Sitting of 3 July 1997

Preamble
The House met at half-past Two o'clock
PRAYERS
[MADAM SPEAKER in the Chair]
Oral Answers to Questions
  TRADE AND INDUSTRY

    Renewable Energy
    Mr. Hanson: To ask the President of the Board of Trade if she will make a statement on her Department's policy towards promoting renewable sources of energy. [5203]
    The Minister for Science, Energy and Industry (Mr. John Battle): The Government are undertaking a new and strong drive to develop renewable energy options, such as wind, water, solar and biomass, as a means of ensuring diverse, secure and sustainable energy supplies.
    We are also examining the role of research and development to maximise the benefit to the economy of the emerging new environmentally friendly energy industries.
    Mr. Hanson: I thank my hon. Friend for his comprehensive reply. Does he agree that the recently announced changes and the Fossil Fuel Levy Bill will go a long way to help promote renewable sources of energy? Does he agree also that renewable energy sources are one of the key features that the Government must achieve and secure to help them meet their laudable target of a 20 per cent. reduction in CO2 emissions by 2010?
    Mr. Battle: I thank my hon. Friend for his remarks. Yes, the targets are tough, but that is all the better in our drive towards renewables, which we see emerging as a contribution to our achieving the CO2 targets. The renewable energy industries need a clear signal that there will be confidence in them as generators of energy in future. The purpose of the alterations to the fossil fuel levy is precisely to create space and more support for renewable sources of energy.
    Mr. Evans: I support any promotion of the use of renewables, but will the Minister give an assurance that local people will always be consulted and taken heed of when any applications for the erection of wind turbines, especially in areas of beautiful open countryside, are made? Does the hon. Gentleman agree that, if we only diverted more money, perhaps away from subsidising some of the more inefficient ways of producing energy,
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    into energy conservation in people's homes, we would be doing far more to ensure that the countryside is preserved for the enjoyment of everyone?
    Mr. Battle: Energy efficiency and conservation are not incompatible with developing sources of renewable energy. Energy efficiency measures, as proposed by my right hon. and hon. Friends in the Department of the Environment, Transport and the Regions for example, are a positive way forward.
    All the projects that go through for non-fossil fuel obligation support must have local consent and support. Some people oppose wind farms, but there is quite substantial opinion in favour of them among those who see them as a positive way forward. In international terms, we should not confine our attention to the turbine itself but think of the chain of engineering in a wind farm. It is a good product and it can win markets internationally.
    Mr. Tipping: Will my hon. Friend examine the research into renewable and sustainable energy and extend it towards clean coal technology? Does he agree that coal faces a challenging time and that any help that we can give it to become a more competitive and environmentally sensitive source of fuel will be welcomed by coalfield communities throughout the country?
    Mr. Battle: My hon. Friend has a record of championing cleaner coal technologies. Research has already been undertaken, and we are pulling it together. It is important that coal generation tackles noxious emissions such as sulphur and nitrous oxide. It is important to look to technologies to ensure that coal is burnt more cleanly and that there are not nasty emissions. We shall do all we can to assist in research and development and to bring the process to market. We shall also assist in ensuring that there is some space in future for coal and coal burning, while not jeopardising the environment.
    Mr. Roy Beggs: Does the Minister accept that there are many small potential hydro sites, as yet undeveloped, throughout the United Kingdom? Will he give early consideration to the difficulties and costs that face those who seek to promote new, small hydro sites? Perhaps too much difficulty is being created by ill-founded objection at local level.
    Mr. Battle: I am grateful to the hon. Gentleman for drawing my attention to that matter. We want to support small hydro schemes—that is part of the package of support for renewables. Hydro is eligible for NFFO as well. I should be grateful if the hon. Gentleman would give me details about difficulties with projects in his part of the world. If he does, I will see what can be done to assist.

    Regional Selective Assistance
    Mr. Hinchliffe: To ask the President of the Board of Trade what steps she is taking to review the criteria for regional selective assistance. [5204]
    The Minister for Competition and Consumer Affairs (Mr. Nigel Griffiths): This will be addressed in my right hon. Friend's comprehensive spending review.
    Mr. Hinchliffe: My hon. Friend is aware of the serious concern about the current calculation of unemployment

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    figures. When he considers the future criteria, will he take account of a recent report by Sheffield Hallam university which suggested that a significant number of unemployed people have been moved on to sickness-related benefits as a direct consequence of the previous Government's policies? When he looks at those criteria, will he have discussions with the Department of Health about the possibility of including a health profile of individual areas?
    Mr. Griffiths: I want to ensure that regional selective assistance is based on reliable criteria. I know that my hon. Friend will want to pursue this point with the Department for Education and Employment and the Department of Health. I am sure that his work to date has contributed to the success of 19 companies in Wakefield in receiving offers of regional selective assistance to secure 820 jobs and in securing capital investment of £31.3 million.
    Mr. Nicholls: Is the Minister aware of the concern that, very often, selective assistance does not so much create jobs as remove them from one part of the country, by a job-shuffling technique, to another? There is great resentment in areas such as Teignbridge that that is precisely what is happening to them. While I do not expect an answer today, will the Minister at least say that the review will consider whether real jobs are created or whether they are stolen from people who had them in the first place?
    Mr. Griffiths: The maps were drawn up in 1993. Perhaps the hon. Gentleman should put his question to the right hon. Member for Henley (Mr. Heseltine), who was President of the Board of Trade at the time. He might be able to tell the hon. Gentleman why his constituency did not qualify. These matters are being addressed in the comprehensive spending review.
    Mr. Barry Jones: Does my hon. Friend know that this form of assistance is ever more important to communities such as mine? Does he know that, in recent years, objective 2 status and development area status have been stripped away from my constituency? What prospect might there be of such status being awarded again?
    Mr. Griffiths: I am sorry to say that I cannot give that assurance, but I know that my hon. Friend will seek to ensure that the best case is made for his area, where he has a reputation for championing local causes.

    Post Office
    Mrs. Ballard: To ask the President of the Board of Trade what guidance her Department has issued to the Post Office in respect of the protection of local services. [5205]
    The Minister of State, Department of Trade and Industry (Mr. Ian McCartney): The Government are committed to a nationwide letter and parcel service with daily delivery to every address in the country, to a uniform and affordable tariff structure under which it costs the same to post a letter anywhere in the United Kingdom, and to maintaining a nationwide network of
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    post offices. Detailed arrangements for the provision of postal services at local level are the operational responsibility of the Post Office.
    Mrs. Ballard: People in my constituency, in Wellington in Somerset, have recently experienced a deterioration in the service at their local post office. They will be glad that the Minister is committed to a network of post offices, which I hope he agrees is vital to the survival of rural communities. This week, the chairman of the Post Office called for greater commercial freedom. In answering that request, will the Minister also ask the chairman to give greater commercial freedom to individual sub-post offices to allow them to negotiate with public utilities and others their own contracts to provide services to local people rather than having to be part of a block contract?
    Mr. McCartney: I thank the hon. Lady for her comments about the post office in Wellington. On 10 July we arranged for Post Office representatives to meet town councillors, after which significant improvements to the arrangements in Wellington were agreed. The Post Office will have another meeting on 12 August, following which I have asked officials to keep the hon. Lady informed of progress. If, after that date, she is still not satisfied, she is more than welcome to contact me, and I will try to assist her to ensure that the Post Office meets the standards and requirements that our constituents deserve in their postal services.
    With regard to the hon. Lady's second point, we shall ensure that the review takes account of the needs of users of Post Office services. The review's purpose is to ensure that, between now and the turn of the century and beyond, the United Kingdom will have the first-class service that its people deserve. I shall ensure that the hon. Lady's comments are included in the evidence that we are gathering as part of the review.
    Mr. Mackinlay: Is not there a problem for all hon. Members in that the Post Office will always hide behind the fact that these are operational matters? Many hon. Members feel that there is a need to expand and increase the number of Post Office Counters outlets in their constituencies, but the franchises have already been given to particular people based on a geographical area. Many hon. Members want more outlets, but are impeded by the Post Office's claim that that is a matter for it rather than a matter of service delivery to the public.
    Mr. McCartney: My hon. Friend should put the matter in perspective. With 19,000 outlets, the United Kingdom has the largest network of any postal service in the world. The Government suspended the Crown post office conversion as a matter of urgency; that was welcomed by both sides of the House. We did so to ensure that the conversion was considered in the context of the overall review, so that whatever decisions are taken at the end of the review will enhance the opportunities for the users of the services, rather than that the Post Office board should have its view and its view alone. The review is an open process and the points that my hon. Friend has made have been made to me by a range of people, including those in the postal service.
    Mrs. May: The Minister has made a number of references to the review of the Post Office and its

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    services. I believe that it was originally intended that that review should be carried out immediately. When will that review be completed and its results made public? The Minister may be aware that this is a matter of particular interest to people in many constituencies, such as Maidenhead, who are concerned about the uncertainty that hangs over the future of their main post office.
    Mr. McCartney: There is uncertainty in Maidenhead and elsewhere because the previous Government ran a campaign to undermine the Post Office for the purpose of privatisation, leaving us with a demoralised service. The review has commenced and, when appropriate, we will announce its decisions. The Government's recommendations, unlike those of the previous Government, will enhance the role of the Post Office as a publicly owned public service, not a privatised one.

    South Africa
    Mr. Coaker: To ask the President of the Board of Trade what action she has taken to promote greater trade with South Africa. [5206]
    The President of the Board of Trade and Secretary of State for Trade and Industry (Mrs. Margaret Beckett): I have already met senior Ministers from South Africa to discuss trade promotion both in the context of bilateral trade and trade with the European Union. The Minister for Trade has also visited South Africa to discuss areas of co-operation.
    Mr. Coaker: I thank my right hon. Friend for that statement, which I welcome because trade is the key to prosperity. Does she agree that the positive relationship that now exists between the new Labour Government and the South African Government is a key to that future prosperity and to creating jobs in South Africa and here in Britain?
    Will my right hon. Friend also take this opportunity to congratulate the British Lions on their recent success? We look forward to that success being continued on Saturday. Does my right hon. Friend agree that such sporting contacts between our two nations help to develop trade?
    Mrs. Beckett: I am very happy to have the opportunity to congratulate the British Lions, although whether that will have increased the warmth of feeling towards us in South Africa I am not entirely sure. However, I share my hon. Friend's wish to see continued British sporting success, which I think we all feel owes something to a new mood of confidence in our country.
    I certainly share my hon. Friend's view that few things can do more to promote successful trade with South Africa, as with other countries, than a positive relationship of the kind we enjoy with the South African Government, and that that relationship is enjoyed within the context of a positive relationship towards the European Union. Better trading within a relationship with the EU is essential for South Africa's future, and we are working to that end.
    Mrs. Gillan: Given that tourism is an important part of our trade with South Africa, does the President consider it damaging and prejudicial to the travel industry that the Minister for Competition and Consumer Affairs should make statements, as he did in Athens last
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    weekend, which pre-empt the Monopolies and Mergers Commission investigation of that industry? What disciplinary action will she take over the Minister's conduct abroad?
    Mrs. Beckett: I am not entirely sure that that arises directly from the issue of trade with South Africa. My hon. Friend did not take any action that would be damaging to British interests—one would not expect a Minister to do so. In the few short weeks we have been in office, he has done a great deal of work to promote British tourism and the cause of Britain in that context.

    Gas and Electricity Supply
    Mr. Bercow: To ask the President of the Board of Trade what progress her Department is making towards liberalising domestic gas and electricity supply markets. [5209]
    Mr. Battle: The phased opening up of competition in the gas industry is well under way: it began in the south-west in April last year, it continued in Dorset, Kent, Avon and Sussex in February and March of this year, and the next stage of domestic gas competition is proposed to start on 1 November in Scotland and the north-east.
    For electricity, the Government inherited a programme which was left in drift by the former Administration. Within weeks of taking office I sought and obtained reports from the Director General of Electricity Supply, the regulator, and discussed the way forward with the responsible parties and obtained their endorsement for the delivery of robust and successful competition in the electricity market in 1998. A timetable for the remaining work has been agreed. Although there is still much to do and very little time in which to do it, the Government look to the companies to play their full part in ensuring that robust, sustainable competition is introduced on time.
    Mr. Bercow: I am grateful to the hon. Gentleman for that reply. Does the Minister of State who is responsible for competitiveness still hold shares or options in British Petroleum? If so, does that not mean that he is automatically prohibited from participation in ministerial discussions at the Department of important energy issues?
    Mr. Battle: I know that the hon. Gentleman has not been here long and that our briefs are not long established, but he should know that I am not the Minister for competitiveness: my colleague in the other place is. But in so far as I understand the question, the answer is no: that does not prohibit him.

    Utilities (Investment)
    Mr. Bernard Jenkin: To ask the President of the Board of Trade what discussions she has had with utility regulators concerning the utilities' investment programmes. [5210]
    Mr. Nigel Griffiths: Ministers have regular contacts with the utility regulators. The current review of utility regulation will cover a number of issues, including shortfalls in agreed investment plans.
    Mr. Jenkin: Which of the utility regulators agreed with the Government that the windfall profits tax would not damage investment?
    Mr. Griffiths: The Chancellor and my hon. Friend the Minister for Science, Energy and Industry have had a

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    number of discussions with the regulators. The windfall tax should have no impact at all on prices, investment, quality of service to customers, or employment. I shall send the hon. Gentleman a list of the utility regulators, since he seems not to have one.
    Mr. Sheerman: Will my hon. Friend look carefully at the behaviour of some of the regional electricity companies—not just at their investment programmes but at their general behaviour in the regions? We have been used to good utilities supporting a range of investment in small businesses and much else in the community. I draw my hon. Friend's attention to the remarks of Mr. Klappa of South Western Electricity, which I thought were totally out of order.
    Mr. Griffiths: My right hon. Friend the Secretary of State announced on Monday a review of utility regulation with a view to identifying best practice. That was greeted with the headline, "Beckett Backs Consumers".
    Mr. Breed: Bearing in mind that the regional electricity companies are now selling gas, and that the gas companies, I suspect, will wish to sell electricity, has the Minister any plans to create an energy regulator instead of the two current regulators?
    Mr. Griffiths: No options have been ruled out.

    Small Businesses
    Mr. Amess: To ask the President of the Board of Trade what recent representations she has received about measures to assist small businesses. [5211]
    Mrs. Beckett: My hon. Friend the Minister for Small Firms, Trade and Industry has had a number of meetings with small firms representative organisations and my Department has received a large amount of correspondence from individual businesses covering a wide range of issues.
    Mr. Amess: Following this morning's Budget breakfast meeting of small businesses in Leigh-on-Sea in my constituency, is the Secretary of State aware that many of those small businesses are deeply concerned about yesterday's changes to pension funds? They are also very worried about increased transport costs. Moreover, they are not convinced that any marginal decreases in corporation rates will offset the two increases in interest rates that have already been made and the probable further increase that has been dumped on the Governor of the Bank of England.
    Mrs. Beckett: I can only say that I am surprised by the hon. Gentleman's claim that small businesses in his constituency are worried now. It was under the last Government that more businesses were going bankrupt than starting up; it was under the last Government that a series of burdens, such as the handling of sick pay and immigration, were dumped on small businesses; it was the last Government who ceased utterly to listen to small businesses. It was the present Government who yesterday took steps that will benefit 3.5 million small and medium-sized businesses, and that is what the hon. Gentleman cannot stand.
    Ms Beverley Hughes: Does my right hon. Friend agree that the statutory right to be paid interest on late payments
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    will be of enormous benefit to many small businesses? Is she yet in a position to give us some idea when the details of her proposal will be available?
    Mrs. Beckett: We intend to publish a Green Paper before the House rises for the recess in order to take soundings on the best means of implementing the pledge. As I am sure my hon. Friend knows, more than 60 per cent. of small businesses have, in repeated surveys, put the case for such a move and we are anxious to press ahead as speedily as possible.
    Mr. Redwood: In an age of more reviews than there are in the west end, I hope that there will at least be some certainty in the Department of Trade and Industry on competition policy. Will the right hon. Lady now tell the House whether she stands by all the remarks made by her junior Minister—the Minister for Competition and Consumer Affairs—at the recent Athens conference? Those remarks seemed to pre-empt a Monopolies and Mergers Commission inquiry into the travel trade, which is very important to small and big business. Is it true that the right hon. Lady has none the less removed her junior Minister from any consideration of that inquiry because he is speaking against her wishes and against Government policy? Business needs certainty. We do not want another review; we want disciplinary action from the President of the Board of Trade.
    Mrs. Beckett: I am surprised that the right hon. Gentleman bothered to ask me that question. I am sure that he knows that I have already written to him explaining that he has been misinformed.
    It is extraordinary that members of the Conservative party continue to protest about the notion of review and consultation. After all, it was their failure to consult and to listen to anyone else that put them on the Opposition rather than the Government Benches.
    If I recall correctly, the right hon. Gentleman fought a leadership election on the slogan, "No change, no chance". Unless his party changes its policy, it has no chance.

    St. Ivel Creamery, Rose-an-grouse
    Mr. Andrew George: To ask the President of the Board of Trade what assessment she has made of the impact of the closure of the St. Ivel creamery at Rose-an-grouse on local industrial and economic development. [5212]
    The Minister for Small Firms, Trade and Industry (Mrs. Barbara Roche): I fully recognise that the closure of the St. Ivel creamery must have an adverse impact on the economy of an area with already high unemployment. A task force of local agencies has been working on an assessment of the impact and on measures that might be taken in response to strengthen the local economy.
    Mr. George: I thank the Minister for that answer. In view of the problems that the closure has created in west Cornwall—Cornwall already has high unemployment, the lowest average earnings in the country and very low gross domestic product per head—does the Minister agree that Cornwall should be making a strong case for objective

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    1 status to the European Commission, which her Department should support? Does she also agree that, rather than just being listed in these papers, which have been placed in the Library today, Cornwall should be given priority for Nomenclature of Units for Territorial Statistics—NUTS—II status?
    Mrs. Roche: I certainly share the concern about high unemployment in Cornwall and the loss of valuable jobs as a result of the closure. The Government office for the south-west and local agencies will continue to work closely with the local authority-led task force and we shall see what we can do to alleviate the impact. The Employment Service has granted major redundancy, status, which will provide immediate access to training and job-seeking programmes for the employees who have been affected.
    The hon. Gentleman raises the issue of the European statistical areas, commonly known as NUTS. He will be enthusiastic about the fact that the copy of the full set of proposals, which as he says has been placed in the Library, includes, among other things, the suggestion that Cornwall should be a separate NUTS level II area.

    Textiles (Anti-dumping Levy)
    Mr. Stunell: To ask the President of the Board of Trade what plans she has for an alternative to the anti-dumping levy for textiles. [5213]
    Mr. Nigel Griffiths: Under the general agreement on tariffs and trade multi-fibre arrangement, we and other industrialised countries impose a range of quantitative restrictions on imports of textiles and clothing from certain supplying countries. In addition, we can impose other anti-dumping and anti-subsidy duties if necessary.
    Mr. Stunell: Is the Minister aware of the catastrophic effect that the anti-dumping levy has had on textile firms such as Strines Textiles in my constituency? Some 18 months ago that company had 200 employees, but its market has been destroyed by the levy. The levy was recently lifted, but not before 40 per cent. of the firm's employees had gone. Another 42 employees were made redundant this week. This is an urgent matter. The levy did great damage, and I hope that the Minister will press hard for alternatives that can get such firms back into the market. If he is willing to meet a deputation of managers and workers from that firm, they will be happy to explain what needs to be done.
    Mr. Griffiths: I deeply sympathise with the hon. Gentleman's constituents about what happened. For reasons of which I am sure the hon. Gentleman will be aware, the United Kingdom opposed the anti-dumping duties. Both sides of industry were unanimous in opposing them, since the UK market's major textile finishing sector uses imports. I shall be pleased to meet the hon. Gentleman and his constituents, or the appropriate Minister will meet them.

    Libya (Sanctions)
    Mr. Dalyell: To ask the President of the Board of Trade, pursuant to Official Report, column 1255, of 11 June, what representations she has received from
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    Kevin Boyle of the British-Libyan interests group about opportunities for British companies in Libya; and if she will make a statement. [5214]
    Mrs. Roche: Kevin Boyle of the British-Libyan business group has written to my colleague the Minister for Trade and to several colleagues in other Departments of State about trade with Libya.
    Mr. Dalyell: Have the DTI lawyers had a sight of the evidence that the Crown Office claims to have, which is the root of all the trouble?
    Mrs. Roche: As my hon. Friend will be aware, his question is a matter for Ministers at the Foreign and Commonwealth Office.
    Mr. Letwin: In the light of the Minister's laudable concern about the fate of British companies in Libya and other emerging markets, would she care to distance herself from the remarks by the Labour MEP Mr. Howitt about the conditions under which employees and others are operating so far as BP is concerned, a company with which the Minister for Trade and Competitiveness in Europe had a long and distinguished association?
    Mrs. Roche: It is difficult to ascertain from what the hon. Gentleman has said exactly what he is talking about. I make it perfectly clear to him that the Government are absolutely committed to promoting international trade and that we shall do as much as we can to ensure that all our businesses, both large and small, have the opportunities of expanding export markets.

    Competitiveness UK Initiative
    Mr. Ernie Ross: To ask the President of the Board of Trade if she will make a statement about her Department's Competitiveness UK initiatives. [5215]
    Mrs. Beckett: On 4 June, I launched Competitiveness UK, a range of initiatives constituting a new partnership between government and business. I am planning a business summit at which I will publish an audit to provide an objective benchmark of the UK's performance in every factor of competitiveness.
    Mr. Ross: I congratulate my right hon. Friend on the speed with which she has moved to deal with the inherently weak economy which she has inherited. [Interruption.] What response has there been from business and companies to her initiatives?
    Mrs. Beckett: I am grateful to my hon. Friend. The business community has responded warmly both to the initial statement and to the invitation to attend the summit. I heard a sedentary intervention from the Conservative Benches to the effect that that is what the previous Deputy Prime Minister used to do. That is not true. He used to issue propaganda documents intended to tell business what a good job that Government were doing. We intend to work with business to produce a document that we jointly agree will further the competitiveness of Britain. That is quite a different matter.
    Mr. Ian Taylor: The right hon. Lady should not he so smug because, in claiming that the word "competitiveness"

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    was invented after 1 May, she slights all those private sector companies that assisted in the previous Government's efforts to stimulate competitiveness in this country, particularly in the information and communication technology sector. Will she affirm that she intends, for example, to continue the foresight exercise, which the previous Government started and which is one of the great success stories of forward planning, to ensure that this country can compete in the key sectors of the global world economy?
    Mrs. Beckett: I would not normally wish to be unkind to the hon. Gentleman, but, in view of his opening remarks, I have to say that I always thought that he had a degree in smugness. The notion that I would claim to have invented the word or, indeed, that I would tell British business how to be competitive is unfounded: I would not dream of doing such a thing.
    Unlike the previous Government, we will also not simply instruct businesses about competitiveness or take credit for other people's achievements. We want a real partnership with business and we intend, through that partnership, to work to develop the foresight programme. As I am sure the hon. Gentleman will recall, I made it clear before the last general election that we did not disagree with some of the things that the previous Government had begun to do—under considerable urging from us—and that we would take forward such programmes and seek to build on and improve them.
    Mr. Redwood: I am sure that the President of the Board of Trade would agree that, in this important work, it is crucial that every Minister should be seen to avoid any possible conflict of interest. Will she now tell the House, so that there is no doubt whatever, that the Minister for competitiveness has sold all his shares, cancelled all his options and severed all his business links with BP—otherwise industry will be worried about possible conflicts of interest?
    Mrs. Beckett: First, my hon. Friend the Minister in the other place is not the Minister for competitiveness—I am—and he is pursuing these interests in Europe. Secondly, the matter that the right hon. Gentleman raises is one for the Nolan procedures. I do not know the details of the issue. I shall write to him about it.

    Business Services (Rural Areas)
    Mr. Boswell: To ask the President of the Board of Trade what steps she is taking to improve the Department's business services in rural areas. [5216]
    Mrs. Roche: I am developing a wide range of measures to improve services to all small business—whether they are in rural or in urban areas.
    Mr. Boswell: I thank the hon. Lady for that answer. Will she acknowledge that it is a matter of great importance that some 23 per cent. of the population now live in rural areas? In particular, will she bear in mind the importance of not getting business links too hung up on the size of firms, which typically is smaller in rural areas? Will she make use, wherever possible, of other institutions such as the Ministry of Agriculture, Fisheries and Food
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    and the Rural Development Commission, and make the maximum possible use of distance and information technology?
    Mrs. Roche: I certainly agree with much of what the hon. Gentleman says. Of course, he will know that it was under the previous Government, in which he was a Minister, that the RDC closed its business advisory service, so it is for this Government to pick up the pieces to ensure that business links become a world-class service and serve all businesses, whether urban or rural. We certainly recognise that there is a need for small businesses to be promoted in rural areas, and I will meet the Country Landowners Association, the RDC and others to ensure that that happens.
    Mr. David Heath: Does the hon. Lady recall the excellent Adjournment debate yesterday initiated by my hon. Friend the Member for Roxburgh and Berwickshire (Mr. Kirkwood)? Does she also recall that one of the points that came through clearly was that the one thing that would help smaller businesses in rural areas is reform of the uniform business rate? Will she now ensure that that happens through her sister Department?
    Mrs. Roche: I do recall that debate, to which the hon. Gentleman made a useful contribution. It was sad that there were not more hon. Members in the Chamber to take part in the debate. Certainly, the uniform business rate is a cause of great concern. We know what the "Your Business Matters" conference and the report compiled by the Institute of Directors had to say about that tax—which was introduced and operated by the previous Government, despite the tax being widely loathed. We are consulting business to see what we can do about it.

    Regional Selective Assistance
    Mr. Fallon: To ask the President of the Board of Trade if her Department's responsibility for co-ordinating regional selective assistance will be shared with regional development agencies. [5217]
    Mrs. Roche: The Government's proposals on the role of the regional development agencies in relation to regional selective assistance will be considered during the current consultation process and set out in the White Paper to be published at the end of the summer.
    Mr. Fallon: Will the Minister clear up the confusion over responsibility for regional assistance? Is she aware that, on Tuesday, the Prime Minister was unable to confirm whether the prime responsibility for regional aid lay with the hon. Lady's Department or with the Department of the Environment, Transport and the Regions? Would it not be extremely damaging if the new regional development quangos were allowed to outbid each other, with public money, for inward investment?
    Mrs. Roche: Let me sort out the confusion which is clearly only in the hon. Gentleman's mind, as in fact there is no confusion whatsoever. It is something of a cheek for him to talk about quangos, when the Conservative Government, from which he had a brief five-year absence, introduced record numbers of quangos in a wholly undemocratic way.

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    The responsibility for the important area of regional selective assistance lies with the Department of Trade and Industry, because that Department is the interface between the business community and Government.
    Mr. Gunnell: Will my hon. Friend confirm that regional selective assistance is, as she implied, often an important factor in investment? In her consultations with the Department of the Environment, Transport and the Regions about the setting up of regional development agencies, did she discuss the role of the Invest in Britain Bureau and the agencies in inward investment?
    Mrs. Roche: My hon. Friend makes an extremely important point. Regional selective assistance, inward investment and the work of the Invest in Britain Bureau are all important. We very much welcome inward investment. The consultation process has involved the Confederation of British Industry, at regional level, and the chambers of commerce—and the interesting point that came out of the process was their enthusiasm for our proposals. The prospect of local partners coming together to promote regional economies has been very much welcomed.
    Mr. Maclean: During the past few minutes the hon. Lady has rightly championed the Rural Development Commission. Will she now assure the House that she will not allow the new regional development agencies to subsume the role of the Rural Development Commission?
    Mrs. Roche: I am sure that the right hon. Gentleman will want to know that representatives of the Rural Development Commission were present at the launch of the consultation process on the regional development agencies. Indeed, the RDC made a valuable impact, and it has been consulted fully on the process.

    Inward Investment
    Kali Mountford: To ask the President of the Board of Trade if she will make a statement on her policy on inward investment. [5220]
    Mr. Ian McCartney: The Government welcome inward investment. It is important not only for the jobs that it brings to the United Kingdom but for the benefit that it brings to local economies.
    The Department's Invest in Britain Bureau will continue to promote the United Kingdom for mobile international investment to ensure that we are the No. 1 location in Europe for investment from countries such as Japan, the United States and Korea.
    Kali Mountford: I thank my hon. Friend for that answer. Is he aware that, when I was consulting small business in my Colne Valley constituency, I found that three quarters of small businesses had closed due to lack of investment? The lack of investment in large businesses has had a huge knock-on effect in Colne Valley. Will my hon. Friend assure me that the measures taken will improve the general trading conditions for small businesses in areas such as mine?
    Mr. McCartney: I thank my hon. Friend for her remarks. After yesterday's Budget—a Budget for business
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    and for jobs—there can be no doubt about the Government's priorities. One of our most important priorities is growth in development of small and medium businesses—unlike the priorities of Conservative Members, who spent 18 years undermining British business and jobs. In our first eight weeks in government, we have done more to develop British jobs and business than they did in the past two decades.
    Mr. Spring: Why does the hon. Gentleman think that the United Kingdom has attracted by far the lion's share of European Union inward investment?
    Mr. McCartney: Under this Government, we will improve on the previous Government's abysmal record—not only on inward investment but on investment in training and in infrastructure. At the end of our first five years in office, we will be able to look back with pride on what we have done to develop the United Kingdom. Conservative Members cannot do the same.

    May Day Public Holiday
    Mr. Cohen: To ask the President of the Board of Trade if she will make a statement in respect of her policy towards the May day public holiday. [5221]
    Mr. Nigel Griffiths: I should tell the House that I have received suggestions for a name change—to Landslide day, to Victory day or even to Demolition day. As we have no wish to be triumphalist, however, we will keep it as May day.
    Mr. Cohen: May I tell my hon. Friend that—because the previous Government seriously threatened to abolish it—I am delighted that he has agreed to save May day as a bank holiday? As there will be many more people in work under this Labour Government, would it not be right to celebrate May day as Workers Away day?
    Mr. Griffiths: Of course May day has very deep roots as a spring festival. The early May day bank holiday is valued by many sections of our community.
    Sir Sydney Chapman: Putting aside the hint of political ideology behind the question, in all fairness is there not a case for moving the relatively recently introduced May day bank holiday to another part of the calendar, to even out the numbers? Does the Secretary of State agree that it might be better to have the holiday on the Monday, or perhaps Friday, nearest Trafalgar day, for example, or a celebration closer to my own heart—All Saints' day?
    Mr. Griffiths: As the hon. Gentleman has mentioned Trafalgar, I should tell him that one of the first changes that I made after taking over my office was to hang on the wall behind my desk a large original painting of the 1836 Waterloo banquet. Hanging that painting contrasts with a decision of his former colleague at the Department of Trade and Industry, who decided to hang several thousand pounds-worth of new drape curtains. As for the hon. Gentleman's initial question, the business community was strongly against such a suggestion.

    Competitiveness
    Gillian Merron: To ask the President of the Board of Trade what plans she has to consult industry about improving the competitiveness of British companies. [5222]
    Mrs. Beckett: Competitiveness must be improved by a partnership between government and business. Therefore, in addition to current discussions, I am establishing a competitiveness advisory group which will be drawn mainly from the business community. That group and working parties will help me to develop policies for a new White Paper on competitiveness, which we hope will be published in early 1998.
    Gillian Merron: I congratulate my right hon. Friend on taking very forward-looking and positive action, which will further enhance the success of companies such as European Gas Turbines, which is in my constituency of Lincoln. That company's success has been built on its ability to embrace change and partnership. Will my right hon. Friend confirm that the consultation has been welcomed by business as genuine consultation—which commenced when Labour was in opposition and is now proving that this Government are truly the Government of business?
    Mrs. Beckett: I thank my hon. Friend. Like her, I welcome the success of European Gas Turbines, which has recently won two Queen's awards—one for exports and one for environmentally friendly technology. As she is well aware, the company has turned around its prospects in recent years and is showing increasing success. We are very appreciative of the support and interest shown by the business community in taking forward this work and believe that it is the kind of partnership that has turned that company around that can turn the country around.
    Mr. Forth: Before the right hon. Lady proceeds any further with her consideration of competition and competitiveness policies, will she please sort out the confusion caused in the House this afternoon by utterly contradictory statements on the important issue of possible shareholdings held by her ministerial team, which might be in direct conflict with their responsibilities for the conduct of competition policy?
    Mrs. Beckett: I have no idea why the Opposition are continuing to flog this matter. Such matters are to be handled and supervised according to the Nolan procedures, and I know that that process is taking place. The right hon. Member for Wokingham (Mr. Redwood) asked a string of questions on precisely how far that process has been taken, but I have to say, quite bluntly, that what all this questioning, pressure and concern tell me is not that the Conservatives are concerned about high standards of behaviour but that they are absolutely livid that a senior and widely respected British business man is a Labour Minister.

    Post Office
    Dr. Tony Wright: To ask the President of the Board of Trade if she will review the legal immunities of the Post Office. [5224]
    Mr. Ian McCartney: The Post Office's immunity from contractual liability was granted by Parliament in the Post Office Act 1969. We have no plans to review the position.
    Dr. Wright: I am grateful for that answer, but what would the Minister say to a constituent of mine who believes that his small business was eased out of existence by an error of delivery by the Post Office? He managed to get from the Post Office an acknowledgement of its error, but the Post Office refused to go to arbitration and shelters behind its immunities. Surely, in an age when we pay attention to consumers and users of services, we have to re-examine the immunities enjoyed by the Post Office. Will the Minister agree to do that?
    Mr. McCartney: No. I made it absolutely clear that there is to be no review of that point. Seventy-two million items are handled per day, there is unrestricted access to 100,000 pillar boxes and there are 19,000 post offices, but only a tiny fraction of the mail posted is claimed not to be delivered. I believe that my hon. Friend wrote to me about the case that he has just cited, and I sent him a detailed report. If this is not the same case, I ask him to send me further details, and I shall consider any new points.
    Mr. Leigh: Given that the sale of the Post Office would raise at least as much as the Chancellor gave to schools and hospitals yesterday, and given that the sale would relieve the public of some of the traditional immunities that militate against their interests, what is the point of principle that decrees that the ultimate monopoly, water, should be privatised under a Labour Government and should be operating successfully and taxed, but that the Post Office should not be privatised and the Government will not even consider the concept?
    Mr. McCartney: First, the hon. Gentleman was a Minister, but he could not even persuade other Conservative Members about this particular privatisation. Secondly, we have just had a general election in which the Conservative party stood on a platform of privatisation and had its worst defeat in history, and rightly so. We are proud of the fact that the Post Office will remain a publicly owned body providing public services. The review that is taking place is about enhancing the public role of the Post Office, not about privatisation.

