representatives of the Commission how they thought that they would be serving the interests of energy efficiency by pushing for ever lower prices. He received a rather confused reply, as indeed anyone must. There is little incentive for people to save on energy if the sole objective is to reduce prices. There should be an objective to improve efficiency in use, to improve value in the hands of the customer. That element is missing.
I believe that the directive is a move in the right direction. I hope that it will come into effect quickly. However, I also hope that the issue of energy efficiency will be introduced in some way into the final version of the directive.
8.15 p.m.
Lord Mackay of Ardbrecknish: My Lords, I share the nostalgia of the noble Lord, Lord Ezra, for Sub-committee B. I was a member of it under his illustrious chairmanship. If my recollection is right, we investigated similar arrangements in the electricity industry and spent some time working out electricity interconnectors between various European Union countries. Therefore I share his nostalgic feelings for the committee.
I cannot say that I share his nostalgic feelings for the old days of the nationalised gas and electricity industries, coal companies, and so on. Perhaps I may recommend to the noble Lord page 47 of the report. The gas regulator, Ms. Clare Spottiswoode was giving evidence. At question 203, she answered by saying that she is a fundamental believer in market processes working better than government. She pointed out that,
"Governments in general tend to interfere in quite negative ways, although with good intentions, and they actually cause a lot of harm to the gas industry".
I shall not read out all she said in order to back up that point, but I commend the passage to the noble Lord.
I think I am right in saying that there may well be public obligations to supply in the gas and electricity Acts, but I am not a great expert in these matters. I suggest that the noble Lord, Lord Ezra, might consider that point.
The report relates to an industry where we and our continental partners are in different playing fields. We are major producers, with the Netherlands—a point made by many noble Lords who have taken part in the debate. My noble friend Lord Haslam illustrated the point by contrasting our position with that of many of our friends on the Continent who are dependent on Norway, Russia and Algeria. The noble Lord, Lord Bridges, commented on these differences and the important impact they have on the way we and our continental friends view these matters.
I believe that the situation will continue for a long time. Early in the development of North Sea oil people talked about the supply beginning to run out. It is not showing too many signs of running out. As my noble friend Lord Moynihan said, the potential sources of supply in the North Sea are there. We know about many, and we still find many. I share his view that there is not

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likely to be any problem of supply for us in the foreseeable future. That is one major difference between ourselves and many of our continental neighbours. It is a difference which my noble friend Lord Geddes referred to in his introduction.
There is another major difference. We have a more competitive regime in this country. My noble friend Lord Skelmersdale drew the attention of the House to paragraph 26 on page 11 of the report. Mr. Jonathan Stern, an independent gas analyst, said that the Commission had faced,
"`a carefully orchestrated campaign' of concerted opposition from the gas industry"—
in other countries—
"which 'regarded the introduction of liberalisation as the equivalent of the end of civilisation'."
In its findings, the committee continued:
"Opposition to liberalisation was difficult to understand from a British perspective".
Indeed, Ms. Spottiswoode, who I mentioned earlier, makes the same point in her evidence. I shall quote from Question 173:
"One of the things I have been very keen to ensure is that the Directive does not stop us doing anything we want to do, and because we are far further down the path of liberalisation the Commission has always been extremely keen to make sure we were not affected negatively".
She goes on to say:
"I am pretty confident the current draft has nothing in it which will stop us from liberalising and going down the route we are going."
I hope that the Minister will not only be able to confirm that that is the Government's view of current position but that he will be equally able to confirm the Government's determination not to allow anything in the directive which will inhibit the liberalisation and the competition we have introduced in our markets.
In his introduction my noble friend Lord Geddes specifically referred to several aspects and I agree with him entirely about the need to re-think the thresholds and the timescale and go for lower thresholds and a shorter timescale. That is important. On "take-or-pay", I must say that I have to turn to Ms. Spottiswoode again, because I think that the point she made in Question 194 was an interesting one, especially from someone coming from Scotland who has watched the gas and oil industry develop. Speaking about this whole issue she says that,
"it is about risk and managing risk, and that is the argument, I suppose, for "take-or-pay".
She adds:
"I think the first one is relatively easy in that the oil companies are used to managing risks. They spend their lives dealing with oil prices. They have no idea what oil prices are going to be a year hence, never mind 10 years hence, so they make their investment decisions on the basis of being the lowest cost producers".
If that is the case for oil, then it seems to me that it can also easily be the case for gas and I was pleased to see that the Committee came to the same conclusion, because it says at paragraph 111:
… the oil industry succeeds in achieving similar levels of investment without take-or-pay contracts".
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The committee goes on to say that they believe that "take-or-pay" contracts are contrary to the spirit of competition, so I hope the Government will endeavour to ensure that any derogations are given only for contracts already in existence and not for contracts to come.
The other interesting point—raised, I believe, by the noble Lord, Lord Berkeley—is about who is to police the gas regime. Is it to be the Commission? I have to say that my confidence in the Commission's policing of competition policy is not great. I remember during my short period in the Department of Transport constantly having to consider how the Commission could possibly agree to the large tranches of money that nation states like France were pouring into their aviation industry. The Spanish, and others, were also doing it. It did not seem to me that the Commission were being very vigorous about fair competition and opening up markets. That is also a worry in the financial services industry and so I am not entirely confident that the Commission would be a good policeman.
I wondered, therefore, whether a European regulator would be suitable, but Ms. Spottiswoode in her evidence knocked that on the head very convincingly when she said at Question 179:
"I think it would be a very had idea because each country has its own different system and I cannot imagine a European regulator would ever take the steps that we have taken in the United Kingdom to move things at the speed we have and get all the benefits that has brought to the United Kingdom. It is difficult to see a European regulatory body as anything other than a compromise across all countries' interests".
I believe that would he the case of the Commission, too, so the question of who is to police these matters could be very difficult. What we have to ensure is that inside each country an effort is made to police any competitive policy arising.
This is a fascinating and interesting report. In many ways I think that my noble friend Lord Geddes and his colleagues have produced a report with a great deal more substance to it than the directive on which they were reporting. It is to be regretted that the directive does not have more substance, but I believe we ought to recognise the difficulties experienced by some of our European friends. These have been illustrated by your Lordships tonight. I hope that they will recognise the huge advantages of liberalisation and competition which have been brought to this country and to our industrial consumers, who need energy as a prime source to produce competitively in the world and also to our domestic consumers who, thanks to liberalisation and competition and—dare I say it?—thanks also to privatisation, have enjoyed the fruits of declining gas energy costs. Unlike the noble Lord, Lord Ezra, on behalf of consumers, both industrial and commercial, I welcome that.
8.25 p.m.
Lord Haskel: My Lords, I am most grateful for the opportunity to reply for the Government to this Motion tonight. The gas directive is an important and late single market measure. I congratulate the committee on a most full and helpful contribution to the Government's

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consideration of this directive. It is also very timely. As several noble Lords have mentioned, the Council will be meeting on 8th December to agree the directive, and I am grateful for the opportunity to debate the committee's findings in advance of that date. I say to the noble Lord, Lord Geddes, yes, there is a very good chance of agreement on 8th December. And if there is no agreement on 8th December it will certainly be a priority for the United Kingdom to achieve one.
As several noble Lords have mentioned, it has not been an easy task for the committee. As one speaker remarked, it has been like trying to hit a moving target. Successive presidency drafts have been tabled, involving new proposals on key issues, and the picture still continues to change. Indeed, there were developments or discussion as recently as Friday and I will try to take account of these.
The committee has taken evidence from a wide range of those who are active in the gas market and those interested in the way it works, including my honourable friend the Minister of State for Science, Energy and Industry. Evidence has been received from companies based inside and outside the United Kingdom, from Members of the European Parliament, from the Commission and from the Norwegian Government. I congratulate and thank the committee upon the thoroughness with which it has pursued its inquiries. The result is a well-informed and valuable analysis of the issues confronting European legislators in considering the first step in opening the European Union to gas market competition.
Several noble Lords have suggested that the gas directive is not in the United Kingdom's best interests and that we should be better off keeping the benefits of competition and of our gas to ourselves. This is not the Government's view. Like other noble Lords, the Government attach priority to the completion of the single market, and the gas directive is an important single market measure. We believe it is desirable for the European Union as a whole to benefit from gas competition. This can bring important benefits to the competitiveness of European Union companies and the wider welfare of the European Union. What is good for the European Union is also good for the United Kingdom. As the committee notes, competition in the European gas market will improve export opportunities for United Kingdom gas producers. This competition should also help the United Kingdom companies which are interested in investing in the European Union in energy-intensive power generating projects. In addition, it will afford considerable opportunities for British companies to provide expertise in the workings of the competitive gas market. The computer applications alone for a competitive gas market across Europe are estimated to be worth billions of pounds by the turn of the century.
A more competitive European Union is good for United Kingdom trade and United Kingdom employment. That is why the Government are committed to pursuing the best outcome possible in terms of effective market opening under the gas directive. I can promise the noble Lord, Lord Mackay,
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that we are committed to that. In doing so, the Government have sought to ensure that the directive will not undermine the competitive market which is currently being unrolled in the UK. I can assure noble Lords who were concerned about the point that competition within the United Kingdom will continue as planned. The committee is right to draw attention to the issue and I am pleased to be able to say that we are on course to achieve the objective.
We do not maintain that the United Kingdom model for gas competition should be the only one available. That is because at present there is no homogeneous European Union gas market. The position varies greatly within the 15 member states. While the UK is a large, mature and liberalised market, there are countries such as Greece and Portugal where natural gas has been available to customers for months only rather than years. There are many variations within the Union and it is those differences between market structure and maturity which mean that member states have different views about how they see competition developing. Accordingly, there is a general wish to permit a large measure of subsidiarity in implementing the directive's core provisions.
Here I respond to the point made by the noble Lord, Lord Ezra, about energy efficiency. It is a matter for subsidiarity. The directive does not seek to impose energy efficiency measures on member states. The decision as to how best to achieve energy efficiency without distorting the single market is up to each individual member state.
Many noble Lords raised the point about member states which are substantially or wholly dependent on imported gas, much of which originates from outside the European Union. The noble Lord, Lord Geddes, gave us the figures. Of course, that has created political concerns about the nature and pace of market openings which have not perhaps been uppermost in our minds in the UK. But we agree that the European Union will be heavily dependent on imported gas in the future. However, liberalisation should not make the position any worse. Indeed, it should help, to the extent that a more open and flexible European market is created which may encourage the development of other possible sources of supply. The political support for some changes that we and the committee consider desirable—for example, the function of separation of gas transportation and supply—has not been present in the considerations of other member states for that reason.
Like the committee, the Government would prefer to see a more ambitious measure than that proposed by the Luxembourg presidency. The Government have sought and will continue to seek at the Council on 8th December improvements to the proposed extent of market opening and the quality of the third party access regime designed to implement that. Depending on how far we can get, there will, of course, be room to speculate about how much difference the directive will make in practice. But whatever the precise outcome, the Government share the view of some noble Lords that on balance it is better to have as good a directive as we can achieve than to have no directive at all.