    Post Office
    Mr. Pickthall: To ask the President of the Board of Trade if she will make a statement on her Department's policy towards improving the competitiveness of the Post Office. [5226]
    Mr. Ian McCartney: Do you think I might have a little rest, Madam Speaker? I have been up and down, up and down. [Interruption.] Bring back Ken—at least he is funny.
    Our policy is to ensure that the Post Office continues to provide a comprehensive and efficient range of postal services that meet customers' needs, represent good value for money and achieve a high quality of service standards.
    Mr. Pickthall: When my hon. Friend discusses modernisation and competitiveness with the Post Office, will he impress on it the need to do something about some of its appalling employment practices, which, among other problems, are holding back its modernisation and increased competitiveness?
    Mr. McCartney: The Government want to ensure good employment relationships in the Post Office—such relationships have not existed in the recent past. That needs to be changed. The Post Office needs co-operation and partnership. Trade unions must realise that management has to manage, but on a co-operative basis. The necessary changes to ensure that the Post Office remains at the cutting edge of international competition will require employers and employees at the Post Office to come together with a common approach and a common objective. When that is achieved, there will be security of employment for postal workers and the decisions on the future of the Post Office will be made on the basis of co-operation, not division.
    Mr. Lansley: Will the Minister give an undertaking that there will be no cross-subsidisation between the protected services of the Post Office and those areas in which it has greater commercial freedom? Is it the Government's intention not to increase the Post Office's negative external financing limit beyond 50 per cent. of its profits?
    Mr. McCartney: The purpose of the review is to examine those issues. When we have done so, we shall make a statement to the House.
    Dr. Iddon: Is my hon. Friend aware that a modern and expandable postal sorting office at Wingates in Bolton is due for closure, affecting 400 jobs—many belonging to my constituents? Is he aware that that decision came out of the blue for the work force? Is he able to put pressure on the Post Office Royal Mail management to set up better lines of communication with the work force?
    Mr. McCartney: I think that my hon. Friend knows that I am aware of that, because I was at the meeting when we discussed the issue. I gave a commitment to Members of Parliament from the north-west and wrote to all hon. Members from the area, from all parties, a detailed note about the proposed changes to the north-west's postal arrangements and investment plans. I have made it clear to them that I am available to consider and discuss with them matters pertaining to or impacting on their constituencies. I cannot be more fair and open than that.

    Imported Toys (Safety)
    Mr. Paice: To ask the President of the Board of Trade what actions she is taking to improve the safety of imported toys. [5228]
    Mr. Nigel Griffiths: The safety of all toys is controlled by the Toys (Safety) Regulations 1995, which set comprehensive safety standards. Trading standards officers have the necessary powers to take appropriate action if they consider a toy to be unsafe.
    Mr. Paice: I thank the Minister for that response, which confirms the written answer that he gave me earlier this week.
    Mr. Griffiths: That is helpful.
    Mr. Paice: It is indeed helpful, and somewhat surprising. Does the Minister recall that, earlier this year, when he was on the Opposition Benches, he issued a press release condemning the standards of imported toys and calling for radical changes? Why does he say something different in government from what he said in opposition?
    Mr. Griffiths: Because the first people I had into the Department of Trade and Industry after I became a Minister were representatives of trading standards officers. We sat down with the Local Authorities Co-ordinating Body on Trading Standards, which has agreed on the powers that it needs to take action. We have backed up what we wanted in opposition by what we are doing in government. Conservative Members will be interested to hear that I have also had dialogue at the Department with representatives of the leading retailers—the four major supermarkets—who told me that they had never been in the Department before because they were never invited by that lot over there.
    Mr. Pike: Is it not a fact that, this Christmas, parents will welcome the steps that have been taken to reduce the risk of dangerous toys being imported? Year after year, hon. Members have had complaints from parents about the danger posed by those toys.
    Mr. Griffiths: Absolutely. As my hon. Friend knows, I have worked closely with British toy and hobby manufacturers and other British manufacturers and importers. I intend to issue advice to consumers on buying appropriate and safe toys in time for the Christmas toy-buying season this year.

    Car Industry
    Mr. Prior: To ask the President of the Board of Trade if she will make a statement on the United Kingdom car industry. [5229]
    Mr. Battle: From 1995 to 1996, UK car manufacturers' output increased by 10 per cent to 1.7 million, although overcapacity throughout the European industry remains a matter of concern. There has been some increase in exports which is welcome.
    Mr. Prior: Why have we in the United Kingdom attracted so much foreign inward investment over the past 19 years?
    Mr. Battle: On 12 June this year, Ford met the Prime Minister and announced investment here which was welcomed by my right hon. Friend the President of the Board of Trade. There will be investment of £40 million. Investment is coming into this country, Britain is a highly competitive location and the skills, hard work and dedication of the work force have attracted the investment they deserve.

Business of the House
3.30 pm
Mrs. Gillian Shephard: May I ask the Leader of the House to give the business for next week?
The President of the Council and Leader of the House of Commons (Mrs. Ann Taylor): The business for next week will be as follows:
MONDAY 7 JULY—Conclusion of the Budget debate.
TUESDAY 8 JULY—Remaining stages of the Local Government Finance (Supplementary Credit Approvals) Bill.
Remaining stages of the Local Government (Contracts) Bill.
WEDNESDAY 9 JULY—Until 2 pm, there will be debates on a motion for the Adjournment of the House.
Opposition day [2nd allotted day].
There will be a debate on pensions on an Opposition motion.
THURSDAY 10 JULY—Second Reading of the Finance Bill.
FRIDAY 11 JULY—Debate on the information society on a motion for the Adjournment of the House.
MONDAY 14 JULY—Proceedings on the National Health Service (Private Finance) Bill [Lords].
It may also be helpful to hon. Members if I tell the House that the Finance Bill will be published in draft form tomorrow and will also be available from tomorrow on the Internet.
Mrs. Shephard: I thank the right hon. Lady for her statement. I also thank her for her acceptance last week of our representations about the days needed for adequate debate of the Budget statement and for the fact that she has made it clear that the Finance Bill will be available shortly in draft form.
The right hon. Lady would be the first to agree that her Government attach great importance to the Budget. She will also agree that many of its proposals are complex and will lead to a complex Finance Bill on which financial institutions and others outside the House will expect to be consulted. Indeed, as she stated in her memorandum to the Select Committee on Modernisation of the House of Commons,
"the quality of legislation can often be improved by consultation with informed opinion on both the substance and the drafting of legislative proposals?.
It is because of the right hon. Lady's stated views on the importance of consultation that I press her on her plans for the Committee stage of the Finance Bill. Would she like specifically to refute the suggestion that she plans for the Committee stage of the Bill to be a disgracefully and unprecedentedly truncated process which will precisely prevent the very consultation with informed opinion to which she aspires in her memorandum? I am sure that she wishes there to be no inconsistency between what she says and what she does in the House.
On another matter of great importance to the House, will the right hon. Lady confirm, in view of the courteous invitation from the Minister for the Armed Forces to all
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colleagues to express their views on defence issues, that there will be adequate opportunity for hon. Members to debate defence matters in advance of the strategic defence review, bearing in mind the fact that, at this time of the year, the House would normally expect to have five days of debate on defence affairs?
Finally, in respect of a matter on which I have given the right hon. Lady notice, will she refute the suggestion in The Scotsman on Saturday that, the work of the Select Committee on Modernisation of the House of Commons notwithstanding, she intends, with the co-operation of other Opposition parties, to refer debate in Committee on referendum and devolution matters to a Committee upstairs, thereby disregarding and, indeed, flouting the convention that debate on constitutional change should be on the Floor of the House?
Mrs. Taylor: I am pleased to accept the thanks of the right hon. Lady in respect of the length of the Budget debate and the publication of the draft Finance Bill tomorrow. It is the first time that the Bill has been available in that way and it is a step forward.
In respect of the time available for consultation, the right hon. Lady suggests that we might like to be consistent. I remind her that, in the 1987–88 and 1983–84 Sessions, the gap between the publication of the Finance Bill and its Second Reading was exactly the same as I am proposing.
Mrs. Gillian Shephard indicated dissent.
Mrs. Taylor: The right hon. Lady shakes her head, but I can provide her with details of the exact dates if she so wishes.
In respect of the Committee stage, we shall have further discussions through the usual channels. So far, we have accommodated the Opposition's requests, and if we can reach agreement on the Committee stage, so much the better.
With regard to a debate on defence, some weeks ago I made it clear that I thought it inconceivable that we would get too far into the parliamentary year without debating defence. The right hon. Lady also asked me to be consistent in that respect. I have said that we ought to consider the setpiece debates that are sometimes not very well attended, but I accept the need for a defence debate, and we certainly have not ruled that out.
I thank the right hon. Lady for bringing the article in The Scotsman to my attention earlier today. I can confirm what I told her privately—that the story is wrong.
Mr. A. J. Beith: Will the Treasury and Civil Service Select Committee be appointed next week? Does the right hon. Lady recognise that, if it is not, the Finance Bill will proceed without the usual detailed questioning of the Chancellor of the Exchequer, the Governor of the Bank of England and the Chief Secretary to the Treasury which normally informs such debates?
In respect of the National Health Service (Private Finance) Bill, which we are now not taking next week, does she recognise that it is a bad principle to deal with all the stages of a Bill on the same day, and that it makes

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for bad law making? When she makes arrangements for it to be considered, will she ensure that the stages are separated?
Mrs. Taylor: We are trying to make progress. We have been discussing the establishment of Select Committees with minority parties as well as Opposition parties, and we will be ready to act in the very near future.
The hon. Gentleman will know that the National Health Service (Private Finance) Bill started in the Lords and has undergone scrutiny there. There is a great deal of agreement among hon. Members on its principles and effects, and it would be reasonable to make a great deal of progress on a rapid time scale.
Mrs. Gwyneth Dunwoody: Does my right hon. Friend acknowledge that the previous Transport Select Committee did a great deal of detailed and informed work on urgent matters? Can she assure me that its successor will be set up very soon and that it will have the full co-operation of the Government in carrying out exactly the same tasks, which are urgently needed in the transport sector?
Mrs. Taylor: My hon. Friend has an outstanding record of contribution to that Committee. I am sure that the new Committee will operate on a similar basis to its predecessor, which did a great deal of outstanding work.
Mr. John Wilkinson: The Leader of the House will be aware that the transport Department has been conducting protracted negotiations with United States authorities on the renewal of a UK-US air service agreement, involving also the European Commission and touching on such crucial questions as gateways into the US, cabotage of British carriers in the US, slots at Heathrow, and above all, the proposed BA-American Airlines alliance. We have so far had only a written answer on these matters from the Government—no debate, no statement on progress. May we have an early debate? If the Government refuse, at the very least may we have a proper statement and question and answer session when decisions are reached?
Mrs. Taylor: There are no plans for a debate at the present time. Should a statement be thought necessary, one will be made.
Mr. Dale Campbell-Savours: May I gently press my right hon. Friend once again for a debate on the disposal of nuclear waste, which would allow us to discuss not only Nirex and its future programme but Beaufort's Dyke?
Mrs. Taylor: I do not see a prospect of an early debate. On Beaufort's Dyke, I think that my hon. Friend will acknowledge that the Government made the information that came to them available as quickly as possible and acted with all speed on the matter in order that there should not be too much alarmism surrounding the issue.
Mr. Desmond Swayne: The provisions announced yesterday for the windfall tax and advance corporation tax are very complex. I do not believe—and it has not been my experience in the past—that the timetable that the right hon. Lady has announced
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is sufficient for the House and, indeed, the financial community to scrutinise the measures properly. Will she reconsider?
Mrs. Taylor: I am confident that the very popular Budget, with all its provisions, which was announced yesterday, can be properly scrutinised, and that we can establish an appropriate timetable for doing so.
Mr. Harry Barnes: New Members are quickly and efficiently getting used to our procedures. Will they not therefore get a shock to find that, when we come to a recess, after being elected Members of Parliament they become Members without a Parliament for about 12 weeks? Can something be done to improve the arrangements by which they can check the Executive in that period—by, for instance, allowing parliamentary questions to be tabled and answered, and early-day motions to be tabled?
Mrs. Taylor: My hon. Friend has raised an important issue. I have commented on such issues in the past. It is appropriate that the Select Committee on the Modernisation of the House of Commons should look at both the problem that he has raised and the possible solutions that he has posed.
Mr. William Cash: The right hon. Lady dodged a number of questions yesterday in relation to the private notice question. Will she deny that the report in the Financial Times referred to a "senior member of the Government", who had—
Madam Speaker: Order. We had a debate on that yesterday; I allowed a private notice question. Is the hon. Gentleman asking about next week's business, because that is what business questions are for? We have touched on new Members getting into habits; we are getting into bad habits in Question Time. I now want a business question from Mr. Cash.
Mr. Cash: Will the right hon. Lady allow a debate on whether a "senior member of the Government" was disclosed in the Financial Times as having divulged Budget secrets in advance of the Budget statement yesterday?
Mrs. Taylor: No case has been made for a debate on that matter.
Mrs. Alice Mahon: Given the massive increase in crime during the past 18 years of Tory rule, does my right hon. Friend know whether our right hon. Friend the Home Secretary intends to do anything to help victims of crime, and whether he will be making a statement in the near future?
Mrs. Taylor: I know that my hon. Friend and many colleagues have made representations about the victims of crime. My right hon. Friend the Home Secretary is providing an extra £1 million to Victim Support, which I know will be of assistance to people who live in my hon. Friend's constituency and, indeed, in mine, which is very close by.
Mr. Nicholas Soames: Did the right hon. Lady yesterday hear the unfortunate and infelicitous

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remarks of the Chancellor of the Duchy of Lancaster about people's alleged lack of confidence in British food? Does she agree that we should have a debate to celebrate the fact that the British food industry and the British farming industry are two of our most successful and dynamic industries? The changes that are likely to be made by the new, so-called food safety agency will not help safety or the expansion and dynamism of one of our great industries.
Mrs. Taylor: I know that the hon. Gentleman regards himself as an expert on the food industry. [HON. MEMBERS: "He is the food industry."] He may well be an expert on it. I doubt whether the Chancellor of the Duchy of Lancaster made any unfortunate remarks and I am sure that all he said was well founded. The proposed food standards agency has an element of cross-party support and I hope that the hon. Gentleman will consider the positive contributions that such an agency could make.
Mr. David Winnick: Will my right hon. Friend make arrangements for Sir Gordon Downey's report to be debated next week? If the Standards and Privileges Committee is to deliberate first, will there be a chance to debate the report before the House rises for the summer recess? Does my right hon. Friend recognise the sheer importance of the matter? If the report is critical of some Members when it is published at 4 o'clock today, will any sanctions will be imposed? There may be a problem because the people involved are ex-Members, but we need a statement from the Government.
Mrs. Taylor: My hon. Friend is right to say that the matter is important and, of course, the report will be published at 4 o'clock. It will be a report on Sir Gordon Downey's findings, but it will not be a report on the conclusions that may be reached by the Committee. It would be inappropriate to have a debate on the findings before the Committee has had time to consider them.
Mr. Edward Leigh: Will the Leader of the House confirm that, at some suitable moment, we will have an opportunity to discuss Hong Kong and its progress towards democracy, following the handover this week? Will she take a few moments to pay tribute to the former Governor, Chris Patten, whose humanity and dedication to the democratic principle are a credit to himself and our nation?
Mrs. Taylor: I am sure that Conservative Members will be watching carefully what they each say about the former Governor of Hong Kong, with an eye on the future of their party. He certainly conducted himself well this week and was obviously moved by the situation. A debate on Hong Kong will be appropriate on future occasions, and my right hon. Friend the Foreign Secretary has made it clear that he will visit Hong Kong again before too long and that he intends to keep a close eye on the situation there.
Ann Clwyd: I am sure that my right hon. Friend will agree that we have had little political or public debate on NATO enlargement in advance of the Madrid summit next Tuesday. While I recognise that there
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is no time for a debate beforehand, may we have a statement following the summit, because the House will eventually be asked to ratify the proposals?
Mrs. Taylor: If there is need for ratification, that will bring the matter before the House. I am glad that my hon. Friend understands the pressures on time in the House and that it will not be possible to have a debate in the near future. There has been much public debate on the matter and general support for the direction in which NATO is moving.
Mr. Eric Forth: Will the Leader of the House reconsider the extremely short time between the Budget debate and the Second Reading of the Finance Bill? While it may be flattering that she chooses to quote precedent from the practice adopted by the previous Government, did she not listen to the points made by my right hon. Friend the shadow Leader of the House? There is an apparent contradiction between the Leader of the House's aspirations for more lengthy and effective consideration of legislation and the over-hasty progress of the Finance Bill in all its complexity. Will she reconsider the issue in the light of her comments and aspirations?
Mrs. Taylor: If the right hon. Gentleman wants us to put our heads down and never consider change, we can do it that way and not come up with proposals for improving things in future on other parts of legislation. I believe that we should change things. That is why we have established the Select Committee on Modernisation of the House of Commons.
We could have had a Budget in June on which there had been less consultation. We would probably have had more complaints in those circumstances. The time between publication of the draft Bill tomorrow and the debate on Second Reading is no less than on the other occasions that I quoted earlier. What is more, as some Opposition Members have said, the Budget yesterday was not a full Budget but a halfway house, even though its proposals are very important for many people.
Mr. Paul Flynn: When may we have a debate on early-day motion 188?
[That this House is concerned that the Fraud Squad raided the premises provided by Corporate Services Group to the Leader of the Opposition in his leadership campaign; and calls on the Leader of the Opposition to make a statement to the House on any benefits he has received from the Corporate Services Group and to explain his reasons for retaining the £20,000 gift from Mr. David Steene, Managing Director of the notorious City Mortgage Corporation.]
It relates to the financial sums given to hon. Members for campaigns in leadership elections. It is clear from early-day motion 164 that certain of the sums given to one candidate in the campaign came from a dubious source. Back-Bench Members have to declare the sums that they receive. Is it not far more important that possible leaders of parties should have to declare which organisations have tried to buy influence with them?
Is my right hon. Friend aware that some hon. Members have declared the sums that they received, but that the right hon. Member for Wokingham (Mr. Redwood) continues to

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refuse to declare who paid into his fund? Is it not right that Parliament should know that elections for Leader of the Opposition are not funded by crooks or lubricated by sleaze?
Mrs. Taylor: My understanding was that the candidates in the recent leadership election had consulted Sir Gordon Downey about disclosure. I trust and hope that they have followed his advice. If my hon. Friend believes that that is not the case, he should take that matter up with Sir Gordon Downey.
Mr. Quentin Davies: The right hon. Lady may recall that I have been a supporter for some time of holding Special Standing Committees as a rule before the Standing Committee stage on complex major legislation. Does she agree that Finance Bills are suitable for Special Standing Committees in view of their complexity and their great economic importance? Does she agree that it would be a great shame if we did not take the opportunity to hold such a Special Standing Committee before the Committee stage of the Finance Bill? If it really cannot be arranged on this occasion, will she at least ensure that there is the opportunity for proper consultation with outside bodies once the Finance Bill has been published in draft?
It is no use saying that there was consultation between the Government and certain outside bodies when no one knew what the Finance Bill would contain. If we are to have good legislation and proper open government, to which I know that the right hon. Lady is committed, there can be no substitute for consultation with outside bodies and the generality of taxpayers once the draft Finance Bill is available.
Mrs. Taylor: The hon. Gentleman supports Special Standing Committees and I know that he has given a great deal of consideration to how the issues might be dealt with. I am glad that he acknowledges that a Special Standing Committee is not appropriate or possible on this occasion. As he follows these matters closely, he will know that various Committees, including the Procedure Committee, have come up with suggestions about how the Finance Bill and other Bills might be managed and how the Finance Bill might be split in future. That is a matter which the Select Committee on the Modernisation of the House of Commons is examining on a long-term basis.
Mrs. Betty Williams: While I hope that the whole House welcomes the announcement in the Budget yesterday of much-needed support for the British film industry, I am especially interested in the Welsh film industry. Can we hope to have a statement soon on the Welsh film industry? [Interruption.]
Mrs. Taylor: I would have thought that the entire House would welcome measures to support the film industry. I am surprised that some Opposition Members clearly do not. I know that the arts in general are important in Wales and that the film industry there has had some success. I am sure that my right hon. Friend the Secretary of State for Wales will ensure that Wales gets a fair share.
Mr. Keith Simpson: May I ask the Leader of the House to firm up her answer to the question of when we might have a defence debate? Many of us have
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been in correspondence with the Secretary of State for Defence on this subject, and so far he has avoided giving any commitment. It is an important issue to many of us because, even as we talk in the Chamber, we have constituents who are literally in harm's way in Northern Ireland, Bosnia and elsewhere. Surely it is reasonable to ask for a major set-piece debate on the subject, and certainly before Christmas. The right hon. Lady has said that she has not ruled out such a debate. May I ask her firmly to rule it in?
Mrs. Taylor: I have said that I think that there is every prospect of a debate, and possibly within the time scale of which the hon. Gentleman is talking. It is, of course, always possible for the Opposition to use one of their days for such a debate.
Mr. Lawrie Quinn: Does my right hon. Friend have any proposals for the further modifications to the Lobbies? I think that the modifications to the Clerks' Tables in the Lobbies—
Madam Speaker: Order. I am sorry. The hon. Gentleman's question might well be put to the Leader of the House when the right hon. Lady answers questions wearing her hat as Leader of the House and President of the Council. The question does not relate to next week's business. I am trying to be helpful. I understand new Members' enthusiasm.
Mr. Andrew Miller: In the light of recent press releases from the Department of Health, may we have an early statement on the desirability for more openness in national health service trusts, and especially on the desirable suggestion of making trust boards open to the public?
Mrs. Taylor: My hon. Friend is right to raise an important issue. The Government want to see as much transparency as possible in all areas. To force trusts to hold their meetings in public would require a change to regulations. My right hon. Friend the Secretary of State for Health has plans to introduce such a change when practicable. In the meantime, my right hon. Friend and, I think, all of us hope that the trusts will enter into the spirit of what we are trying to achieve and will make their meetings open to the public so that local people can ensure that health trusts are serving local needs.
Mr. Nigel Evans: Will the Leader of the House find some time shortly to discuss the Government's drug policy? I know that she leads a committee that co-ordinates Government policy on this issue. Has she seen early-day motion 112?
[That this House notes that a year after the appointment of General McCaffrey as America's Drug Czar, statistics prove that teenage drug abuse is soaring, reports of drug-related corruption have multiplied and the cities of New York, Philadelphia and Los Angeles have suffered startling jumps in use and overdoses; observes that the Drug Czar has been called a 'drugs nanny and a disaster'; and urges the Government not to repeat America's mistakes by creating a Drug Czar but to set up a Royal Commission to consider alternative policies.]
In the light of that motion, will the right hon. Lady reassure the House that the committee that she leads will not be suggesting that the Government do not introduce a drugs tsar?

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Secondly, will the right hon. Lady confirm that there will be no reconsideration of the legalisation of drugs, whether they be hard or soft?
Mrs. Taylor: I think that the hon. Gentleman knows that I have paid tribute to the work of my predecessor in this respect. We intend to appoint a drugs tsar. We intend to go ahead with that policy and to ensure that the Cabinet sub-committee on drugs misuse has an important part to play in the fight against crime. I hope and trust that, as was suggested by the hon. Gentleman, rather than some Opposition Members below the Gangway, the issue can be approached on a non-party political basis.
Dr. Ashok Kumar: Given the Tory government's miserable record on low pay after running the country for 18 years, will my right hon. Friend make a statement on the progress of the low pay commission? The matter will be of particular interest to my constituents because, after 18 years of Tory Government, one in seven of them is earning less than £3.50 an hour. Will my right hon. Friend make a statement on the matter?
Mrs. Taylor: My hon. Friend will know that we are making preparations for the establishment of the low pay commission. Applications for membership of the commission have been invited and advertised publicly in both the national and local press. I think that the closing date will be reached in about 10 days' time. We intend to establish a balanced commission. I think that that will put us in a strong position to meet our manifesto pledge.
Mr. Andrew Robathan: Will the right hon. Lady make time next week, or in the very near future, for a proper debate on Northern Ireland? She will be aware that, on Monday, a debate on Northern Ireland lasted for only 90 minutes. This is a very important time in the peace process and, indeed, for security, so will she explain why the debate on the extension of direct rule was reduced from three hours, which we had last year, to 90 minutes this year? The House started the Adjournment at 5 minutes past 7, so there was lots of time.
Mrs. Taylor: There have been three debates on specific issues related to Northern Ireland in the past few weeks. The hon. Gentleman's complaint might be valid if there had been some artificial means of curtailing that debate, but that was not the case. When debates on Northern Ireland are required, those debates take place in the House, as do statements. Again, it is one of the areas where there can be some cross-party agreement on how to treat very sensitive and difficult issues.
Mr. David Borrow: Before being elected to the House, I was heavily involved in a single regeneration budget bid for the Greater Deepdale area of Preston. Discussions are taking place for a cross-border bid involving Preston and South Ribble. Can my right hon. Friend say when the next round of bidding will start?
Mrs. Taylor: I cannot, of course, comment on any bid from my hon. Friend's constituency, however high the quality of that bid may be, but I anticipate that my
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hon. Friend the Minister of State who is responsible for this matter will shortly announce the fourth round of SRB bidding and will announce the criteria to be adopted. As I said, I cannot comment on the individual bid from my hon. Friend's area, but the procedure will be laid out shortly.
Mr. Bernard Jenkin: Can the right hon. Lady tell the House what lies behind the rather unseemly rush with the timetable of the Finance Bill? Could it be that she does not want us to spend too much time discussing the mammoth raid on pensions in the changes to advance corporation tax, or is it that none of the utility regulators support the principle of the utilities tax and that they think that it will harm investment in the utilities? The stifling of dissent and debate on controversial issues is becoming something of a hallmark of the way in which she conducts her responsibilities.
Mrs. Taylor: I think that it is quite important that we press ahead as quickly as possible with very positive measures to employ unemployed youngsters and many people who have been unemployed for a very long time. I also think it very important that we press ahead with some of our specific commitments in the manifesto, such as the reduction of VAT on fuel. I can understand why Opposition Members are not happy with those measures. It is because those measures are extremely popular with the country.
Mr. Andrew Mackinlay: Does my right hon. Friend recall that, last week, I requested that the House of Commons Commission should meet to address, among other things, a number of pressing industrial relations problems for which, ultimately, all Members of Parliament are responsible? When will the Commission—and the other relevant Committees—meet to deal with those matters and throw some light on something that I have learnt about since last week: the reorganisation of our Post Office, including the extinguishment of the century-old post of postmaster? That office will disappear, but, more important, so will the function. There are ramifications for all of us. These matters need to be examined by the appropriate Committees, but they are not meeting at the present time, and that is bad.
Mrs. Taylor: My hon. Friend is right to point out that there is always a problem in the early days of a new Parliament. I was not aware of the particular problem that he mentioned with regard to the postmaster. I am not sure whether that is a matter for the House or the Post Office, but I will make inquiries.
Mr. Andrew Lansley: Will the right hon. Lady make time next week to debate "Questions of Procedure for Ministers", which would not only allow the House to discuss the circumstances in which Ministers can discuss the exercise of free speech by hon. Members on behalf of their constituents, but allow us to examine the question of conflicts of interest for Ministers? In that regard, will she look at the Official Report of today's proceedings at Question Time, when the President of the Board of Trade appeared not to know whether the Minister for Trade and Competitiveness in Europe still had a continuing conflict of interest in relation to his shareholding in BP?
Mrs. Taylor: I do not intend to find time for a debate of that nature. My noble Friend the Minister for Trade and Competitiveness in Europe is in the process of complying with the rules in "Questions of Procedure for Ministers", which takes time. During that time, he has not been involved in discussions that would be relevant or relate to his particular interests.
Mr. David Heath: Does the right hon. Lady recall that it is now two weeks since the European Council met in Amsterdam? It would be a shame if it were forgotten. Either it was a triumph for British diplomacy, in which case we should celebrate it, or it was a missed opportunity, in which case we should deprecate it. Either way, does she agree with the Prime Minister that it must be fully debated, and will she provide an early opportunity for that?
Mrs. Taylor: There will be consequential legislation in due course, and that will be debated.

Orders of the Day
  WAYS AND MEANS
  Order read for resuming adjourned debate on Question [2 July].

  WINDFALL TAX
  Motion made, and Question proposed,
  A Motion was made and the Question being proposed, That provision may he made for imposing a tax on the amount of the windfall from which a company was benefitting on 2nd July 1997 in any case where—

  (a) an undertaking whose privatisation involved the imposition of economic regulation has been privatised by means of a flotation; and

  (b) the profits of the undertaking in the period after the flotation show that the company was benefitting on that date from a windfall from that flotation.—[Mr. Gordon Brown.]

  Question again proposed.

  Budget Resolutions and Economic Situation
  4.6 pm
  Mr. Peter Lilley: Yesterday was the first time that the trust which the British people put in the Government was put to a real test. We shall see that, as the consequences of the Budget filter through to them, the British people will realise that their trust was misplaced.
  It was the Prime Minister himself who chose to make trust the central issue of his election campaign—above all, trust that a Labour Government would not revert to tax and spend. Invoking almost biblical language, the Prime Minister claimed to have entered into a new covenant with the British people. He, Tony, claimed to be uniquely trustworthy. To allay fears that Labour would once again tax and spend, he gave the British people clear and categorical assurances.
  Earlier this year, the Prime Minister told business men in Birmingham:
  "We have no plans to tax at all.
  He told Daily Express readers:
  "Our plans do not involve raising taxes at all. If we have any such proposals we will make them clear before the election."
  How does that square with yesterday's Budget—17 new Labour taxes introduced by the Chancellor? They are not taxes on fat cats, but taxes which will ultimately fall on the hard-working, prudent savers of middle Britain. The Labour Government have broken their covenant, they have forfeited their trust and betrayed their pledges.
  The truth is that there was no need for an emergency Budget now at all. There was no emergency—quite the contrary. No Chancellor has ever inherited a better economic legacy than that bequeathed to the Chancellor by my right hon. and learned Friend the Member for Rushcliffe (Mr. Clarke) and his predecessor.
  As Lord Healey said yesterday,
  "As we look at this and future Budgets produced by the Labour Administration, we must always remember that rarely, if ever, have a Government had such cause to be grateful to their predecessor when it comes to the economy."

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  When the Chancellor arrived at the Treasury and opened the books, as the phrase has it, he found that, far from there being hidden problems, the economy was doing better than my right hon. and learned Friend had predicted during his Budget last November. Borrowing in the four months between the Budget and the end of the financial year was £3.3 billion lower than forecast, and it has continued on a healthy downward path since then. Revised figures show that growth has been better than we thought it would be. The trade figures have been better than expected, despite the strong pound, and unemployment has been falling faster than forecast.
  As the new Chancellor could not find anything wrong when he looked at the books, he decided to cook the books. He did, in effect, what any takeover merchant about to asset-strip a sound company would do: he decided to downgrade the forecasts. So he came up with four new assumptions, and got the National Audit Office to examine them. The NAO described his assumptions, rather acidly, as a deliberately cautious interpretation of the evidence. And so they are. Indeed, his new assumptions are not merely cautious; they assume that the Government will fail.
  The right hon. Gentleman assumes that the Government will fail to privatise anything—that is the black hole of which we warned during the election. He assumes that the Government will fail to get unemployment down. He assumes that they will fail to deter any tax evasion; and fail to get the economy to grow as fast in the future as it has in recent years. So we have four forecast failures by a Labour Administration—a pretty dismal outlook, but, I suppose, a fairly realistic assessment of what this Labour Government may actually achieve.
  Even the revised forecast that the Chancellor has made did not justify increasing taxes, but he was determined to raise them, because he wanted to tax now in order to be able to spend later.
  Mr. Dale Campbell-Savours: The right hon. Gentleman will know that the City has been saying that the economy is overheating and that something has to be done. In those circumstances, would the Opposition have supported raising interest rates, raising taxes or doing nothing? Presumably they would have had to do one of the three—which one would they have selected?
  Mr. Lilley: Funnily enough, I was just coming to that. The Chancellor justified his decision to raise taxes precisely on the basis of the hon. Gentleman's point—that there are some who believe that consumer spending in the short term is growing too rapidly. Yet, overwhelmingly, the taxes that the Chancellor raised fell not on consumption but on the corporate sector. So presumably the Chancellor does not believe in the thesis; there is therefore no reason why the hon. Gentleman or I should believe it either.
  Far from trying to take action to deal with a short-term growth in consumer expenditure, the right hon. Gentleman's taxes—by and large—fell on the corporate sector, and were geared to the longer term, by when it is assumed that consumer spending will have slowed, anyway.
  The Budget raises very large amounts of extra taxation: roughly £6 billion a year, which is £300 for every household in the land. But it seeks to do so in ways that
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  are not easily visible, and are at one remove from the ultimate taxpayer. Unfortunately, however, there is a general rule of taxation, stating that, the less visible a tax is in the short term, the more damage it does in the long term. As taxes work their way through to people's pockets, they do a lot of damage en route. Any attempt to conceal the blame will increase the ultimate pain.
  There are two big measures in the Budget—the change in advance corporation tax and the windfall tax. Both hit pensions and long-term savings. That is a double whammy for pension funds; it is the Robert Maxwell memorial Budget. No wonder the National Association of Pension Funds has described the Budget as
  "the biggest attack on funded pension provision since the war. Even Robert Maxwell only took £400 million."
  The ACT change alone, according to the NAPF, will take more than £50 billion of extra pension contributions from employers over the next 10 years.
  The House will recall that I published a proposal to give every working person in the new generation a funded pension, which would have involved Government putting billions of pounds into pension funds. Labour is taking billions of pounds out of pension funds. That means that Labour's shameful election lie that we would put people's pensions at risk was not merely dishonesty, but rank hypocrisy.
  In opposition, Labour said that changes to pension arrangements should be introduced in a spirit of bipartisan co-operation. Certainly, major changes should be introduced only after full consultation with the pensions industry. Yet these changes, which radically alter taxation of both pension funds and the corporate sector, have been introduced without consultation with either sector. They have been rushed in after just a few weeks of being tacked together. I fear that, as a result, they are shoddy, incomplete and ill thought out.
  By definition, if the Government are several billion pounds a year better off, pension funds must be several billion pounds a year worse off. As a result of this tax, in order for the same pension to be paid, members or companies will need to pay more into their pension schemes. The National Association of Pension Funds calculates that a contribution sufficient to pay a pension of £100 a week will now pay only £85 a week. Do the Government plan to tell members of personal pension schemes the amount of the extra contributions that they will need to pay to make up the shortfall?
  The Chief Secretary to the Treasury (Mr. Alistair Darling): The right hon. Gentleman is trying to pose as a friend of pensioners. Does he not recall that, when he was a Minister at the Department of Social Security, he presided over the regime under which the mis-selling of pensions took place? Does he not remember that he proposed the abolition of tax relief on employee pension contributions, and was it not the Conservative party that was going to abolish the state pension? No wonder no one believes anything that the right hon. Gentleman has to say about pensions. His arguments simply do not stand up.
  Mr. Lilley: If the right hon. Gentleman can only stand at the Dispatch Box and make a statement that he knows to be untrue, while refusing to answer the question that is posed to him, he discredits his office. I have a number of questions to put to him, and we would rather have more

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  sensible and constructive answers. Not just Conservative Members, but all who are involved with pensions and companies, want to hear answers to those questions.
  The present national insurance rebate is calculated by the Government so that, assuming a certain after-tax return, it will generate a private pension that is roughly equivalent to the pension that people would have if they stayed in the state earnings-related pensions scheme. If the level of rebate is not revised to reflect the change in taxation, many people with pensions would be best advised to contract back into SERPS. Is that the Government's intention? Will they advise people to opt back into state earnings-related pensions?
  If the Government do not do that, will they not be guilty of the very mis-selling that the Chief Secretary just accused the last Government of having allowed to happen? Trying to make it suitable, or rather advisable, for people to opt back into SERPS and then not advising them to do so is certainly mis-selling of a kind; moreover, it is the very opposite of what the Government have been saying they intended to do ever since the election. We must ask whether Social Security Ministers who have been saying that they want to enable everyone to opt out of SERPS were aware of the impending change in the tax regime.
  If the Government do not advise people to opt back into the state scheme, the alternative is that they increase the value of the national insurance rebate to offset the tax change. Do they intend to do that? How much will it cost? Have they asked the Government Actuary to assess that cost? Has that extra cost been factored into the Budget arithmetic?
  I shall give way to the Chancellor, who will surely want the House to know whether his calculations took that into account. It seems that not only do Social Security Ministers not know, but the Chancellor does not know what is in the Budget, and he does not know its implications for social security. The pensions industry, those who are in pension schemes, particularly those with private pension funds, and those in companies which run occupational pension schemes, want answers to those questions. I hope that we shall have answers before the end of the debate.
  There is another perverse consequence of the change to ACT which the Chancellor failed to mention yesterday. He constantly laments the lack of investment, and claims to want more investment in Britain. He often laments that many British companies invest more overseas. However, his proposed change will make it significantly more advantageous to invest abroad relative to domestic investment than was previously the case. How many Labour Members realised when they cheered yesterday that the first act of the new Chancellor would be to encourage British companies to switch investment from Britain to abroad?
  To the extent that companies continue to invest in this country, they are discouraged from paying out the fruits of productive investment in mature companies which have few good productive investment opportunities left. They are encouraged instead to retain those funds and invest them in their own companies. That means that less money will be recycled through the capital markets to the new, small, expanding companies which need investment, and will no longer find it so easy or so cheap to get.
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  The other major tax is the windfall tax. It is the only new tax burden that Labour admitted to planning before the election. To make it acceptable, Labour had to pretend that it would not be paid by ordinary people. Last year, the Chancellor said that it would not be paid by ordinary families. The impression was created that it would all fall on the fat cats in the privatised utilities.
  Now we know. Virtually none of it will be paid by the fat cats. Instead, we are led to believe that it will be paid by an abstract entity called the firm, but as John Kay, the adviser to the Prime Minister and Chancellor has said:
  "There is no such thing as a tax on firms. The effective incidence of all taxes is ultimately on individuals."
  Normally, the £5 billion cost of this tax would show up in due course in household bills and there would be higher gas, water, electricity and phone bills.
  As there are nearly 20 million households, that £5 billion tax would, on average, cost each household more than £250, but the extent that regulators prevent the tax from being passed on in higher prices, it will instead fall on the value of shares. Of course, its impact will be the more concentrated on pensioners, who pay a disproportionate amount of household bills out of lower incomes, than if it had ultimately gone through in higher charges. That is because more than half of all shares are held by or on behalf of today's and tomorrow's pensioners.
  If several billion pounds are siphoned from pension funds by the tax on top of the ACT changes, companies and individuals will have to put in an equal extra amount or suffer lower incomes in retirement. Even if the tax did not fall primarily on pensioners, it is still objectionable in principle. It is not merely retrospective: it is being imposed long after the alleged windfall profits arose. It goes back 15 years, to when BT was originally privatised, much to the chagrin of Iain Vallance. It does not go back to the first privatisation under the influence of the International Monetary Fund—the sale of the Government's stake in BP. It appears that a company's chairman has to become a Minister; voting Labour is not enough, as Iain Vallance found out.
  Of course, this tax will not be paid primarily by the people who benefited from the original speculative profits. People whom the left vilify as speculators—those who sold the shares fairly soon after they were issued—will not pay a penny of the tax, but pensioners whose schemes invested later for the longer term will bear the full burden.
  Labour's windfall tax will damage Britain's standing as a country whose Government can be trusted not to behave arbitrarily. It will drive up the cost of capital and, perversely, reduce the revenue that may be obtained from any future privatisation, if the Chancellor eventually finds something to privatise; but the real absurdity is that it is a one-off levy to fund an on-going make-work scheme. The Government cannot fund a permanent programme from a temporary tax.
  We support the objective of getting young people off welfare and into work. We believe in that passionately. It has been one of the keys to our reforms of social security, employment and education. We have aimed to give people the skills, the incentives and the jobs to get them off welfare and into work, and we have been succeeding.

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  Over the past four years, the number of young people unemployed has come down by 100,000 a year. When the Chancellor first mooted his plan to get 250,000 young people who had been unemployed for six months or more off the dole, 280,000 young people were in that position: there are now fewer than 180,000. We have done a lot of his job for him, and we did it by sensible measures to create real jobs, not by make-work schemes and the skivvy jobs that he proposes.
  The Secretary of State for Education and Employment (Mr. David Blunkett): Will the right hon. Gentleman give way on that pathetic note? Perhaps he would tell us, therefore, why his party, over the period of its recent office, introduced 30 separate schemes, which he now describes as makeweight?
  Mr. Lilley: I have no objection in principle to taking measures over and above those that I have described to get people off welfare and into work. I have no objection in principle to the sort of measures that the Chancellor is proposing.
  Mr. Campbell-SavoursThe right hon. Gentleman referred to "skivvy jobs".
  Mr. Lilley: I was quoting the term used by Labour Members to describe the regime that we established for 16 to 18-year-olds, which is precisely what they want to extend to 18 to 25-year-olds. We established a scheme under which people had the option of education, of training or of work, but not of benefit. He proposes to establish that benefit regime and to extend it to those people. We have no objection to that in principle, and no objection in principle to the proposal to introduce job subsidies. It is just that we think that it will not work, and we know that it will not save money.
  We set up a study to examine similar schemes throughout the world, and it discovered that not a single scheme saved more in benefit than it cost in subsidies and in employing people on make-work schemes.
  Mr. Blunkett: Will the right hon. Gentleman tell us, therefore, why his Government introduced three schemes, including workstart, that involved a job subsidy of the sort that he is now attacking?
  Mr. Lilley: I have just told the right hon. Gentleman that I do not attack these schemes in principle. Had he listened to me during the Queen's Speech, he would find those very words. We believe that there can be a social case for them, but that there is no financial case; and it was the financial case that the Opposition put to the electorate before the election. They claimed that the savings on social security would be greater than the cost of the schemes, and that they would be able to transfer the savings on social security to the education budget. All talk of that has disappeared, because it is nonsense.
  There are no such savings, because a large part of the cost of subsidy goes to young people who would have got jobs anyway. A further element goes to people who displace people who had jobs, or who would have got jobs but were not entitled to the subsidy. Yet a further
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  element goes to people who are on the schemes only for the six months that the subsidy lasts and then return to benefit. For all those reasons, the costs far exceed benefit savings.
  I repeat that there may be a social case for such schemes. The Conservative Government certainly thought that there was, for example, to help those who had been unemployed for a long time—two years or more, and we introduced a pilot scheme. The dead weight in that circumstance is far less—because far fewer people get back into work after they have been unemployed for more than two years—so there is a far greater chance that a high proportion of the costs will be met by benefit savings.
  When the Labour Government try to pretend, as they did before the election, that they have come up with a magic scheme that will enable the right hon. Gentleman to increase his departmental budget, they are deluding both themselves and the British people. The schemes might work to the extent that the subsidy reduces the cost of employing people. If the Government accept that reducing the cost of employing people will create some additional jobs, surely they must also accept that increasing the cost of employing people—by, for example, adopting the national minimum wage and importing European social costs—will reduce the number of jobs.
  The subsidies are temporary, and apply to only a few hundred thousand people. The increases in employment costs are permanent, and apply to millions of people. The net effect of the Government's proposals will be to drive people out of work and into welfare, and the cost of that will be far greater than could possibly be met by a windfall tax.
  As well as changes to help young people who are unemployed, the Chancellor made much of his plans for lone parents. However, he did not bother to inform the House of one aspect of his plans that was hidden away in his departmental press releases.
  The House may recall that, before the election, I announced, but did not have time to implement, plans to equalise the benefits payable to new lone parents to make them equal to those available to married couples in similar circumstances. That is fair, it does not send out the wrong signals about marriage and the value of two-parent families, and, in the long run, it saves £500 million a year.
  However, that was anathema to the politically correct denizens of the Government Benches. Before the election, the then Leader of the Opposition, now the Prime Minister, was asked on the "World at One" programme:
  "Are you going to stick with the Conservative plans to equalise benefits for lone parents with those of married couples?"
  The right hon. Gentleman replied,
  "No."
  It is not easy to misunderstand that reply—it was a quite simple, unusually straightforward "No." He told the people of this country that he would not implement my plans.
  But yesterday, only moments after the nauseating spiel we heard from the Prime Minister about his integrity and how he always sticks to his promises, the Chancellor broke that promise. We now know that the right hon. Gentleman will implement my plans—I welcome that—with total disregard for the pledge the Prime Minister made to the electorate before the election.

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  The Prime Minister is keen to emphasise that this Budget is no more or less than his party promised during the election campaign. However, before 1 May he was asked a number of clear questions, to each of which he replied, "No." Would he put up taxes at all? No. Would his July Budget go beyond his windfall tax plan? No. Would Labour implement my lone-parent benefit reforms? No. Would Labour leave a £1.5 billion black hole by refusing to privatise assets? No. Would Labour alter Conservative departmental spending plans? No.
  Only two months ago, Labour answered no five times. Yesterday, however, we learned that the true answers to those questions were yes, yes, yes and yes. [HON. MEMBERS: "That is only four."] And yes. [LAUGHTER.] Is it not extraordinary how Labour Members are proud of the number of pledges that they have broken? They do not want me to underestimate them, and in future I will not.
  The Budget provides not only the opposite of what Labour told voters it would provide, it will accomplish the opposite of what the Chancellor claimed, only yesterday, that it would accomplish. He said that it was a Budget designed to curb a consumer boom; yet the overwhelming bulk of the tax burden will fall on the corporate sector. He said that it was a Budget to control houses prices; yet its net effect will be to make investing in houses more attractive than investing in equities. He said that it was a Budget to encourage long-term investment; yet its biggest effect will be to hit long-term investment in pension funds. He said that it was a Budget to encourage investment in the United Kingdom; yet its measures will encourage people to invest abroad.
  Today, the cheers of Labour Back Benchers may still be ringing in the Chancellor's ears. Tomorrow, I fear that he will find that those cheers have turned to hollow laughter.
  4.35 pm
  The Secretary of State for Education and Employment (Mr. David Blunkett): I welcome the shadow Chancellor to his new post: may he hold it with distinction for many a long year. Before commenting on his speech, I should like to accord him a tribute. I acknowledge that he does care about young people, about their exclusion from society and about their need to be able to earn their own living and to lift themselves off the scrap heap of time. I accept that he should like those young people to be in jobs and able to develop their own families. After hearing the shadow Chancellor's speech today, however, I am totally unclear about whether he supports our measures, whether he is in favour of job subsidies or whether he believes that the Government should intervene in the labour market to help clearly disadvantaged unemployed people.
  The shadow Chancellor has contradicted himself in this debate several times already. He said, for example, that he is in favour of programmes organised by the Government, but that he is not in favour of our programme. He is also in favour of subsidies, but he is not in favour of our subsidy. He is in favour of the Government raising money to spend on young people, but only if it is not raised from a windfall tax on the utilities. Presumably the shadow Chancellor would be in favour of raising money to help young people if the burden fell on the backs of someone else—such as pensioners, whom the previous Government required to pay VAT on domestic
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  fuel bills. The previous Government imposed 22 tax increases that affected everyone, although the burden of most of them fell on individuals.
  My right hon. Friend the Chancellor has introduced a windfall tax on profits which, in the 1980s, the present shadow Chancellor clearly believed—because he came close to admitting it—were excessive. The shadow Chancellor seemed to say that it is all right to raise money to help young people, but only if it does not come from windfall profits. If the money is to come from a windfall tax that demonstrates those excess profits—the billions of pounds of profits made over the past 15 years—he is agin it. He made an extraordinary admission. He is in favour of the type of intervention that we propose—although he would like it to cost less and not to be based on quality, continuity and employability, which are the hallmarks of our programme—and he is agin it.
  Yesterday, my right hon. Friend the Chancellor announced a programme that has received almost overwhelming applause and the unified commitment of the British people. He presented the most popular Budget in decades, and he did so in a manner that showed considerable aplomb. He has given hope to the British people. They now have hope that the legacy that we inherited—a legacy of neglecting investment in our health service, in our education, training and employment programmes and in our housing—will be ended.
  There is neglect in the education system, which the right hon. Gentleman and his colleagues have left us to clear up: 600 primary schools rely on outside toilets, and there are 25,000 temporary classrooms. There is a legacy of redundancy among teachers and a legacy of disrepair in schools with crumbling walls, leaking roofs and window frames that rattle, which creates an environment not fit to teach in. That is why my right hon. Friend the Chancellor's announcement yesterday was welcomed by parents, governors and teachers and by communities across Britain.
  An investment of £1.3 billion over the coming years to tackle that disrepair is morally right, economically sensible and will bring about social cohesion. It allows those who want a job to have a sensible job to meet a need in our community, by linking public and private, as my hon. Friend the Paymaster General will be assisting us in doing.
  Mr. William Cash: In the light of what the right hon. Gentleman has just said, will he review the whole question of the standard spending assessment system to ensure that constituencies such as those in Staffordshire get a fair deal? Will he also recommend to the Chancellor that the capping of local government expenditure should be removed?
  Mr. Blunkett: I am fascinated by the hon. Gentleman's admission that those constituencies did not get a fair deal under the Conservative Government—we certainly all agree with that. The quantum amount available and the distribution of it are about fairness. The hon. Gentleman asks whether, after nine weeks, I am going to do something about it. I hope that we manage more in the next nine months than his Government managed in the past nine years. If we do, we shall bring about greater fairness, and no doubt the hon. Gentleman's electorate will be so enamoured of the new Labour Government and

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  so grateful for our bringing a bit of common sense and equity to the funding of their children's schools that they will vote Labour and vote him out. We all look forward to that.
  We will not only bring about fairness and equity by ensuring that investment in the infrastructure provides classrooms fit to teach and learn in, but we can now ensure that we turn back the legacy of a 40 per cent. increase in class sizes, which the Government managed to bring about in the past five years. We shall also be able to reverse the trend of redundancy and implement our class size pledge through the £1 billion that will be available next year for the education service across Britain—£835 million in England—which was not available until my right hon. Friend the Chancellor stood up in the House yesterday afternoon and announced that we will invest in the education service, even if the previous Government were not prepared to do so.
  Mr. David Willetts: The Secretary of State will be aware that the university teachers' pension scheme is a funded scheme and has no surplus. What advice has he received from the Government Actuary about the extra contributions necessary to offset the effect of the tax changes in the Budget? How does he propose to raise the money to finance the higher contributions in order to meet existing pension commitments?
  Mr. Blunkett: The hon. Gentleman is right to say that it is a funded scheme. I have checked on the university teachers' scheme, which was revalued last year. There is no prospect of the proposal placing any burden on it; I am delighted to be able to say that it is perfectly able to continue in the current vein. I double-checked that this afternoon because I was certain that, despite not having reached the Cabinet, the hon. Gentleman would at least be smart enough to ask that question.
  Mr. John Townend: Will the right hon. Gentleman give way?
  Mr. Blunkett: In a moment. I was getting around to applauding my right hon. Friend the Chancellor for lifting the abysmal £182 million that my predecessor managed to win for the education service next year and for translating it into a 5.7 per cent. increase—2.9 per cent. in real terms—that will give us the opportunity, as I will spell out to the House next week, to implement our standards agenda so that every child in every school in every part of Britain will have the opportunity to learn, to earn and to have hope and prospects of a job.
  That £1 billion is worth every penny in terms of the life chances of our children. It has been welcomed by all those who care about education. It is a disgrace that we have to take such action to overcome the penny-pinching meanness of the previous regime, which would have allowed teachers to be sacked, class sizes to increase and children's education to be affected.
  Mr. Townend: We are all very worried about the standard of education of children leaving school, especially the standard of literacy and numeracy—the Conservative Government introduced the national curriculum to try to improve standards—but does the right
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  hon. Gentleman agree that one cannot blame the problems in education on the previous Government or, indeed, on any Government? The major responsibility for education lies with local education authorities, the vast majority of which are controlled by Labour. As spending is not hypothecated, many of those local authorities could have spent more on education had they not spent it on frills as so many Labour authorities did.
  Mr. Blunkett: As a matter of fact, Labour authorities were responsible for spending £500 million more than the then Government allowed them through the standard spending assessment. I hope that the hon. Gentleman will make it clear to the schools in his neighbourhood that it was the Conservative Government who denied the money to North Yorkshire county council and the schools in his area, not the Labour authorities.
  Mr. Cash: You are the Government now.
  Mr. Blunkett: We are the Government now; that is absolutely true, and I will tell hon. Members what we are going to do on the back of that.
  Mr. Stephen Dorrell: The Secretary of State makes great play of the extra money for schools that the Chancellor announced yesterday. What assurance will schools have that the money will get through to them, especially as the Chancellor announced no extra money yesterday for social services, the other major spending head of local authorities? What assurance can the Secretary of State give that the money that he claims for schools will reach them—or will it in fact go towards the generality of local authority services?
  Mr. Blunkett: We have had an admission that there was not enough money for education under the previous Government, followed by an admission that there was not enough money for social services. Who was it who set the Budget for this year? Who imposed the standing spending assessment and the revenue distribution last year?
  I was asked how much of the money will go to schools. First, it has been made clear that the £835 million allocated in the Budget yesterday will go to education authorities, not into the SSA for all councils. Secondly—this is unique in recent years—the SSA that was announced will be matched pound for pound by grant so that we shall at last have transparency rather than the fraud perpetrated in recent years when the SSA was lifted by the Conservative Government but the grant was not made available for local authorities to be able to match it.
  Mr. Dorrell: The right hon. Gentleman has just made an important announcement. Is he telling the House that in future local authority education budgets will be financed by specific grant?
  Mr. Blunkett: No. I have just made the important announcement that, when we declare an increase in the SSA and say that there is £835 million more available for education than was previously budgeted for, we will match it pound for pound and allocate the money to the education authorities. I have today written to the leader of each of those authorities, saying that it is now their responsibility to ensure that the schools and the standards agenda are funded from the direct revenue support that

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  my right hon. Friend the Chancellor made available yesterday. I am sure that they will be delighted, because local authorities have long awaited that level of honesty and transparency being brought to the carrying out of their duties.
  Mrs. Theresa May: I am grateful to the Secretary of State for clarifying that point. I should like to be sure that I understand clearly what he is saying. As a former chairman of an education authority, I know how important it is to know exactly what is happening when the Government allocate extra funds. As I understand it, he is saying that money will go to those local authorities that are also education authorities and not to those that do not have education responsibilities, but that the money will not be ring-fenced to ensure that it goes to the education budget: instead, it will be allocated to the authority's general budget and it will be up to councillors to determine whether it goes to schools.
  Mr. Blunkett: I am delighted that I have been so clear that the hon. Lady has got it first time. We are giving the money for education to education authorities. I have just said that I have written to the leaders of those authorities stating clearly what the money is for and where it should go. They will join us—at least, Labour authorities will join us—on the standards agenda. I remind the hon. Lady that in the past Conservative authorities have refused to spend money allocated for nursery education on nursery education.
  Mrs. May: Will the Secretary of State give way?
  Mr. Blunkett: No, I shall not give way to the hon. Lady again because I am going to give way to my hon. Friend.
  Mr. Deputy Speaker (Sir Alan Haselhurst): I call Ms Karen Buck.
  Ms Beverley Hughes: I am grateful to my right hon. Friend for giving way. Does he have any thoughts on why Conservative Members are signally failing to endorse and welcome the measures in the Budget that have been welcomed by schools, parents and local education authorities? [Interruption.] I will not be barracked and I will finish my point. Can my right hon. Friend give us any more details yet on how local education authorities—which are the appropriate bodies—can begin to access some of the resources that I congratulate him, the Chancellor and all my right hon. Friends on including in the Budget for the education service?
  Mr. Deputy Speaker: Order. Before the Secretary of State responds, I apologise to the hon. Lady for mistaking her name. The Secretary of State has been generous in the number of interventions that he has taken. I appeal for them to be brief.
  Mr. Blunkett: Thank you, Mr. Deputy Speaker. My hon. Friend spoke for the nation. The nation is speaking with one voice, which is fully in favour of what my right hon. Friend the Chancellor announced yesterday.
  Some £83 million of the capital award will be available this year and £250 million for each of the four subsequent years. Local authorities will be expected to bring forward
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  proposals, in conjunction with their schools. We shall judge the priorities with my hon. Friend the Postmaster General—
  The Paymaster General (Mr. Geoffrey Robinson): Paymaster General.
  Mr. Blunkett: I apologise to my hon. Friend. I was obviously thinking of stamp duty.
  We shall look at how the public-private partnerships that we announced before the election can be developed and kick-started with the resources that are made available.
  A substantial part of yesterday's Budget was about the welfare-to-work programme. It is important to get the message across to the country that it is not a cheap and nasty substitute for work, but a programme of quality with continuity and the possibility of employability for all who take part in it. All parts of the programme will involve education and training and will have mentors who will work with the young people, so that from the start, when they enter what we are calling the gateway, they will have the advice and support that they need, providing them with guidance on the best choices and with the basic skills that they require to hold down a job or take up a place on a programme.
  As my right hon. Friend the Chancellor announced, four choices will be available, but there will not be a fifth choice of remaining out of work on full benefit. The programmes will involve a subsidy of £60 a week to private employers, plus a £750 allowance for education and training that will be available to all young people for accredited and properly qualified training and education. For the environmental and voluntary sector options, there will be a placement fee of £3,200 for each six-month placement, totalling £6,400 in a full year. In addition, there will be the full-time education option, which will be extended to up to 12 months to allow young people to take a proper qualification. A discretionary grant will be available for fares and equipment.
  In addition to being able to retain their benefit and passported benefits, which is important to ensure that there is no penalty, there will be a grant of up to £400 for those on the voluntary and environmental programmes. All those on the programme will receive mentoring and skills training.
  At the end of the programmes, for those who have not already obtained full-time work or gone on to full-time education, there will continue to be a programme to enable them to take up trials in particular types of employment, to be given further advice and skills training and to continue without feeling that they have dropped off the end of the programme. We have devised a new and imaginative way of ensuring that those who have been excluded and alienated from society can take their place alongside their peer group, earning their own living, creating their own families and contributing to society.
  Judy Mallaber: The new deal will give new hope to the many hundreds of young people in my constituency who have been unable to get work. Is my right hon. Friend aware that the confusing multiplicity of schemes introduced by the last Government have seriously damaged confidence among young people and the long-term unemployed? What measures can he take to

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  reassure them that we are offering quality jobs and training, not make-weight jobs? In particular, what measures will he take to ensure that the programmes do not involve job substitution and do not result in other people losing their jobs or being sacked to make way for the new deal participants?
  Mr. Blunkett: I fully accept the thrust of my hon. Friend's question. It is crucial that young people have confidence in the programmes and in the options available. They must believe that their voice is being heard, that they are being consulted and that those who are working with them are equipping them for future employment. That is why the offer of education and training is so important.
  The previous Government ran a community programme from 1982 to 1989. It was the nearest that they got to a quality programme. The problem was that it did not offer education and training, it did not offer mentoring, it did not have a gateway access programme to prepare people for it and there was no mechanism to ensure at the end of the programme that those who had participated did not find themselves in a revolving door. Our programme picks up on all those problems. All those in the new deal will receive the help and support that I have outlined.
  My hon. Friend asked an important question about job substitution.
  Mr. Bernard Jenkin: Will the Secretary of State give way?
  Mr. Blunkett: I shall finish answering the question first, thank you.
  My hon. Friend asked an important question about job substitution. We must all join together. Good employers, who gave their whole-hearted support and commitment at the event that my right hon. Friend the Chancellor organised at No. 11 Downing street, must be able to join us in monitoring the programme so that there is not job substitution and people do not abuse the £60 subsidy. There will be a declaration for employers to sign and there will be a contractual requirement. There will therefore be the potential for breach of contract. We believe that, by working together with good employers—as Winston Churchill rightly pointed out, the bad will be undercut by the very worst—we can avoid substitution taking place.
  Mr. Jenkin: I very much hope that the Secretary of State's scheme succeeds in all the aims he has for it, but can he explain what will happen when the proceeds of the windfall profit tax run out? Will the scheme continue to be funded or will that be the end of it?
  Mr. Blunkett: One of the advantages of this programme, as opposed to the 30 schemes that preceded it—because of the time taken and the interventions that I have accepted, I shall not read out the list to the House, although it would make interesting reading—is its continuity. For the next five years, people will know that the programme is in place and that it will be built on stage by stage. Through the growth of the economy, through the reduction in overall unemployment, through the transfer of welfare into work, through the increase of people contributing back through
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  tax and national insurance and through the reduction in payment of benefits, we shall be able to continue investing in the well-being of young people.
  I would not want the hon. Member for North Essex (Mr. Jenkin) to worry his head about the matter. In four years' time we shall tell the electorate how we have done and what progress we have made. We shall ask them to re-elect us, and once we are re-elected we shall be able to tell the hon. Gentleman what we are doing, how important it is and what progress we have made. We are modest enough to believe that we shall succeed and that this country will have a popular Government who actually carry out their pledges, who are trusted by the electorate and who can once again give the British electorate confidence in politics and in politicians. In view of this afternoon's revelations, we desperately need to reinforce belief in politics, politicians and democracy.
  Mr. Archy Kirkwood: Will the Secretary of State give way?
  Mr. Blunkett: I will give way one last time, as the hon. Member who wishes to intervene sits on the Liberal Democrat Benches.
  Mr. Kirkwood: Can the Secretary of State confirm that his scheme will have a penalty sanction for non-compliance? Will he share with the House the background against which the penalties will be imposed? More importantly, will he explain what rights of appeal, if any, there will be against such sanctions?
  Mr. Blunkett: There is an issue here of rights and responsibilities, and of obligations. We need to ensure that people are prepared to take up those responsibilities for themselves, which is important. The ability to offer choice is at the heart of this programme. People can choose, and be guided and supported in what is right for them. For the able-bodied, we do not believe that it is right after they have been offered choices for them to turn down those choices and to continue drawing benefit. We made that clear before the election.
  There will be a series of steps before people find that their benefit is withdrawn. There will be counselling for those who believe that none of the options is acceptable to them. Further offers will be made and guidance will be given, including, as part of the gateway, guidance on the social and educational skills required. If young people then choose not to take up one of the options, they will be able to appeal to an adjudicating officer and still retain their benefit. If the adjudicating officer judges that there is no good reason for refusing the option of work, such as sickness, family circumstances or caring responsibilities, the penalties will come into place.
  People will at first lose benefit for two weeks. At any point in those two weeks, they can rejoin the programme. If, after two weeks, they refuse to join the programme, there will be a further month's penalty. In those circumstances, if people have dependants who are in need of support, an award will be made to ensure that the dependants do not lose their support and benefit. There will, however, be a 40 per cent. penalty on the individual who has declined to take up the programme.
  Those are the sanctions which are available within the total context of a new programme which gives young people the duty and obligation to fend for themselves,

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  but which also gives them the right to choose and to receive more than the benefit that they have been receiving on the dole. The programme is about quality, as I have said, and about employability. It is about a new beginning. It is about people not being excluded and alienated from our communities. It is about bringing back people in some of the most disaffected and disadvantaged parts of the community, including my own constituency.
  I know that young people will be persuaded that the programme is about hope and not punishment, that it is a new beginning with a Government who care. We are big enough to impose the sanctions as well as to offer the opportunities. The rights and obligations offer a new beginning for Britain.
  Today, the BBC has not concentrated on improvements in education or health. It has not talked about those who are excluded from the society around them or about the £3 billion that we will invest in their future. It does not talk about the money available for caring and disability, which will be spelled out by my right hon. Friend the Secretary of State for Social Security in the House tomorrow morning.
  Instead, the BBC wrings its hands over the pension funds and gives publicity to the shadow Chancellor, who also wrings his hands although he was prepared to put forward a pension proposal that would have withdrawn tax concessions from individual pension contributors. He served in a Government who allowed the most scandalous misuse of pension advice that this country has ever known. He was a member of a Government who betrayed people—he used the term himself—by allowing misleading information and advice. Hundreds of thousands of people are still waiting for redress for what happened under his regime.
  When we see those who are powerful and those who have vested interests turning away from those who have no power and who are excluded from society, we know that we are speaking for the people of Britain when we say that it is investment in our future, through education and employment, and putting our nation to work that will make the difference and create the kind of society that we want for the 21st century. I am proud to be a member of this Government, and I congratulate my right hon. Friend the Chancellor of the Exchequer on making it possible to bring welfare back into work.
  5.7 pm
  Mr. Kenneth Clarke: Seven months ago, I appeared in this Chamber and presented a Budget on behalf of the previous Government. The present Chancellor of the Exchequer, who was then my shadow, replied on the measures that I proposed. I produced a deficit reduction programme which was intended to ensure that we were on course to have a balanced budget by the end of the century.
  I was able to make some small reduction in personal taxation. I brought down the standard rate of income tax and I brought down the small companies rate of corporation tax. That was not opposed by the then shadow Chancellor. Indeed, he committed himself to sticking to those rates and to holding down rates of income tax to the level that I had set.
  I do not recall the then shadow Chancellor saying to the House that, if his party won the next election, he would introduce a quite different Budget within eight weeks of
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  taking office. I cannot recall the right hon. Gentleman saying that it would be a much tougher Budget than the one I had produced. I do not recall him mentioning that he thought I should be introducing a big tax hike on pension funds, on investments and on savings. I do not remember him pointing out that he thought I had not put up the tax on petrol enough or that I had not put up the tax on cigarettes enough. I do not remember his heavy words about mortgage interest tax relief and how it should be phased out. I do not remember a commitment to putting up stamp duty on the sale of houses.
  The Chancellor fought the election thereafter, as my right hon. Friend the Member for Hitchin and Harpenden (Mr. Lilley) said, on the basis that Labour would do the same as we had. He did not mention an early Budget and, when we told the public, during the election campaign, that there would be an early Budget which we feared would be heavily tax-raising, we were accused of scaremongering.
  I congratulate the Chancellor on his political skill. After only eight weeks in office, he has introduced a totally different Budget from anything that the British public who voted for his Government expected. I was amazed to see Labour Members cheering. It was an extremely tough Budget. It was tax raising on a grand scale and it was announced with great skill yesterday.
  Order Papers were waved when I introduced tax-raising Budgets. My first Budget was tax-raising; Order Papers were waved on the day, but I knew that I was in trouble thereafter. The Chancellor will find that the same will happen with his first Budget.
  The Budget was presented within eight weeks as part of a significant change in economic policy from the policy that we were pursuing successfully before the election. That change will be bad for important sections of our community. It is already beginning to prove bad for manufacturing industry and exporters. It is bad for the traded sector of the economy. It is bad for pension funds and future pensioners who had anticipated and planned the benefits that they might get from their pension funds. In the medium and long term on which the Chancellor laid such heavy emphasis, the change in economic policy, including the Budget, will be bad for jobs, living standards and the British economy.
  Mr. Blunkett: Does the right hon. and learned Gentleman agree with his retiring adviser who, only a few days ago, advocated the same measures that my right hon. Friend the Chancellor has taken in respect of tax credits, and that were started by Norman Lamont in a previous Conservative Budget, when he reduced them from 25 to 20 per cent?
  Mr. Clarke: If Edward Troupe said that, I do not agree with him. I did not always take the advice that I received, even from Edward Troupe. I shall give my reasons for disagreeing when I turn to tax credits. However, the right hon. Gentleman cannot deny that the changes to tax credits on dividends are a significant tax hike on pension funds that have affected the position of every pension fund manager in the country and the expectations of pensioners, and often their employers. They are part of raising resources and taxes on a scale that had not been anticipated.
  It may seem churlish to the Secretary of State for Education and Employment, who has spoken in the debate and intervened in my speech, for me to say that I do not

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  altogether welcome his presence at the Dispatch Box today: that is not because of any feeling against him or his proposals for education and welfare to work. However, this is the second day of the debate on the Budget. Yesterday, £5 billion-worth of net tax increases were imposed on the economy and now we have broken with tradition. There are Treasury Ministers on the Bench, but there is no Treasury Minister at the Dispatch Box.
  The Secretary of State made no mention of the Budget provisions. Instead, he took us back to education spending and welfare to work. Labour used the same tactic in opposition. Whenever we made speeches about the potential for Labour to turn to taxation and spending, Labour Members talked about welfare to work.
  I agree with my right hon. Friend the Member for Hitchin and Harpenden, who was perfectly entitled to say that, in principle, we are least inclined to attack that policy because we worked on it. I used the phrase "welfare to work" in my Budget three years ago. The phrase has been lifted from our description of our policies at that time.
  I worked with my right hon. Friend, now the shadow Chancellor, when he was Secretary of State for Social Security, on a package of measures based on included family credit that was designed to increase the number of young people—particularly long-term unemployed—moving from welfare into work. It was the centrepiece of our entire Budget at the time.
  We hope that the measures work and have some effect, but we are entitled to point out that, because they were devised politically in opposition, the Government raised expectations far beyond what they are likely to achieve. They have taken inadequate account of displacing people from existing jobs and the temporary nature of some of the opportunities that they will provide. The idea of 250,000 young people being taken out of unemployment became rather weak when we got the number of those eligible for the scheme down to 178,000 by pursuing orthodox economic policies.
  At a time when they are tightening fiscal policy dramatically and, in my opinion, making the most unwise choice of a tax base from which to raise revenue, the Government must not be allowed to avoid addressing serious economic arguments by making worthy protestations about their desire—which I wholly share—to avoid the development of an underclass in our more prosperous society and to get people from welfare to work. They are labouring that aspect of their policy because they do not wish to give further publicity to other measures that the Chancellor announced yesterday.
  Fiona Mactaggart: Does the right hon. and learned Gentleman accept that young people regularly enter the employment market, so we shall certainly have the opportunity to meet the target that we set? In addition, does he accept that the skills and talents of the British work force are at the heart of any successful economic strategy and, therefore, it is absolutely right that they should be at the heart of the Budget debate?
  Mr. Clarke: Absolutely. That is why I worked so long on education reforms and the establishment of national vocational qualifications. There is a long way to go in developing a proper system of vocational qualifications.
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  That is why I helped devise schemes such as action for jobs. That is why, three years ago, we extended family credit. In recent years, all that was achieved against the background of an expanding enterprise economy which made it easier to create real jobs and help unemployed people move into lasting employment.
  The scheme now being introduced was devised largely in opposition as a way of presenting the windfall tax, to which I shall turn in a moment, and is produced against the background of a change in economic policy involving a dramatic tightening of fiscal policy and a huge increase in taxation which the Government have not adequately explained or defended in the House and so far in the debate, although it may be addressed in the Minister's reply to the debate.
  At various times since the election, we have been given two reasons why a July Budget was necessary and why UK Ltd. and the real economy needs such an eye-wateringly tough Budget.
  First, the Government tried to soften us up with the usual line that the Chancellor had looked at the books, found a black hole and suddenly discovered that he needed to raise more taxation that he had not been able to mention at the general election. That did not run very well. The Chancellor then tried to build on understandable concerns about the overheating of the economy and the rapid increase in consumer demand and said that a tough Budget was required to slow it down and make sure that it was sustainable. In only eight weeks, the Chancellor has slipped from the first reason to the second in explaining why he is taking so much money out of the economy.
  The first explanation involving the black hole is simply untrue. The second is misleading. I do not approve of adjusting fiscal policy to consumer demand in order to slow down the overheating of the economy, even if the Budget succeeded in doing that.
  Yvette Cooper: I sense from the right hon. and learned Gentleman's indignant tone when he speaks about what he did in the past that he still finds it hard to accept being in opposition. I have three questions for him—[Interruption.] The third completes the first two. Is he saying that interest rates should not have gone up? Is he saying that taxes should not have gone up and is he saying that the economy is in no danger of overheating?
  Mr. Clarke: I apologise to the hon. Lady if I am giving one of my more bipartisan speeches. I had obviously failed to get across the fact that, on the whole, I disapprove of the strategy lying behind the Budget. She asked a very direct question, and I shall deal with the two reasons that have been given.
  The issue of the black hole has not really been pursued very much recently. The National Audit Office, to which the whole matter was turned, rather killed it off when asked to look at it. It was an ingenious idea to ask the NAO to test the assumptions. I congratulate Sir John Bourne and the NAO on the very high standards of public service that they maintained by giving a perfectly