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Through consistent presentation of the UK case, persuading others of its relevance, it has been possible to make some progress on the concerns raised by the committee. For example, the presidency's proposals contain a form of the Chinese walls which so disturbed the noble Lord, Lord Skelmersdale. The provisions will require transmission and distribution companies not to abuse commercially sensitive information obtained from third parties in undertaking their own gas sales.
A noble Lord raised an important question about the scope for cross-border trade and the impact of the UK-Continent gas interconnector pipeline. The importance of both the directive and the interconnector lies to a large degree in the fact that they will help to make new forms of activity possible. Although the number of major sources of supply into the UK market is comparatively limited, there will be additional competition between those sources of supply for market share, once competition in supply is established.
In addition, by providing an assurance of third party access rights for large industrial customers, the directive will open the door to new forms of market activity. The potential of the directive to facilitate such developments will be reinforced by the interconnector. The interconnector will link developments in the liberalised UK market to Europe. I agree with the noble Lord, Lord Moynihan, that trading and arbitrage are likely to develop around the interconnector, which will help promote similar developments in the European industrial supply market. We are therefore likely to see the emergence of traders and aggregators in the European market, as well as the more traditional forms of gas trade.
Some noble Lords raised the issue of the impact of the interconnector on UK gas prices. On that, the Government anticipate that on price and otherwise the interconnector will in the long term benefit UK customers. The noble Lord, Lord Bridges, reminded us of Clare Spottiswoode's comment about the interconnector having a price-dampening effect.
UK gas will only be sold abroad if it cannot find a competitive outlet in the UK and it is economic to sell elsewhere. However, by connecting the UK and the European markets, the interconnector is likely to lead to more stable UK prices than in the past and to enhance Britain's security and diversity of supply. Liberalisation in the United Kingdom will then continue to ensure that our consumers benefit from competitive prices.
I now turn to two other major issues: market opening and the take-or-pay contracts. On market opening, the Government agree with the committee's wish to see competition introduced into the European market as widely and rapidly as possible. We agree that it is desirable to achieve lower thresholds for eligible customers in second and third stages. There is also a case for shorter periods between stages of market opening. But it has been agreed that all gas-fired power generators should be able to benefit from competitive supply in order to avoid distortion in the electricity market.
It is important for European Union competitiveness to encourage the service innovation which will go to the competition in the electricity market and the power
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generation market. I can assure noble Lords who are concerned that the Government will not seek an improvement on the Luxembourg presidency proposals at the meeting on 8th December that we shall certainly do all we can.
Turning to take-or-pay, discussions on the possibility of derogating from the directive in respect of problems arising from long-term take-or-pay contracts have been one of the most difficult areas of negotiation. The Government share the concerns of many noble Lords about the potential for such derogations to delay the establishment of a competitive market. There has, however, been a strong political wish on the part of other member states to include such provisions for both existing and future contracts. The Government's view is that this should be seen as a transitional issue. It should be recognised that there is some potential for problems to arise as competition is introduced and in that sense a case for derogation is undoubtedly much stronger for existing take-or-pay contracts than for future ones.
We argued that case. However, the force of the political debate has been in favour of including the possibility of derogations for future contracts. We therefore sought other means of limiting the potential anti-competitive activity and the most significant safeguard in that respect is that any derogation can only be granted if important competitive criteria are met. For example, there is a requirement to show that no other alternative to a derogation is reasonably available. Most important, we have worked to ensure that those criteria are harder to satisfy for future than for existing contracts.
The Government believe that assurance can be taken from the fact that it is the European Commission, not the member states, which has the final say on whether a derogation may be granted. In our view it is essential that the Commission should have that role to ensure that we have a real single market in gas. We are concerned, however, at developments at discussions on Friday. Those showed a wide range of support for French proposals to allow member states considerable freedom to protect their companies in respect of existing take-or-pay contracts in ways which may blunt the impetus to competition under the directive. That remains a difficult issue and noble Lords are right to draw our attention to it.
My noble friend Lord Berkeley and other noble Lords raised the question of coal. I do not want to enter into a debate on the coal industry tonight. However, in Europe it is possible that the directive will, over time, encourage greater competitive pressures on the coal industry. It may assist with the removal of coal subsidies mentioned by the noble Lord, Lord Haslam.
The UK is already on course to open its gas market fully to competition by next year and the directive will not require the Government to make any additional changes in the UK energy markets.
I have tried to cover the Government's views on the main issues raised by the committee. I have also tried to answer any questions, and where I have not been able to do so I shall certainly write to noble Lords. I close by repeating the Government's welcome for the report.

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I know that the Luxembourg presidency will be pressing for an agreement on 8th December and it is therefore extremely helpful to my honourable friend to have the committee's support and guidance on the key issues before the meeting.
8.42 p.m.
Lord Geddes: My Lords, before making my brief closing remarks, perhaps the Minister could help the House. Doubtless because my attention was distracted, I am not now clear as to whether on Monday the Government will or will not seek improvements regarding market opening. My attention must have been elsewhere. Perhaps the Minister could say.
Also, before the Minister answers, did I hear him correctly say that last Friday, under strong pressure from the French, the take-or-pay derogations may well be continued for future contracts as well as for existing and past contracts? If that is so—I am sure all members of my committee would support me—will he ask his honourable friend to do everything possible to change that decision? As I said in my opening remarks, the Minister himself said that any derogations on take-or-pay for future contracts would, to use my words, drive a coach and horses through the whole point of it. Perhaps the Minister would be kind enough to reply.
Lord Haskel: My Lords, first, I can confirm that we will seek improvements in access. On the question of take-or-pay contracts, last Friday there were developments and discussions and those discussions showed a wide degree of support for French proposals to allow member states considerable freedom to protect their companies in respect of existing take-or-pay contracts, both now and in the future. It is a difficult issue and the Government will bear that in mind on Monday. They will negotiate as best they can to convince other member states that the derogation should not happen. If it does happen, it will only happen under extremely tough circumstances.
Lord Skelmersdale: My Lords, this is an important point and, with the leave of the House, perhaps I can press the Minister to say who else was involved in those discussions. Clearly the French were and 1 assume we were. But that is an assumption and it may be we got to hear of it on Saturday morning.
Lord Haskel: My Lords, I do not know who was present at the discussions. I only know their outcome.
Lord Geddes: My Lords, I am grateful to the Minister for clarifying my first question and relieved that the Government will be seeking improvements regarding market opening. In relation to take-or-pay contracts, I hope that this last interchange will strengthen his honourable friend's arm—if I can put it that way—in discussions next Monday, as I hope the whole of this debate will strengthen his honourable friend's arm. As I said in my earlier remarks, he was an impressive witness. In the committee's view he seemed to be going along exactly the right lines and I hope that
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what we have reported and what has happened during the debate this evening will strengthen his arm on Monday.
I promised to be brief and I certainly shall be brief; the evening is not as young as it used to be. I wish to make just one or two quick remarks. I noted with pleasure what my noble friend Lord Moynihan said in regard to his doubt as to whether prices would rise once the interconnector is in. I repeat what I said in my opening remarks, that the committee thought they might. I hope that he is right. We have slight fears on that subject.
The noble Lord, Lord Ezra, was a redoubtable chairman of Sub-Committee B, and I sat at his feet for many years. It was entirely predictable that he should raise the subject of coal but, with respect, that is not directly relevant to this debate or the report. However, regarding producers needing cover—I believe that was his expression—I am glad that my noble friend Lord Mackay drew his attention to paragraph 111. The committee was strongly of the view that if the oil industry did not need take-or-pay contracts, why did the gas industry need them? We have heard no evidence to take us away from that view.
I believe the Minister said in his opening comments that some noble Lords had said that the EU gas directive was bad for the UK. The committee certainly did not come to that conclusion and I am not sure that I heard that remark anywhere in the House this evening. I would hate him to think that the committee took that view; it did not.
Having said that, I am extremely grateful to all noble Lords who have taken part. It has been a good and short debate—almost exactly one-and-a-half hours. I have already thanked members of the committee but am particularly grateful to those noble Lords who were not members of the committee who took part. I commend the report to the House.
On Question Motion agreed to.