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  straightforward factual reply to the assumptions that they were given, which did not do any good to the Government's case at all.
  Mr. Stephen Timms: Will the right hon. and learned Gentleman give way?
  Mr. Clarke: I should like, first, to deal briefly with the NAO and wait to see whether anybody on the Government Benches puts any weight on the issue.
  The Government put to the NAO the Chancellor's own fresh assumptions and asked it to comment on them. The NAO did not criticise my Budget assumptions or my figures, and it did not say that there was a black hole in my Red Book in November.
  Mr. Timms: Will the right hon. and learned Gentleman give way on that very point?
  Mr. Clarke: If the question is on the Government's new assumptions, I shall.
  Mr. Timms: Does the right hon. and learned Gentleman accept the view that the NAO took about the potential savings from the spend-to-save initiative, given that the amounts that he claimed that he would save from that initiative were very much greater than those that have now been confirmed by the NAO?
  Mr. Clarke: I cannot in the middle of a debate look up the precise words, but the NAO accepted that, as we had predicted, there would be a deterrent effect over and above the direct changes that we were making in the spend-to-save proposals. The NAO said that the amounts were difficult to estimate, and therefore left it at that. The fact is that that initiative will save more than the Chancellor is now saying and that the deterrent effect which we calculated was a cautious assumption—I think that the NAO confirmed that when commenting on the Inland Revenue figures concerning the knock-on effect as people become more compliant once they are tackled. The NAO otherwise merely commented that such an approach was one way of approaching the whole problem.
  Some of the other assumptions that the Chancellor put to the NAO in order to say that there was a black hole are quite astonishing. He is insisting that this country's trend rate of growth is 2.25 per cent. only—the average for the past 40 years. After 20 years of supply-side changes and the criticism of our decline in the league tables—I thought the Chancellor was implying that we would leap up them once we had a Labour Government—he is back to 2.25 per cent., abandoning my reckless 2.5 per cent., to which I had persuaded the Treasury to move. That is totally out of line with the rhetoric of the Labour party that fought the election recently, when it said that Britain was growing too slowly compared with our competitors.
  The Chancellor has gone back to a flat-rate assumption of unemployment, which was much criticised by the Treasury Select Committee. The assumptions that I made were very cautious—we are already doing better than the assumptions that I made in November. The Chancellor effectively said, "We are not going to reduce unemployment as a Labour Government. We will return to a flat-rate assumption."
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  I will not go on, because the real problem about going to the NAO was that, by the time that it had finished, the Chancellor still could not find much of a black hole, even after adding up the difference between his pessimistic conclusions and mine, because the economy by then was doing so much better and tax receipts were rising. He could find a difference of only £500 million for this year, even if his deliberately pessimistic assumptions were right. There was no black hole; it is a myth to say that there was—barring one factor.
  We had pointed out that, if a Labour Government stopped privatisation, they would not have our privatisation receipts. I have given up working out where we are on national air traffic control, which I think is one of the subjects under review, like so many others under the Government. The assumption now, as we said, is for nil privatisation receipts—and that is the most expensive part of the black hole that the NAO was trying to discover. That part exceeds any other. If one translates the last paragraph of the NAO's conclusions, it is basically: "It is up to you if you wish to make these pessimistic assumptions." The Chancellor has done that, and it does not really make his case.
  The Chancellor announced that, for the first time, he has a deficit reduction programme. Alas, I did not have the slogan, but I had the deficit reduction programme. The previous Government were reducing the public sector borrowing requirement every year without fail and we were continuing to act in order to do so. Looking at the books, the Chancellor has no explanation of why the Labour Government are suddenly dramatically speeding up that process.
  I turn to the overheated economy argument. The economy is certainly running very strongly—better than my cautious assumptions. It is certainly right that, as I repeatedly said more often than I can remember throughout my time as Chancellor, we want no return to boom and bust. We spent four years being committed to stability, creating the conditions that really encourage investment, growth and new jobs, and that has to be maintained.
  There is, however, a new departure. I would never have begun—nor, I think, would any Conservative—turning to fiscal measures to control overheating of the economy. I attribute the system that I put in place and my approach to economic policy to Nigel Lawson, particularly in his earlier years after his Mais lecture. The control of demand and activity is largely a function of monetary policy, and one sets interest rates to hit inflation targets and produce stability in the financial markets. The aim of fiscal policy is to produce healthy public finances. Over the cycle, one aims to ensure that there is not excessive borrowing. Fiscal policy is all about tax and is linked to public spending and borrowing. We should not go back to fiscal fine-tuning to control demand.
  It is extremely dangerous to lurch back to such ideas and start turning to features of taxation to react to inflationary dangers which one sees coming along. The weakness of the argument—the average member of the public can realise it—is that it is no good pretending that one is putting up taxes on cigarettes and petrol and cutting away at mortgage interest relief because one thinks that the economy might be overheating and running out of hand. That might be credible if anybody thought that, if demand ran down, taxes on fuel or cigarettes would be

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  cut and mortgage interest relief at source would be reinstated, but I do not think that any of that will come forward.
  What this Budget is doing is raising revenue. Interest rates have to be used to control demand. They have to be set high enough to deliver the inflation target, but they should also be kept as low as possible to permit growth, job creation and rising prosperity, consistent with hitting the inflation target.
  If the Chancellor genuinely disagrees with me and says that, in the present circumstances, he needed to raise taxation to control the overheating of the economy, and if he really agrees with the Confederation of British Industry—which I do not, because I think that it was mistaken to demand the raising of taxation and to think that it was an alternative to interest rate increases—then he has failed, because he has not satisfied the people who advocated rises in taxation. Such a policy was too difficult politically, and he chickened out in the end. He has not done enough on cigarettes, fuel or MIRAS to satisfy the people who were making those demands.
  The Chancellor has gone for the biggest hits on pension funds and the corporate sector. I can only say that, when I was raising taxation on behalf of the previous Government, we did not go for pension funds and savings. We deliberately avoided loading taxes on the corporate sector, precisely because we were trying to produce growth, stability and continuity, which has been disturbed by what has been done.
  As I have said, the Government have failed to use fiscal policy to control consumer demand. I happen to think that one of the difficulties of setting interest rate policy at the moment is that much of the consumer demand is slightly one-off. The difficulty about this year is in trying to predict what will happen to all the one-off money coming out of building societies. How much will be spent and how much will be saved? Together with the strength of sterling, to which I shall turn in a moment, that creates a particular problem in setting monetary policy.
  The Chancellor has chosen this moment of all moments to hand away responsibility for monetary policy. He has given complete freedom to the Governor of the Bank of England, with the sole objective of hitting the inflation target. That is against the background of a Budget in which the Chancellor said that he was trying to control excessive consumer spending, but he has not demonstrably done so.
  We all expect that the Governor of the Bank of England will raise interest rates. Alongside a tough tightening of fiscal policy, we will have the tightening of monetary policy. On that basis, the outlook for inflation is good, and I will concede that yearly forecasts of 2.5 per cent., 2.75 per cent. and then 2.5 per cent. again look possible. Unfortunately, we are responding to a sudden flurry of excitement about overheating now and consumer demand this year, but we will see the effects of the Gordon and Eddie show in only two years' time. That is when we will see the combined effects of a tax-raising Chancellor and an interest-rate-raising Governor, and we will see whether they have gone too far.
  One constraint is already staring the Chancellor and the Governor in the face. I do not know what they will do about it, but they have succeeded in sending the pound up to dramatic levels and a DM3 pound is staring us in the
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  face. That is the biggest problem facing our manufacturing industry and exporters. Parts of the economy are slowing down in their expectations, because they are contending with a strong pound and facing a Government who seem to be doing everything they can think of to drive the pound up further in the pursuit of their economic policy.
  Mr. Tam Dalyell: Will the right hon. and learned Gentleman satisfy our curiosity? Were our suspicions in opposition wrong that, as Chancellor of the Exchequer, he would have dearly liked to give independence to the Bank of England, but was forbidden to do so by the Prime Minister and others?
  Mr. Clarke: I have always said that the views of Chancellors on the independence of the Bank of England are usually given after they have left office. Perhaps at some stage I will give a full exposition of my views on the independence of the Bank of England.
  My view on monetary policy is that it should be based, above all, on controlling inflation. Interest rates have to be high enough to hit an inflation target, but also kept as low as possible to provide room for growth. If the arrangements are to be changed, the Chancellor should make far better provision than he has to ensure a balanced approach. I am not the only person who thinks that giving the Bank of England complete independence with the sole purpose of hitting the inflation target will mean over-insurance. It certainly does not need to be combined with the fiscal tightening that has been introduced in the Budget.
  I am sure that the hon. Member for Linlithgow (Mr. Dalyell) does not disagree with my comments about the strength of sterling. I thought that he was going to congratulate me on my record of keeping down the duty on whisky. That always got praise from Scottish Labour Members, but was suddenly forgotten by the Chancellor in the Budget. He put up the tax on whisky, because he obviously prefers water.
  I shall deal briefly with the measures chosen in the Budget, because I have already dealt with the strategy. I am now speaking from the Back Benches, so my contribution should be shorter than a Budget speech. The windfall tax is a deeply regrettable tax and I hope that we never see its like again. The tax has no economic justification. It is a political tax, devised at a time when it was needed by the Labour party to appeal to the popular prejudice against fat cats—those individuals who seem to have done too well, although they will not pay the tax—and to old Labour's prejudice against privatisation. The tax combines those two prejudices, but has no logic behind it.
  The choice of companies is arbitrary, as is the definition of excess profits and the choice of the tax base. As it happens, the Government have chosen the best tax base, because the regional electricity and water companies have performed better than British Gas and British Telecom.
  However, the windfall tax has fatal flaws. It is arbitrary to look with hindsight at a purchase and say that it was a bargain, so it will now be taxed. The Government have no answer to the argument that today's shareholders are not, in many cases, the people who had the windfall. The tax will hit people, and pension funds, who happen to have investments in the relevant companies. It is a political gimmick, and people will forgive the Government only if they never do it again.

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  My fear is that, now that the Government have found that they can raise £5 billion to spend on their programmes, they will be tempted to do something very similar next time they get into financial trouble. The Government have shown that they have a populist approach to tax raising, not an approach based on economic policy. They look for a tax that makes a good speech on the right platform, and that is the sole origin of the windfall tax.
  The tax change that the Government did not announce beforehand is even worse. I happen to know that they were secretly working on it in opposition. The Chancellor has the nerve to describe the changes he has made to advance corporation tax as part of his Budget for investment.
  A few years ago, my right hon. Friend the Member for Charnwood (Mr. Dorrell) and I considered whether the tax credit encouraged the distribution of profits instead of their retention. We considered the argument that companies would invest more if they retained more, but we rejected it, mainly because we were worried about the impact on pension funds. We were worried about its effects on pension funds, especially after the new capital adequacy requirements, and we left it alone. We certainly never contemplated abolishing the tax credit completely.
  The changes have not been done for any economic reason. The Chancellor announced changes to dividend tax credit because he knew that 999 out of 1,000 people would not understand a word he was talking about. He did not do so because he wanted to explain to the public that it would give a tremendous boost to investment. It was a convenient tax that people would not understand and that is why Labour Members cheered it. The Government are now attacking the BBC for reporting the true consequences of the policy on the radio this morning. Norman Lamont had a similar problem when he reduced the tax credit, and that is why I did not follow his example.
  The policy will have an extremely damaging effect on pension funds. We are told that the pension funds are in surplus, but that is absurd, because they are not all in surplus. Some are, but many are not. Many people with personal pensions will not be told that their funds are in surplus, and their expectations will be upset. People who are about to retire have rung me to say that they are in funds that are not well funded. They tell me that they have legitimate, but not guaranteed, expectations of lump sum payments, and they know that the trustees of their funds will have to consider the effects of the change.
  It is no good saying that the change will have no effect, because it will take 20 per cent. out of the value of the income from the equity investments of pension funds. It is absurd to say that £5 billion can be taken out of the funds every year without any effect. The change is not good for investment, because it will raise the cost of capital. It has cut the capital value of major companies. It is a political decision and, like the windfall tax, it makes no economic sense. It played well in presentation to say that it would raise £5 billion, because people do not understand it.
  Mr. Chris Pond: The right hon. and learned Gentleman cannot see the faces of his Front-Bench colleagues, but many of us suspect from their glum expressions that we are hearing the prepared speech
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  that he would have given—and had hoped to give—as Leader of the Opposition yesterday. He obviously does not wish to waste it.
  The right hon. and learned Gentleman has told us of his concern about the big hit on the pension funds. Was he not concerned about the big hit on the pensioners that the previous Government made when they raised VAT on fuel? That was a much more important big hit and, therefore, his comments are somewhat hypocritical.
  Mr. Clarke: When we raised VAT on fuel, we raised the pension and benefit levels to compensate. I shall not go through the arguments again, because the Labour party has now done what it wanted to do. However, it has always been true that retirement pensioners were the one section of the population not affected by our change. They were the only ones who were compensated for it.
  The increase in VAT on domestic fuel was an environmental measure. I found it amusing yesterday to listen to the Chancellor go on about environmental measures and then a little later reduce the tax on domestic fuel that the Conservative Government had introduced. When I was defeated on the second instalment of the imposition of VAT on domestic fuel, I said that everyone in the House of Commons would benefit from the defeat except pensioners, because we cancelled the increase in pensions to offset the change. The bigger people's houses, the more they will benefit from the reduction on VAT in domestic fuel, but the windfall tax and its effect on the utilities will more than wipe out any benefit.
  The Government have increased tax on petrol. The housing market has been tackled, not, rather surprisingly, by getting rid of MIRAS but by cutting it back a little. The increase in stamp duty on bigger houses falls between two stools. It is not enough to affect the housing market. I do not believe that the housing market is overheating seriously outside the south-east of England. The increase in house prices is extremely patchy. The Government must be cautious in hitting the housing market when it is recovering from such a dead condition that it could still come back to normality.
  The Government's measure is a small way of raising revenue at the expense of those buying a house or moving house. I do not remember the Labour party mentioning it at the general election. If the Chancellor had told owner-occupiers that he was contemplating increasing stamp duty, more of them might not have voted for his party.
  Reference has been made to spending. I welcome that, because it is a complete change from what the Prime Minister and the Chancellor have said until now. The Liberals got in first. They were right to say that it was an idiotic commitment by the Government to say that they would stick to departmental spending totals for the first two years. No Government in history have done that. We have had a public spending round every year. All sensible Governments readjust their priorities. I am flattered by the extent to which the Chancellor still sticks to my spending totals for last year. Local authorities will have to stay with what they have got, except on education. The police service will stay with what it has got; so will the Prison Service.
  The Chancellor has not made the slightest attempt—which I would have done, with my Chief Secretary—to go around Government Departments to try to take

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  something out of their total to move to priority services. The Government have announced some welcome easing, but not for this year. My totals for this year, which the lobbies are complaining about, are endorsed by the Chancellor. He is sticking to them. I advise Government Back Benchers not to support the complaints of local authorities or health trusts about this year's figures. The Chancellor and I agree on them.
  The Chancellor has increased spending on health and education next year by worthwhile but not spectacular amounts. We did better than 2.25 per cent. real growth in the national health service in most recent years.
  Mr. Dorrell: It was the average.
  Mr. Clarke: My right hon. Friend the former Secretary of State for Health tells me that 2.25 per cent. was average. We did much better than that in some years. Many hon. Members who are new to the House have only to hear the word "billions" and they wave their Order Papers. It is as well to listen to how many billions when one is talking about education and health. Even I thought that the capital expenditure on education—more than £1 billion from the windfall tax—which I welcome, sounded like a great deal of money. I had not appreciated that the amount was spread over five years and every local education authority.
  My hon. Friend the Member for Maidenhead (Mrs. May) is right about current spending on education. I always exhorted the local authorities to pass on the increased standard spending assessment to schools, but the Labour ones did not. A letter from the Secretary of State for Education and Employment asking them, "Could you please do so this year?" is not guaranteed to succeed.
  Mr. Edward Davey: Will the right hon. and learned Gentleman give way?
  Mr. Clarke: No. I said when I gave way to the hon. Member for Gravesham (Mr. Pond) that it was for the last time. I should conclude.
  The extra spending on education, modest though it be— I apologise to the hon. Member for Kingston and Surbiton (Mr. Davey), a Liberal Member who no doubt agrees with my strictures on public spending, for not giving way to him—is drawn down from the contingency fund. We drew money down every year, but we usually waited to discover that we did not need it before doing so. What happens if a contingency arises? What happens if mad cow disease turns into mad sheep disease or there is some disaster we wait to see? The Chancellor has waved those arguments aside in order to have something to say to cheer up his Back Benchers in his July Budget.
  The Budget imposes a dramatically increased tax burden. That is from a Chancellor who lectured me all the time in opposition about the extent to which we had increased the tax burden on the British economy. We now have tighter monetary policy. The Governor of the Bank of England has been let free to have charge of monetary policy. When I was Chancellor, I found that it was no good looking to market expectations. The markets guess what the Chancellor or Governor is going to do. They do not tell the Chancellor that they have inner wisdom that is denied to him.
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  When I was Chancellor, the expectation was that interest rates would peak at about 7 per cent. by this stage in the cycle. In fact, I never, ever went higher than 6.75 per cent. Interest rates of 8 or 9 per cent. are now predicted. I remind the Order Paper wavers that that can only produce in two years' time slower growth, slower creation of jobs and possibly a rise in unemployment if the Government have overdone it completely, and some abatement in the expected rise in living standards. In two years' time, the economy will have slowed down too much.
  I know what the Government will do. I do not think that the Chancellor will mind if the economy slows down too much. He is cynically prepared to pay that cost. If the economy slows down too much, he will kick-start it. There will be more public expenditure. He will start cheering up the lobbies and prepare to cheer up the electorate. He is increasing taxes now as soon as he can after the election in ways that he thinks people will not notice, in order to spend public money more generously to buy votes later in the Parliament and win the election.
  The Chancellor's policy is simply the dreaming up of cynical excuses to justify the tax hikes, despite election promises, and make a political Budget sound as if it has a respectable economic purpose. In my opinion, that will sacrifice jobs and growth in the meantime.
  The sole purpose of a Government's economic policy should be to create the stability that enables jobs to be created, living standards to rise and the British economy to become one of the most successful and efficient in the western world. The legacy that the Labour Government were given gave them every ability to do that, in the national interest. The party that has taken power puts politics before the national interest. Only a day after the Budget, it is not very popular. The true costs will be felt by the British public in the next two, three or four years. We have to bring that home to the British public.
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  Mr. James Plaskitt: Thank you, Mr. Deputy Speaker, for giving me the opportunity to make my maiden speech in this debate. It allows me to confirm, especially for the benefit of the right hon. and learned Member for Rushcliffe (Mr. Clarke), that the Budget measures introduced by my right hon. Friend the Chancellor are welcomed throughout the constituency of Warwick and Leamington, which I have the honour to represent.
  I have illustrious, not to mention knighted, predecessors. From 1924 until shortly after the Suez crisis, the constituency that I now represent was held by Captain, later Sir, Anthony Eden, who became a Conservative Prime Minister. My immediate predecessor, who served the constituency from 1968 until the last general election, was Mr., and later Sir, Dudley Smith. I am beginning to wonder whether my constituents think that it is a prerequisite that their Member of Parliament be knighted, judging by the number of letters that I receive addressed "Dear Sir James".
  I have had the opportunity to look back at the maiden speeches of my illustrious predecessors. I note that they were all made during debates on historic issues of the time. Sir Anthony Eden's maiden speech urged the then Labour Government to embark on a programme of rearmament. Sir Dudley Smith's maiden speech urged

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  the then Labour Government to toughen immigration restrictions. I am glad that I have the opportunity to maintain the tradition of Warwick and Leamington Members making their maiden speech in historic debates and addressing Labour Governments. I am delighted that I can set a precedent, because I can speak to a Labour Government from the Labour Back Benches.
  I am somewhat surprised, looking back to my predecessors' maiden speeches of 1924 and 1968, that neither of them told the House anything about the constituency. So much for that tradition. As right hon. and hon. Members have heard little or nothing about Warwick and Leamington for 75 years, I think the House should receive a quick briefing.
  There are many attractive features to my constituency. Warwick is an historic town in its own right and possesses one of the most splendid mediaeval castles in England. Similarly, Leamington is an historic town. It possesses many fine buildings, including some of the best examples of Regency architecture to be found in the United Kingdom.
  The constituency incorporates many delightful Warwickshire villages. It includes, since the boundary revision, the attractive town of Henley-in-Arden. It is possibly the most prosperous part of the constituency but, interestingly, the only one to have approached the recent general election with any experience of Labour representation. It was formally part of the Stratford-on-Avon constituency, which was represented for a while, before 1 May, I am happy to say, by the Under-Secretary of State for Education and Employment, my hon. Friend the Member for Newport, East (Mr. Howarth), who was located a short while ago on the Government Front Bench.
  My constituency benefits from a substantial cultural diversity, reflecting settlement into the area that began 30 or 40 years ago. It is a development from which the entire constituency benefits. I am pleased to say that we regularly celebrate the cultural diversity of our community. The efforts of many voluntary organisations and local authorities have ensured generally harmonious relations between the various communities. There is, however, a considerable caseload of immigration appeals as families in my constituency wrestle with various regulations.
  I am happy to pay full tribute to my immediate predecessor for his tireless work on behalf of many of my constituents who were, or are, caught by immigration regulations. Things have already been made easier, I am glad to say, by the welcome abolition of the primary purpose rule announced by the Government.
  Leamington Spa, for the past two years, has been designated in surveys as the most profitable town in England in which to do business. There are many thriving small businesses and many large employers, many of which are concerned with the car industry, such as Ford, Volvo and Automotive Products. We also have communications and technology-based companies such as IBM.
  Thriving though these businesses are, they have concerns about the future. They were looking to my right hon. Friend the Chancellor of the Exchequer to bring forward certain measures to address their concerns. I am happy to say that their concerns have been met.
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  First among the concerns frequently expressed to me are those that relate to employment constraints, especially the shortage of skilled young people. Manufacturing employers tell me that it is often difficult to fill apprenticeship places. The fact that the manufacturing sector has spent so many years in decline has damaged the image of that sector for many young people. That is something that we shall need to remedy in years to come. I believe that we shall do so as we begin the vital task of rebuilding such an important part of the economy.
  Despite apprenticeships, hundreds of young people in my constituency are out of work. Measures to create education, training and employment opportunities for 18 to 25-year-olds will be welcomed both by young people and by local businesses.
  A second area of concern to businesses in my constituency is the exchange rate. Many firms export a substantial proportion of their output. They have been concerned about the recent 18 per cent. appreciation of sterling and the difficulties that that creates for winning and holding export markets in a global economy. Companies in my constituency may still be concerned to some extent that perhaps not enough has yet been done to restrain the appreciation of sterling.
  If, as my right hon. Friend the Chancellor of the Exchequer judges—I think that he is right—the output gap has probably closed, it is important to dampen domestic consumption in the short term until my right hon. Friend's welcome measures to promote investment and expand the productive sector of the economy begin to bear fruit in the longer term.
  If we rely primarily on monetary policy to do the job, there could be an appreciable further rise in sterling. The impact on our exporting manufacturing sector would not be welcome. Nevertheless, it will warmly welcome the fact that the Government have a commitment to fiscal rectitude and to a five-year deficit reduction programme. That will minimise the risk of higher long-term interest rates, which will combine with the welcome tax incentives in the Budget to stimulate investment. Progress towards a fiscal balance in line with the golden rule of my right hon. Friend the Chancellor of the Exchequer will in itself be a stimulus to business.
  The third and final area of concern of local businesses in my constituency is the European Union. Companies in the constituency have had anxieties about relationships with the EU for some time, although I think chat they began to ease after 1 May. The companies of which I speak urge a constructive approach towards membership of the EU. They urge also completion of the internal market. They fear nothing from inclusion in the social chapter. That being so, they have every reason to welcome the support of business that has come already from the changes that the Government have brought about.
  All the aspects of the Budget to which I have referred are welcome to the business community in my constituency. There are also other sections of the community, however, that will welcome my right hon. Friend's measures. At the same time as we enjoy a good business base, we experience also many of the results of past economic mismanagement. Too many families are living in hopelessly inadequate accommodation. In Royal Leamington Spa, for example, people are sleeping rough on the streets. There have been 100 this year so far. Also in Royal Leamington Spa, we have a daily soup kitchen, which is run by dedicated volunteers.

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  Tackling the housing crisis is an urgent imperative. The decision to begin the phased relief of capital receipts will be most welcome, as will other measures in the Budget to bring general stability to the housing market as a whole.
  There are too many families caught in a welfare and poverty trap, and especially single parents who are anxious and willing to work but unable to find work that will pay in relation to benefit income. The decision to embark on a general review and begin to create a modern welfare system incorporating a child-care strategy will be most welcome.
  In my constituency, there are no fewer than 19,000 pensioners, many of whom live in straitened financial circumstances. They will especially welcome the direct help that they will receive with the coming winter's fuel bills. I hope that my right hon. Friend will be able to do more for such an important section of the community in future Budgets.
  The schools in my constituency are doing an outstanding job but under intense financial pressure. There are still some hopelessly inadequate buildings. These schools will raise a chorus of approval for the measures announced yesterday that will in due course bring urgently needed additional resources for classrooms and for children. I hope that this benefit will not be cancelled out by my right hon. Friend the Secretary of State for the Environment, Transport and the Regions as he considers Warwickshire's case for redetermination.
  I reluctantly accept my right hon. Friend's announcement that local authority capping will apply again next year. It remains, as it always was, a fundamentally undemocratic practice, and it undermines meaningful local democracy. We are, of course, rightly committed to its removal. I hope that next year will be the last year of capping, and that thereafter we can begin the process of restoring vitality to local government and of seeing further improvements in important local services.
  As I said earlier, my predecessors made their maiden speeches in historic debates. I am glad that I have been afforded the same opportunity. The Budget sets the course for sustainable growth, low inflation, stronger investment, fair taxation and decently funded public services. That is what the people of Warwick and Leamington voted for on 1 May. That is why they sent me here. I will be able to support the Budget, on these measures, confident that we have begun the task. I commend it to the House.
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  Mr. Don Foster: I am sure that the whole House would wish to pay tribute to the hon. Member for Warwick and Leamington (Mr. Plaskitt) for an excellent maiden speech. I have no doubt that the House appreciated his tribute to his predecessor, Sir Dudley Smith, and to his work for individual constituents.
  I have no doubt that the House has suffered, almost in silence, for 75 years from not having heard more details about the hon. Gentleman's constituency. Not only were we grateful to have heard more about it; no doubt his constituents were, too. That may ease his passage to the knighthood that he so clearly craves.
  I suspect that there will not be uniform agreement in the House about the hon. Gentleman's comments on the undemocratic nature of local government capping. Liberal
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  Democrat Members entirely agree with him and feel it a great pity that other hon. Members on the Government Benches do not seem, at the present time at least, to support his view.
  The hon. Gentleman referred to his concern for schools. I shall pick up on one or two of the points that he made, because I share his concern about the situation in our schools and fear that the Budget will not offer the comfort that he currently believes is contained within it.
  Yesterday, my right hon. Friend the Member for Yeovil (Mr. Ashdown) made it clear that the Liberal Democrats believe that there are some good elements in the Budget, but we do not believe that, when taken together with the many aspects of the Budget, with which we fundamentally disagree, they can lead us to support it. Therefore, as my right hon. Friend made very clear yesterday, we will not support it. We believe that the Budget is rather like the proverbial curate's egg—good in parts. Some of those good bits offer jam tomorrow, but frankly there is precious little of it, as I shall demonstrate shortly.
  The right hon. and learned Member for Rushcliffe (Mr. Clarke), in an excellent speech that the House will have thoroughly enjoyed if not entirely agreed with, made it clear that the more one analyses the content of this Budget the more one will see that it will not deliver what the Chancellor, in his hype, suggested it would deliver. Indeed, it is probably fair to say the Budget is more of a triumph for the spin doctors than for the British people.
  As the former Chancellor said, the British people will certainly be hit by higher taxes. There is nothing intrinsically wrong with higher taxes. Indeed, my party has been clear and consistent on the issue. We have long argued for increased taxes, and have said very clearly what those increases should be. We have said clearly that they should come through the fair, open and honest form of taxation—income tax. We have made very clear what we would use the revenue from an increase in income tax to fund.
  The Liberal Democrats have also made it very clear that we would have had a different Budget. Our proposals to increase carbon tax while reducing employers' national insurance contributions would have meant a switch away from things that are bad, such as pollution, to things that are good, such as creating employment.
  Sadly, that is not what the Chancellor did in his Budget. He has certainly raised taxes. It is estimated that the average taxpayer will have to pay an extra £234 per year—£1,100 extra during the course of the Labour Parliament. Those taxes have been raised not through fair taxation but through hidden taxes, which the Chancellor hoped that the public would not notice. We believe that such taxes are wrong. They will not stop interest rates from rising, because they will not cool the consumer boom. Nor will they, in many cases, help businesses.
  The Institute of Fiscal Studies has today analysed the Budget and argues that the net effect of the various tax measures will be a £3 billion tax increase on businesses. Because the consumer boom is not being tackled, businesses will face high exchange rates, which affect exports, and the very real likelihood of higher interest rates. In other words, the Budget is offering a triple whammy to businesses in this country.
  The extra taxes that are being raised are also wrong, because they are not being used to improve our essential public services. What warning were we given for the taxes

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  that are in the Budget? What reference was made to them in the lead-up to the Budget? Indeed, what reference was made in the Labour party's election manifesto to a tax on pensions?
  The current Chancellor of the Exchequer must believe that it is right for political parties to make clear in advance their taxation plans, because, after the Lamont tax-raising Budget of March 1993, following the 1992 general election, he said:
  "If he cannot point out the section of the election manifesto which warned of increased tax rises for the ordinary voter … he should be ashamed of himself."—[Official Report, 17 March 1993; Vol. 221, c. 291.]
  I believe that the current Chancellor should be ashamed of himself, because he has introduced taxes of which no warning was given in the Labour party election manifesto. He has betrayed the very spirit of the Labour party's promises on taxation. It is also clear that he has betrayed the Government's promise on education. "Education, education, education," said the Prime Minister in the lead-up to the election. But has this Budget really delivered for education? There is no doubt whatever that it has delivered more than many people expected, or could even remotely have expected.
  After all, despite repeated questions from my right hon. Friend the leader of the Liberal Democrats, from me and from many of my parliamentary colleagues, we were told categorically, time after time, that individual departmental spending ceilings would not be breached. Yet there has been a significant U-turn by the Government in a very short time. In the two keys areas of health and education, the departmental ceilings are to be broken. It is a U-turn, but I congratulate the Secretary of State for Education and Employment on persuading the Chancellor to break the clear commitment that they gave only a few days ago.
  The Chancellor announced an extra £1 billion for education—taken, incidentally, from the contingency reserve. One might argue that that will leave them in a rather parlous state and perhaps unable to sustain the pressures that may well come because of the pressures on many other public service areas. He implied that it is only a one-off increase in spending, a one-off payment into education. Even given that, one could argue that something is better than nothing, but the real question is whether it will be enough. One thing that is clear is that it will do nothing to help this year. It will do nothing to help resolve the crisis that exists in our schools at present. Class sizes will continue to rise. Already one in three primary pupils are in classes of 30 or more. I wonder how that figure will look in a year's time.
  Were he in his place, the Secretary of State would no doubt intervene to say that the Government are doing something; that they will reduce class sizes by the transfer of money from the assisted places scheme for children aged five, six and seven to maintain the pledge, that they gave to the British people.
  But it is worth reflecting that, from the figures that we now have of the amount of money which, in the forthcoming year, will be transferred from the assisted places scheme, that amounts to the equivalent of 1p per pupil per day. It is simply not enough. I have consistently said that it is not enough to deliver that election pledge, but the Government have consistently said that I am wrong.
  The story has now broken. Only yesterday, the Minister for Education and Industry, Scottish Office, the hon. Member for Cunninghame, North (Mr. Wilson), also
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  acknowledged that there will be insufficient money from the assisted places scheme to ensure that the Government meet their commitment on class size. That was plastered all over the Scottish press. Class sizes will continue to rise.
  Similarly, the Secretary of State referred to the 600 primary schools with outside loos. They will continue with outside loos for at least the next 12 months. He referred to the 25,000 temporary classrooms. For the next year at least, there will continue to be 25,000 temporary classrooms. Buildings will continue to crumble, and roofs, as the right hon. Gentleman said, will continue to leak. There is nothing in the Budget for education this year. Therefore, there is no comfort for the hon. Member for Merthyr Tydfil and Rhymney (Mr. Rowlands) who, only three weeks ago, addressing members of the Government Front Bench, said:
  "Ministers must address the crisis facing primary schools now".—[Official Report, 10 June 1997; Vol. 295, c. 957.]
  Ministers have failed to deliver for the hon. Gentleman.
  But if there is no jam today, what of the jam for tomorrow? We are told that there will be £1 billion extra for schools. It sounds like pennies from heaven until we start to analyse the reality. Put simply, it goes like this. First, there is no extra money for further education, at a time when, under the previous Government's Budget, the money for further education was to be cut. That means that there will be further cuts in further education. Secondly, there is no additional money for higher education. That means that there will be further cuts in the higher education sector.
  Yesterday the Chancellor announced that he was increasing the inflation targets for the current year and the next financial year and that, in turn, he was therefore increasing the GDP deflators, in both cases from 2 per cent. to 2.75 per cent. Taking those two years and that increase together, it will cost somewhere in the region of £500 million to meet that increased cost of inflation to the education sector. Therefore, the amount of money that is now left of the £1 billion to spend on any improvements is only £500 million.
  But then the Chancellor announced his taxes that will hit pensions. They will hit the local authority pension schemes as well, and the local authorities will have to find the money to replace the money that is lost. That too will reduce the amount left from the £1 billion.
  We now have a situation where the increased money that is available in real terms is less than £500 million. Yet if we go to the local education authorities and ask them simply how much money they need to stand still to take account of the continuing overhang of the second half of the teachers' pay award, changes in legislation on school transport and seatbelt rules and, in particular, the increased number of pupils that there will be in our schools, they will tell us that in England alone they need well over £500 million, so in the Kingdom as a whole they will need even more than that.
  The net effect of all that is that the £1 billion on offer for next year—not for this year; there is nothing for this year—will not even be sufficient to allow our education service to stand still. As a result of the Budget announced yesterday, there will be further cuts in our schools. Therefore, as I said, jam tomorrow but not very much of it.

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  That, sadly, is true in so many other areas of the Budget. The hype was impressive. For example, we are told that £150 million will come each year from the mid-week lottery to help child care. We are also told that £200 million will come from the windfall tax over the lifetime of the Parliament. That amounts, roughly speaking, to £200 million a year.
  If that is the case, and if we accept that there are about 1 million lone parents each with two children, that £200 million a year amounts to the staggering sum of £2 per week per child. Frankly, one cannot buy much child care with that. Not widely reported is the fact that the new Government are continuing the plans of the previous Tory Government and freezing benefits to lone parents, so that the extra available is effectively wiped out.
  The Government may say that that may be true but, nevertheless, they are extending the child care disregard, uprating it from £60 a week to £100 a week, so they are doing something. However, if one looks at the figures, one sees that only one in 20 of lone parents entitled to family credit currently benefit from the existing child care disregard, so the chances of more being helped by the uprating are slim. Let the House not forget that the increased disregard is available only to those lone parents with more than one child. It is no wonder that the so-called bonanza is reckoned to cost the Treasury only £10 million.
  We are now told that there is to be a national child care strategy, but we have to ask what that strategy is. If there is some extra, however small, for child care, for education and health—although we must reduce the increase for health because of the impact of the increased GDP deflator and the abolition of tax relief on private medical premiums—there is no additional money for other vital public services such as the police and social services. As the right hon. and learned Member for Rushcliffe said, the present Government are accepting for those services the spending targets and limits that he set for them, so there is no extra. Yet they will now have to face the increased pressure of that rise in the GDP deflator.
  Therefore, it must be questioned whether that extra money for education can, in any shape or form, be ring-fenced or whether it will end up propping up the equally vulnerable services. The overall picture for our public services does not look rosy.
  Only today, the Institute of Fiscal Studies, in the briefing to which I referred earlier, looked at the three scenarios for public finances that are offered in the new Red Book. Its analysis, if I understood it correctly, shows that, even taking the most optimistic estimate of growth in public spending, when the new Government's plans are compared with the historic position of the previous Government there would, in the last year of the Parliament, be a cut in public service spending of £15 billion. In other words, according the IFS, Labour will spend £15 billion less on public services, on its current plans, than might have been expected to be spent by the Tories in the last year of this new Parliament.
  The centrepiece of the Budget—the part that we heard most about from the Secretary of State today—is the welfare-to-work programme, paid for by the windfall tax. My party fully supports the principle of welfare to work,
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  and we offer to support the Government in any way that we can when they introduce the measure. Getting people off benefits and into work must be the right way forward; we applaud the new Government for making a start.
  We would not have gone about it in quite the same way. We would have helped to boost job creation by cutting employers' national insurance contributions, which are a tax on jobs. We would initially have targeted the additional help on the parts of the country with the worst unemployment. We would have given a greater boost to child care provision. Additionally, we would have tackled the root cause of unemployment by significantly increasing—far more than the Government have—investment in education, especially in schools and nurseries.
  Generally, however, we welcome the Government's moves and will do what we can to support them. We believe that they offer real hope to many of the young people who feel that there is no hope. But we must record a severe reservation about the compulsory aspects of the scheme. I am grateful for today's assurance from the Secretary of State that, during the adjudication process or an appeal, someone who chooses not to take up any of the options will still be able to receive benefit. But the vast majority of people who are out of work clearly want to be in work or to take up training opportunities that will improve their employability. So we see no need for a compulsory element to the scheme; indeed, we perceive several dangers in it.
  I hope that, when the Financial Secretary replies to the debate she will assure the House that the Government will publish in full the results of the proposed pilots and include in any review of those pilots details of what happened to people whose benefits were cut because they failed to join one or other of the elements of the package.
  We certainly do not support the Government's way of funding the welfare-to-work scheme, however. We fundamentally oppose the windfall tax, which is unfair and retrospective. Nor will it hit its intended target: the fat cats. It will hit ordinary people such as pensioners, those who hold endowment mortgages, and many others. It will hit many people who gained nothing when the immediate gains were made just after the utilities were privatised. The House will have noted from the Secretary of State's speech today that he accepts that it is a retrospective tax. He made it clear that he was referring to the taxation of profits made in the past.
  An analysis of shareholding revealingly shows that the tax will not hit the fat cats. In my area's water company, Wessex Water, immediately after privatisation there were 186,000 small shareholders. Within two months, that had fallen to 124,000. It now stands at only 60,000—in other words, most of the fat cats have gone. Only 15 per cent. of the shares of Wessex Water are owned by individuals; all the rest are held by institutions which, as might be expected, have moved in and out of Wessex shares over the years.
  We cannot support a Budget that contains measures with which we fundamentally disagree. We cannot support a Budget that uses backdoor tax rises instead of the fairer, more honest approach of income tax rises. We cannot support a Budget that does little more than ensure a standstill for health and education. The country deserves more than standstill: it deserves to move forward. We should have preferred a Budget that achieved that, which is why we shall not support this one.
  6.24 pm
  Mr. David Borrow: I begin by thanking the voters of South Ribble for showing their confidence in the Labour party by electing me to represent them on 1 May. I find myself in this Chamber because of a cruel twist of fate. In January 1996, the Labour party in South Ribble selected Dennis Golden as the candidate. In January 1997, ill health forced him to resign as the Labour candidate. Thus, not only did he fail to achieve his lifelong ambition of representing the constituency in which he lived; he also failed to live long enough to see the election of the Labour Government. I am therefore conscious that I arrived here in tragic circumstances.
  Dennis lived in Leyland and held a county council seat there. He served as chair of the highways committee on Lancashire county council. He was a tireless worker for the people of Leyland. He worked at Leyland Motors, the heart of the town, and was a pillar of the engineering union. During the election campaign, many members of that union from across the constituency told me little tales of how Dennis had helped them. I am glad to pay this tribute to a fine socialist.
  I was gratified to learn while in my constituency last week that the local authority has agreed to name a road there after Dennis Golden—a fitting tribute to the chair of the highways committee of Lancashire county council, a post he still held on the day he died.
  The constituency was created in 1983, when it shared the boundaries of South Ribble borough council. Between 1983 and this year's election, it was represented by Robert Atkins, who became my Member of Parliament when he was elected, by 20 votes, to represent Preston, North in 1979. Ron Atkins, the defeated Labour candidate, remains a good friend of mine and continues to serve on Preston borough council as chair of the planning committee. I have spoken to him since the election. The election of a Labour Government gave him great pleasure, and he was particularly pleased that his daughter, Charlotte, has been returned as the hon. Member for Staffordshire, Moorlands (Ms Atkins).
  Robert Atkins had a reputation in the constituency as an assiduous dealer with correspondence. His reputation owed a great deal to his wife, Dulcie, who ran the constituency office and whose personal manner with constituents was often praised during the election campaign. Robert served as a Minister in several Departments, including the Northern Ireland Office and the Department of the Environment. He also took a particular delight in being the Minister for Sport—like the right hon. Member for Huntingdon (Mr. Major), he loves cricket. I am sure that he will now have more time to devote to the cricket at Lord's.
  I also pay tribute to my hon. Friend the Member for West Lancashire (Mr. Pickthall), four of whose wards were transferred to South Ribble in the boundary changes. He gave me a great deal of help before and after 1 May, for which I give him these public thanks.
  My constituency can be divided into three distinct parts. The principal town is Leyland, an old manufacturing town which has traditionally depended on the commercial vehicle industry. The forerunner of Leyland Motors was founded in Towngate, which is in Leyland, in 1896. When I first moved to central Lancashire in the mid-1970s, Leyland was a thriving town to which thousands of people
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  travelled by bus and train each day to make buses and trucks. It is a tragedy that, over the past 18 years, so much of that industry has gone.
  I pay tribute to the work of Lancashire Enterprises and Lancashire county council in rescuing Leyland DAF in 1993. I was pleased to have the opportunity, on Wednesday last week, to welcome the Prince of Wales to Leyland Trucks so that he could see the company that had been born out of the ashes. It is expanding, taking on more staff and investing heavily in new trucks and new ideas.
  The second chunk of my constituency is best described as the southern suburbs of Preston, lying to the south of the River Ribble. As a former leader of Preston borough council, to the north of the river, I well remember many of the communities in the area participating in the Preston guild celebrations of 1992.
  The remaining part of the constituency contains about a dozen small rural villages stretching between Preston and Southport. They are partly commuter villages, but, in many respects, they are agricultural, specialising in horticulture and market gardening. There is also a good deal of poultry breeding. As the new Member of Parliament for South Ribble, and as a confirmed townie, I found it particularly interesting to meet and talk to farmers in the constituency.
  It is customary in maiden speeches to mention figures from the past who have served in all or part of one's constituency. Leyland, in my constituency, used to be part of the Chorley constituency. I was very pleased when George Rodgers, the former Member of Parliament for Chorley, spent several days working for my election campaign, and I know that he was pleased when the result was announced.
  I want to mention another former Member of Parliament for part of my constituency. Until recently, I did not realise that he had represented it. As a Yorkshireman, born in Huddersfield, I was interested to find that, 50 years ago, Ormskirk had been represented by another Yorkshireman born in Huddersfield, the late Lord Wilson.
  The Budget should be judged on the basis of two sets of criteria. The first relates to the Government's policy objectives and priorities. Those will not necessarily be shared by the Opposition parties, but Labour Members must assess the Budget according to how far it goes towards meeting them. That is part of the test that we must apply.
  The second set of criteria involves the extent to which the fiscal and monetary policy in the Budget creates stability and eases the excesses of the business cycle. Obviously, exchange rates and interest rates are a particularly important aspect of that. In any Budget debate, those two factors can sometimes work in opposite directions.
  Let me deal first with the policy priorities and objectives. I remember visiting Leyland in 1975 and seeing a thriving town. Many people worked in manufacturing industry, and school leavers could walk into apprenticeships. My generation, brought up in the 1960s and early 1970s, could not only expect to be better off than our parents, but could look forward with some optimism to a secure future. By and large, our expectations were justified, but the young men and women in my constituency today do not enjoy the same

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  sense of security. They do not believe that they will experience better living standards than their parents or that their jobs and futures will be more secure.
  One of the tragedies of the past 18 years is the fact that work has become less secure. So many jobs are part-time, casual or fixed-term, and so many jobs are low-paid. A social tragedy and a growing problem in society is that while, at the age of 16 or 17, members of my generation could expect to settle down, establish homes and start thinking about raising the next generation at 28 or 29, that is no longer a prospect for all too many youngsters in their late teens and early twenties. We should not be surprised by the violence, drugs offences and other crime that we now see—all the social problems that blossomed during the years of the Tory Government.
  The key measure in the Budget is the welfare-to-work proposal, which goes to the heart of what I see as the basic problem in society. That proposal begins to give the generation to which I refer some hope of secure employment and of security in later life. It will be particularly effective when combined with legislation to establish a minimum wage.
  All too many youngsters are paid such poor wages that they have no prospect of leaving home, settling down and bringing up a family—and we wonder why they feel that they are not part of society and why there is social breakdown. Unleashing market forces produces winners and losers. We have seen the salaries of the winners, and we have seen the social consequences for the losers. Combining welfare-to-work measures with legislation for a minimum wage will constitute a crucial first step towards stabilising our society.
  I was interested to hear the Chancellor's proposals for the release of capital receipts, which will improve—albeit only marginally—not only employment among building workers, but the prospects of people in poor housing or no housing at all. That, too, is a useful step in the right policy direction.
  If I am asked whether the Budget meets my Government's policy priorities and objectives, I will say that it does. It meets the policy priorities and objectives of the people who voted for me on 1 May.
  Will the fiscal and monetary policies produce stability and cushion the excesses of the business cycle? There have been contradictory comments by Opposition Members. The figures given by the Chancellor yesterday show that, in the current financial year, £6 billion is being taken out of the economy by the reduction in the public sector borrowing requirement. A similar amount is proposed for 1998–99.
  Classic economic theory has it that a rise in interest rates and a rise in the value of the pound are linked to excessive demand in the economy with which the economy is not structurally strong enough to deal. Therefore, it seems sensible to take some of that demand out of the economy. We can argue about whether it has been taken out in the right way, but the policy seems to be heading in the right direction. It is strange that Opposition Members are not prepared to admit that some demand needs to be taken out of the economy.
  It is a pity that the right hon. and learned Member for Rushcliffe (Mr. Clarke) has left the Chamber. It has puzzled me for 12 to 18 months that insurance and
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  housing finance companies have acted as if they were printing money and have put extra spending power into the economy in an uncontrolled way. The Treasury and the Government have to pick up the pieces as a result of those private decisions to print money, but there was remarkably little debate on such issues before the election. That increase in money which is about to circulate in the economy has had a significant effect on the Budget.
  I have tried to keep my speech as uncontroversial as possible. I commend the Budget to the House and look forward to its provisions being implemented and well received in my constituency.
  6.42 pm
  Mr. Archie Norman: Thank you, Mr. Deputy Speaker, for this opportunity to make my maiden speech on the important subject of the Budget. I congratulate Labour Members who have made their maiden speeches today and welcome their interest in the businesses in their constituencies, especially the highly profitable ones in Leamington Spa. I share their interest and that of the Chancellor in the business community, but perhaps in a more substantial way. I should declare that I am chairman of Asda—the largest private sector employer based in the north of England—a director of Railtrack and a former director of British Rail. That establishes my public sector credentials as well.
  I have tried to speak in the Chamber in previous debates, and I think this is about my 11th hour of taking assiduous notes. I have listened to many excellent maiden speeches and, as a result, my geography has been much improved. On this occasion, I do not intend to give the House a guided tour of my constituency, but I should like to speak about my predecessor, Sir Patrick Mayhew, who is now Lord Mayhew of Twysden.
  It is not difficult to pay tribute to Lord Mayhew. He was a distinguished Attorney-General and his contribution as Secretary of State for Northern Ireland was remarkable. He undertook the role with an open mind, great objectivity, integrity, enthusiasm and relish, and he brought the prospect of lasting peace in Northern Ireland closer than at any time in the previous two decades. In the constituency and in the House. Sir Patrick was, in all respects, larger than life. He succeeded in making a contribution which was in many ways beyond politics. His halo still shines brightly in Tunbridge Wells and, as I am constantly reminded, he leaves large shoes to fill.
  Mine is a delightful constituency, situated in Kent in the heart of England. Its focal point is Royal Tunbridge Wells, a spa town which was famous in the 18th century for its royal visitors who, I suspect, were able to get there rather more quickly than today's commuters. It has two major public finance initiative projects which are important to the local community and which were supported by the Conservative Government. The first is the long-awaited dualling of the A21, which is the main arterial route from London to Hastings. The second is a desperately needed new hospital because the Kent and Sussex hospital is divided into two parts and has outdated facilities. A PFI project for a new hospital is at an advanced stage.
  Regrettably, both projects have been called in for one of the new Government's ubiquitous reviews. That means that, within two months of the election, my constituents

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  fear that they may have to pay a steep price for a Labour Government. I hope that those fears are unjustified. The people of Tunbridge Wells are famous, apart from anything else, for the forthright expression of their views in national newspapers. They are vigorous letter writers, as the Minister will find out before long if our transport and health projects are not approved.
  My warning may be a little too late for the Chancellor. He will hear from many home owners in Tunbridge Wells and especially from those whose incomes are less than £15,000 a year. The majority of those who benefit from MIRAS are in that income range, and their incomes have been cut as a result of the Chancellor's action.
  Many of my constituents are retired or saving for retirement and their pension funds will be hit by the changes to advance corporation tax. The abolition of tax relief on private medical insurance affects many of my constituents who are in nursing homes and many people in the insurance industry. It is short-sighted, mean-spirited and economically insignificant and can only add to the pressure on the health service. It is greatly regretted by my constituents. My ambition is to rebrand my constituents "Contented from Tunbridge Wells", but I fear that the Government have done little in their first few months to help me to achieve that aim.
  Two of the Chancellor's main themes were business and employment. Unlike many Labour Members, I believe that experience in business, enterprise and industry is good for the Government and for the House. I am proud of my record in business and of the companies that I served. I welcome the Chancellor's intention to be business-friendly, and I also welcome the promotion of people with business experience to the Government. The appointment of the Paymaster General and of David Simon, the former chairman of British Petroleum, are a welcome recognition of the contribution that business can make to the policy and process of government. I am glad to see that my friend Howard Davies has been given a leading role in the Securities and Investments Board. It is good to see a former McKinsey man in gainful employment in public services. Hopefully, he will not be the last.
  It was reported at the weekend in, I think, The Sunday Times that Martin Taylor had turned down a ministerial job. Of course, BP and Barclays are among Britain's 10 largest companies: Asda is about the 50th. Perhaps as the Chancellor works his way down the list I will eventually receive a call. My badge from my shopkeeping days reads, "Happy to help", which has always been my motto, but, of course, I cannot be certain that my help would be the sort that the Chancellor has in mind.
  It is not long since the Secretary of State for Health described people like me as
  "stinking, thieving, lousy, incompetent scum.
  Even as I read the words I find them amazing. One of the great strengths of the House is that hon. Members are able to speak freely, and the right hon. Gentleman is entitled to his view, but I hope that there is a little truth in the last part of his epithet because my dictionary defines scum as
  "matter which rises to the top in an otherwise murky liquid."
  The right hon. Gentleman's words were, in the main, different from the more honeyed prose that we have heard from the Labour party in the past two years. Its business manifesto states that a Labour Government would create
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  "a dynamic and supportive environment in which business can prosper and thrive."
  We hope that they will succeed in that endeavour, although it will be hard to better the achievement of the Conservative Government in the past 18 years, during which period there has been a comprehensive managerial revolution in the way in which we manage and employ people, create success and invite investment into the United Kingdom. To date, the words from the Government have been friendly, but the substance, I fear, has been increasingly hostile.
  The Chancellor said that this is a Budget for investment and to secure our future. Business people are, in the main, practical, and we will wonder quite what he means. Our economy's future depends on competitiveness and profit and, so far, the balance sheet does not look too good. To start with, business people will wonder whether it is logical for a Government, who make much of the need for investment in infrastructure, transport and the waterworks, to reduce the prospect of further investment with a windfall tax.
  The Chancellor said that the tax will not affect investment, employment or the cost of services. In fact, it clearly will. It takes investment cash from those companies, and it defies belief to suppose that obliging utilities to gear up and take on more debt will have no effect on investment. Surely we are all financially literate enough in this day and age to understand that taxing more means investing less. Stage two, we fear, may be regulation to force the investment, which the Government have made less attractive, by other means.
  Business people will wonder also where the logic is in Labour's plans for the proceeds of the tax. They are to be used, apparently, to subsidise wages to create temporary jobs, but permanent jobs will be threatened as wage costs will be driven up with the introduction of a minimum wage. Those of us with experience of employing people and of being employed do not need to be the principal of the London business school to know that a minimum wage will mean fewer jobs. It will hit the most vulnerable people in society—in many respects, those whom the welfare-to-work programme is supposed to help, including the unskilled in particular, the handicapped, the young, the old and, yes, single mothers who work part time.
  There is a piece of hypocrisy floating around that the minimum wage is a form of competitiveness—that it will even up the competitive field between employers who exploit employees by paying less and those who do not. The reality is that big business will not be affected by the minimum wage, but small business will. The companies affected will not be large and profitable; they will be the corner shop, the local pub, the small hairdresser and those that we need to support most.
  Business people will wonder also how opting into the social chapter will help our competitiveness. I was curious and interested to hear the hon. Member for Warwick and Leamington (Mr. Plaskitt) say that businesses in Leamington Spa were not concerned. That is not my experience. Many small businesses throughout the UK are in favour of a free-trading Europe, but wholly opposed to further regulation in the form of the social chapter. New regulations in the form of works councils, supervisory boards and paternity requirements can bring us only closer to a European model of inflexibility and ossification.

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  Business people will wonder also how taxing pension contributions by limiting tax relief on advance corporation tax can do other than raise the cost of employment. It is irrelevant for the Chancellor to justify that measure by claiming, as he did yesterday:
  "Many pension funds are in substantial surplus".—[Official Report, 2 July 1997; Vol. 297, c. 306.]
  If they are in surplus, that is a consequence of the funds that have been injected and of their investment performance. Those companies with surplus funds are taking advantage of that by improving their profits through a pension holiday. By definition, eliminating the scope for pension holidays means reducing those profits. It follows that, if those pension funds are in deficit in future, the money to fund them will have to come out of corporate profits. The £5.4 billion that this measure will raise has to come from somewhere. The cost of the Budget is in company profits and individual savings. That is corporation tax by another name for companies and a savings tax by another name for pensions.
  It would be churlish of me not to welcome the cut in corporation tax, particularly for small businesses, many of which will benefit in my constituency, but the balance sheet for businesses in the first eight weeks of this Government is in the red—a small cut in their tax bill for a large slice of their pensions and a large increase in pension contributions.
  After this Budget, business people will ask whether we have a Government who mean what they say about business, or a Government for whom business was simply a nice idea and who simply said what the electorate hoped they would. The Chancellor's grand words about investment and long-termism belie a fundamental shift in Government tone and policy—a shift towards a belief that it is Governments who create jobs and shape the economy. The question that business people will be asking is whether new Labour means a new form of socialism—not the ownership socialism of the past, but the regulatory socialism of continental Europe.
  The assumption behind the Budget appears to be that the Government can engineer investment, whereas, in the business world, we know that subsidised investment is often the worst form of investment. The other assumption is that the Government can engineer and create jobs, whereas, in the business world, we know that subsidised jobs are often of the poorest quality and temporary.
  It is not my intention to be unreasonably contentious, The Chancellor's aspiration to improve competitiveness and long-termism is, of course, one which we share. It is the means that we contest. This Budget is not a people's Budget, as the people will have to pay more tax. It is not a Budget for competitiveness or for enterprise. It is a Budget of taxation to enable a Labour Government to pursue political policies that involve spending more of the "people's money" on their well-meaning, but perhaps ill-judged, projects.
  It is not a good Budget for business, for middle Britain or for my constituents in Tunbridge Wells. The business world is pragmatic, not ideological. Most business men operate in their commercial interests and in those of their shareholders and employees. We judge people by what they deliver, not by what they say. As far as we can, we call a spade a spade. Substance triumphs over style,
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  decisions over reviews, and we will hold the Chancellor to account for his promises. Today, the jury may still be out, but the first signs for business and enterprise are ominous—very ominous indeed.
  6.57 pm
  Ms Patricia Hewitt: Thank you, Mr. Deputy Speaker, for giving me this opportunity to make my maiden speech during the debate on the Budget. It has been a pleasure to listen to such fine maiden speeches this afternoon. I listened with interest to the speech of the hon. Member for Tunbridge Wells (Mr. Norman). Having spent many a pleasant weekend with friends in his constituency, I was sorry to hear that "Disgusted of Tunbridge Wells" remains disgusted. I hope that he will make good his offer to assist my right hon. Friend the Chancellor of the Exchequer by ensuring that Asda, the company with which he has had such a long association, participates enthusiastically in our welfare-to-work programme.
  This is, above all, a Budget for jobs and families, which is why it is being so warmly welcomed in the constituency that I have the honour to represent. I know that my pleasure in this Budget will be shared by my predecessor, Greville Janner, whom many right hon. and hon. Members will remember as an effective Chairman of the Select Committee on Employment.
  Greville Janner is remembered and known more widely for his lifelong opposition to racism in all its forms, for his distinguished presidency of the Board of Deputies of British Jews, for his sponsorship of the War Crimes Act 1991, and for his relentless pursuit of the secret repositories of Nazi stolen gold. In the constituency, however, he is remembered above all as an outstanding constituency Member of Parliament.
  I remember last year knocking on the door of one elderly woman, who told me most movingly how her grandson had died many years ago in a tragic accident swallowing the top of a biro pen, which, in those days, lacked the tiny hole that would have enabled him to breathe sufficiently to remain alive. It was Greville who led the successful campaign for that safety measure in product standards. It was that sort of campaigning on behalf of his constituents for which not only he but his father—his predecessor in this House—is remembered.
  Greville was one half of a unique father and son team, who between them represented my constituency for 52 years. Greville's father, who subsequently became Lord Janner, did not announce his decision to retire until after the 1970 general election had been called. Greville used to tell the story of his selection with great amusement. He claimed—I am sure quite wrongly—that he was assisted by the fact that the election posters, "Vote Labour, Vote Janner", had already been printed. I am sure that he would have been selected under any circumstances. He will no doubt forgive me if I say how grateful I am that his son decided not to follow in his footsteps.
  I also want to pay tribute to three other outstanding public servants who served my constituency. Councillor Paul Sood was one of the most outstanding fighters for the Asian community, not only in Leicester, but throughout the country. Tragically, he died last year, just a week after being re-elected to serve as the city councillor for Abbey ward in my constituency. It was an enormous loss, but I know how proud he would be to see his widow, Mrs. Manjula Sood, now serving in his place.

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  All of us in the constituency were sad to hear last month of the death of Councillor Martin Ryan, who for many years was leader of the Labour group on the county council. He served, among other capacities, as the county councillor for the Mowmacre ward in my constituency. Just two days ago, I was also extremely sorry to hear of the death of the former councillor, George Billington, who had only recently retired as my predecessor's parliamentary agent. I will do my best to live up to the extremely high standards of public service which they and my predecessors have set.
  I know that my hon. Friends the Members for Leicester, South (Mr. Marshall) and for Leicester, East (Mr. Vaz) will agree when I say that Leicester is a wonderful place in which to live and to learn. We are Europe's first Environment City. We are home to two first-rate universities. Many of their students, especially those at De Montfort, live within my constituency.
  Although it may distress some right hon. and hon. Members to acknowledge this, now that Leicester holds the triple crown of sporting achievements in football, rugby and cricket, we are indeed Britain's sporting capital. I am delighted to say that, now that the Millennium Commission has chosen the project for the national space science centre, to be sited within my constituency, as the landmark millennium project for the east midlands, we will shortly be the space capital as well.
  Leicester, West is a constituency of captivating variety. It stretches from the old industrial buildings along the banks of the River Soar and the Grand Union canal, which form part of the border of the constituency. It takes in a small part of the city's old mediaeval centre—although, less happily, we also take in some of the inner-city ring road, built in the 1960s with a distressing lack of sensitivity for that old mediaeval heritage. It extends down the Belgrave road, which marks the border between my constituency and that of my hon. Friend the Member for Leicester, East, where the red brick cottages of 19th century weavers are now the heart of Leicester's Asian community, and from there across to the new estate of Beaumont Leys and the longer-settled communities of Mowmacre, Stocking Farm, New Parks and North Braunstone.
  I know that residents, especially on those estates, will warmly welcome my right hon. Friend the Chancellor's announcement yesterday that he would rapidly begin the release of council house receipts, which will make possible desperately needed repairs and renovations to their homes.
  Above all, Leicester is rich in its people. We are well known, and rightly so, for our cultural and racial diversity. By the year 2000, half the young people of our city will come from the ethnic minority communities. Leicester is fortunate to be home to many thriving businesses and to a variety of churches, temples, gurdwaras and mosques that are at the heart of the communities they serve. It is home also to a number of theatres, festivals and arts performances from a variety of different traditions.
  Like many of my constituents, I am a citizen not only of this country, but of another—in my case, Australia. In this Parliament, I am the only Member also to be an Australian citizen. Like many of my constituents, I know what it is like to have families in two countries, so I know how much many families in my constituency warmly welcomed my right hon. Friend the Home Secretary's early decision to abolish the odious primary purpose rule.
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  I must mention also the parks and open spaces with which my constituency is so richly endowed. Perhaps suitably for Europe's first Environment City, Western park in my constituency is home to one of the country's leading green charities and consultancies, Environ, along with the flourishing city farm on Gorse Hill—both of which will, I hope, play a considerable role in creating the environmental task force within the east midlands.
  I regret to say, however, that our enjoyment of some of our open spaces is all too often spoiled by the arrival of unauthorised travellers, who themselves have too few authorised sites to which to turn. I hope that my right hon. Friend the Deputy Prime Minister will be sympathetic to the case that I will be making on behalf of my constituents for a badly needed review of the previous Government's law and practice in this area, which has proved so disastrous.
  Perhaps too often neglected in my constituency and others like it are the outer-city estates. Almost half of my constituents live on such estates. Listening to my right hon. Friend the Secretary of State this afternoon, I found myself thinking in particular of families struggling to bring up children in communities where anything up to one in four of working-age men are officially unemployed—and where, in reality, far more are out of work.
  Young men all too often turn to destructive or criminal activities, because no creative outlet is offered for their energy. Children are growing up, as one grandmother said to me in fury and frustration, to believe that the only way they can earn a living is to sign on for a giro.
  Those are the people whom the last Government locked into unemployment and poverty, and then derided as an underclass. The people I have the privilege to represent are no underclass. They want a chance of a job, a chance to earn a living, a chance to bring up their families decently, to live in safety and to retire with dignity. They want the same respect and opportunity' as other people. That is what the Budget will begin to give them.
  Listening to today's speech by my right hon. Friend, I thought of Betty, for example, who is a parent governor at Wycliffe community college, which is located on one of the estates in my constituency. Recently, Wycliffe community college was inspected by the Office for Standards in Education. One member of the inspection team asked Betty how the school coped with local parents and with families living on income support—"you know", he said, "with the underclass."
  Betty said, "I'm one of the people you're talking about." She told him, "I live on benefit—not because I want to, but because my husband lost his job and hasn't been able to get another one, and because we bought our council house, just as the last Government encouraged us to do. Now we find that the only way we can pay the mortgage is to stay on income support."
  Betty left school at age 15 with no qualifications, returned to school, through Wycliffe college, and got herself five O-levels, which in itself is no mean achievement. She would love to train and work as a classroom assistant, and that school would love to give her the job. She cannot take such a job, however, for the simple reason that, as things stand, her family would no longer be able to afford their mortgage. It is such poverty traps, which were created by the previous Administration, that force families such as Betty's to choose between the job they need and the home in which they live.

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  I know how much Betty's family and families in a similar position will welcome the announcements made in the Budget, and today by my right hon. Friend the Secretary of State, about the Government's welfare-to-work programme and their longer-term objective of creating a benefit system that will at long last reward rather than penalise hard work and effort.
  I thought also of Bill, who is a manager at one of the employment projects on a local estate. Bill was a construction worker—a roofer—until he was injured in a fall from the roof on which he was working. He now says, however, that that accident was the best thing that ever happened to him, because it gave him a chance to discover within himself gifts that he did not know that he had. He is now running an employment advice project, into which he has introduced some wonderfully sophisticated software that, with his guidance, enables people who are lacking not only a job but the most basic confidence to start exploring their own real aptitudes and aspirations before taking that first step into training or a job.
  Bill said, "I know how hard it is to change. But I also know that people can do it, because I've done it myself." I believe that the Government's welfare-to-work programme will mobilise community groups such as Bill's, marrying the bottom-up energy and potential of millions of people across the country to the Government's top-down strategy and vision.
  I thought also of the lone mothers in my constituency who began another group, which they called Turning Point, because that is what it was for them. Originally, those lone mothers met to support one another over a cup of coffee around a kitchen table, but now they are running their own thriving voluntary organisation.
  I thought also of the staff and parents—fathers and mothers—who run creches and playgroups that have been starved of funds, sometimes to the brink of closure, because of the previous Government's local council budget cuts. They are able to offer not only child care places but—in response to yesterday's very welcome announcement—training places for young unemployed people who wish to work with children.
  I am sure that, like me, those parents hope that my right hon. Friend the Secretary of State will ensure that lone parents under the age of 25 who have spent six months or more out of work and on income support will be able to access the opportunities created by the welfare-to-work programme in the same way and on the same terms as other young people who have been on job seeker's allowance.
  After listening to yesterday's Budget and to today's debate, I thought also of the teachers working and living in my constituency. Their dedication was scorned by the previous Government. Our new unitary council shares the new Government's determination to ensure that all our children have a chance to fulfil their potential, whether they live in inner cities, in suburbs or on outer estates.
  I know that my right hon. Friend the Secretary of State will not be at all surprised if I say that several Leicester schools—including Dovelands junior school and Bendbow Rise infant school, which is in my constituency, and recently did its best to celebrate an anniversary while the rain poured in through the roof—will be early in the queue for the very welcome new capital funding and private finance initiative announced yesterday.
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  Finally, I thought of the hundreds of women and men, many of whom are retired, who are now volunteers in so many community organisations, such as social clubs, youth sporting groups, children's bands and other organisations. I thought also of the sometimes wholly unrecognised individuals who, in their own homes, are looking after children and other relatives with profound disabilities. Our social fabric is woven from all their efforts.
  Those men and women, and many others like them, are the heroes and heroines of my constituency. They and thousands of other people across the country will be the heroes and heroines of the new Britain that we were elected to build, and for which the Budget lays such a magnificent foundation.
  7.16 pm
  Mr. David Willetts: I begin by congratulating the hon. Members who have delivered their maiden speeches in this debate. I feel slightly guilty that I am not delivering a maiden speech myself.
  We heard speeches by the hon. Members for Warwick and Leamington (Mr. Plaskitt), for South Ribble (Mr. Borrow)—whom I congratulate on delivering his speech without notes, so far as I could tell—and for Leicester, West (Ms Hewitt). We also heard from my hon. Friend the Member for Tunbridge Wells (Mr. Norman), who is particularly welcome on the Opposition Benches. From now on, we will call him "Eloquent of Tunbridge Wells". They are all very welcome to the House.
  We also heard a sort of maiden speech from my right hon. and learned Friend the Member for Rushcliffe (Mr. Clarke), the former Chancellor of the Exchequer. He made his maiden speech from the Rack Benches, after serving for I do not know how many years on the Front Benches on both sides of the House. He made a very powerful and effective speech, in which he demolished the macro-economic judgment that supposedly lies behind the Budget. He also took apart the various arguments that we have heard at various stages from Labour Ministers in defence of the Budget.
  We have been told that there was a black hole in the nation's finances. However, table 1.1 the very first table in the Red Book—as we traditionalists still call it, although new Labour has of course abolished the "red" bit—gives the lie to the story of a black hole. It reveals that—on the instructions of the Chancellor, who has provided some rather bizarre assumptions to work on—since the November 1996 Budget, the National Audit Office has changed the PSBR assumptions for the worse by £0.6 billion for 1997–98 and by £3.2 billion for 1998–99.
  The line below that one, however, shows what are called forecasting changes, which are the economic changes that have occurred in the past six months under our management and since the final Budget of the previous Chancellor, my right hon. and learned Friend the Member for Rushcliffe. What do those forecasting changes show? They show an improvement in the PSBR of £3.3 billion in 1997–98 and of £6.7 billion in 1998–99. Therefore, the overall change in the public finances since the November 1996 Budget—even taking account of the assumptions under which the Government Actuary was supposed to work—has been an improvement. There is no black hole.
  We were then told that the problem was that the economy was overheating. The basis for that judgment was a rather speculative interpretation of whether the economy was or