Iraq
8.48 p.m.
Lord Avebury Lord Avebury rose to ask Her Majesty's Government what is their current policy towards Iraq.
The noble Lord said: My Lords, before coming to the main theme of this debate, perhaps I may say how delighted I was to see that my noble friend Lady Nicholson of Winterbourne has chosen this subject on which to make her maiden speech. In another place she was a formidable campaigner for human rights in many parts of the world, but she is particularly renowned for her work on behalf of the victims of Iraqi oppression. She has undertaken works of an important and charitable nature to succour particularly those who were on the receiving end of Saddam's wrath in the marshes which were cleared by him of almost the entire population. We look forward to hearing what she has to say about that tragic situation.
It was six years ago that Saddam was evicted by the allies from Kuwait, but we left the job half done. We did not get rid of Saddam himself, first, because we had no authority from the Security Council to do so; but also because we were afraid that the Egyptians and the Saudis would drop off the alliance if we went ahead to Baghdad. Instead, President Bush encouraged the people to dislodge Saddam themselves. However, when the Kurds in the north and the Shi'as in the south took his advice, he left them in the lurch. The result was that hundreds of thousands of people were killed or driven into exile, the holy cities of Najaf and Karbala were devastated, and the opposition to Saddam was severely discouraged and weakened.
However, one objective that the Security Council adopted in Resolution 687 was the destruction under international supervision of all chemical and biological weapons and their means of delivery, and that Iraq should not acquire or develop nuclear weapons, or engage in any research for that purpose. I intend to concentrate on this subject because I know that the noble Lord, Lord Rea, and others will be dealing with the humanitarian situation in Iraq.
The Iraqi regime has made no fewer than seven "full and final disclosures" of its biological weapons programme, the most recent of which was in September 1997. But, as your Lordships are aware, it has never agreed to full and unfettered access by UNSCOM to monitor compliance. That was the cause of the latest crisis. On 12th November the United Nations described the Iraqi attempt to impose conditions on the special commission as "unacceptable". As a result of vigorous diplomatic efforts, and perhaps also the concentration of US and British forces in the region, the regime backed down on the composition of the UNSCOM team. But it is still imposing restrictions on where it can go. In particular, it says that UNSCOM cannot enter any of Saddam's 78 palaces. Your Lordships might well ask how a state which claims that it is too poor to give children proper medical treatment can afford to make such lavish provision available to its ruler, especially considering that each of those palaces has a large surrounding area which is treated as part of the presidential estate, and so the scope for hiding weapons, laboratories and production facilities in those areas is quite considerable.
The former head of UNSCOM, Dr. Rolf Ekeus, said that the Iraqis gave up about a third of their capability in missiles and chemical weapons and sought to keep two-thirds. They admitted that they had 25 warheads and 166 bombs filled with biological agents such as anthrax, botulinum and aflatoxin immediately before Desert Storm. In 1990 alone, Iraq produced up to 1,700 pounds of a chemical nerve agent VX, which I am informed is enough to kill half the population of the world. It has also stockpiled vast amounts of materials used to produce this deadly substance which has 10 times the lethality of the chemical Sarin, which is also very deadly. UNSCOM has been unable to account for all the VX that has been produced.
The Iraqis engaged in new and more sophisticated tricks of concealment, such as establishing companies in Jordan for the procurement of equipment and raw
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materials. It would be useful to know what steps UNSCOM is taking now to monitor Iraqi use of third country production or development facilities. The latest report by Dr. Ekeus' successor, Mr. Richard Butler, says that, although UNSCOM has now accounted for all but two of the imported prohibited missiles, it has been unable to check on Iraq's indigenous production of missiles, warheads and components. There is uncertainty about the extent of Iraq's continuing efforts to produce VX and about the existence of production equipment for chemical weapons manufacture. Mr Butler says that the most serious and persistent area where Iraq has disregarded its obligations to the United Nations is that of biological weapons. The report takes note of systematic concealment of activities and emphasises that failure to grant access has impeded the disarmament process and the work of the commission.
To summarise, it is clear that Iraq is a very long way from compliance with Resolution 687 and appears to be playing its usual game of brinkmanship in defying the United Nations. Nevertheless, it would be unwise for the US and Britain to attack Saddam on the grounds of recent prevarication and threats when he has not actually used violence. We would incur the rage of the whole Arab world, where there is a strong feeling about western double standards. They see that Israel gets not so much as a diplomatic slap on the wrist for armed action, which results in many civilian deaths, while Iraq could be on the receiving end of a huge air attack, more or less regardless of the strength of the provocation.
If Saddam was unwise enough to shoot down a UN aircraft, or to use violence against UN personnel, we would have to consider the position. But the launching of a few Cruise missiles, as in 1996, would have no effect on Saddam's policies. At worst, it could endanger the lives of UN personnel in Iraq, while at best it would lead to even less co-operation by Iraq with UNSCOM.
If Baghdad was on the point of developing an operational capacity for delivering weapons of mass destruction, there would be a powerful case for taking pre-emptive action against the sites themselves. He did use prohibited weapons in the Iran-Iraq war and in the notorious attack on Halabja nearly 10 years ago. It is unthinkable that he should ever be allowed to regain that capability as the Security Council decided when it passed Resolution 687. What it missed then, and what I do not think is fully appreciated nearly seven years later, is that as long as Saddam remains in power, that danger still remains. We needed a strategy to get rid of the dictator and to promote a pluralist democratic alternative inside the country, daunting as that task may be.
In the south, the Shi'as who number perhaps 12 million out of Iraq's 20 million population, had no tradition of political activism, and their religious leaders disappeared and almost certainly were murdered after the uprising of March 1991. Shi'a institutions were systemically destroyed, including libraries, religious schools and mosques. The marshes of the south were systematically drained, and the people who used to live there were internally displaced, except for 30,000 who became refugees in Iran and on whose behalf my noble friend has worked so assiduously.
It is clear that the Shi'as would like to see the back of Saddam and would probably like to manage their own affairs in a federal Iraq. There is no demand by them for union with Iran because of religious affinity, as some people imagine. So we should have taken the trouble to encourage political consciousness among the Shi'as, with those living in exile and through broadcasts in the Arab language service of the BBC. We should have made it clear that in a post-Saddam Iraq we expect the Shi'a population to exert the political influence to which their numbers entitle them. I should be grateful if the Minister would confirm that that is a corollary of the mission statement.
In the north, we have to understand that Barzani's control of the 1 million dollars a day revenues from the illegal traffic in oil has militated against a political agreement between the PUK and the KDP for reunification of the region. We are still trying, after losing count of the deals which have been agreed and then fallen apart. For the moment, there is a ceasefire and a partial withdrawal of Turkish forces from the region. But the chief of the Turkish general staff said over the weekend that the army will re-enter in strength any time it feels like it. That is intolerable and we should say so firmly. We have been far too sotto voce in condemnation of Turkish intervention in northern Iraq, which is a breach of the United Nations charter. I should like to know from the Minister whether we will now speak up more clearly about this violation of the charter.
The Turks had the effrontery to suggest that Ankara should be the venue for the next round of KDP-PUK talks. However, I understand that the alternative of London has been suggested. If we are to be the hosts, we should not invite the Turks. But we should ask the minority parties from northern Iraq and perhaps other distinguished Kurdish personalities who are not members of any party. We should insist on an interim government of national unity, leading to elections under neutral supervision for a new regional parliament, as was agreed in Paris, Drogheda and Dublin. We should insist that all revenues be paid into an escrow account and disbursed according to the arrangements that are already in place for 986/1111. There should be a fall-back policy that if any party obstructs the agreement, the holding of elections or their supervision, then the allies will cease to deal with its leaders, helping only those who are ready to adopt democratic principles as a first step towards applying them throughout the whole of Iraq. Above all, the question of the money has to be solved and since Resolution 986 is clear in forbidding any exports of oil products other than those specified by the Security Council, the KDP must agree to hand over the proceeds of this traffic to be spent for purposes agreed with the unified administration.
There needs to be a permanent forum in which democratic Iraqis from every section of the community can participate in a discussion of strategic moves towards a free Iraq. That could be an expanded and revitalised Iraqi national congress or, perhaps, to emphasise that it is part of a new co-ordinated approach, it could be a new body altogether.
The UN rapporteur on Iraq, Mr. Max van der Stoel, says that Iraq remains in the grip of one of the most ruthless dictatorships that the world has seen since the end of the Second World War. We need a coherent and effective plan for replacing this evil villain who does horrible things to his own people and, if given the chance, would threaten the whole world.
9.1 p.m.
Lord Rea: My Lords, in contrast to the noble Lord, Lord Avebury, who concentrated on UNSCOM and weapons inspection, I shall concentrate on the progress in meeting the humanitarian needs of the Iraqi people.
In February 1991, as the noble Lord has said, the United Nations task force abruptly ceased its advance into Iraq although it could probably have taken both Basra and Baghdad in a few days. The subsequent withdrawal and abandonment of the Kurds in the north and the Shia in the south who had risen against Saddam was a shameful episode only partly assuaged by the protection later afforded to the Kurds.
The decision to leave Saddam in power—perhaps as a prop to the status quo in the Middle East—has been revealed as a major mistake. Taking a rather cynical view, it could be held that the persistence of a defiant Saddam in charge of a repressive regime, a bete noire if one likes, has provided the United States with a good reason for continued high military expenditure long after the end of the Cold War.
Saddam's survival is something which most of us, particularly Israel, as the noble Lord, Lord Beloff, pointed out during Question Time today, could well do without. Whatever the reason behind the fact that Saddam's regime still exists and is causing international concern, the real brunt of the decision to allow him to stay in charge of Iraq has been borne by the long-suffering Iraqi people. For five years after the Gulf War the Iraqi regime has refused to allow the Security Council Resolutions 706 and 709 to operate. These would have allowed the import and monitoring of necessary food supplies in return for the sale of a limited amount of Iraqi oil, the proceeds to be handled through an escrow account by the United Nations. During this period Iraq orchestrated a campaign inside and outside the country which blamed the United Nations sanctions for the undoubtedly severe food shortages and the breakdown of the health care systems and infrastructure which occurred in Iraq.
I am afraid to say that I was one of those who was taken in by this to some extent at the time. It was quite hard to believe that a ruler would deliberately starve his own people for a propaganda effect. In retrospect, that was very gullible of me. After all, he had gassed, as the noble Lord, Lord Avebury, said, some 8,000 people in Halabja in 1988. In fact, the population has not only had to live under a repressive regime, but it has had to tighten its belt and suffer a disastrous increase in infant and child mortality, the true extent of which may never be accurately known.
This was all blamed by Iraq on the United Nations, particularly the United States. That was apparently believed by a large section of the Iraqi people. The