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  was not operating at full capacity. The Treasury has a learned little note on that, on page 54 of the Red Book. The most sensible remark appears in the second paragraph, which states:
  "It is impossible to measure the output gap with any degree of certainty."
  The output gap is no basis on which to conduct macro-economic policy, because measuring the output gap is virtually impossible. One cannot manage an economy by speculating on the size of any output gap.
  The Chancellor told us that, because he believed the economy was overheating, he was going to take tough fiscal measures. However, as my right hon. Friend the shadow Chancellor and my right hon. and learned Friend the former Chancellor made clear, that belief in the need to use fiscal policy to tighten up on consumption in the economy was not put into practice.
  If the Government were serious about trying to stop the economy overheating by tightening fiscal policy, they would have done some unpopular things to reduce people's perception of their spending power, but the Chancellor's nerve failed him. According to his analysis, the economy was overheating and we needed tough fiscal measures to deal with it, but, in practice, the only fiscal measures that he dared introduce were those which he thought would be invisible to the average consumer and the average voter. He went for pension funds and companies. His analysis was that the economy was suffering from the dangers of overheating, but he failed to deliver the measures that he claimed were necessary.
  The person on whom responsibility will now fall for acting on the Chancellor's own analysis will be the Governor of the Bank of England. If interest rates rise, it will be because of the failure of this Budget to deliver the fiscal tightening that the Chancellor himself claimed was necessary.
  I am reminded of the old Treasury story of the Chancellor who treated his speech writer rather badly. He was sent off to deliver a speech written for him by that writer. He went on for page after page, describing the appalling circumstances of the British economy and speaking of high inflation and a balance of payments deficit. He said that the Government had a set of policies that would enable the British economy to escape those problems. He turned over the page and found only a short note from his speech writer: "From now on, you're on your own."
  The Chancellor is now in that position. From now on, he cannot blame his inheritance. If interest rates have to go up, it is because the Budget has failed to include the measures which his own analysis of the situation suggested were necessary. The Chancellor's nerve failed him. There was a failure of will and a failure of courage to follow through on what his own analysis said would be necessary.
  The most important feature of the Budget, and by far the biggest tax increases, are the measures involving the taxation of dividends. I should declare an interest as an economic adviser to Kleinwort Benson, as there is obviously a learned economic debate going on in the City about the implications of these measures.
  The analysis on which the Chancellor bases his measures is one with which we are familiar. It is to be found in the writings of the likes of Will Hutton and
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  others. The argument is simple: one of the things that is wrong with this vulgar Anglo-American capitalism which they dislike so much is that too much money is distributed in dividends to shareholders and not enough is retained in the way that it is in the virtuous continental economies that they admire so much. However, that analysis is flawed.
  It is not the case that money distributed in dividends is spent on candy floss and conspicuous consumption. Much of the money distributed in dividends goes to pension funds, and is then available for them to invest in projects and companies which they believe have the best prospects. There is no reason why the companies that generate the best cash flow and retain most of their earnings should have the best new investment projects. The role of the capital market is precisely to take the revenues from companies that are thriving and to allocate them to the capital projects which are going to provide the best return.
  It is not unlike the dilemma with which the Labour Government have already had to start to wrestle—what to do with the regime for local authority capital receipts. It has dawned on the Government that the local authorities that have the greatest capital receipts may not be those to which the Government wish to give the biggest new spending and borrowing powers. That is why there is a rather ingenious scheme in the Budget whereby the extra £900 million of capital spending by local authorities is not the £900 million belonging to the authorities which happen to be sitting on the greatest capital receipts.
  By analogy, exactly the same argument applies in the capital markets—there is no reason why the companies sitting on the greatest retained earnings should be the companies with the most attractive investment prospects. That is the classic argument for capital markets to allocate investment funds, and it works in this country.
  That is why entrepreneurs who want to invest in biotechnology or set up a new business and get investment venture capital come to the markets of London and New York. They do not go to the continent, because there, the only way to get more money to invest is to be big already. That is why the continent's economies are slowing down and why the British economy is in its sixth year of growing more rapidly than that of France or Germany. Therefore, the economic analysis on which the Chancellor's measures rest is false. It cuts across his declared intention of doing something to stimulate investment.
  The Chancellor also claims that his proposals will yield an enormous amount of tax revenues. The figures are very dramatic, and much bigger than those for the windfall tax. In the next three years, he wants the abolition of tax credits for pension funds to yield well over £10,000 million. That means that the fiscal tightening of which he is boasting depends crucially on this one incredibly complicated and yet ill-thought-out measure.
  If this measure does not deliver what the Chancellor claims for it, and if people in the City work out ways to get around this enormous tax hit that he is trying to impose on them, all the calculations in his Red Book will go up in smoke. He will have nothing else to turn to.
  The evidence is that the Chancellor may well find that the ingenuity of the City is such that he fails to raise the revenues he promises. The incentives for people to work

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  out ways to distribute funds from companies to pension funds and avoid the heavy hit that he is trying to impose are enormous.
  We know what pensions funds will do: they will now invest in foreign equities to get past the tax penalty that the Chancellor is imposing on domestic investment. He also knows that, because of the abolition of the foreign income dividend scheme, many international companies with streams of income from abroad, which will now be highly taxed, will instead look for other ways to pass on those dividends to their investors.
  There will, of course, be a significant shift abroad by international companies with headquarters or large-scale operations in London to avoid the effect of the tax. It is at that point that Labour Members, who were yesterday cheering so loudly about an indefensible and incomprehensible measure, will begin to realise what it means for the real economy. When BP, Shell or ICI announce that they are shifting a significant part of their activities abroad to avoid the tax penalties, Labour Members will understand what it means.
  There are also economic implications for the public sector. I would be interested to hear from Treasury Ministers what calculations the Government Actuary has given of the impact of the proposals on, for example, public sector pension schemes. The Secretary of State for Education and Employment assured me when I intervened on him that there was not a problem with the pension funds of university teachers. I was grateful for that assurance, and I hope that it is correct, but we know that there are no surpluses in the funded local authority pension schemes.
  How are local authority employers to top up the pension schemes they operate in order to meet the liabilities they already have to their employees? Where will they find the money? It will come from the sums that they are supposed to spend on schools and school buildings. As was established under questioning by my hon. Friend the Member for Maidenhead (Mrs. May), those resources cannot be ring-fenced, and they will be used to meet the extra pension liabilities that the Chancellor has just imposed.
  We were promised a full explanation from the Secretary of State of what the Government's welfare-to-work measures will do, but no such explanation was forthcoming. We heard the sketchiest of accounts, with no serious analysis of the British labour market or of the employment circumstances of 18 to 24-year-olds. There was nothing to enable people to assess the measures seriously.
  I offer the House some evidence about the labour market for 18 to 24-year-olds. A written answer the other week said that, in 1996, 1,209,000 people aged 18 to 24 went off benefit. Of those, 637,000 definitely went into work, and another 359,000 failed to attend the benefits office for reasons that we do not know. Those people are also expected to have found work, adding up to almost 1 million 18 to 24-year-olds moving off benefit and into work last year.
  That puts Labour's 250,000 into perspective, and raises an important practical problem. How will they design their measures in such a way that they do not help the 1 million young people every year who would be going
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  off benefit and into work anyway? How will they avoid what, in the language of the policy analysts, is called the dead weight cost?
  The dead weight cost problem affects all welfare-to-work policies, and is particularly acute for 18 to 24-year-olds, because there is a lot of mobility in that age group, with many people going off benefit and into work and others, sadly, going out of work and on to benefit. It is a turbulent part of the labour market. That is why it is difficult to design measures to help those stuck on benefit without wasting a lot of money helping those who would have got off benefit and in to work regardless.
  In 1996, 18 per cent. of benefit claimants aged under 25 left the count each month, as against 13 per cent. of claimants aged over 25. Even among 18 to 24-year-olds who had been unemployed for more than six months—about whom the Government claim to be particularly concerned, although there are way below 250,000 such people left—12 per cent. left the count each month, as against 8.5 per cent. of those aged over 25 who had been unemployed for that period. There is already a lot of mobility among those young people. That is why dead weight is such a problem. We have heard no explanation of how the Secretary of State will address that.
  There are other problems. What about the displacement effect? Why should any employer now employ a 16 or 17-year-old? Can Labour Members, who claim to be so concerned, explain what prospects there are for a 16 or 17-year-old who wants to get a job—as I understand it, this is still a free country, and that is a legitimate option for 16and 17-year-olds—when employers will get a subsidy if they take someone who is 18 to 24?
  What about the perverse incentives? What if an employer wants to take on an 18 to 24-year-old who has been unemployed for three months? There will be no special subsidy there. The employer will say, "Why don't you come back in 12 weeks? I like the look of you and I want to take you on. Come back in 12 weeks and I'll make it worth your while." There will be an increase in the number of people unemployed for six months so that the employer and employee can divide between them the special tax subsidy that the Government are offering.
  The measure is so ill thought out that I doubt the Labour party's genuine conviction and belief about taking action on welfare to work for 18 to 24-year-olds. If they cared about the problem, they would not just say so: they would have thought about it. If they had done, they would surely be able to tell us how they will deal with the dead weight costs, how they will avoid the problems of displacement and how they will confront the perverse incentives. We have heard nothing about that from the Chancellor or from the Secretary of State for Education and Employment. That is why we are beginning to doubt how serious they are about it.
  My right hon. Friend the shadow Chancellor eloquently pointed out that we had been told that the measures would save money that could be released for education. As my right hon. Friend established when he researched the subject as Secretary of State for Social Security—findings that have been backed up by independent organisations—in no country are such schemes self-financing. There is no scope from saving on unemployment in that age group to release funds for education.
  The programme may achieve a reduction in benefit expenditure on 18 to 24-year-olds, but once the other public expenditure programmes that Labour are gaily

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  inventing are added back in—the tax subsidies, the training schemes, the costs of employing people on benefit plus to do environmental projects—there will be no public expenditure saving.
  We were told that that was how the Government would find resources for education, but they have just raided the contingency reserve in the traditional way. In eight weeks of office, they have discovered the truth of the supposed great device to raise money for education by saving money on employment—the figures do not add up. The plan is ill thought out, and will not raise the revenue for education that we were promised during the election campaign.
  7.36 pm
  Gillian Merron: The Budget encapsulates the essence of the Labour Government. It is a breath of fresh air for the whole nation, touching the places and people whose well-being had long been forgotten by the last Government. It is a privilege to make my maiden speech in a debate on a Budget that gives hope to the 671 young people in my Lincoln constituency who have been out of work for six months or more.
  As tradition holds, I pay tribute to my predecessor, Sir Kenneth Carlisle, who carried out his duties with a deep affection for the city of Lincoln and its people. I am honoured to follow in the footsteps of the last Labour Member for Lincoln, the President of the Board of Trade and Secretary of State for Trade and Industry, my right hon. Friend the Member for Derby, South (Mrs. Beckett), who continues to serve our people with great dignity and skill. The House will be aware that Lincoln has had a chequered political past, but I hope that we shall have a distinguished political future.
  I have met many people in Lincoln over the years, but perhaps the one whose experience of life has touched me most is a young man of 20 who came to see me. His mother had sent him because she said that I would understand. He had never had the chance to work and he wanted to. I am sure that he will remember our conversation as I have done. He will join me, the 670 other young unemployed people in Lincoln and their friends and family in warmly welcoming the opportunity to work or train.
  How interesting it is to make my maiden speech in the same debate as the contribution of the right hon. and learned Member for Rushcliffe (Mr. Clarke), the shadow shadow Chancellor, who has confirmed that he—and perhaps also his party—has a commitment to the welfare-to-work policies commended to the House by the Labour Government. I want to acknowledge their long and regrettable experience of work-to-welfare policies, which has damaged the lives of many millions in this country.
  Many of my hon. Friends will have visited Lincoln and enjoyed the beauty of the fine cathedral and castle which form the historic heart of the city. The cathedral, which has suffered fire and earthquake, stands partly on the site of a 1st-century Roman fortress. It is a vision to behold and was commended by John Ruskin, who wrote:
  "I have always held and am prepared against all comers to maintain that the cathedral of Lincoln is out and out the most precious piece of architecture in the British Isles, and, roughly speaking, worth any two other cathedrals we have."
  I give the House those words without wishing to offend anyone else who represents a cathedral city.
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  Despite its wealth of attractions, both historic and current, Lincoln frequently finds itself in splendid isolation because of poor transport links which have worsened over recent years. There is now no direct rail link to London and there are inadequate connections to other places. The A46, one of the major link roads to the city, is aptly described by the local paper as "agony corridor". The difficulty of travelling to and from my constituency makes life difficult for people trying to go about their everyday lives while business opportunities continue to be lost to Lincoln. I look forward to making representations in the review of road building and transport.
  I consider Lincoln to be a city of partnership. It is the partnership between this Government and the people that will make this Budget one that equips Britain for a positive and bright future. On the banks of Lincoln's Brayford pool is living proof of how a dream can become a reality. The first purpose-built university for decades, the university of Lincolnshire and Humberside, welcomed its first intake of students last year. We were delighted to welcome Her Majesty the Queen and Prince Philip, who did the honour to the city of formally opening the university, as befits such an important project. Local authorities, businesses and ordinary people freely gave their financial and practical support to make the university happen. It is just the kind of university we need to work with the Government to deliver the education opportunities that can truly open doors. It is through opening doors by education that we can give equality and opportunity to all.
  For hundreds of young people in Lincoln and for many local good causes, the football in the community initiative has been a lifeline. That is down to the good work of Lincoln City football club, where the team are affectionately known as the Imps. I must explain that that is due to the influence of the infamous Lincoln imp which can be found in the stonework of Lincoln cathedral, and is no comment or reflection on the stature of the players.
  The football club has gone one step further in developing partnership. I have been pleased to support Lincoln City 2000, a venture that fosters wider community support and involvement. Sincil Bank, the football ground, is open to us all in Lincoln to enjoy, not only for football matches, but in terms of fine fitness and social facilities. That is just the kind of community organisation that we need to work with this Government to enhance the quality of people's everyday lives.
  Lincoln has the distinction of being the birthplace of the tank as well as having been home to top engineering companies, many of which, sadly, have suffered the ravages of Conservative economic policies. I suspect that, if previous Budgets had worked in favour of investment and industry, as this Labour Budget surely does, Lincoln would not have seen the round of factory and other closures and the resultant blight of people's lives as they live daily with the threat or reality of losing their jobs.
  I am pleased to tell the House, however, that engineering excellence is still alive and well in a number of companies, including Lincoln's largest private employer, European Gas Turbines. The success of this world-class company demonstrates the value of partnership between the company and its work force, working together to set ambitious targets and sharing aims, worries and a vision. That is just the kind of business that we need to work with the Government to

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  boost local economies and to create jobs. We have made our intentions clear by cutting corporation tax and increasing capital allowances. This Government are serious about investment and jobs.
  This is a Budget that plans ahead; it is not a Budget just for today or for yesterday, but one that looks to a stable future. This is a Budget that sets out what is decent and what is not. This is a Budget to be proud of.
  I passionately believe that a one-off windfall tax on excess profits to fund a new deal for young and long-term unemployed people, lone parents and schools is right and proper and will be regarded as the decent thing to do in my constituency and across the country. The nonsense of the privatised utilities has gone on for long enough. East Midlands Electricity can boast to its board of a sixfold increase in annual board pay since privatisation, while the work force has been halved and those remaining carry heavier work loads and worries for their future and the future of their service.
  What this Budget offers, which recent Budgets have failed to do, and what the experience of partnership in Lincoln has shown is the idea that working with and for the people is the way to true prosperity. I hope that I shall be worthy of the trust put in me by the people of Lincoln. I hope that they, like me, will feel that this Budget is the breath of fresh air that we have all been waiting for.
  7.45 pm
  Mr. Keith Simpson: I congratulate the hon. Member for Lincoln (Gillian Merron) on her maiden speech. I do so on the ground that I made my maiden speech only a month ago and I know that it is stressful to wait to catch Mr. Deputy Speaker's eye. Although I represent a constituency in another part of East Anglia where I should defend the interests of Norwich cathedral, I fully recognise the hon. Lady's comments about Lincoln cathedral, which is also our national memorial to the 30,000 British aircrew in Bomber Command who died during the second world war.
  My right hon. Friend the Member for Hitchin and Harpenden (Mr. Lilley) pointed out that this Budget is, above all else, a political Budget. It is not determined by a Labour Government who are keen to demonstrate that they can deliver their promises, but by a Labour Government who are unclear on how they will deliver their contradictory promise of not raising personal taxes while keeping to the previous Government's departmental spending ceilings.
  Over the past two months, since the new Parliament first met, hon. Members have seen those promises beginning to come apart at the seams. One can hear great stretch in all directions. Over the past two months, many Conservative Members and one or two Labour Members who have not yet been sufficiently ideologically turned have been greatly amused by the Government's attempts to rummage through the historical lumber room of clichés to breathe new life into what is a rather vacuous political party.
  In what is, I believe, referred to in a slightly different context as cross-dressing, new Labour borrows much from the Liberals who formed the Government in 1905. Indeed, I understand that the present Chancellor greatly admires the Liberal Chancellor of the period just before
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  the first world war—David Lloyd George. He is in many respects David Lloyd George without the sex. He has modelled his Budget on David Lloyd George's people's Budget—another historical cliché—of 1909. That Budget is not necessarily a fortunate example, as it raised massive expectations but failed to deliver on public expenditure, but then, perhaps, as that great Conservative Prime Minister Arthur Balfour said:
  "History doesn't repeat itself, rather historians repeat each other."
  New Labour's attempt to give clichés a fresh look has led to so many absurdities that it is getting almost beyond a joke, and those absurdities have been very much mirrored in the present Budget. We have heard, for example, of that wonderful, original phrase, "a new deal". I have a suspicion that someone called Franklin Delano Roosevelt once talked about a new deal. We are saved from hearing the phrase "a new Europe" because someone obviously had the sense to look it up and found that Hitler had used it first.
  I an genuinely surprised that we have not heard about the new woman. It is alleged that the length of ladies' skirts reflects economic prosperity and recession. At times of economic prosperity, skirt lengths rise and when we are about to go into recession skirt lengths fall. [Interruption.] Listening to the mutterings among Labour Members, I realise that I may be making a politically incorrect statement. Perhaps I should say that under new Labour, in every possible sense, it is a matter of trousers going up and coming down. I take the advice of my wife who says that at the moment skirt lengths are beginning to come down, so I suspect that we are heading for a recession.
  Yesterday, we heard what could best be described as a hangover Budget. It felt good yesterday, but by God there are some bloodshot eyes among Labour Members today.
  I want briefly to consider one aspect of the Government's economic policy and then turn to a specific issue that relates to my constituency. In less than a year's time, the Government will realise that the basic issue of public expenditure, which will not be debated this autumn, is crucial. Some of the more astute Labour Members have woken up to the fact that their Government's public expenditure plans do not add up.
  Lord Healey, the former Labour Chancellor, once said that the Treasury knows the cost of everything and the value of nothing. The Treasury has produced a series of instruments to contain public expenditure. At the strategic level we have the comprehensive spending review, at the operational level we have the cross-departmental reviews and at the tactical level we have a whole series of departmental reviews that are taking place at the moment. The declared aim of the reviews is to assess how to use resources better while rooting out waste and inefficiency in public spending. I have never heard that from anyone in the Labour party. Many Conservative councillors would find it absolutely amazing, in view of the excess spending of many Labour local authorities.
  The "Oxford English Dictionary" defines a review as
  "a general survey or assessment of a subject or a revision or reconsideration".
  The French word, revue, is defined as
  "a theatrical entertainment of a series of short usually satirical sketches and songs".
  On every occasion in the past two months when Ministers have been faced with a difficult decision, they have hidden behind the usual phrase, "We are reviewing it".

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  That has caused at the very least a degree of scepticism among the Opposition and some hilarity on the Labour Benches below the Gangway. Every time the hon. Member for Bolsover (Mr. Skinner) hears a Minister mention a review, he sings the song from "Oliver" that begins, "I am reviewing the situation". I understand that the awkward squad below the Gangway are to cut a disc but that they have turned down the offer by the Minister without Portfolio to act as their manager because he was asking for far too high a cut of the profits.
  The serious point about the series of reviews is that in a year's time there will be winners and losers. I suspect that there will be more losers than winners. The Treasury is looking for savings and I can highlight one Department which is a sitting duck for making savings.
  Before the election, the Conservatives costed every Labour departmental election promise and found a minimum of £10 billion in promises. In only one Government Department were there no spending promises— the Ministry of Defence. To be fair to the Labour party, it has never considered defence a priority and it is not a priority in terms of Government spending.
  Putting aside the security implications of taking considerable sums of money out of the defence budget to fund some of the Government's election promises, it should be remembered that the Ministry of Defence is still the biggest single customer of United Kingdom industry. There is probably not one hon. Member present who does not have small and large companies in his or her constituency dependent on that. Defence cuts will have a major impact on employment and business, not least in my constituency.
  I now turn from the general impact of the Government's economic policy to the specific impact of the Budget. The Budget resembles an Arthur Daley deal; we must look beyond the Chancellor's extra-large print and read the small print. Many people are beginning to realise that the Budget is a time-bomb.
  More than 20 per cent. of my constituents in Mid-Norfolk are pensioners. The Budget will be a tax on them. Labour has made much of the reduction in VAT on fuel from 8 per cent. to 5 per cent., but most pensioner households will save at most 31p a week.
  This Labour Budget will tax all our pensioners in four specific ways. First, the windfall tax will hit pension funds and many utilities will pass the costs directly to consumers. Those least able to afford that will be pensioners. Secondly, reducing the rate of advance corporation tax credit will mean that pension funds will have less income and pensions will be lower. Some councils have already indicated that increases in council tax will pay for the impact on their pension funds—another blow for our pensioners.
  Thirdly, abolishing tax relief on private medical insurance—a rather nasty little measure—will hit the over-60s, affecting some 600,000 pensioners and overloading the national health service. It also contradicts the policies outlined by the Minister of State, Department of Health.
  Fourthly, the increase in tax on petrol and the intention to make insurance companies bear the cost of hospital treatment for those injured in accidents will doubly hit pensioners, particularly in my large rural constituency.
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  It is a time-bomb Budget that will dramatically affect pensioners and it will not achieve the honest objectives of many Labour Members. Lady Violet Asquith once said of Lloyd George that
  "he could never see a belt without hitting below it".
  The present Chancellor can never see a tax relief for private enterprise without reducing it or abolishing it.
  7.57 pm
  Mr. Stephen Hesford: Thank you, Mr. Deputy Speaker, for allowing me the opportunity to speak in what I and many hon. Members consider to be a historic Budget debate.
  There are three reasons why I am pleased to make my maiden speech on this historic occasion. It is the first Labour Budget to be presented to the House since 1979. As other hon. Members have said, many in the House and outside consider it to be the people's Budget—the Budget that the people wanted my right hon. Friend the Chancellor to implement as soon as possible. It is also an historic occasion for me to make my maiden speech in this important debate. I have no hesitation in welcoming my right hon. Friend's Budget, and nor do my constituents in Wirral, West whom I have the honour of serving.
  Before moving on to the formal part of my speech, consistent with the pleasurable traditions surrounding a maiden speech, I should like briefly to touch on why I believe the Budget will be good for the country and good for the people of Wirral, West.
  There are 18,000 elderly people in my constituency—good and decent people, many of whom live in the pleasant seaside towns of West Kirby, Hoylake and Meols. They will welcome the measures to reduce VAT on domestic fuel and the extra money that my right hon. Friend the Chancellor has found for the health service. I know that those and other measures will go a long way to allay the fears of pensioners across my constituency. I spoke to many of them during the election campaign, and they told me just that.
  In the town of Greasby, which is inland and central to my constituency, as well as in the areas of Irby and Pensby, many hard-working families with children at school will welcome the new money earmarked for education by my right hon. Friend the Chancellor.
  On the eastern edge of my constituency, which borders on the constituency of the Minister for Welfare Reform, my right hon. Friend the Member for Birkenhead (Mr. Field), my constituents in Upton and Prenton and especially those on the Woodchurch estate, where during the election campaign people were kind enough to give me the warmest of receptions, will welcome the welfare-to-work measures, which will provide real opportunities for jobs and real training for the many hundreds of young people who have been out of work for more than six months.
  Moreover, the measures to which I have just referred will go a long way towards dealing with and repairing the damage done to the body politic by the former Government. What this Government and what Labour Members are willing to say and promise, they are also willing to carry out.
  Convention directs that I now mention my predecessors, and I do so gladly. Indeed, I would do so even if convention did not direct me in that way. I have

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  the honour of succeeding the right hon. David Hunt MBE. Before him, the seat—Wirral as it was then—was held by a former occupant of the Chair, the late Lord Selwyn-Lloyd.
  I have had the considerable benefit of being able to read the maiden speeches of both my predecessors, and on the face of it certain traditions appear to have been formed by them. I should like briefly to outline some of those traditions. First, Lord Selwyn-Lloyd, while Speaker, had the reputation of answering his constituency correspondence by return of post.
  Secondly, both my predecessors made their maiden speeches while in opposition and, as was consistent with those former times which are sometimes difficult to recall, they welcomed the proposals being put forward by the then Labour Government in a constructive manner. I wish and hope—although I do not necessarily expect to be repaid for it—that Conservative Members would reintroduce that tradition of constructively welcoming proposals when they are good for the country, although I have not heard any of that in my short time in this honourable place.
  Thirdly, the right hon. David Hunt made his maiden speech during the 1976 Budget debate. To emphasis the point that I have just made, he welcomed many measures before the House in that speech, especially in relation to job creation and training. Both my predecessors represented the constituency for many years—31 years and 21 years, respectively.
  I should be delighted to try to continue some of those traditions. I shall endeavour to answer my constituents' correspondence by return of post. I am only too happy to welcome the measures put forward by my right hon. Friend the Chancellor on behalf of the Government, but by way of difference from my predecessors, I am pleased to be able to do so from the Government side of the House. I hope that I am not tempting providence as a new Member, but I am also willing to represent Wirral, West for many years to come. I also realise that, in my own small way, I may have started a tradition of my own: I am the first Labour Member for Wirral, West. Again, I hope that I am not tempting providence, but I hope that that will continue for many years to come.
  David Hunt was and is widely respected and liked inside and outside the House. He was known in the constituency as a courteous and diligent Member of Parliament. He was and is a one-nation Tory. His career is well known to many hon. Members, and it would be remiss of me not to remind the House of the many important ministerial pasts that he held, culminating in a well deserved place in the Cabinet in the important position of Secretary of State for Wales.
  On a personal note, no victorious candidate can ever have been blessed with a more gracious person in defeat than I was with David Hunt. He has been most kind, and continues to be so, and I should like my thanks to him for that to go on record.
  I should like to make one brief observation on the welfare-to-work proposals which were so clearly set out yesterday by my right hon. Friend the Chancellor. My hon. Friend the Member for South Ribble (Mr. Borrow), who made an excellent maiden speech on behalf of his constituency, has already made mention of the minimum
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  wage, but I should also like to do so. My right hon. Friend the Chancellor made it clear that that proposal underpins the challenge to get 250,000 young people back to work. The need for that proposal is well understood across my constituency and across the age range.
  If I may, I should like to cite one anecdote from just before the election campaign. During a particularly cold February, I and my colleagues in the constituency petitioned on the question of a minimum wage. More than 1,300 people supported the principle of a minimum wage by signing that petition. Sadly, when it was sent it to the relevant Department, it was ignored.
  What struck me most forcefully on the streets of Hoylake, West Kirby, Pensby, Upton and Prenton was that people knew about the minimum wage. They well understood the principles behind it and the need for it. I therefore beg to differ from Opposition Members when I say that people in my constituency do not believe that the minimum wage will have the job-negative effect claimed.
  The new jobs that will be created under Labour's welfare-to-work scheme must not be under Burger-King conditions. In addition to helping the young people to whom I have referred, a minimum wage will assist about 6,000 people—mainly women part-time workers—who currently earn, disgracefully and unacceptably, less than £2.50 an hour.
  I shall conclude on that note, as I hope to speak in the debate which I understand that we are to have later in the year on the minimum wage, when I hope to put other arguments before the House. I beg to support the Chancellor's Budget statement.
  8.9 pm
  Mr. John Burnett: Thank you, Mr. Deputy Speaker, for calling me to make my maiden speech. I am delighted to congratulate the hon. Member for Wirral, West (Mr. Hesford), who made a fluent speech. I am sure that he will be an able and effective advocate for his constituents.
  It is a great honour to have been elected to serve the constituency of Torridge and West Devon, which has been my home and where I have farmed for many years. I am also delighted to pay tribute to my predecessor, Miss Emma Nicholson, and her predecessor, the late Sir Peter Mills.
  I first met Emma Nicholson during the 1987 general election campaign. She was a formidable and fair campaigner and I got to know her better after December 1995. She has always championed the causes of the less fortunate and, last year, I accompanied her on the traditional pre-Christmas tour of the constituency. In schools, hospitals, day care centres for people with learning difficulties and homes for the elderly, she was greeted with warmth, affection and gratitude. Her reputation for personal courage is widespread and her work with refugees was often carried out at great personal risk. She has been a source of encouragement to me, and I am most grateful.
  The late Sir Peter Mills and his dedicated wife, Lady Mills, served the constituency with distinction for many years until his retirement in 1987. He was a much admired Member of Parliament and a man of the highest integrity—a fact that he himself would have been the last to advertise.

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  My constituency is, I believe, the second largest, geographically, in England. It is a beautiful part of England with a variety of landscapes. The cliffs at Hartland in the north-west give way to the long beaches of Westward Ho! Nearby at the mouth of the River Torridge is Appledore, whose shipyard has survived in a difficult market. Further up the river is Bideford, which has a busy quay and a breathtaking setting. To the south are the towns of Holsworthy, with its busy livestock market, and Great Torrington, which has recently been successful in the rural challenge. That will provide a much needed impetus to the stalling local economy. In the south of the constituency is Okehampton, which is often referred to as the gateway to Dartmoor national park, whose stark beauty has been so successfully sustained by the park authority. The most southerly town in my constituency is the ancient stannary town of Tavistock.
  The people of Torridge and West Devon are independent and hard working. Our economy is based on some industry, tourism, fishing and, of course, agriculture. In his maiden speech in 1964, Sir Peter Mills explained that an increasing number of farmers in the constituency were producing cereals, although we had not reached the heights of other counties, such as Wiltshire, Norfolk and Suffolk, with their rotation of four years barley and one year in the south of France.
  Times have not changed, and agriculture in my constituency still mostly consists of small and medium-sized livestock enterprises. Many farmers, especially now with the bovine spongiform encephalopathy crisis in its second year, are hard pressed financially. They have seen the value of their stock plunge to levels not seen for years. The unwarranted and unfair cuts in compensation for the over-30-months scheme and the imposition of the upper weight limit announced last week by the Minister of Agriculture, Fisheries and Food are a cruel blow to many farmers in my constituency who are already having the greatest difficulty surviving in business.
  In his Budget speech, the Chancellor put great emphasis on stability and long-termism. As a lawyer practising in my constituency for more than 20 years, I have seen at first hand the results of instability and short-termism. One of the great problems we have in Devon and Cornwall is that the brakes get put on the economy by dramatic increases in interest rates when overheating in the south-east demands it, which is usually just before the recovery reaches us. For years, our downturns in the economic cycle have been relatively lower and longer than in most other Organisation for Economic Co-operation and Development countries. It is no surprise that our investment record is poor.
  I have frequently witnessed the destruction of good and viable businesses caught up in the boom-bust cycle. I have watched the havoc it has caused to the lives of many able, honest and hard-working people. To help stabilise our economy and to promote sustainable growth and investment, it was my party's policy to bring greater independence to the Bank of England. We are pleased that the Government have adopted that policy which should assist the regions of Britain especially to plan for sustainable growth and investment, free of the concerns that are generated by political interference in the day-to-day management of monetary policy.
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  Yesterday's announcement that the National Audit Office will have a continuing role in auditing the public finances—and the commitment to greater openness—should buttress changes made to the role of the Bank of England to secure long-term stability for the British economy. However, pressing needs remain for public expenditure. There was nothing extra for the national health service and education this year. I hope that the £1.2 billion for health next year—which in real terms, allowing for inflation, works out at about £560 million—is sufficient to keep open facilities such as Winsford hospital in my constituency, which is threatened with closure.
  Will the additional education spending enable the rebuilding of many of the old and unsuitable schools in my constituency, such as Holsworthy primary school? I can assure the Chancellor that, notwithstanding the poor structural condition of the schools, they meet exacting standards for results and discipline.
  Most of the revenue required to match the Government's commitments to expenditure and repayment of debt comes, first, from the one-off and retrospective windfall tax and, secondly, from changes in the tax treatment of company distributions. Both those measures raise legitimate and significant concerns. The Liberal Democrats can only hope that the expectations raised by the Budget will be fulfilled in the years to come.
  8.18 pm
  Charlotte Atkins: I am especially pleased to follow the hon. Member for Torridge and West Devon (Mr. Burnett) because, only the other evening, we discussed our maiden speeches and he told me that he wished to make his maiden speech during the debate on the Budget, as did I. I congratulate him on his maiden speech, which was fluent and interesting. I drive through his constituency to Cornwall when I visit my mother, so I was pleased to hear something about it. As he said, it is a beautiful area.
  I am honoured to represent Staffordshire, Moorlands. The name of the constituency often confuses people about its location. It includes Kidsgrove and Talke, which are parts of Stoke-on-Trent and were generously transferred to me by my hon. Friend the Member for Stoke-on-Trent, North (Ms Walley). Staffordshire, Moorlands also stretches all the way to Derbyshire. My constituency borders no fewer than 10 other constituencies. I do not know whether that is a record, but it is certainly amazing.
  The constituency has a large agricultural area. It has many potteries. It has quarrying, engineering, textiles and the computer industry. It also has the headquarters of a large building society, the Britannia, which is proud to maintain its mutual status. Sadly, there are no longer any pits; there is only the awful threat of opencasting, and its blight on the landscape.
  Staffordshire, Moorlands is one of the most beautiful constituencies in the United Kingdom. It includes large parts of the Peak national park, the lovely market town of Leek, and Biddulph, which is the home of the famous Biddulph grange gardens. I am glad to say that Biddulph is festooned in flowers at the moment, thanks to the local organisers of the marvellous "Biddulph in Bloom".
  I also have the delightful village of Flash, which is the highest village in Britain. Farmers in Staffordshire, Moorlands have the tradition of farming high up into the

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  hills. They, like the constituents of Torridge and West Devon, are experiencing severe difficulties as a result of the BSE crisis and bovine tuberculosis.
  Staffordshire, Moorlands is a very beautiful constituency, so it was no surprise to me that, when the BBC filmed its highly successful adaptation of Jane Austen's "Pride and Prejudice", it came to my constituency in Staffordshire to film Elizabeth Bennett's visit to Derbyshire. Some scenes were filmed at the Roaches, right in the centre of my constituency, which Lizzie Bennett describes as "absolutely beautiful." Like Lizzie Bennett, I recommend my constituency to all who seek a delightful holiday in the Peak district. I also recommend a visit to the local potteries to pick up some interesting Staffordshire pottery.
  Staffordshire, Moorlands is a constituency of surprises. Who would have thought that there would be a tornado a few weeks ago? It lifted the roof of the swimming pool in Waterhouses. I am glad to say that moorlanders are equal to adverse weather conditions. They are used to snow, sometimes well into late spring. They take such weather conditions in their stride.
  As Member of Parliament for Staffordshire, Moorlands, I follow Sir David Knox, who sat in the House for 27 years. His predecessor, the Labour Member of Parliament, Harold Davies, served for 25 years. I can only hope that my tenure matches theirs.
  I am delighted to pay tribute to Sir David. He was well respected by all hon. Members on both sides of the House. He was also well respected in the constituency. He looked after the interests of supporters and opponents alike with great diligence. He has always been kind and accommodating to me. I know that he will be a hard act to follow. His devotion to public service cannot be questioned, and I wish him a well-deserved retirement.
  I come into the House 18 years after my father left it. My father is Ron Atkins. I am pleased that my hon. Friend the Member for South Ribble (Mr. Borrow) mentioned my father, because he defeated Robert Atkins, to whom my father lost in 1979 by 21 votes. Hon. Members will notice that they had the same initial and the same surname. It is ironic that, as one Atkins leaves the House of Commons, another arrives to take his place.
  William Morris, the socialist reformer, spent much time in Leek, the lovely market town in the centre of my constituency, observing the horrors of the industrial age. I am glad to say that his legacy lives on in Leek in the wonderful stained glass windows of both the grade I listed All Saints' church and the lovely, older St. Edward's church.
  I wonder what William Morris would think if he visited Staffordshire, Moorlands today. Many of my constituents are forced to accept pay of £2.50 an hour and less and they have to look to the taxpayer to top up their wages. I am pleased, therefore, that my right hon. Friend the Chancellor spoke about the minimum wage, which will create a floor under low wages. Why should the taxpayer have to subsidise Scrooge employers? That only encourages a cheap labour mentality. My right hon. Friend underlined the point by quoting figures for investment in United Kingdom workers. He said that, for every £100 invested in the United Kingdom, Germany
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  invested £140, the United States invested £150 and Japan invested £160. There is no future in a low-wage, low-skill economy.
  The previous Government helped to create skill shortages in my constituency by their policies. That is why I am so pleased that the Budget allocates an extra £2.3 billion for schools. I follow the hon. Member for Stone (Mr. Cash) in pressing the case for Staffordshire in terms of education funding. Staffordshire has some of the largest class sizes and worst school buildings in the country. It has consistently come bottom or second to bottom in the standard spending assessment funding league. The area cost adjustment unfairly discriminates against Staffordshire, so that, for example, Bedfordshire gets more than £160 per primary pupil and £230 per secondary pupil more than Staffordshire. That injustice must be remedied by the Government.
  I hope that my constituency gets its fair share of the £1.3 billion allocated for school capital spending. When I visited Moorside high school in Werrington, I was appalled by the conditions under which teachers have to teach. Their labs are especially disgraceful. Most are not even large enough to take full-size classes. The school has been awaiting modernisation for years and it is still waiting. Is it any wonder that students decide to opt out of science—a subject that is vital for Britain's prosperity in the 21st century?
  As my hon. Friend the Financial Secretary to the Treasury is due to sum up the debate, I must put in a plea for the Leek tax office. Its future is under review by my hon. Friend. With self-assessment upon us, the office has never been needed more. Already, the staff see 10,000 taxpayers a year. The office covers a vast area from Buxton and Uttoxeter to Stoke-on-Trent. If it closes, people will have to go to Stoke-on-Trent for advice. Public transport is appalling in my constituency as a result of deregulation. If people take a bus from Buxton to Stoke-on-Trent, they have only 15 minutes to conduct an interview on their tax affairs if they are to get back to Buxton.
  I am told by experts that the self-assessment form takes at least three quarters of an hour to go through. I appeal to my hon. Friend the Financial Secretary to ensure that the Leek tax office is not closed. It would leave the people of Staffordshire, Moorlands, the elderly, small businesses and farmers at the mercy of so-called independent tax advisers. I urge my hon. Friend to reprieve Leek tax office. It means so much to the community.
  I congratulate my right hon. Friend the Chancellor on his Budget. It has been well received already by my constituents and it offers real hope for the future.
  8.30 pm
  Mr. Piers Merchant: It is a pleasure to take up the remarks of the hon. Member for Staffordshire, Moorlands (Charlotte Atkins). I congratulate her on making an excellent maiden speech and I look forward to hearing many contributions from her in future. She took us on an interesting tour of her constituency, which seemed at times to live up to its name. The prospect of a holiday in the area is certainly enticing. I was rather concerned about her new Lib-Lab pact, but reassured when she paid a generous tribute to her predecessor, who was a much respected colleague of mine and Member of this place, whom we shall certainly miss.

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  There are some who no doubt felt that they might reasonably expect a new party in government for the first time for many years to launch a Budget that was inspiring, radical and inventive. Such a Budget was introduced by the then new Conservative Government in 1979. If people were expecting such a Budget this year, they must have been sorely disappointed. The only radical feature of this Budget is the new red box that the Chancellor of the Exchequer produced. The rest of the Budget is a disappointment. It harks back to old Labour Budgets of tax rises and public spending increases, with no new economic direction charted.
  I fear that a trend will be set for future Labour Budgets. As Government Front Benchers find themselves put under strain by vested interests and by right hon. and hon. Members on the Back Benches championing their own causes—all, of course, requiring more public spending—they will bow, bend and ultimately break. To fund additional public spending, they will have to increase taxes. They will return to the House again and again with tax-increasing Budgets, no doubt clothing them in the language of demand management. That is an old, tired phrase which is almost forgotten but with which the Chancellor, rather weakly I thought, attempted to defend the Budget.
  As my right hon. and learned Friend the Member for Rushcliffe (Mr. Clarke) said in his excellent speech, the way to treat an overheated economy, where necessary, is by monetary policy and interest rate rises, not by increasing taxation. The Government are increasing taxation because they want more money to spend. They want to increase public spending, but not because they are interested in demand management.
  The Budget is about tax rises, and there are 17 across the board. At the end of the day, it will be the ordinary man and woman in the street who will pay the increased taxes. There is a thinly veiled disguise, one so thin that we can see through it already. The Government take the view that somehow the money will be raised elsewhere.
  Let us examine the main tax increases that are instituted. Who will pay for the windfall tax on the utilities? Of course, the consumer will pay for the smash-and-grab raid on the utilities through the increased prices that the utilities will have to introduce sooner or later to fund the mammoth £5.2 billion tax that the Chancellor has imposed.
  What about the tax on pension funds? There has been the greatest attack on pension funds since the war, according, rightly, to the National Association of Pension Funds. This £5 billion attack is one that will be paid for by the ordinary man and woman through their pension contributions. They will have to increase their funding so that they might have a reasonable pension at the end of the day.
  There is an increase in transport or fuel tax along with vehicle excise duty. The Government mask these increases in rhetoric about the environment. Car and freight use on the roads is inflexible, and users will not abandon their cars despite the 16p a gallon increase and notwithstanding the increase in vehicle excise duty; instead, they will simply pay up. Again, the Chancellor's hand is going into the pocket of the ordinary man and woman.
  There is a strange contradiction in the Government's environmental rhetoric: they claim that, by increasing taxes on transport, they will restrain the use of transport
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  and improve the environment; at the same time, they are decreasing taxation on house fuel—without mentioning the impact it will have, if their theory is correct that demand will be affected—thereby increasing consumption of home fuel and accordingly harming the environment. There is a peculiar contradiction that destroys the myth that the Government's measures are designed to help the environment. They are not; they are designed to raise increased taxation.
  There are other tax increases on tobacco, alcohol and insurance premiums. They are all designed to raise extra money, but with a thinly veiled disguise. The Budget is about raising taxes and about the Chancellor's sticky paws being slipped into the pockets of working men and women, thereby taking from them a larger proportion of their hard-earned wages. It is about transferring choice from the individual into the state's centrally planned economy. It is also about increasing state power and influence and decreasing choice and the amount of money that an individual keeps to spend or save as he wishes.
  That is not the way to inspire an economy to grow and to be healthy—far from it; it will have the reverse effect. It ignores the lesson that is apparent throughout the world. Strong, vibrant and growing economies come about when taxes are kept low, when public spending is controlled and when individuals are given the initiative and encouragement to do and earn of their best. Those are the conditions in which economies grow. That does not happen when Governments plot and plan to take a larger proportion of the income that would otherwise flow into individuals' pockets.
  My greatest concern about the tax-raising Budget that is before us is the attack on home ownership. All my constituents will suffer from the other measures to which I have referred, but the measures that will hit them most in the longer term are those linked with taxes that will specifically hit home owners.
  I happen to believe that home ownership is a good thing in itself. I also believe that there should be an onus on Government to encourage home ownership. That is because it builds for individuals a stake in the community. It encourages them to be individually responsible financially and in other ways. It makes for easier mobility. In addition, it takes the burden away from the state to provide housing, as much as possible, and leaves it with the private market and individuals making their own choice.
  The Labour party has always been equivocal about home ownership. It has been responsible in the past for many measures designed to restrict home ownership or to discourage it. The Budget, however, is a downright attack on home ownership. Through three measures, the Budget will ensure that life is made more difficult for home owners, and that those who wish to move into home ownership will find it more difficult to do so.
  First, there is the reduction of MIRAS to 10 per cent. That will cost the average mortgage payer about £120 a year. That sum will increase as interest rates increase. That is the second consequence of the Budget. The inevitability of interest rate rises will additionally hit home owners.
  Home owners will be hit also by the increase in stamp duty that the Chancellor has brought forward. Stamp duty is an iniquitous tax because it taxes mobility. It is a tax

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  on a simple transfer, and I would like it to be non-existent. To go in the opposite direction and increase it will certainly be harmful.
  Most of the impact on home owners will not be on the rich; it will be on the ordinary, struggling middle classes who are attempting to stay in home ownership, or young people who are moving into home ownership in the first place, because they require mortgages and have to service them. Those people sometimes have to move into houses of higher value, particularly if they live in areas of the country such as mine, where property prices are much higher—as, indeed, they are across London and the south-east. Many of those people will have to pay the new increase in stamp duty which has been introduced in the Budget, which will have a serious impact.
  The Budget, which is merely the first step in a series of Labour tax-raising Budgets we will see, will have a particularly adverse impact on the ordinary men and women who want to move into home ownership or want to retain their stake in the nation via home ownership. It is despicable that the Government should attack those hard-working people in that way.
  The Budget is also a conjuring trick—an attempt to produce money where there is none, an attempt to shift money around, an attempt to raise taxes and then conceal the fact. The Chancellor may be able to get away with that in one Budget until it dawns on people, but the people of this country are not stupid. They realise when they are expected to pay more. The Labour party led them to believe, during the weeks running up to the general election, that they would not have to face tax increases; yet, a mere handful of weeks after the general election, they are faced with precisely that.
  This is a breach of trust with the British people, who were led to believe one thing and have now seen, even this early, something quite different delivered. They will grow increasingly irritable with a Government who go in that direction, as this Government will. The Government will not be able to continue the conjuring tricks that they were able to use when the Labour party was in opposition and that they have used successfully in the first few weeks of being in office. People will see through that. When the Government have to deal with the real economic problems, with their lack of ability, which they will soon display, to control public expenditure, they will need much more than magic to get them through.
  8.41 pm
  Mr. John Hayes: Thank you, Mr. Deputy Speaker, for allowing me to speak in the debate.
  As a new Member, I congratulate other new Members who made their maiden speeches today. Perhaps I may, unconventionally, also congratulate the Chancellor of the Exchequer both on the delivery of his Budget speech and on its political cleverness.
  I draw particular attention to the issue of consumption. In his Budget speech, the Chancellor made great play of the argument that consumption was heading out of control. I suggest that, because of the invisibility of the tax burden that he is now levying on the people, the mood that leads to excessive consumption will not be dampened or challenged and will necessitate interest rate rises in the
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  short rather than the medium or long-term. When those interest rate rises take place, which I predict will be in the very short term indeed, the responsibility will lie fairly and squarely with the Chancellor.
  The trick of transferring apparent blame to the Bank of England is just that—a trick. When interest rates go up, the British people will recognise that the Government must bear the brunt of the responsibility for that. The judgment on the Budget will be on what the Bank of England does about interest rates, and on how the British public will respond to that increase.
  I now deal with the main thrust of my speech—health. People who care about the health service must have been desperately disappointed by yesterday's Budget. The increase in health service spending is less than it was last year. Last year it was £1.6 billion; this year it is only £1.2 billion. This year's increase—2.25 per cent.—is lower than the average for the previous 17 years. That is a disappointment to the people who care about spending on health.
  As other hon. Members have said, there is no new money, no extra money, until next year. There is nothing to satisfy those who wanted immediate action. There is nothing to stave off any of the demands that will undoubtedly come as we head into the autumn and winter of this year, and there is less growth than we could have reasonably expected.
  The Budget is also bad news for petrol prices, which have gone up. I know that, for the wealthy, and for those, perhaps, who live in conurbations, it will not be so much of a problem, but for the people who live in rural areas, who will be condemned to their hamlets and villages because they cannot afford to use their vehicles, it is a significant problem.
  The problem with increasing the duty on petrol is that it is indiscriminate. It is not progressive. People in rural areas, on small incomes, have to use a car, because we cannot take public transport into every hamlet, into an area with a sparse population like the one which I represent. They need a car to get out. They are discouraged and blighted when duty is increased on petrol, and to do so under the artificial veil of green, environmentally friendly, environment-conscious activity is little more than an insult to the people who will have to pay more.
  The hon. Member for Staffordshire, Moorlands (Ms Atkins) mentioned this country's lamentable record—I think that she described it as such, or used words to that effect—on investment. Let me assure her that, in terms of capital allowances, the record on promoting investment is not encouraging. Whether the doubling of capital allowances that was announced in the Budget will lead to the targeted investment in infrastructure that the Government need and desire is highly debatable. The record suggests that it will not.
  That is not something that I say with any great political malice, because it was tried by the previous Government, and, by and large, the investment that was aimed for was not achieved as a result of increasing capital allowances. I wonder whether investment is not better achieved by a more targeted and focused approach to encourage companies to invest in the infrastructure that most hon. Members desire.
  I also wish to draw the House's attention to the extra money for education, and to the non sequitur on this subject in the Chancellor's speech. He talked about the

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  submission of plans, of bids by schools and how they would spend additional capital money. He talks about the submission of strategic plans that will be based on some competitive bidding process. Then, almost in the same breath, he talked about £150 for every pupil in this country.
  Either the Chancellor targets the money on infrastructure—on information systems, on technology—into some schools, to give them a reasonable chance to lead by example, a reasonable chance of investing the sums that are necessary to make a real difference to teaching and learning, or he spreads that investment—£150 per pupil, in his words—so thinly that it will make no difference to the experience of children throughout this country. I wait to hear in the wind-up speeches whether the money will be targeted, ring-fenced, bid-based, or, as the Chancellor implied, spread very thinly and therefore have little impact.
  Above all else, the Budget is an attack on pensioners. It is a take now and pay later Budget, a short-term Budget, a Budget that tries to disguise its real intent by attacking the future plans, the future prosperity and happiness of people who are investing in their own future, in their own pension.
  The attack on tax credits will have two effects. First, pension funds will suffer. People will either be asked to contribute more in order to make up a pension fund to a reasonable level, or they will find, possibly too late, that the pension that they expected and anticipated—not unreasonably, with the degree of individual responsibility which one would hope for and expect from prudent people—will not be there when they most need it, That, by any measure, is an attack on pensioners. Make no mistake about it, people will come to recognise the fault and frailty which is implicit in that proposal.
  As I have already said, I was impressed by the delivery of the Budget to which I listened with great interest. But I was not impressed by the Budget's short-termism, its political conjuring, and its flagrant attempt to deceive the British people into believing that it increased spending without affecting them, when the effects on them will be profound, long-term and deeply damaging.
  8.50 pm
  Mrs. Theresa May: Before I speak, I declare a non-registrable shareholding in the Prudential Corporation.
  This is a spin doctor's Budget, because the impression it gives is entirely divorced from reality and because it claims to do things that it does not do while claiming not to do things that it is doing. Its only success is that it is a Budget for spin doctors.
  The Chancellor told us yesterday that one of the main themes of his Budget was to take some heat out of consumer expenditure. As was ably pointed out earlier by my right hon. Friend the shadow Chancellor and my right hon. and learned Friend the Member for Rushcliffe (Mr. Clarke), in the short term the Budget does nothing of the sort.
  The Chancellor claimed that it was a Budget for investment. I have news for him. Investment is not increased by taking £5 billion out of the corporate sector every year. If £5 billion is taken as a tax hit out of the corporate sector, the funds available for investment are reduced rather than increased.
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  The Chancellor also gave the impression that the Budget would not have an impact on families and individuals. He gave the impression that he had been extremely clever because he had found a way of raising revenue without affecting anyone. He gave the impression that somehow the abolition of dividend tax credits for pension funds is a victimless tax. In fact, it is nothing of the sort. The victims will be companies, pensioners and people whose jobs might be lost as a result of that £5 billion being taken out of the corporate sector.
  Company pension schemes will either have to reduce the benefits that are available to their members, or they will have to put more contributions into the pension schemes, which again means less money for investment. In particular, they will have to be looking at the funding of those schemes today because of the more stringent requirements on funding that were introduced by the previous Government out of necessity following what happened under the remit of the late Robert Maxwell, who, as we know, was a former Labour Member of Parliament.
  But there are two other ways in which the abolition of dividend tax credits will hit people. First, it will have an impact on people with money purchase pension schemes; individuals with personal pensions who will now be faced with the stark choice of either reducing their standard of living today by putting more contributions into their schemes, or reducing their standard of living in the future when they come to take their pensions out.
  Secondly, a matter which was not referred to by the Chancellor yesterday, but which was highlighted earlier by my hon. Friend the Member for Havant (Mr. Willetts), the abolition of dividend tax credits will have an impact on local authorities. Local authorities' pension funds will be hit by the abolition of dividend tax credits and local authorities will find themselves in the position of having to increase contributions into those pension funds. Where will they find the money?
  As was pointed out earlier, one possibility will be for that money to come out of the extra money next year supposedly for education, which the Secretary of State for Education and Employment said he will not ring-fence for schools but leave for decisions to be taken by local councillors. We have seen the sort of decisions that too many Labour councillors take when they are allowed to make such decisions on money that the Government hope will go into education.
  For local authorities, the likelihood is that they will either put up council tax or cut services in order to fund the contributions required for their pension funds. That will be a hit on families and individuals. Far from all those smiling faces of Labour Members waving their Order Papers at the end of the Chancellor's speech thinking that somehow the Budget would put more money into public services, it will do the opposite. It will result in cuts in services by local authorities.
  In my constituency is the headquarters of one of the regional electricity companies, Southern Electric. I am particularly concerned about the principle of the windfall tax and its impact. As the hon. Member for Bath (Mr. Foster) said, when the windfall tax concept first came up, the Labour party claimed that somehow it would be a tax on fat cats. It is nothing of the sort. It is a tax on pensioners, shareholders and customers. Far from what we have just seen, a period of better services and falling

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  prices in the electricity companies, we may well see prices going up, and we will see an impact on shareholders and on people whose savings are invested in the shares of those companies and whose pension funds have investments in those companies.
  A number of points have been raised with me by constituents. One is the increased tax on petrol. My office took a phone call this morning from an extremely irate constituent asking whether the Chancellor realised that that measure hit everybody, even those who do not have cars, because of delivery costs of food, manufactured goods and so on. She said, "This will hit us all. Can't you make that point? Doesn't the Chancellor understand?"
  Another point was made by someone who is disabled. He is particularly concerned because he relies on his car to give him the quality of life that he wants. This measure will be an extra hit on him and other members of the disabled community who also rely on their cars to get about.
  The Chancellor also claimed that the Budget would help small businesses. The reduction in corporation tax is to be welcomed, but there are other aspects about which I am sorry the Chancellor did nothing. For example, he did not raise further the VAT threshold for small business, and he did nothing to pick up the ideas which the Conservative Government developed before the election about changing the uniform business rate, which is a particular concern of many small shops, particularly in the rural villages in my constituency. There is an aspect of the Budget which will adversely affect small businesses. It has been put to me that, if a small business is in difficulties, the proposal to change the period of qualification for loss carry-back will have a real impact on it. Far from being a positive measure for small business, then, it will have a negative impact on them.
  Nowhere in the Budget is the spin-doctoring more acute, or the Chancellor's claim to be doing one thing while doing another more callous, than with the funding of the NHS and education. There were cheers yesterday when Labour Members heard that £1.2 billion was to go into the NHS—but it is going in next year. As my hon. Friend the Member for South Holland and The Deepings (Mr. Hayes) pointed out, that is less extra money than we put into the health service last year.
  For the next few months there will not be a single penny extra for hospitals. So all the hardship cases that Labour Members have been raising about their local hospitals—they will continue to raise them—will meet with no extra money from this Budget to solve their perceived problems. The money will be available only from next April, and then only if the contingency reserve has enough money in it. The Chancellor is raiding tomorrow's nest egg but announcing it today. The impression given is that something is happening immediately; the facts are very different.
  The same impression has been given about education. Here the spin doctoring went into fast forward. Those of us who watched the Chancellor's Budget television broadcast last night saw him produce a pretty little table showing how much extra money was to go into schools—£2.3 billion, he said. I wonder how many teachers, parents and school governors watching must have rubbed their hands with glee at the thought that their schools would benefit immediately from the Budget.
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  Once again the reality is different from the impression, and the Chancellor has claimed to be doing something he is not doing. Far from £2.3 billion going into schools over the next few months, either £100 million—the Red Book figure—or £83 million—the figure given us by the Secretary of State for Education and Employment—is to be given to schools up to April 1998. That is nowhere near the Chancellor's claimed amount. Furthermore, the £1.3 billion from the windfall tax new deal will be spread over five years, and the other £1 billion that the Chancellor announced will not be available until next year either—and then only if it can still be taken out of the contingency reserve.
  This is a spin doctor's Budget, a cynical Budget. It tries to pull the wool over the eyes of the electorate. As others have said, a Budget that is applauded and thought popular on the day it appears is a Budget which turns out to be very unpopular in the long run; because it is in the long run that people will feel the pinch in their pockets.
  9.1 pm
  Mr. Tim Boswell: This is inevitably an unusual occasion, in that there are no wind-up speeches on the first day of Budget debates, so today we have to wind up two days of debate. It is my pleasant duty to record the delivery of a number of elegant and remarkable maiden speeches. On my count, there were eight yesterday and another eight today. It would be invidious to pick out any of them and tedious to enumerate all of them. Still, those that I heard were of high quality and were an example to everyone.
  Almost without exception, maiden speakers have described their constituencies with affection and have been considerate and generous to outgoing Members of Parliament, especially those who had been defeated. They have also produced interesting insights into current politics.
  It is always a pleasure, listening to maiden speeches, to hear resonances from constituencies that I have visited to campaign in, or whose Members I have known, or which I have visited as a Minister or in some other capacity. It all introduces a note of courtesy to our proceedings which is of great value to those who honour this place.
  I welcome the Financial Secretary to the Treasury to her position. We look forward to her contribution this evening. My closest involvement with the Treasury came some years ago when I acted as parliamentary private secretary to my right hon. Friend the Member for Hitchin and Harpenden (Mr. Lilley), now the shadow Chancellor. I enjoyed that experience, just as I enjoyed his speech today. That post gave me a good insight into the workings of the great institution in which the hon. Lady now serves as a Minister.
  The House may be surprised to know that the first time I ever briefed Members—then Opposition Members—on a Finance Bill, as a comparatively young man, was during the passage of the celebrated 1968 Finance Bill, That experience is seared into my mind. For one thing, it was on the back of a Budget introduced by Lord Jenkins of Hillhead, as he now is—he was then the Labour Chancellor—which, as I recall, involved a tax increase of £923 million. That was then a record increase.
  The most remarkable development in the nearly 30 years that have elapsed since then is the change in the scale of the figures: it has changed out of all recognition.

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  Just the change in MIRAS—which the Chancellor sought to downplay—will cost £950 million in a full year, which is almost the same figure as the one that I mentioned earlier, but is in fact only a nominal amount relating to a single change. That is before we even start on advance corporation tax and the windfall tax.
  I think that the moral of my rather long, if intermittent, experience of Treasury matters is that, while some things change, others go on for ever. The first is the simple perception that Labour Chancellors nearly always raise taxes. That is what I associate with Labour Chancellors, and that is what we all suffer from Labour Chancellors. The second is this. When the late Iain Macleod—of whom some of us were deeply fond—was shadow Chancellor, he coined a concept that was known then as Macleod's first law of the Budget, to which a number of hon. Members on both sides of the House have referred today. He said that what played well as a Budget on day one would look very different in a few months' time.
  I think that he had in mind the traditional timetable to which I believe the Government are considering reverting—a spring Budget followed by a summer Finance Bill concluding in July. This year, we have a midsummer Budget, also, apparently, concluding in July—but I shall pass over that until later.
  Iain Macleod was making the point that, however hard you spin and however well you dress it up—and there are people in that great Department of State who are past masters at concealing spin, flights, googlies and so forth—reality will out by the time people have to pay the bills.
  As we have some time to spare, I think it appropriate to refer to the first First Lord of the Treasury, Sir Robert Walpole. He said—admittedly not on a financial occasion, but on the outbreak of war with Spain in 1739—
  "They now ring the bells, but they will soon wring their hands."
  Before I begin my speech in earnest, I should get one point out of the way. It would be inconsistent with the general tenor of the debate, and particularly with the maiden speeches, to engage in some silly controversy about who cares most for young people. I sincerely hope that hon. Members on both sides of the House are conscious of the position of young people, and the position of unemployed people, whether young or older.
  Some of us have done time as Education Ministers. I had the great pleasure of being the Minister responsible for further and higher education, and I also have a fairly strong family involvement with adult literacy issues. Probably all of us, by definition, have no direct experience of the underclass, but, in our constituency work, we all come across people who may be in danger of falling into that category. We all want to help them; the questions are how we help, what are the most effective means and whether there will be any repercussive effects if we adopt one course rather than another.
  I think that some of my right hon. and hon. Friends have analysed the Budget as they have because it was heavily presented by the Chancellor as a warm and caring Budget. The difficulty that should be exposed—indeed, my colleagues have exposed it effectively today—is that all those warm and caring words could not hide the fact that there was a time bomb in the Chancellor's hand. That time bomb is primed to go off at some stage, and it will cause a degree of disappointment—even, perhaps,
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  feelings of ill faith among Labour Members, who will find that what they expected to be glad confident morning turns into a very depressing picture.
  I do not want to seem totally negative and churlish about not merely the delivery but the contents of the Budget. I often feel that Labour Chancellors who, as I reminded the House, nearly always put up taxes, are a little like the proverbial monkey on a typewriter because sometimes, by accident, the result is intelligible and quite palatable. A Labour Chancellor cannot help sometimes getting something right. The cut in corporation tax, including the small companies' tax, and the proposals on the film industry are welcome. However, they must be set in the context of what the Chancellor is trying to do and set against the unpalatable measures in his proposals which he sought to conceal.
  The measures that we have welcomed are isolated shafts of light in a bleak picture. It is rather disturbing for me to talk about a bleak picture, because the Government have been in office for only nine weeks. Just like that, they have taken an economy which was an acknowledged success throughout Europe and have started to run down the golden legacy of growth, competitiveness and low inflation that we bequeathed them. They are busy on the task of turning that golden legacy into dross.
  I shall analyse first, as my colleagues have done in some detail, the impact of Labour's proposals on the home owner, who will suffer heavily from the Budget. He is facing three direct hits. The first is the scaling down of MIRAS which will total £950 million in a full year. I remind the House that the benefit of MIRAS is not for the middle or upper classes: it is not only Islington man who benefits from it. The distribution of the benefit across all sectors and percentiles of income is broadly stable. That has been shown by the Institute of Fiscal Studies, and scaling down MIRAS will hit everybody with a mortgage more or less equally.
  The second hit on the home owner is the increase in stamp duty, which is smaller in amount, about half the size of the MIRAS reduction at just over £500 million, and is apparently confined to larger properties, which, according to the Chancellor's definition, are those costing over £100,000. Of course, many such properties are not necessarily occupied only by the executive classes. Farms and commercial properties may also attract the charges, and the structure of stamp duty with its rather unusual step system means that it has strong repercussions at the borders of the changes. Instead of having two rates—zero and one—there will be four rates, and that will not contribute to reducing the burden of taxation or simplifying the tax system.
  The third hit on the home owner is the two increases so far in interest rates since the election, which, as I have said, was only nine weeks ago. Who knows what will come next week? The press is certainly speculating hard that there will be a further increase then. It is not surprising that people have not gone out into the streets and revolted at these changes on day one, because, as Treasury Ministers will know, there is only an annual statement of account for many mortgages. The general tendency is to lengthen the repayment period. As the tax change, one of the three hits, will not appear until the spring, it is hardly surprising that the burden and impact of the changes, some of which are already taking

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  place, will not come to a head until then. Like the other deferred Budget disappointments, they will appear with a vengeance.
  I shall deal with another matter that I do not think has been flagged up in the debate, most of which I have heard. It bears on the other tax changes, with which I shall deal in a moment, in particular, the changes in advance corporation tax, and relates to the use of endowment policies to repay mortgages; and, I suspect, it relates also to mortgage protection policies. The plain fact is that a hole will be torn in those endowment policies and one or two people may find themselves with inadequate policies to service their eventual mortgage repayment. I hope that the Financial Secretary to the Treasury will comment on that concern.
  The second and perhaps greatest sectoral hit in the Budget is the impact on pensioners in particular and on other savers in general. To quote for the last time the late Iain Macleod, he once said memorably that savings are the harvest of a man or woman's life and career. Of course, many people are saving, through one means or another, for their eventual retirement, so this affects not only pensioners, but people in my age group who are contemplating eventual retirement and are trying to put their affairs into sound shape.
  The windfall tax is one aspect of that impact. In fairness to the House, it has been well discussed. It was brilliantly analysed by my right hon. Friend the Member for Hitchin and Harpenden, the shadow Chancellor, and by my right hon. and learned Friend the Member for Rushcliffe (Mr. Clarke), both of whom explained the incoherence of introducing a temporary tax to fund a long-term programme and a partial tax to fund much more general aspirations, including education. The proposal is already holed below the waterline, but it will be for the Government to decide how they wish to persist with it. If they do not persist with it, they cannot possibly make even their rudimentary figures stand up.
  At a modestly early hour of the morning, I found myself appearing on Talk Radio. In another studio was Professor Geoffrey Wood from the City university business school. I made a comment that was fairly politically blunt about the impact of the changes in ACT. I have no idea what his politics are, but, when asked to comment on my remarks, he said that the ACT changes were a major change in the British tax system and that their full significance had yet been realised. That was a masterpiece both of precision and of modesty.
  The plain fact is that there is a black hole somewhere around the Chancellor's Budget. It was not bequeathed to the Government by their predecessors. As my right hon. and learned Friend the Member for Rushcliffe has already made clear, it is an autonomous black hole, chosen by the Chancellor. The black hole that he is carving out is in the pension funds and the savings of individuals.
  We all know that the National Association of Pension Funds estimates that the changes will mean over £50 billion of extra pension contributions over a 10-year period. Its chairman, Mr. Peter Murray, commenting perceptively, said that the changes were a direct attack on the people's money. Of course, the NAPF is generally representative, although not always, of the larger funds. What about the smaller company schemes and
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  self-financed pension schemes? What about personal pensions? By definition, they have no friendly, large, well-capitalised public company to top them up. The changes are a direct hit on the resources available to individuals.
  The exact nature of that hit is somewhat difficult to calculate. For example, one fund may be investing more in tax-favoured assets such as real property, or in overseas companies rather than in domestic companies. One of the most telling points that has come out of today's debate is the way in which we are driving investment away from Britain by making it less attractive for companies to hold assets here.
  If companies feel that they are challenged by the ACT changes, they may re-balance their portfolios and pension funds, but it is clear—certainly to me—that the hit on pension funds induced by the Chancellor to raise his £5 billion every year, will total between 5 and 15 per cent. of income. That allows for capital gains, from which they also benefit.
  I advise people to get out their policies tonight. It might be as well for them to take advice in the near future on whether they will have a sufficiently large policy to meet their mortgages or other commitments in due course. If they are politically motivated, or just cross about what has been done—as they should be—I suggest that they write on their policies, "Devalued by the Chancellor who said he would never put up taxes."
  Before I leave the position of pensioners, I want to flag up the damage done by the withdrawal of tax relief on private health insurance—again alleged to save money, but again a rather small amount. It is targeted at 600,000 people and is likely to drive many of them, perhaps even a third, back into the public health sector, thereby lengthening waiting lists.
  I want to deal with one or two other effects of the tax changes. Some of us had the considerable privilege of attending today's lunchtime seminar conducted by the Institute of Fiscal Studies. It is a body respected by both sides of the House because, quite frankly, it dishes it out indiscriminately to all of us, as it sees fit. It points out—it is not difficult, as it is obvious even from the Red Book—that advance corporation tax changes will cost business almost £5 billion in a full year, while the cut in corporation tax which the Chancellor presented as the offsetting benefit amounts to only £2 billion. It does not require a university degree in mathematics and computing to work out that the gap is £3 billion. As the institute magisterially concluded today, despite the rhetoric the changes are unlikely to benefit business investment. Quite frankly, I agree.
  I want to pass from taxation of business—which, as a number of people, including Professor John Kay, have conceded, in the end is merely a shell or a format for the payment of taxes that fall indirectly on the people—to taxation that falls directly on the people. In today's presentation, the institute analysed the impact of tax changes on households according to their relative income. It calculates that the impact on the top decile of incomes will be £2.19 a week, while the impact on the bottom decile will be 50p a week. Some 70 per cent. of all households will lose out from the Budget, while 20 per cent. will gain and 5 per cent. are "don't knows".

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  What is clear is that, on the absolute figures, the greatest proportional loss is among the bottom decile. Yesterday, Labour Members were busy waving their Order Papers in support of a Budget that independent experts have assessed as regressive.
  I want to raise a final point that deeply concerns me. Many Conservative Members are becoming increasingly worried about the Government's propensity to treat the House with ill-concealed contempt. Of course, I except those who are here tonight. Much of the legislation introduced in such a short period has been rammed through in haste, often with Committee stages being taken on the Floor of the House and therefore with highly truncated consideration. Bills are being rammed through on the back of the Government's current handsome majority.
  We are also deeply concerned about the ill-concealed attempts by Treasury Ministers to leak the Budget contents in advance. [Interruption.] If Labour Members want to deny that, they should agree to have the allegation examined properly and independently. We would respect any such inquiry. Let them not, however, try to brush off the leaks, as if Opposition Members are not properly concerned when we discover that the Budget is delivered to us not by the Chancellor but with the Financial Times in the morning.
  Such leaks are all of a piece with other events. The Opposition do not believe—I warn Ministers of this—that arrogant and hasty high-handedness contribute to good legislation. The Chief Secretary to the Treasury goes on about the community charge or poll tax. I should tell him that that measure was most extensively debated in the House, and if we did not get it right, it was not for lack of trying by him. He should consider that matter. I am not making a narrow party point. We need to ensure, and I hope that Ministers want to ensure, that we get the Government's legislation right. At the end of my speech, I will advert to one specific concern on which I should like the Financial Secretary to the Treasury to comment.
  The Opposition believe that legislation should be properly considered. We also believe that there are chinks in the Chancellor's carefully crafted Budget armour which need prising open with proper and full scrutiny. We are bound and driven to the conclusion that, if that scrutiny does not occur, it will be because the Government have something to hide and prefer that neither the Opposition nor the public notice. If Ministers try to rush a Finance Bill, they will leave not only technical errors but a mood of disillusion, as the public discover that the expected glad morning does not appear.
  I tell Ministers that the Opposition simply will not settle for a truncated debate on those matters. We want a proper debate and we want a proper reply from the Government, both to today's debate and in Committee. I hope that Ministers will show the right spirit in dealing with that issue.
  I ask the Financial Secretary to make—she will perhaps recall the phrase—a fresh start and to set a good example to her colleagues by answering four specific questions, rather than brushing aside the concerns that were expressed so eloquently by my hon. Friends and other hon. Members.
  First, I stated the figures, as I took them down, on the Budget's impact on households because of tax changes. Does the hon. Lady accept that the overall distribution of
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  the Budget's tax changes will have a regressive effect on the lowest income deciles? If she does not, will she please explain why?
  Secondly, will the hon. Lady explain to the House—because no adequate explanation has been offered—why she expects business to invest more when it will have to give up an additional £3 billion in corporate taxes annually?
  Thirdly, does the hon. Lady accept that the deflator changes that were announced in the Red Book, even on the most optimistic of the three projections provided, mean that public spending plans over the quinqucnnium will be below the trend line of public spending in the past 18 years of Conservative government?
  Finally, as an example of the types of technical problem that over-hasty and arrogant legislation can cause, has the hon. Lady considered, and can she give any indication of the Treasury's thinking on, the treatment of franked income for unit and investment trusts? Is such income—as it appears to me—totally to be suspended and wiped out? If so, can she tell us what the impacts will be on savers? Does she concede that its suspension will represent yet another blow to savers and to pension holders—in a Budget that attacks them directly?
  9.28 pm
  The Financial Secretary to the Treasury (Dawn Primarolo): I welcome the hon. Member for Daventry (Mr. Boswell) to his new post. I look forward to our future debates, and acknowledge his experience, which goes back for some 30 years. As he said, while he was advising on the Finance Act 1968, I was 14—when I was enjoying an excellent comprehensive education, which has equipped me with the qualifications to establish myself in society and to contribute to that society. The Budget is about offering to young men and women the opportunities which the hon. Gentleman's Government unfortunately denied them.
  The hon. Member for Daventry talked about controversy, said that he did not wish to trade insults across the Dispatch Box, and reflected on his past. When I entered the House 10 years ago and made my maiden speech, I spoke of the young men and women in my constituency who were despondent, disappointed and rejected and who believed that society did not value them as individuals. Unemployment is a personal disaster as well as socially destructive but, some 10 years later, this Government have to take action to tackle it because the previous Government failed to do so.
  I remind the House that the last time the Conservative party advised members of the public to seek advice on their pensions, it led to this country's biggest scandal in pension mis-selling. It ill behoves the hon. Member for Daventry and his colleagues to scaremonger and to frighten pensioners.
  Yesterday and today, many hon. Members have made their maiden speeches. They were mostly Labour Members; that reflects our majority in the House, but I assure the hon. Member for Daventry that we have no intention of stifling debate or forcing through legislation, as his party did with the poll tax, because we intend to keep our excellent Prime Minister, not pull him down as the Conservatives did with their Prime Minister over the poll tax.