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antagonism thus created against the West was unfortunately boosted by unwise missile attacks on Baghdad by the United States a few years ago. However, last year Iraq finally agreed to the implementation of Security Council Resolution 986, which could be held to be an updated version of the previous Resolutions 706 and 709, providing for humanitarian supplies in exchange for limited oil sales. I gather that oil under this plan started to flow in December 1996—exactly one year ago. The food and medical supplies started to arrive shortly afterwards. This scheme appears to have been reasonably successful, at least where it has been monitored, although inevitably there have been delays and difficulties.
At present we are just reaching the end of the second 180-day period of operation of the agreement and we are awaiting the Secretary General's report on this second phase, which will then lead on to the approval of the next 180-day phase. I have seen the interim report of the half stage of 90 days on into the second phase, which records considerable achievement, at least in the three northern governorates, which is the Kurdish zone, although it is still too early to make a full assessment. However, I gather that on the strength of that report it has been suggested that the amount of oil sales be increased to deal more effectively with the urgent humanitarian needs of the Iraqi people.
I believe that there are some 150 monitors, very few of whom are British or American, supervising the distribution of the food and medical supplies. Mr. Benem Savan, who is a very able Cypriot of Lebanese descent, was appointed three months ago to co-ordinate the work of United Nations monitors and to suggest improvements in their methods of operation. Initially, these operations were supervised by the United Nations Department for Humanitarian Affairs, but that was not very effective. I gather that Mr. Savan is due to report shortly on his work so far. Can my noble friend the Minister say whether this report will be published and when?
During this exercise of the distribution of humanitarian supplies, there appears to have been reasonably good co-operation between the Iraqi and Kurdish officials and the monitors, at least in the northern parts of the country. But the Secretary General's report says very little about what is happening in the south, particularly among the Shi'as—the special concern of the noble Baroness, Lady Nicholson—who suffered Saddam's revenge after their 1991 uprising, as described by the noble Lord. Has my noble friend any news of the operation of Security Council Resolution 986 in those areas? How many United Nations monitors have been allowed in, particularly to the marsh area—if anybody is still living there—and to Basra?
Turning away from humanitarian concerns, can my noble friend tell the House the prospects for building a viable Iraqi opposition in exile? What is the present status of the Iraqi National Congress? How many political parties are part of that organisation? It is good news, as the noble Lord reported, that a further ceasefire
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between the rival Kurdish sects, the KDP and the PUK, has been arranged, but we have seen many before, so what chance is there of a permanent rapprochement?
Finally, the repeated incursions and now almost permanent presence of Turkish armed forces in Northern Iraq can hardly be contributing to the welfare of the Iraqi Kurds in the area. Can my noble friend say whether, as has been reported, agricultural activity has been disrupted and the distribution of food impeded by the presence of Turkish troops? It will be interesting to hear whether Her Majesty's Government know whether the Turkish incursion, ostensibly to track down PKK guerillas, has succeeded in finding any. I believe that they are extremely adept at melting into their mountain background. Do Her Majesty's Government believe that the Turkish forces ever really intend to withdraw behind their frontiers?
9.10 p.m.
Baroness Nicholson of Winterbourne: My Lords, it is indeed an honour to be a Member of this House. I wish to place on record my gratitude for the welcome all have shown me, and most particularly my colleagues on the Liberal Democrats. One of my Conservative friends wrote to me saying, "God does indeed move in mysterious ways"—all that I can say is that He has placed me among the most remarkable colleagues.
I have to declare an interest in Iraq. As the noble Lord, Lord Avebury, remarked in his most interesting speech, in 1991, at the end of the Gulf War, I formed a small human rights group, the AMAR International Charitable Foundation. The ballpark figures today are that we have worked in Iran and Iraq, particularly in the south, with 6 per cent. overheads and wholly local staff and resources. The interest perhaps is that, although I am a volunteer, we are partners financially of the European Union through ECHO, which provides 47 per cent. of the funding. We are also funded by DfID—thanks in part to the noble Baroness, Lady Chalker of Wallasey, and to the new Secretary of State—which has given 25 per cent. of the funding. Private donations, ranging from those of the Emir of Kuwait to schoolchildren in the United Kingdom, represent another 25 per cent. of our funding. We have a partnership agreement with UNESCO, receiving a fraction of funding (3 per cent.), a Memorandum of Understanding with the emergency division of the World Health Organisation, and now a partnership with the Irish Government (Irish Aid), which focuses on education.
This work has taught me that the people of Iraq are close to the hearts of the British people. The mixture of private and public funding has touched the lives of, and provided basic support for, half a million or more refugees. In five years we have raised and spent approximately £5 million. With 50 doctors, we provide 120,000 annual medical consultations, with five clinics, two laboratories and a new clinic under way. We have provided clean water supplies and sanitation in five camps. Two more deep water wells are now under construction. Garbage collection and sewage disposal is now provided in another four camps, with another project under way. Electricity has been supplied to two

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camps. We have provided 3,500 tonnes of food and approximately 250,000 pieces of clothing, most of which was funded by ECHO and the European Union. There are now 11 schools with 215 teachers, educating 6,500 primary schoolchildren.
In addition, we have established a permanent standing conference on Islam and the European Union in partnership with UNESCO and partly funded by the European Union. We are now drawing academics, politicians and senior religious figures from 27 nations. Our first conference was opened by the Archbishop of Canterbury, Ayatollah Taskiri of Iran and Dr. Federico Mayor, the director general of UNESCO.
Finally, we have conducted a huge scientific survey and report on marshland drainage. At the mid-term point of 1993, we reported that 50 per cent. of the marshes of southern Iraq had been drained and now only 10 per cent. of that area—half the size of Wales—remains under standing water. One-third of the refugees for whom we have cared in that period are marsh dwellers, commonly known in Wilfred Thesiger's great phrase as the "Marsh Arabs", who seem to me as I talk with them to be the water bushmen of the Arab-Persian Gulf. Those thousands of people are self-sufficient, strong and adaptable—a community literally stretching back to Sumeria, whose ancestors created the wheel, the rule of law and writing.
Since all but two of our staff—we have two European staff, one Frenchman and one Englishman—are refugees or local experts, and all those we serve are refugees, they have become closely aware of Iraq's current horror. A once honourable nation has become a living concentration camp. Human rights and freedoms have been deliberately demolished. There is no freedom to follow a faith. This year during the great Shia annual period of mourning for Arbaeen Iman Hussain men and women were slaughtered in their thousands by the regime's police as they worshipped. In south Iraq the holy city of Najaf is as important to Moslems as Rome and Canterbury are to Christians and parts of Jerusalem which reflect the sacred places of Judaism.
It is a dreadful, dreadful state. The regime now attacks small towns and villages in the south almost daily. We hear about them from the southern Iraqi refugees who are with us in Iran. It encroaches militarily in the barer areas of the north. In 1996 I visited 150,000 refugees as they swarmed across the border. We set up a large clinic and distributed blankets. As bombs rained down upon us we saw fear on the faces of children. Thousands died then to join the several million already killed whose escape from torture and imprisonment seemed to come only with death. Iranians, Kuwaiti prisoners of war, Iraqis, the Marsh people, the Kurds, the Shia and the Sunni disappeared. There are so many dead that they are uncountable. There are so many torments that we cannot feel.
But no tyranny is eternal. Once the watershed has been crossed and Saddam has been vanquished what lies ahead? Can we not look further tonight than just the miserable horrors of today? I urge Her Majesty's Government to join with me and many others in this House and the other place who understand Iraq to plan
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for the establishment of a new Iraq which surely should be a liberal democracy, perhaps a federated structure to reflect the curious nature of the Iraq that the United Kingdom created in the 1920s. Almost all the people wish for a liberal democracy.
I believe that much can be done when Saddam is toppled, but it will be much less effective if it is done in haste in the aftermath of what emerges than if it is done today. I believe that in our presidency of the EU we should draw as a nation upon our knowledge of Iraq—we have perhaps a more profound knowledge of that country than any other nation in the world—and the knowledge that we have gained in so many places in the world of post-conflict situations and of what to do. Saddam may go tomorrow and we must prepare. We have much experience from east and central Europe with the collapse of communism and the Soviet Union. I have witnessed the excellence of the Know-How Funds and the work of those whose expertise has been brought to bear. I saw that in Poland. It was wonderful to watch their stock exchange and banking system being created.
What about assisting in the restoration of professional standards through the establishment of professional bodies similar to those that we have in the United Kingdom? For example, are we supporting the Iraqi Medical Association? I helped the British Computer Society to set up a similar body in Hungary. Professional bodies with peer group analysis and pressure surely offer a way forward. We have seen this happen with the legal profession in the post-war tribunal in Rwanda. It is short of lawyers and judges. What are we doing? We are helping there. In the field of education, I recall assisting the Open University to begin work in Bulgaria. The Open University is one of the most important developments in the post-war era. It still has not spread throughout the world as it could and should have done. Surely the Government can help with that.
Finally, what will become of a unique and extraordinary body which has a rightful reputation once its work has been completed? I refer to the Truth and Reconciliation Commission of South Africa. That is a unique and extraordinary body set up by the Parliament of the new South Africa to heal past wounds and not rely always on law and punishment. Can we look again to see whether that can help?
What is our aim? Our aim is surely the creation and support of a stable nation where the gross national product expenditure of 37 per cent. on weaponry—the recent figure—is a past nightmare and not a future goal. That calls for Western self-discipline. I seek a register of arms first in the European Union and then internationally so that peace can reign.
9.20 p.m.
Lord Sempill: My Lords, it is a great pleasure to welcome the noble Baroness to the House and to congratulate her on a staggeringly moving maiden speech. I am sad that not more Members were present to hear her. I wish also to convey a special message of welcome from my noble friend Lord Weatherill, our Convenor, who unfortunately had a prior engagement.

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He told me that the noble Baroness was the only MP to have moved him to tears as she related her experience with the Marsh Arabs and her determination then to set up a consolidated fund to aid their project. He was so moved that he reached for his cheque book and contributed on the spot.
The noble Baroness has an impressive curriculum vitae, especially relating to her work for human rights. She has chaired various all-party parliamentary groups with a special focus on the Middle East and a series of highly successful appeals. She is someone with immense energy and is rightly regarded as a doer rather than a talker. Her appearance last week at the truth and reconciliation proceedings in Johannesburg in a role as protector of a key witness showed another major attribute—that of courage. I know that her talents will be fully appreciated in the House. We all look forward to her next contribution.
I am grateful to the noble Lord, Lord Avebury, for raising this Question. I thank him for giving such a clear exposé of the situation in Iraq and where we are today with it. However, I believe that it is time to review our relationship with Iraq, especially in the light of the Government's desire to conduct the nation's foreign policy on ethical grounds.
Recent events have resulted in a substantial amount of media coverage, some of it unfortunately, or disturbingly, of a jingoistic nature. There is an example from The Express of 10th November:
"Blair sends chilling warning as he backs Clinton over UN".
and:
-RAF go on alert to blast Saddam".
The outcome of the recent incident has been hailed as a victory by both Iraq and the US, with Russia claiming the high moral ground as the mediator. The reality is that the UN inspectorate is back in Baghdad, and the Iraqis still have the capability to manufacture weapons of mass destruction. The inspectors, however, are unlikely to make any headway, especially in the light of a statement by the Iraqi foreign minister Mohammed Saaed al-Sahhaf on 25th November that the government would "throw out" any inspectors who tried to enter sites designated as palaces, even if that provoked a US military strike. The previous day, President Clinton had announced that there were now 78 of those palaces, some of which encompass more land than Washington DC.
We have an impasse. As with many diplomatic coups, the Russian achievement is essentially to have given everyone a way out of a difficult situation but to have done so by telling each player something different. The Iraqis are told that they will be issued with a series of certificates that Iraq no longer possesses various weapons of certain descriptions— certificates which, I suspect, will be issued on a less rigorous basis than in the past—and that once the last certificate is issued sanctions will he lifted. To the Americans and their close allies—namely, ourselves—the line is there have been no concessions to Saddam and that the inspectorate will continue as before. Washington has not signed any paper, and Russian assurances to Iraq have no American endorsement.
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We now have statements from Moscow and Paris, stressing the need for the lifting of sanctions, which goes to show how the emphasis is now shifting. I strongly recommend that the Government conduct some high level talks with both the French and Russian governments in order to clarify their relationships with Iraq. It is certain that the bargain struck in Geneva will never work. All it will do is put off a crisis which will eventually burst on us in the form of either a new confrontation with Saddam over the inspections or his emergence, after sanctions have been raised, fully armed with the very weapons of which the United Nations vowed to deprive him.
The ability to produce these weapons of mass destruction with limited resources was highlighted in this week's edition of Time magazine under the headline "Germ Warfare". The article introduces us to Dr. Rihab Rashida Taha, Iraq's long-time chief of bioweapons production. She trained in the United Kingdom and is known to various American inspectors as "Dr. Germ". She is attributed with thwarting United Nations officials at every turn. Of more concern is the subsequent revelation about bioweapons. According to a Pentagon official, they can be produced using a recipe found on the Internet, a beer fermenter, a culture, a gas mask and a total investment of around 10,000 dollars. The official says:
"If you buy commercial equipment and put it in a very small room you can he producing anthrax within a month".
Anthrax is a bacteria which causes deadly haemorrhaging in the brain and chest. Iraq admits to brewing more than 8,500 litres of the substance, although American experts believe that the true amount is three times that. A United States Defense Department official says that a fatal dose is,
"smaller than a speck of dust; something you wouldn't even see".
If we accept that Iraq's overall concealment efforts are highly organised and involve thousands of people. how can we realistically hope that the UN inspectors will ever find these weapons? Is it not time to review post-Gulf War strategy, stand back from our vendetta with Saddam and view Iraq as an important regional power in one of the most volatile areas of the world?
The general consensus is that a split is appearing within the post-Cold War order, which envisaged permanent co-operation between North America, Russia and Europe acting together to keep the peace. We are seeing the decline of American influence in the Middle East following its failure to deliver a range of promises made after its successes in the Gulf War in 1991. The US set itself some tough objectives. They were to isolate, contain and sanction not only Iraq but Iran and Libya, hoping that those regimes would collapse or be changed. It intended to broker a peace negotiation between Israel and the Palestinians. It also intended to ameliorate the differences between Greece and Turkey and, it was hoped, resolve the crisis in Cyprus. It was an ambitious plan for the Middle East and the eastern Mediterranean.
However, the results have been meagre and the Arab states have lost confidence. And let us not forget that all of those states must cope with an anti-Israeli,

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anti-American constituency inside their own countries. Their dilemma is most clearly evidenced in the case of Jordan and King Hussein. He was the Arab leader who tried to mediate between the West and Saddam before the war and before siding with us. He still faces Saddam, an enemy whom he was assured would be removed. And to compound the problem, he now has in Netanyahu an Israeli leader who has little respect for him. The lack of a united front effectively undermines the use of force against Iraq and might even create a much wider area of conflict and substantial damage to the already weak economic fabric in the region.
It is time to change our strategy and perhaps take a completely different initiative. A good starting point may be that raised by Simon Jenkins in a very interesting article in The Times on 12th November entitled:
"Exploding the myth … It is time the West stopped fooling itself that bombs destroy dictators".
He writes:
"This is not a moral foreign policy. For seven years sanctions and bombing have been tried and failed. If Britain wants a proper Iraqi 'policy', it should seek an end to sanctions, flood the country with trade, help to pluralise its institutions and offer scholarships to Iraqis at British universities. In other words, the policy should be the opposite of one that clearly does not work. Such a 'contact strategy' would not only be humanitarian, it would almost certainly hasten the day when Saddam Hussein is toppled by enemies better able to garner local support".
I believe that a different strategy needs to be developed. Whether it should be as dramatic as that suggested by Simon Jenkins, I have my doubts. Equally, I believe that our current quest to seek and destroy all weapons of destruction has failed. The dynamics in the region are changing and new opportunities will present themselves. I believe that it is now the time to be pro-active and not reactive in our future relationships with Iraq.
9.31 p.m.
The Earl of Winchilsea and Nottingham: My Lords, what a pleasure it is for me to congratulate my noble friend Lady Nicholson on her excellent and moving maiden speech. Her personal experience brings a priceless contribution to the subject under debate and I am certain that we shall all benefit from her participation in your Lordships' House for many years to come.
I visited Iraq once in August of last year. The purpose of my visit was to deliver and help to install a wide range of parts for the air-conditioning system which was inoperative in the children's hospital in Baghdad. It had been inoperative since 1990 because it had become impossible to find spare parts due to UN sanctions imposed against Iraq. With the indulgence of the House, it is important that I offer an explanation as to how all this came about.
I was asked to do this by a close businessman friend of mine, Mr Ronald Laybourne, who is an electrical engineer living on Tyneside, and he had been asked to do it by the president of the Friendship Force of Atlanta, Georgia, USA—Wayne Smith. Wayne had visited Iraq
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and, in particular, the children's hospital in Baghdad at the invitation of the Association of Iraqi Women, and he had been appalled at the conditions he found. He returned to Atlanta determined to see what he could do to help alleviate the terrible working conditions in the hospital. An obvious way would be to get the defunct air conditioning system up and running. It was not difficult to see why he thought that. When Ron and I were there the temperature climbed to 69 degrees centigrade in the shade, outside the hospital, which is 156 degrees fahrenheit. It was several degrees higher inside it.
Wayne telephoned all his American air conditioning contacts and gave them the list of part numbers he had been given by the resident engineer at the hospital, but they were unable to match the numbers with any American product. Wayne therefore telephoned Mr. Laybourne in Newcastle, for two reasons. First, he is a long-standing member of the Friendship Force. Secondly, he knew that he was an electrical engineer. Ron soon established that the entire air conditioning system installed in the hospital was of British manufacture. The company was traced to Nottinghamshire and, yes, they could supply all the required parts.
I should explain that the Friendship Force is a non-profit making organisation dedicated to making friends around the world by organising exchanges with ordinary people, and as such is strictly non-political. Wayne Smith agreed to do what he could to help because politics played no part in what he saw as the purely humanitarian action of improving the terrible conditions prevalent in the hospital.
It was at this point that Mr. Laybourne went to Iraq himself to double check the system and the part numbers which he had been given by Wayne. He was able to satisfy himself that none of the parts could possibly be used anywhere else except in that particular air conditioning system in the hospital.
On his return he contacted me and asked whether I would be willing to assist in obtaining the necessary licence from the UN Sanctions Committee in New York, and also whether I would consider going with him to Baghdad to deliver them personally and to help install the parts. I agreed.
I must apologise to the House for this somewhat lengthy lead-in account, but I think it is important to stress that we obeyed all the rules and regulations, and never attempted to cut corners or in any way undermine the position of the UN. Everything was done strictly by the book, even though we did it purely for humanitarian purposes, to help the staff, and the young patients and their families in the hospital. We did not do it for the benefit of the Iraqi Government, although our visas were issued to us under the auspices of the Iraqi Minister of Health.
Conditions in the hospital were horrendous. I was taken on a complete tour of the hospital by the director, a splendid man of enormous humanity who himself was slowly dying of cancer and in considerable pain because there were no drugs available to treat him. I was shown the hospital dispensary. Only two items were on the

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empty shelves—aspirin and eye ointment. The hospital, which is the Iraqi equivalent of Great Ormond Street Children's Hospital, is the only paediatric hospital in Iraq. Children come from all over the country for treatment. Very often their families come with them and, because they cannot afford hotels or have no friends in Baghdad, they pitch camp in the hospital entrance lobby when they are not sitting by the bedside of their son or daughter. The hospital car park has been turned into a makeshift camp with families cooking and sleeping on the tarmac.
I was shown ward after ward of children, ranging in ages from infants of a few weeks old dying of malnutrition, to teenagers, victims of various forms of cancer but mostly bone cancer or leukaemia. What was very interesting indeed to discover was that all of these youngsters, without exception, came from the southern part of Iraq where the war had been fought. The doctors were convinced that they had contracted their illnesses due to exposure to the fall-out from the different types of weapons used.
I was also taken to the operating theatres and I witnessed an operation taking place on a five year-old girl to remove her appendix. Noble Lords may think that that was unfortunate for one so young, but it happens. That is normal. But without any anaesthetic—is that normal? Yes, in Iraq that is normal; it is also obscene. They had no anaesthetic of any kind in the entire hospital. If they had not operated, that little girl would have died. As it happens, she survived the incredible trauma, which speaks wonders for the skill of that surgeon.
That little girl was strapped to the operating table, with four distraught and weeping nurses holding her down while the surgeon did his magnificent best through his tears. I can still hear her screams, and no doubt I always will. I kept on wondering what I would be feeling if that was my own daughter Alice lying there on the operating table. How would I feel? Who would I blame for there being no anaesthetics? Would I blame the hospital director, or Saddam Hussein? No, I would probably blame the UN and, more specifically, the USA, which I would see as being the puppet master pulling the strings of the UN.
What do you tell her family? How do you explain to them why she had to go through that operation fully conscious? What do you tell all the other parents whose children are suffering from illnesses which could be successfully treated and which would not be terminal if there were drugs available to treat them? You can only tell them the truth, which is that there are no drugs available because of the UN sanctions imposed against Iraq. The UN will tell you, of course, that sanctions do not include medicines, pharmaceuticals, or foodstuffs, and that, on the face of it, is true, until you think about it a little more.
The only way that the Iraqis have of paying for food, drugs, and medicine imports is with hard currency. They are selling everything that they own in order to scrape together a few dollars to buy outrageously priced medicines on the black market. You can buy anything
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that you want in Baghdad if you have unlimited pots of money, but you will need to have a wheelbarrow in which to cart it around.
Before the Gulf War, one Iraqi dinar was worth close to three US dollars. We were able to get 1,000 dinars for one US dollar, so in 1996 inflation stood at 3,000 per cent. I saw windows, doors, door knobs, hinges, taps, shower fittings, plumbing connections, anything in fact that you would expect to see in a DIY shop here in the UK. The difference is that all these things on sale in the markets of Baghdad had come out of people's homes—they were secondhand—and because of that people were living in houses with no doors or windows, no heating, no plumbing, and sometimes no roof because the tiles had also been sold to buy food and medicine.
The only export Iraq had which everyone else wanted was, of course, its oil. You stop the flow of oil and you stop "Mrs Iraq" going down to the corner chemist to buy a bottle of cough mixture. So what is "Mrs. Iraq" going to think? Who is she going to blame—Saddam Hussein? That is possible but she would be wise to keep that to herself as you cannot trust anyone. There are agents and secret police everywhere. She will most probably blame the USA whom she sees as exerting the most influence on the UN.
A tremendous legacy of hatred is building up in Iraq against the West, particularly against the United States, simply because innocent people are being punished. The tragedy is that that hatred did not exist prior to the Gulf War, nor did it exist even during the war itself, or when Baghdad was being bombed. The very least we can do—I urge the Government to take a strong stand on this at the UN—is to see that no other five year-old Iraqi child has to endure a surgical operation without anaesthetic, or that no one has to continue to drink filthy, contaminated water because spare parts to repair the sewerage system in Baghdad can no longer be obtained and raw sewage is mixing in with the drinking water. I know that you can always buy bottled water, or you can if you are prepared to pay an entire month's wages for one bottle.
I am currently involved in sending supplies of pharmaceuticals to Iraq through the generosity of an anonymous donor who has made available large sums of money for that purpose. He recently paid for a huge quantity of powdered infant formula milk to be sent to Baghdad over a period of one year in a noble effort to stop infants dying through malnutrition. That was successfully completed in September. We are just embarking on a similar programme with pharmaceuticals, most of them for the treatment of various cancers. Let us hope that when the revenue from the agreed oil sales comes on stream, and is available to purchase medicine and pharmaceuticals, this disastrous situation in Iraq will be eased a little.
I intend to return to Baghdad next spring to check how the pharmaceutical programme is going, and also to see whether the hospital's air conditioning system is still up and running, which it certainly was when Ron and I left it. I just hope that I am in time to see my good friend the director of the hospital before he dies.
9.42 p.m.
Lord Hylton: My Lords, I thank the noble Lord, Lord Avebury, for the way in which he has introduced this debate. The Question concerns our current policy towards Iraq. This is not an easy subject to discuss because the great majority of us have not had any access to that country for a long time. It is therefore quite possible that I may find myself repeating points that have been made by previous speakers, and if so I apologise in advance.
I wish briefly to mention three factors that we need to take into account. The first is that we are confronted by a megalomaniac dictator. He has been responsible for two major wars of aggression. The first was against Iran, and that lasted between seven and eight years, and the second was, of course, against Kuwait in which we ourselves were directly involved. Mention has been made of Halabja. That is only the worst item of Saddam Hussein's devastation of the northern Kurdish area. Mention has also been made of his destruction of the Shi'ite holy places, and of his forcing out of virtually the entire population of marsh Arabs in the south. This man has murdered, tortured and pillaged his own people. He has refused for six years to sell the oil that he might have sold in order to buy medicines, children's supplies and other humanitarian materials. That point was effectively brought to our attention by the noble Lord, Lord Rea. That failure to sell oil has produced exactly the situation described by the noble Earl, Lord Winchilsea and Nottingham. I can bet any sum that any noble Lord cares to risk that the medical care available to the regime, the members of the party, and the security forces leaves little to be desired, while the rest of the people suffer in the way described.
UN resolutions exist on almost all these points. I believe that it is right to enforce them just as it is right to enforce and implement resolutions dealing with Israel. Just because a country happens to he a democracy, and happens to have friends in the United States, it still should not flout the will of the United Nations. The fact that it has done so for many years explains why so many Arabs throughout the Middle East and elsewhere still sympathise with Saddam Hussein.
The second factor on which I wish to touch relates to the Kurds. Probably the best estimate that can be made is that some 25 million people of Kurdish origin live in the Middle East. There are no accurate counts. They are the largest single group of people without a country to call their own; and those people have to put up with and have dealings with three of the most repulsive regimes in the world: Iran, Iraq and the military forces of Turkey.
In Iraq, the Kurds amount probably to between 3.5 and 4 million people out of a total population of 19 to 20 million. I pay tribute to the safe havens organised by the previous Prime Minister some years ago. Those undoubtedly saved the majority of Iraqi Kurds from the vengeance of Saddam Hussein and from the very strong probability of death by starvation and disease. Since then, alas, the Kurds of Iraq have been poor friends to each other. Despite elections in 1992, and a rather temporary Government of Unity, civil war has followed.
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I pay tribute to the patient efforts of the United Kingdom and the United States to achieve ceasefires and to resolve that internal conflict. To my knowledge, British diplomats have been travelling regularly from Ankara to Northern Iraq for that purpose. I am glad to hear that their efforts have at least resulted in a new ceasefire which became effective on 24th November.
The third factor is Turkey. For 13 years a continuous armed conflict has been in progress in eastern and south-eastern Turkey. Those are the very areas of Kurdish majority population. That has led to the imposition of martial law in the east and to predominant military influence throughout the whole country. I am not aware of any official effort to take up the various ceasefires offered by the Kurdish Workers Party or—and this is important—to negotiate the reasonable political and cultural demands of the Kurds in that country.
This war has continued, and the 1990s have seen many and prolonged Turkish military attacks into northern Iraq in search of the elusive PKK guerillas. These attacks have caused much damage and many civilian casualties.
In October Turkey compounded these offences by intervening openly on the side of the Kurdish Democratic Party and against the Patriotic Union of Kurdistan. Turkish forces were 50 to 80 miles away from their own frontier inside Iraq, fighting battles near, curiously enough, the Hamilton Road from Arbil to the Iranian frontier. (This road, as your Lordships may know, was built in the 1920s by a New Zealand engineer of that name.) Yet there was virtually no international protest or action.
I believe that Iraq should be seen in the context of the whole Middle East. The region is strategic for all Europe, the United States, Japan and Russia. If the rule of law cannot apply in the Middle East, where else can we expect it to apply? I suggest that the United Nations should recognise this strategic quality of the region and take much more responsibility for it.
Israel should honour the Oslo agreement, and here I should like to welcome the forthright replies of the Minister, the noble Baroness, at yesterday's Question Time, although I was not here to hear them myself. Turkey should live by the standards of the Council of Europe, the OSCE and NATO, to which it already belongs, and by those standards which are upheld and believed in by the European Union, of which Turkey aspires to be a member.
The United Nations should monitor and control all trans-frontier and military operations. Saddam Hussein, on his past record, cannot be trusted. He can only be constrained by military force to carry out his minimum obligations.
Such an approach may perhaps sound a little idealistic or, if you prefer, a little pessimistic, but I believe that it is in the wider interests of this country and of the whole world, and in fact it may be the only way to prevent wars, the loss of life, and the creation of refugees which these almost inevitably entail. The Question on the Order Paper addresses the current policy, but I would like to see that current policy being thought through as

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far as it can possibly be and the long-term factors, some of which have been referred to tonight, taken more fully into account.
9.53 p.m.
Lord Moynihan: My Lords, I should like personally to welcome and warmly congratulate the noble Baroness, Lady Nicholson, on her maiden speech. Politically, I am hopeful that with such eloquence and insight it will not be too long before we can welcome her hack to the Benches behind me.
In the light of recent events, I think that this is an exceptionally timely opportunity to hear a clear, unambiguous statement of Government policy on Iraq, and I congratulate the noble Lord, Lord Avebury, on securing this debate. Events this year are not the first time that Saddam Hussein has presented a naked challenge to the will of the international community, vested in the resolutions of the United Nations Security Council. It is vital that the Government have a clear, unwavering policy on Iraq, together with our international partners, since the consensus of world opinion, presently focused on Iraq, doubts that this will be the last time that the Iraqi despot attempts to dictate to the United Nations.
Saddam Hussein demonstrated the extent of the megalomania described by the noble Lord, Lord Hylton, when he invaded Kuwait in August 1990, and since the end of the Gulf War he has repeatedly flouted Security Council resolutions. In 1993 he violated the no-fly zones and last August his attack on Arbil in northern Iraq was a clear violation of Security Council Resolution 688. The US military response to his aggression in northern Iraq, strongly supported by the previous government, I am pleased to say, sent an unequivocal statement that such behaviour would not be tolerated.
An unequivocal statement that diplomatic and moral authority rests with the Security Council was again required last month. The international community cannot allow itself to be drawn into a protracted game of cat and mouse, in which Saddam Hussein ignores the rules defined by the Security Council and invents his own as he goes along. As usual, I listened intently to the noble Lord, Lord Avebury, and I heard what he said in his comparative analysis of Israel and Iraq. One critical difference to me and central to this debate is that the UN Security Council resolutions are not negotiable and that no country can determine the composition of UN teams and no country should defy UN resolutions.
Since your Lordships' House heard the Government's Statement on Iraq just over three weeks ago, the Opposition joins with the Government in welcoming the news that Saddam Hussein has apparently responded to intensive diplomatic pressure from the Russian Federation in particular, and has agreed to let the UN Special Commission inspectors return to Baghdad.
I should like to take this opportunity to reiterate the Opposition's support for the Government's firm stand in this crisis. We deplore Iraq's failure to comply with UN Security Council resolutions. In government and now in opposition, we supported the UN efforts to end
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Saddam Hussein's programme for the manufacture of weapons of mass destruction and to enforce the UN no-fly zone over Iraq.
Thus we support the Government's influence in securing a tightening of sanctions and we support the Government's refusal to rule out any option, while pursuing a diplomatic solution. Saddam Hussein's actions in obstructing the work of the UN Special Commission and in expelling the American inspectors on the team were an unacceptable breach and an uncompromising challenge to the international community.
In the years since the illegal invasion and occupation of Kuwait and the subsequent imposition of sanctions, it appears that Saddam Hussein is no closer to full compliance with Iraq's obligations under the terms imposed by the UN. No one can doubt the gravity of the current situation. The UN Special Commission's reports on the weapons of mass destruction amassed by Saddam Hussein are deeply alarming. Iraq is thought to have developed enough biological and chemical weapons to decimate the world's population several times over.
I should like to express the Opposition's full support for the highly skilled work of the UN Special Commission and to pay tribute to the work of its two chairmen, Rolf Ekeus and now Richard Butler. UNSCOM's mandate has been repeatedly impeded by a catalogue of delays, restrictions and, on occasion, absurd excuses, while damning evidence has been removed or destroyed. Nevertheless, during its six years of work, the team has been very effective in dismantling a large part of Saddam Hussein's nuclear programme and appears to have halted his attempts to develop a growing chemical arsenal. The monitoring regime has destroyed more weapons than were destroyed in the course of the Gulf War, and I should like to pay tribute to that success. Indeed, Richard Butler has not ruled out the possibility that this whole crisis may have been contrived by Iraq because UNSCOM was getting close to making a key discovery, to deflect attention from the real issue of the weapons, and give Iraq time to move the evidence and force the inspectors to start their search all over again.
UNSCOM has reported that Iraq's biological weapons represent an area,
"unredeemed by progress or any approximation of the facts",
and may include deadly nerve agents and mustard gas. I urge the Government to heed the words of the former United States president, who observed during this crisis that Saddam Hussein is, "hiding, ducking and dodging", and the,
"only way to make him comply is to be strong".
The Opposition welcomes Saddam Hussein's climb-down in the face of the international community's united front, but I wish to ask the Minister questions on the immediate implications of that, recognising that full replies may not be possible this evening. However, I hope they will, as posed, spark some debate and consideration of the key issues. Does the Minister agree that the crisis has only ebbed, rather than passed and that the true test will be UNSCOM's ability to undertake

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its work on the ground, without hindrance from the Iraqi authorities? Will the Minister confirm that, as a result of the Russian diplomatic initiative undertaken by Foreign Minister Yevgeny Primakov, Saddam Hussein has agreed unconditionally to allow the American UNSCOM inspection to return to Iraq?
Can the Minister further confirm that Iraq has accepted the return of the UNSCOM personnel in its previous composition as stipulated in Security Council Resolution 1137 and that the same UNSCOM inspection team has returned to Baghdad? Can the Minister also confirm that to secure Iraq's co-operation, no incentives or quid pro quos were offered during the Russian negotiations, which would indicate any capitulation of the UN to the demands of Baghdad? Can the Minister inform the House what the specific reference in the joint Iraq-Russian communiqué of 20th November to,
"improving UNSCOM's activity on the basis of respecting Iraq's sovereignty and security",
means? Can the Minister further confirm that there will be no price to pay for the unity of the Security Council and that Saddam Hussein's agreement to back down was not bought by the prospect of the relaxation of sanctions?
I note what the noble Lord, Lord Sempill, said about the shifting sands of the geopolitics of the world, let alone of the region, and I ask the Minister to give her views on that issue. Would the Government agree that the success of the Gulf operation in 1991 depended greatly on the support of Kuwait and Iraq's neighbours? In the event of military action against Iraq, would similar support be forthcoming? It seems unlikely, given that on 2nd November 1997, the Arab League expressed a,
"total rejection of any military action to be taken against Iraq",
and even Kuwait rejected military action. Why do the Government believe that the Arab states reacted so negatively and, unlike Britain and the United States, were prepared to rule out the option of a military solution? I genuinely believe—it reflects the comments of the noble Lord in introducing the debate—that there is a dangerous perception of an anti-American backlash among Arab states, based on the tripartite belief that the US will never lift sanctions while Saddam Hussein is in power, therefore giving him no incentive to comply; that sanctions have caused the Iraqis to suffer disproportionately; and that the US operates a double standard in its respective treatment of Israel and Iraq. That backlash was demonstrated by poor attendance of the US-orchestrated Middle East-North Africa conference in Qatar on 16th November, while by contrast Saddam Hussein seems to have his knees firmly under the high table of Middle Eastern diplomacy. He has been invited to attend this month's Islamic Conference in Tehran and his Deputy Prime Minister, Tariq Aziz, has been in talks with Syria, Iraq's former arch enemy.
I believe that there are important developments and that important questions have been raised in this debate on the geopolitics of the region. It is important for the Government to reflect on those issues and their views
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would be welcomed by the House. Also, can the Minister say whether the crisis revealed any rifts within the permanent membership of the Security Council.
I share the noble Baroness's insistence that we look over the horizon and beyond today's conflict. Noble Lords are wise to urge the Government to raise their sights beyond today's crisis. The Minister will no doubt respond to the many comments on Iraqi opposition movements; the importance of assisting with humanitarian aid; the situation in northern Iraq: sanctions and the oil-for-food deal which were so clearly made this evening.
Iraq has a huge potential, once its people are released from the yoke of tyranny under which they are currently enslaved. The international community must stand by to help with reconstruction and renewal and to ensure Iraq takes its place in the family of nations. For the past six years Saddam Hussein has traded in a currency of concealment, lies and deception. We must make it clear that Saddam Hussein's juggernaut on the road to defiance and transgression will not bring power. kudos and legitimacy, but only bankruptcy in its wake.
The only route to prosperity and acceptance by the world community is to comply fully and unconditionally with Security Council resolutions. Only in that way will sanctions be lifted. If modern history has taught us anything, it is the peril of unchecked tyranny. Short-term appeasement pays few dividends. Britain, as a permanent member of the Security Council, has a duty to protect the integrity of the United Nations. Britain has a duty to stand firm with our allies against the twin forces of tyranny and aggression, as we did in 1991, and we have a duty to remain vigilant to ensure that Iraq co-operates fully with the UN and the UNSCOM inspectors can carry out their full mandate to prevent the acquisition of nuclear, chemical and biological weapons. So, on behalf of the Opposition, I assure the Government of our committed and unconditional support in the action they take to pursue a clear and firm policy towards Iraq to achieve these goals.
10.5 p.m.
The Parliamentary Under-Secretary of State, Foreign and Commonwealth Office (Baroness Symons of Vernham Dean): My Lords, I, too, thank the noble Lord, Lord Avebury, for initiating this important debate. The depth and sincerity of the noble Lord's commitment to human rights is well known in the House and he ably demonstrated the strength of his convictions again this evening.
I should also like to add my congratulations to those already expressed in your Lordships' House to the noble Baroness, Lady Nicholson of Winterbourne. Knowing her capabilities, I have looked forward very much to her contribution this evening. I was indeed right to do so. It was a knowledgeable, eloquent and keenly felt intervention. We look forward to drawing more in the future on her expertise and on her tremendous powers of expression.
Saddam Hussein is a dictator who has remained entrenched in power through his own ruthlessness. He has caused untold misery and suffering to the Iraqi

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people. He is a threat to regional and international security. One need not look far for examples of Saddam Hussein's brutality. As recently as 1994, he once again threatened the people of Kuwait with occupation of their country. He has pursued a consistently brutal approach towards his own people as the Iraqi Kurds of Halabjah and the Shia of the southern marshes can testify. The noble Lords, Lord Avebury and Lord Rea, reminded us of that.
The question we are facing today is one about the Government's current policy towards Iraq. Our policy is twofold: the containment of a despotic leader who threatens regional and world security; and the protection of the Iraqi people from his inhumane repression. We conduct our policy by lending our full support to the United Nations and by ensuring the implementation of Security Council resolutions. I thank the noble Lord, Lord Moynihan, for his points of support over those.
However, we must not lose sight of the aim of sanctions. Sanctions against Iraq came into effect as a result of its illegal occupation of Kuwait in August 1990. The sanctions isolated Iraq and threw the spotlight of world opinion on the terrible excesses of Saddam Hussein's regime. They have prevented Saddam Hussein from expanding his arsenal of weapons of mass destruction. They have shown other would-be aggressors that they may not invade sovereign states with impunity.
Resolution 687 lays down the foundation for the UN Special Commission—UNSCOM—and invests it with the task of inspecting and rendering harmless all Iraq's stocks of weapons of mass destruction and ballistic missiles. It is a horrifying fact that at the start of the Gulf War Saddam Hussein had sufficient chemical and biological weapons to kill the world's population several times over. UNSCOM has succeeded in removing more of those weapons than were destroyed during the Gulf War. Like the noble Lord, Lord Moynihan, we applaud the efforts of this dedicated team of specialists who have made so much progress in spite of Iraqi deception and concealment. The work of UNSCOM knows no conditionality. It is not for Iraq to negotiate the terms of Security Council resolutions. Nor is it for Iraq to determine the nationality of UNSCOM members or the sites that they may inspect.
As the noble Lord, Lord Avebury, told us, in October, UNSCOM's executive chairman, Richard Butler, published a report which told of a prolonged strategy by Iraq of obstructing inspection of sensitive sites and duplicity in its so-called full and final declarations. In particular, it cited an "almost complete lack of progress" in the field of biological weapons. UNSCOM suspects Iraq of holding large quantities of anthrax and VX among others. These are capable of killing the world's entire population. They have to be destroyed.
The noble Lord, Lord Avebury, asked about UNSCOM's mandate outside Iraq. UNSCOM's mandate is to inspect sites within Iraq only under SCR 687.
The recent stand-off between Iraq and the UN was only the latest chapter in an ongoing saga of deception. On 13th November, US members of UNSCOM were
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expelled from Iraq, compromising the safety of the remaining team, so that they also were forced to leave. Iraq also threatened to shoot down the UN reconnaissance plane that supported its work.
Throughout the crisis that ensued, we were engaged in intensive multilateral diplomacy, as described by the noble Lord, Lord Hylton. I thank again the noble Lord, Lord Moynihan, for his support over our endeavour. We did not enter into negotiations with Iraq, which they were not entitled to expect. Instead, we invested our efforts in bolstering the Security Council. The Security Council was unanimous in its condemnation of Iraqi actions. On the same day that Iraq initiated the crisis, the Security Council responded with a strongly worded Presidential statement demanding full compliance with UNSCOM. On 12th November it unanimously adopted SCR 1137, which punished Iraqi officials responsible for the crisis by imposing a travel ban on them. By achieving unanimity, the Security Council was able to impose its authority on Iraq.
Iraq's actions were a blatant and ultimately unsuccessful attempt to question the authority of the Security Council. Saddam Hussein had thought to be able to exploit supposed divisions in the Security Council. He failed because the council, standing united and firm, sent an unambiguous message to Iraq that it must comply with relevant Security Council resolutions.
We succeeded. Saddam Hussein backed down. Iraq has now unconditionally allowed UNSCOM inspectors to return. This success was achieved through our policy of pursuing a diplomatic solution backed by the credible threat of military force.
Saddam Hussein's political posturing impressed nobody. He must now allow UNSCOM to enter all sites which they judge necessary to inspect. He must submit to their inspections without further attempt to mislead or make false declarations. These are indeed the tests as the noble Lord, Lord Moynihan, suggested they were.
Well-meaning people criticise the effect of sanctions on ordinary Iraqis and complain at the length of time they have been in force. They ask when they will be lifted. The answer is simple. Sanctions will be lifted when Iraq complies with all relevant Security Council resolutions and Saddam Hussein knows this. But he consistently refuses to comply. He has taken a cynical decision to exploit the suffering of his people in the hope that the international community, suffering from sanctions fatigue, will give in. We shall not give in. Iraq has to comply with the relevant Security Council resolutions before sanctions can be lifted.
Let it be clearly understood that we have no argument with the people of Iraq. I applaud the work described by the noble Earl, Lord Winchilsea and Nottingham, in the humanitarian undertakings which he witnessed. Sanctions are aimed at the Iraqi regime, and not at the people. It has always been possible to import food and medicines into Iraq, but unfortunately Saddam Hussein has always preferred to spend Iraq's money on palaces for his regime rather than treating children or helping the sick. It is Saddam Hussein who is responsible for the suffering of the Iraqi people. By refusing to comply with Security Council resolutions, he alone is delaying the day when sanctions can be lifted.

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I assure the House, including the noble Earl, that we care deeply for the welfare of the Iraqi people. Proof of this is our sponsorship, in 1995, of Security Council Resolution 986, known as "oil-for-food", referred to by the noble Lord, Lord Rea. This allows Iraq to export a quota of oil and use the revenues to buy essential humanitarian supplies. The resolution contains safeguards to ensure that the revenues are spent on the welfare of the Iraqi people and not on the aggrandisement of the regime. The measure has since been renewed in the form of SCR 1111 and we are pleased that supplies are reaching the Iraqi people and alleviating at least some of their suffering. We will support a further renewal later this week. With our Security Council partners we are also looking at ways of making "oil-for-food" work more effectively, as indicated by my noble friend Lord Rea.
Additionally, the UK has provided £94 million in aid to the Iraqi people since 1991, making us the second largest bilateral donor of aid. We have been instrumental in helping to rebuild the shattered economy of northern Iraq, an area that had suffered greatly under Saddam Hussein's infamous "Anfal" campaign. Several of our aid programmes are specifically directed towards helping Iraqi children.
As many noble Lords have said, Iraq has a terrible human rights record. We strongly condemn Saddam Hussein's appalling record of brutality towards his own people. The highly respected UN Special Rapporteur for Human Rights, Max van der Stoel, has reported a catalogue of human rights abuses in Iraq. These include the disappearance of hundreds of prisoners of war, the mutilation of army deserters, summary arrests and executions, torture and the infliction of barbaric punishments, as described by the noble Baroness, Lady Nicholson. In his most recent report Mr. van der Stoel states:
"It cannot be said that any human rights are respected in Iraq".
In coalition with the US, we enforce No Fly Zones above the 36th parallel in the north and below the 33rd parallel in the south of Iraq. This action is in support of SCR 688 (adopted in 1991), which demanded that Iraq end its repression of the Iraqi civilian population.
The noble Lord, Lord Avebury, referred to the position in northern Iraq. We have also been actively promoting peace in northern Iraq between the warring Iraqi-Kurdish factions, the Patriotic Union of Kurdistan (PUK) and the Kurdish Democratic Party (KDP). Following renewed fighting in mid-October which ended a year-long UK/US brokered ceasefire, we have again managed to negotiate an end to hostilities with a new ceasefire that came into formal effect on 26th November. We are now working on setting up substantive reconciliation talks between the two sides.
We view with concern recent Turkish involvement in the fighting in northern Iraq. We recognise Turkey's right to self-defence from the terrorist activities of the Kurdish Workers Party. However, we have made it clear
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to the Turks that we do not accept this as justification for any involvement in the conflict between the PUK and KDP.
The noble Lord, Lord Sempill, asked questions about a number of different issues. Dealing with Iraqi intransigence is not an East-West power play; nor is it an exercise in posturing from individual countries. However, it is vital that we secure the position in the whole of the Middle East. That is recognised by the countries mentioned by the noble Lord: Russia, France, the United States and the United Kingdom. All are united in insisting that Iraq must comply with UNSCOM. All also agree that Iraq must comply with all the relevant resolutions before sanctions can be lifted.
The noble Lords, Lord Avebury and Lord Rea, asked me about support for the Iraqi opposition. We support and encourage efforts to form a united representative opposition to Saddam's regime. Two recent meetings at the FCO, designed to promote that aim, were successful.
The noble Lord, Lord Moynihan, asked specifically about the composition of the UNSCOM team. It is the same UNSCOM team and Mr. Butler is responsible for its selection. No deal was done with Saddam Hussein. Saddam must now realise that the Security Council cannot be dictated to.
It was also suggested that perhaps support for us in the Middle East was not as great as it had been. Noble Lords may be interested to learn that we received strong private support from a number of Gulf states throughout the recent conflict. As Saddam's neighbours they recognise that the threat he poses to the region is a real one. All Middle East countries are worried about Saddam's capabilities in weapons of mass destruction.
I should like to deal with some of the remarks of the noble Earl, Lord Winchilsea and Nottingham. He asked what we would say to the parents of the child he saw undergoing an operation. We would say that Saddam had deliberately taken a cynical and wicked decision to allow the Iraqi people to starve and their children to suffer in the way described by the noble Earl. Saddam has taken that decision in order to increase pressure on the international community. It is difficult to believe that anyone can take such a decision but, knowing what Saddam has already done to women and defenceless children in the Iraqi marshes, perhaps we should not be surprised that he has taken it.
As to the future, we look forward to the day when Iraq is no longer ruled by a regime that ignores international obligations and brutalises its own people. Such an Iraq will no longer be subject to sanctions and can realise its enormous potential, its wealth of people and its natural resources as the noble Baroness suggested earlier. There are many Iraqis in the UK representing opposition groupings and working to bring about democracy in Iraq. We support their efforts and look forward to the day when Iraq can rejoin the family of nations as a respected member.
House adjourned at twenty-one minutes past ten o'clock.

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