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  In yesterday's debate, my hon. Friends the Members for Eastwood (Mr. Murphy), for Brentford and Isleworth (Mrs. Keen), for Redditch (Jacqui Smith), for Enfield, North (Ms Ryan) and for Pontefract and Castleford (Ms Cooper) spoke in support of the windfall levy and talked of the importance of giving young people the opportunities for work and training. They supported the principle of rebuilding the health service and the principles that the previous Government allowed to be undermined and destroyed. They acknowledged the importance of reducing VAT on fuel and the benefits that that brings to the elderly. Conservative Members speak of their concern for pensioners, but I do not remember them showing that concern when they introduced VAT on fuel in the first place, having promised that they would not.
  What seems to shock Conservatives Members is, first, that the Government intend to keep their election promises; and, secondly, that a new Government would want to introduce a Budget to set out the course that they intend to take. When the Conservative Government were elected for the first time, they introduced such a Budget, so I cannot see what is so terribly unusual about this Government wanting to do likewise, especially as we made clear in our manifesto our intention to do so.
  My hon. Friend the Member for Warwick and Leamington (Mr. Plaskitt) gave us a scenic tour of his constituency. He, too, underlined the importance of ensuring training and skills for our young people. We must avoid the trap that the previous Government reversed those young people into—the trap of low wages, low skills and only rare chances of jobs that offer opportunities, if they have jobs at all.
  My hon. Friend the Member for South Ribble (Mr. Borrow) spoke movingly of the cruel fate that denied Dennis Golden, the previously selected Labour candidate, the chance to contest that constituency. He had to resign because of ill health and then unfortunately died before he was able to see the election of a Labour Government. My hon. Friend spoke fluently without notes on the importance of jobs. I think that all hon. Members will acknowledge his thoughtful contribution and look forward to hearing him in the future.
  My hon. Friend the Member for Leicester, West (Ms Hewitt) talked about a Budget for jobs. She also paid tribute to her predecessor, Greville Janner. I am sure that Greville would not mind me saying that he was a character in the House who will be sorely missed, although my hon. Friend, who is one of 101 Labour women, is an excellent addition to the House and will make a good contribution. She described graphically the needs of her constituents for access to jobs and training to liberate their talents and ensure that they can contribute to society. That was echoed by my hon. Friend the Member for Lincoln (Gillian Merron), who showed a clear understanding of the needs of her constituents.
  My hon. Friend the Member for Wirral, West (Mr. Hesford) made it clear that we were delivering on our election promises. He acknowledged the contribution of his predecessor, David Hunt. He added a personal pledge, saying that he intended to answer all his constituents' letters by return post. I wish him good luck and hope that he is able to keep that pledge.
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  My hon. Friend the Member for Staffordshire, Moorlands (Ms Atkins) spoke of her predecessor, Sir David Knox, and the kind support that he has given her. I agreed entirely with her argument about the desperate need for a minimum wage—a floor under which wages cannot fall—and the importance of that for the future of Britain. I took particular note of her spirited representations for her local tax office. She rightly drew attention to the importance of self-assessment. I shall consider her points carefully.
  The hon. Member for Bath (Mr. Foster) asked some specific questions about the provisions in the welfare-to-work programme. The programme will be carefully monitored in all respects—quality of training, quality of work experience and how people get on in keeping jobs. We shall also always keep open the opportunity for those who do not initially accept the option to take part to choose to do so. I stress again the importance of the advice, support, counselling and help that young men and women will get before their placement and new career.
  Young people who have difficulties—special needs, homelessness or drug abuse problems, which blight so many lives—will have special advice and support. The organisations involved will have a track record of success in that area. It is our intention that the programme we propose should be about inclusion and opportunities, and not about exclusion and punishment.
  In what has been an interesting debate this evening, one contribution hit an all-time low. I refer to the speech by the hon. Member for Mid-Norfolk (Mr. Simpson), who started by talking about the length of women's skirts and cross-dressing as an indicator of economic prosperity. Although the House appreciates a joke, he should perhaps refine his a little more before he speaks again.
  The hon. Gentleman made comments about private medical insurance, and described Labour's proposals as nasty and hitting at pensioners. He really should check his facts. Between 1990, when the scheme was introduced by the previous Government, and now, there has been no significant growth in the number of people using private medical insurance relief. Some £140 million could be better spent, because the people getting the relief are those who already had insurance premiums. If Conservative Members are so worried about pensioners, will they explain why they took away the zero rate of VAT on fuel?
  The Government have put forward clear proposals. We have a Budget equipping Britain for the long-term future. We have reflected the priorities of the people. Disillusionment does not stalk the land; instead, there is acceptance and support of the Chancellor's proposals. The Budget fulfils our election promises, in stark contrast with the practice of the previous Government. It is about a new deal for the unemployed, and about investment in industry and infrastructure. It is about fair taxes and economic stability. The Budget is for the long term and it is about equipping Britain for the future while delivering now on the priorities of education and health.
  During the election, Labour promised that education would be our number one priority. This Budget allocates £2.3 billion extra spending for schools and £1.2 billion more for health while ensuring that Government borrowing is reduced. This Government are determined to

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  encourage a fair society in which the many and not the few can share high living standards and greater job opportunities.
  Mr. Boswell: I sense that the hon. Lady may be coming to the end of her remarks—
  Dawn Primarolo indicated dissent.
  Mr. Boswell: In that case, I am prepared to wait. I hope that we can have her assurance that she will answer the questions I posed.
  Dawn Primarolo: I can assure the hon. Gentleman that I was not about to bring my remarks to a close.
  The new deal for the unemployed fulfils our manifesto commitment, and it will be paid for by the windfall tax on the privatised utilities. The Chancellor made it clear yesterday that after full consultation with the regulators, there is a clear judgment that the tax can be paid for without there being an impact on prices, investment, service standards or the employment prospects of those currently in the utilities. Indeed, the Public Accounts Committee has made it clear that in the case of the water companies, which have made profits totalling £7.4 billion, and in the case of the regional electricity companies, which have made profits of £8.7 billion, the profits were in excess of the level that the respective director generals have judged it reasonable to allow in the future.
  The Budget contains a popular set of proposals that people have accepted. It provides opportunities for the unemployed, and assists lone parents back into full-time employment by helping them with child care provision. Some Opposition Members have complained that we have not invested enough in child care. That is rich coming from them, when, for 18 years, the Conservative Government presided over the worst investment in child care, denying people access to quality provision.
  A successful economy needs stability, low inflation, strict control over Government borrowing, and openness. My right hon. Friend the Chancellor has set a target of 2.5 per cent. underlying inflation, and the Bank of England is responsible for setting interest rates. Strict control over Government borrowing and public finances is essential for stability. The Budget introduces new rules, under which the Government will borrow only to finance investment, and which include deficit reduction.
  The Government are committed to building their reputation on trust and openness. They have opened the books to independent checks, and will continue to do so.
  Mr. Lilley: Will the hon. Lady tell us how many of the 17 tax rises introduced in the Budget she had the honesty and openness to trust her voters with before the election?
  Dawn Primarolo: We have stuck to our promises. Our manifesto made absolutely clear our intention to invest in industry and infrastructure, and to plan for the future.
  Openness has never been a hallmark of the previous Government. We hope that, in the exchanges between Front Bench Members in the coming years, our openness will help the Opposition to understand the direction that the Government are taking, even if they cannot grasp it now.
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  We have undertaken a major reform of the corporation tax system, providing a low-tax environment for companies, encouraging quality long-term investment, and maintaining an attractive environment for inward investment. We have cut the basic rate of corporation tax from 33 per cent. to 31 per cent. from April 1997, and the rate for small companies from 23 per cent. to 21 per cent.
  Let me make it clear that there is no attack on pensioners or pension funds. Opposition Members are engaging in scaremongering. Tax credits for pension funds and United Kingdom companies are abolished from Budget day. The abolition of credits removes the distortion which encourages the payment of dividends rather than the reinvestment of profits. Many pension funds have large surpluses totalling nearly £50 billion, so they can absorb the loss of tax credits and improve company performance as a result of encouraging long-term investment.
  The measure is good for pensions and pensioners, not bad for them. Furthermore, the existence of pension fund contribution holidays demonstrates that there is scope to absorb the measure. People should understand that our reforms will benefit pension funds.
  Mr. Christopher Chope: Is the hon. Lady aware that, this evening, Sir Jeremy Beecham, a highly respected member of the Labour party's local government team, has spoken out by saying what a disaster tax credits will be for people who pay council tax due to the implications of costs on local government? He is calling on the Government to give an indemnity to local authorities against the additional burden. Is she able to meet his demand?
  Dawn Primarolo: Having listened to this debate and despite all the hon. Gentleman's protestations, I would like to ask him why the Government whom he supported cut advanced corporation tax if they believed that it would be so damaging. The issues are clear. The tax credits can be coped with in being withdrawn from pension funds and companies will benefit as a result. There is no change for charities and no change for other non-taxpayers until April 1999. Charities will then receive transitional compensation for five years, giving them a total of seven years' notice—more than the previous Government did.
  Mr. Boswell: The hon. Lady has just effectively given the House the impression that there will be no impact in most cases of the changes which we have discussed. In that case, why is it necessary to give charities compensation? If there is no problem, why are the Government giving compensation to one sector but not another?
  Dawn Primarolo: We accept that there is an impact on charities, and that is why we are giving compensation. It seems a very simple proposition, but obviously not one that Opposition Members can understand.
  Individual savings accounts will be created to continue to provide tax-favoured savings. The provision of first year allowances for small businesses is a temporary measures to ensure that investment in machinery and plant for small and medium-sized companies can also assist their development.
  The Government have responsibilities to promote real opportunities for all the people in Britain. Young unemployed men and women have responsibilities to seek

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  work and accept reasonable opportunities, and to upgrade their skills when those opportunities are provided. Those people are ambitious and motivated but cannot get work. There are also young men and women who have lost their motivation and whose ambition has been eroded as a result of years of unemployment under a Government who offered them no hope.
  The Government have put forward a Budget which invests in people, education and health, and which creates stability and long-term security. This Government keep their promises and will be earning the respect of the people of this country. The people know that they can trust this Government because they are fair, open, honest and direct. That is why this Government have been elected. The economic policies to which Opposition Members have constantly referred in this debate have been rejected.
  I hope that, in the discussions that will ensue on the Finance Bill, the Government will demonstrate that they do not follow the example of the previous Government. There will be no abuse of our majority; there will be debate and discussion of the issues before the House. I sincerely hope that, as has been said, we shall do so in a fair and open manner—not trading insults across the Dispatch Box.
  Mr. Boswell: On a point of order, Mr. Deputy Speaker. The Financial Secretary has an endearing style of what might be termed serial peroration, which is why I intervened somewhat prematurely in her remarks. I gave her every opportunity to make some attempt to answer the four specific questions that I posed to her at the end of my remarks. I appreciate that she is new in the job and she may not be familiar with the answers to entirely reasonable questions, but she might have sought advice and made some effort to respond, as she indicated she would. Is not that a gross abuse of the House of exactly the kind that we have complained about before?
  Mr. Deputy Speaker (Mr. Michael Lord): The way in which Ministers choose to answer questions is not a matter for the Chair.
  Debate adjourned.—[Mr. Robert Ainsworth.]
  Debate to be resumed tomorrow.

  Transport (Middlesbrough and Cleveland)
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. Robert Ainsworth.]
  9.55 pm
  Dr. Ashok Kumar: I am grateful for the opportunity of this Adjournment debate, because the subject is very important to my constituents. I congratulate my hon. Friend the Member for Hampstead and Highgate (Ms Jackson) on her appointment as the Minister for Transport in London. I am sure that she will make a great contribution, and I wish her well in the future on behalf of my constituents.
  Some weeks ago, commuters on London underground and railway services found their journeys enlivened by sitting next to my hon. Friend the Minister for Transport in London and my right hon. Friend the Secretary of State for the Environment, Transport and the Regions, who abandoned the aroma of the leather seats of their ministerial Jaguars for public transport. I applaud them for that demonstration that we are committed to building a good public transport system for the 21st century. However, if their ministerial duties had taken them to the isolated villages in my constituency, they would not have been so lucky.
  My constituents living in the hamlets of Margrove Park and Charltons have found that they have no bus services in the early mornings, evenings and Sundays, because of the supposed freedoms conferred on them by the previous Government's bus deregulation measures. Other communities, such as Loftus and Easington, have seen big reductions in their services and the loss of school runs. They can only watch bemused as more urban areas of my constituency experience a motley procession of buses, many nearly empty, through their estates.
  Stainton village, which adjoins a more urban part of my constituency on the edge of Middlesbrough, has had its direct bus services to the town of Yarm cut. That has affected people's work prospects and dramatically affects school children, even though they live on the edge of a conurbation. Schoolchildren have petitioned me. For example, Carla Sterling, a 13-year-old from the small east Cleveland village of Brotton, tells me that she has to make a roundabout journey of one and a quarter hours to get to and from her school, Huntcliff, in Saltburn. That means that Carla loses two and a half hours a day out of her young life just to make the journey to and from her place of education. That adds up to nearly 400 hours a year, which could make all the difference between a good or poor GCSE grade. That is the human reality of the effect of a poor, deregulated bus service on a family.
  Those villages need their services. Many local people find it hard to hold down a job. In an area of high unemployment, a job is a job is a job. Many people do not have access to private transport and in many wards more than 40 per cent. of families are without cars.
  Many of my constituents find their social life during the evening disrupted, and local snooker, domino and darts clubs are finding their existence undermined. In the Lockwood ward there is only one church and the Sunday bus service was a lifeline for scattered worshippers. It has now gone. Why? Simply as a result of the impact of

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  deregulation and the measures originally pioneered by the former Secretary of State for Transport, the late Nicholas Ridley. The local bus company, which has a near total monopoly in the rural part of my constituency, has decided that the pickings are richer elsewhere. Those services were formerly underwritten by the then Cleveland county council, and most villagers travelled on buses supported by the public purse.
  It being Ten o'clock, the motion for the Adjournment of the House lapsed, without Question put.
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. Robert Ainsworth.]
  Dr. Kumar: The fact that the former Cleveland county council played a key role in providing support from the public purse to provide excellent services has been recognised by my local newspaper, the Evening Gazette. A debate has now started in our local newspapers. I am deeply grateful for the support that the Evening Gazette has given me on this matter. There was a lead item on it yesterday, Wednesday 2 July. The newspaper rightly recognises that I am highlighting the concerns of many people in east Cleveland who raised the matter before, during and after the general election.
  Now, with the advent of smaller unitary authorities and with all the problems that were visited on the fledgling authorities by the final local government settlement of the previous Administration, that support cannot be given to the same extent. Other pressing areas of services, notably school buses, have rightly had to be given priority, but that is no comfort to my constituents. The small print of local council budgets does not relieve their problems. It merely tells them why they are experiencing these difficult problems.
  We need to consider as a matter of extreme urgency how we, as a Government committed to public transport, can bring a degree of sanity back into bus operation. We need to look into the quasi-monopoly that has arisen in the bus industry, and at the carving out of local and regional spheres of influence. The local council in the rural part of my constituency in the boroughs of Redcar and Cleveland all too often finds that, when it issues tenders for services, only the dominant operator in the area—Tees and District, part of the Cowie group of companies—bothers to reply. Other regional and sub-regional operators, notably Stagecoach, decline to tender out of their operating area. Smaller, often family-owned coach and bus operators find it difficult to compete for tenders that last only one year. They cannot be expected to buy new buses and hire new staff for a contract that they might lose 12 months down the line.
  The problem is not confined to my constituency. It is a national problem. A recent study by Symonds, Travers and Morton transport planning consultancy found that, on average, 16 operators provided scheduled services in each local authority in the United Kingdom. Significantly, it also found that in almost all the areas surveyed just one dominant operator cornered the market, with small niche services existing on the periphery—the minnows following the sharks, perhaps. It went on to confirm the monopoly situation that is prevalent in the bus industry. If we accept the definition of monopoly as a company controlling more than 25 per cent. of the market, we find that no fewer than 94 per cent. of all local authority areas have suffered, and still suffer, from bus company monopoly practice.
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  We need to look long and hard at how the bus industry is to be managed in future. I accept and acknowledge that we cannot return to the position that obtained in 1986, or before that, when there was much that was bureaucratic. It was a system designed for another time, when there was a far lower level of car ownership, different journey-to-work patterns and different expectations of public transport. We must accept, however, that more re-regulation must be introduced. That, and the future for public-private partnerships, was outlined by the Minister of Transport earlier last week. My right hon. Friend argued that debate must begin on the future for local transport. He asked for everyone involved to give his or her views.
  I shall make some suggestions to help my right hon. Friend along. My constituency lies within the orbit and influence of the Teesside conurbation. It is not formally designated as a metropolitan area, but it shares many of the characteristics of metropolitan areas such as Rotherham in South Yorkshire or Calderdale in West Yorkshire. There is a dense core surrounded by a string of small settlements.
  Both Rotherham and Calderdale benefit from the existence of a passenger transport authority and a passenger transport executive. In a PTA setting, fares can be managed, routes devised and linkages with other transport modes, especially railways, harmonised and, of course, improved. PTAs already have the ability to set up dynamic and successful private-public infrastructure projects.
  The success of previous large infrastructure schemes such as the Manchester metrolink, the rail improvements in Birmingham and the Sheffield supertram, all pursued by PTAs, prove conclusively to me that such authorities can manage complex systems and procedures competently and swiftly.
  I recall the Secretary of State for the Environment, Transport and the Regions, speaking before the general election of possible pilot projects for PTAs in non-metropolitan areas. His statement was greatly welcomed by Teesside local authorities, which would welcome such additional powers. I know that they would welcome also being pilot areas. That, however, is insufficient. We need to go further.
  Another respected transport research body, the Public Transport Information Unit, has recently issued a new and important contribution to the debate. Its research work, entitled "Buses for People—Social Provision and Commercial Service" argues the case for complete integration and reform of local transport systems. It argues also for the creation of an expanding public transport market that is based on the European experience. That would benefit everyone, including local authorities, private operators, the franchisee and, most importantly, the passenger. The unit drew on real experiences and from those produced real conclusions. Its words deserve further study and I recommend that further work be undertaken. I commend both studies to the House and to my right hon. and hon. Friends, but the prime lead must come from our local authorities.
  Our local authorities, perhaps in areas like Teesside, through new non-metropolitan PTAs, and with the co-operation of the operators, need further powers to plan the shape and extent of the local bus network, to have returned to them the powers to license or to refuse local

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  bus routes, to look to innovative public transport experiments for disadvantaged or remote communities, and to plan for full mobility for the elderly and the disabled.
  We should not shrink from examining the physical methods to finance this programme. Possible models have been examined. Why do not we look at the potential earmarking of part of the existing business rate for public transport provision? We should examine financing arrangements that could follow from "network tendering" exercises, where an operator, in return for the knowledge that he has successfully tendered for a service period that could run for up to five years, makes a binding pledge to invest in new buses and guaranteed levels of service.
  We are, of course, already looking at new forms of public-private partnerships for infrastructure investment for mass transit schemes in our cities. That model could be transferred to smaller bus enhancement schemes developed jointly by local authorities and bus operators. Timetabling and timetable information systems and good waiting facilities all help to make bus travel more accessible, comfortable and safe.
  The role of these local-authority-led partnerships would be to overcome the difficulties caused by the impact of unrestricted deregulation—the wasteful competition, the decline in passenger usage, the honey pot syndrome and the low level of bus investment of the past 15 years—and to build on a foundation which sees public transport as central to the lives of our community.
  The development of a new framework for public transport is long overdue. It is time to bury the old arguments that deregulation would free the market. It did not. The Thatcherite model of a free market has failed. It created new monopolies, penalised passengers and isolated both geographical communities and communities of interest.
  In conclusion, I return to my constituents. The villagers of my constituency are looking for a lead from the Government. I believe that, with the help of the Labour Government, with imagination and with clarity of purpose, their isolation could be brought to an end.
  10.12 pm
  The Parliamentary Under-Secretary of State for Transport (Ms Glenda Jackson): I congratulate my hon. Friend the Member for Middlesbrough, South and Cleveland, East (Dr. Kumar) on securing this debate. I am sure that, given the detail and the commitment that he has shown tonight to his constituency and his constituents, he will be returned many times to the House. I sincerely hope so.
  The issues that my hon. Friend raised are not of importance only to his constituency. They have a much wider significance in terms of the development of our policy for a balanced and integrated transport system. I share the bemusement of my hon. Friend's constituents that, in many rural areas, public transport provision is either inadequate or invisible. It is surely disgraceful that, in a country as small as ours, and only three years from the 21st century, there are rural communities that not only feel isolated but are isolated. That is why my right hon. Friend the Minister of Transport announced last week
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  a review of buses and bus services—an example of the urgency that is needed in this area, to which my hon. Friend referred.
  The purpose of the review is to examine how buses can best play their part in an integrated transport policy. We want to see increased use of the bus as a means of reducing congestion and pollution, particularly by attracting motorists from their cars. We recognise that buses have a crucial role to play in providing access to jobs and shops in rural areas—or areas outside the urban core—where car ownership is low. My hon. Friend touched on the harsh realities of unemployment as experienced in his constituency, and the seemingly pointless increase in journey times to schools.
  I agreed with much of what my hon. Friend said when he referred to features of bus services that needed fresh consideration. I assure him that our review will be wide ranging. It will look at all aspects of buses, including the scope for more effective use of bus priority measures, including segregation from other traffic; better arrangements for passenger information and ticketing, including inter-modal travel; and regulatory and other measures to improve the quality of bus services, notably through the quality partnership approach between operators and local authorities.
  There are some promising developments already on this front in many areas. Only last week, I was privileged to launch a new service in Northampton using gas-powered, low-floored buses. I was much impressed not only by the vehicles but by the steps taken by the local authorities—county and district councils—working together to improve waiting and boarding facilities and to give priority to the bus at major junctions.
  Such measures can only help to make bus travel more attractive as an alternative to the private car. That is what we must do, if we are to make our towns and cities better, cleaner and safer places to live in and visit. An integrated approach to transport means that we must also examine disincentives to using private cars where public transport options are available.
  My hon. Friend spoke of the need to give local authorities—at least in some areas—the powers to plan the shape and extent of the local bus network. I must tell him that we are approaching the review with an open mind. We do not come to it with preconceived ideas about the scale and nature of the changes that may need to be made. We are certainly seized of the need to make changes, if we are to have a hope of seeing the long-term decline in bus patronage halted and reversed, and of seeing a wider provision of services in areas which need them.
  There is a range of possibilities, including radical options such as franchising buses, either by area or by route. Another approach might be based on quality partnerships, but with powers to enforce conditions if voluntary arrangements prove insufficient. I have been impressed by what I have seen up and down the country of such partnerships in action.
  We shall be seeking views on these matters from a wide range of interests and intend to consult fully with the industry, local authorities, bus users and other groups. Many of the points that my hon. Friend made tonight will be of great value to that review.
  I particularly noted the concerns that my hon. Friend voiced—most succinctly but in no small detail, if I may say so—about the local authority subsidy of socially

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  necessary bus services. The House will recognise that there are many competing pressures on local authority expenditure, and I am, of course, not in a position to offer a new pot of gold to relieve those pressures.
  However, the bus review will also address financial issues such as costs and support for the industry. More generally, public transport solutions may—as my hon. Friend acknowledged—require new methods of funding if we are to secure sustainable policies for the longer term. I can reassure my hon. Friend that the White Paper will address that.
  The absence of local bus services in rural areas mentioned by my hon. Friend highlights the difficulties in catering for the needs of communities where, in many cases, patronage levels do not attract commercial services. I agree that that is a very real problem, but even new funding arrangements would not make it possible to provide services to meet every aspiration.
  My hon. Friend has made some interesting comments on the degree of competition for tendered services. Recent research for my Department has shown that the national average of bids per contract is now just over three bids per tender. That is a decline from an average of around five in the early days of deregulation. The reasons for the decline are complex; they include higher quality specifications set by local authorities as well as the consolidation of ownership within the industry. And the degree of competition still varies markedly from place to place. I accept that there are issues here that we will need to look at in the context of our review.
  My hon. Friend has suggested that a way forward would be the establishment of a passenger transport authority to cover Teesside. That clearly is an interesting option which I do not dismiss. We will wish to consider the role of PTAs and PTEs as part of the wider review that will lead to a White Paper on transport, but let us remember that local authorities already have significant powers to promote transport.
  Public transport policies are not merely the preserve of PTEs; local authorities have responsibilities for bus infrastructure, the provision of timetable and fares information, and the support of socially necessary bus
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  services, which they can support after competitive tender. Similarly, they can enter into quality partnerships. I take my hon. Friend's point about shortage of cash, but, of course, that also applies to PTAs.
  There is no reason now why the new unitary authorities on Teesside should not co-operate with each other, and with the rail and bus operators, to achieve a more integrated transport strategy for the area. The franchising of rail services should not in itself prevent closer working between local authorities and the rail industry. Both Railtrack and the train operators are keen to consider value for money improvements to the rail network. Local authorities should look to opening a dialogue with them and with the Office of Passenger Rail Franchising.
  Talking of capital investment, I hope that my hon. Friend will acknowledge that my Department provides resources for capital expenditure by Teesside local authorities on their transport infrastructure, under the transport policies and programme system. We have, for example, been funding the Teesside transport package since 1995–96. A total of £3.3 million has so far been allocated to it.
  The package strategy puts strong emphasis on promoting alternatives to the car, with relief of congestion and regeneration of the area as the principal aims. I am very keen to see that significant environmental benefits are achieved and that improved facilities for bus travel are a key element. In addition to new busways, rail improvements are among the longer-term features. We shall continue to fund this package in future, as far as resources permit, and providing it delivers the forecast benefits.
  My hon. Friend asked for a lead from the Government. He is right to expect it. I can tell him that the Government intend to give such a lead. We will be looking at the future role of the bus industry in the context of a proper role for local authorities. We will be led not by doctrine or dogma, but by our desire to see buses play their full role in an integrated transport policy for the future, and for the benefit of all the people of the United Kingdom.
  Question put and agreed to.
  Adjourned accordingly at twenty-two minutes past Ten o'clock.

WALES

  Economic Regeneration
  Mr. Martyn Jones
  To ask the Secretary of State for Wales when he expects his review of economic regeneration in Wales to be completed; and if, and in what form, he intends to publish the results. [5161]

  Mr. Hain
  My right hon. Friend and I intend to publish our proposals for an economic powerhouse for Wales in the White Paper which will issue before the summer recess and certainly well before the referendum. I will also be setting out my strategy for the Welsh economy in the coming months on which I will be consulting widely.

  Welsh Assembly
  Mr. Llew Smith
  To ask the Secretary of State for Wales if there will be a requirement in job advertisements for the Welsh Assembly that fluency in Welsh would be essential or desirable. [5299]

  Mr. Ron Davies
  That will be a matter for the Assembly to decide.

  Mr. Barry Jones
  To ask the Secretary of State for Wales if he will make a statement on the date of the Welsh Assembly referendum. [6103]

  Mr. Davies
  The Welsh referendum will follow shortly after the Scottish. Announcements will be made in due course about the precise dates of each referendum.

  School Polling Stations
  Mr. Denzil Davies
  To ask the Secretary of State for Wales what plans he has to avoid the need to close schools for use as polling stations in the forthcoming referendum on devolution. [6073]

  Mr. Ron Davies
  The organisation of the poll in each local authority area is a matter for the relevant returning officer. Polling places to be used in the referendum are to be the same as those used in council elections, but the returning officer has discretion, if he considers special circumstances exist, to designate some other place for taking the poll. In areas where schools are used for polling, it is therefore open to returning officers, if they consider special circumstances to exist, to designate other places as polling places for the referendum.

  Transport Policy
  Mr. Barry Jones
  To ask the Secretary of State for Wales what plans he has to integrate transport in Wales; and if he will make a statement. [6099]

  Mr. Ron Davies
  I welcome my right hon. Friend the Deputy Prime Minister's announcement on 5 June honouring our election manifesto commitment to 218
  developing an integrated transport policy. This will, of course, embrace Wales and Welsh Office Ministers and officials will participate fully in drawing-up proposals for implementing the new policy, taking into account the views of a wide range of interested organisations.

  We will, in any case, be looking closely at all transport issues in Wales during the course of the next few months, including priorities for the roads programme as part of the strategic review promised in the Welsh election manifesto. I intend to set the strategic review of the roads programme in the broader context of the development of a balanced, integrated transport policy for the Principality. The review will, therefore, consider not only the relative priority of particular routes and schemes within the programme, and the scope for altering those priorities, but wider issues including the need to manage the network more effectively and the scope to promote alternative transport modes where appropriate.

  The review will consider afresh all schemes currently in the Welsh roads programme with the exception of the A55 dualling across Anglesey. In that case, I have decided that the strategic importance of the improvement is so great that it must proceed without delay subject, of course, to the successful completion of the legal and statutory procedures.

  I will be initiating a process of wide public consultation on the review, and will publish a consultation document shortly. This consultation document will set out the present position, summarise the issues for consideration and suggest possible options for change, and will invite views from the widest possible range of organisations. I hope to announce the conclusions of the review next spring.

  Referendum
  Mr. Öpik
  To ask the Secretary of State for Wales if postal votes will be available in the proposed referendum on devolution in Wales; and if he will make a statement. [6347]

  Mr. Ron Davies
  Postal votes will be available in the usual way for those voters who need them for the referendum.

  Public Bodies
  Mr. Öpik
  To ask the Secretary of State for Wales what has been his Department's expenditure in each of the last five years on the boards of non-departmental public bodies; and if he will make a statement. [6323]

  Mr. Ron Davies
  Details of expenditure are published annually in the Cabinet Office publication, "Public Bodies", copies of which are available in the Library of the House.

  Mr. Öpik
  To ask the Secretary of State for Wales if he will list the non-departmental bodies which will be abolished in the event of a Welsh Assembly; what will be the savings to public funds of this process; and if he will make a statement. [6325]

  Mr. Davies
  Details of our proposals will be included in the White Paper on a Welsh Assembly which we shall be publishing shortly.

  NHS Trusts
  Mr. Alan Williams
  To ask the Secretary of State for Wales if he will list the contracts of chairmen and chief executives of Welsh NHS trusts which terminate in(a) 1997–98, (b) 1998–99 and (c) 1999–2000. [6498]

  Mr. Win Griffiths
  The appointments of the following chairmen terminate as listed. Details of Chief Executives' contracts are not held centrally but in the NHS generally they have permanent or three year contracts which are rolled forward annually.

  Appointments of NHS trust chairmen

  Trust

  (a) 1997–98

  Mr. B. Thompson

  Carmarthen and District

  Mrs. L. George

  Pembrokeshire and Derwen

  Mr. I. Kelsall

  East Glamorgan

  Mr. R. H. Davies

  Gwynedd Community Health

  Mr. G. Drake

  Gwynedd Hospitals

  Sir Donald Walters

  Llandough Hospital

  Mr. R. Jenkins

  Llanelli/Dinefwr

  Mr. E. Rea

  Mid Glamorgan Ambulance

  Dr. G. Jones

  Nevill Hall and District

  Dr. B. Wolfenden

  North Wales Ambulance

  Mr. W. B. Davies

  Rhondda Health Care

  Mr. A. E. Robarts

  Wrexham Maelor Hospital

  (b) 1998–99

  Mr. F. P. Crawley

  Bridgend and District

  Mr. D. L. Crobsy

  Cardiff Community Healthcare

  Mr. R. Hopkins

  Glan-y-Môr

  Dr. T. Williams

  South and East Wales Ambulance

  Mr. A. S. Gould

  University Dental Hospital

  Mr. D. W. C. Morgan

  UHW Healthcare

  Mr. J. P. R. Hayes

  West Wales Ambulance

  (c) 1999–2000

  Ms E. Ebenezer

  Ceredigion and Mid Wales

  Mr. E. L. Fitzhugh

  Clwydian Community Care

  Mr. E. M. W. Griffith

  Glan Clwyd

  Mr. D. F. Jessopp

  Glan Hafren

  Mrs. F. N. Peel

  Gwent Community Health

  Professor Michael Vickers

  North Glamorgan

  Hon. L. A. T. Lewis

  Powys Health Care

  Mr. J. H. Button

  Swansea

FOREIGN AND COMMONWEALTH AFFAIRS

  Indonesian Military and Police Personnel
  Ann Clwyd
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will list by name and rank the Indonesian military, police, security and paramilitary police officers in respect of whom visa applications have been made to attend the International Police and Security Expo 97; and if he will identify those which were granted. [5692]

  Mr. Fatchett
  [holding answer 27 June 1997]: We have not been asked to issue visas specifically for Indonesians attending the International Police and Security Expo 97.

  Ann Clwyd
  To ask the Secretary of State for Foreign and Commonwealth Affairs how many visas have been granted to Indonesian(a) military, (b) security, (c) police, (d) paramilitary and (e) special forces personnel visiting Britain in the last 12 months for which figures are
  220
  available; for what purpose; and what is the policy of the Government on granting visas to the above categories of personnel. [5693]

  Mr. Fatchett
  [holding answer 27 June 1997]: The British Embassy in Jakarta issued 29,931 visit visas for the United Kingdom last year. Statistics are not kept for the different categories of applicant and the information requested could therefore only be produced at disproportionate cost. All visa applications are processed in accordance with the criteria contained in the Immigration Rules.

  UN (Budget Contributions)
  Mr. Hancock
  To ask the Secretary of State for Foreign and Commonwealth Affairs from what budget the United Kingdom will fund its additional contribution to the UN. [6353]

  Mr. Tony Lloyd
  Negotiations on the level of assessed contributions to be paid by Member States to UN budgets for 1998 and beyond will resume at the UN General Assembly in October. It is therefore too early to predict what change, if any, there might be in the level of the United Kingdom's assessed contribution.

  The United Kingdom's assessed contribution to the UN Regular Budget will continue to be met from Vote 2 of this Department's budget.

  Security Policy
  Sir Geoffrey Johnson Smith
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on the relationship between United Kingdom membership of(a) the WEU and (b) NATO in respect of United Kingdom security policy. [5723]

  Mr. Tony Lloyd
  NATO is the foundation of our defence and security. The Western European Union (WEU) is developing its capacity to contribute to European security and plays a key role in building the European Security and Defence Identity (ESDI) within the Alliance. It is pursuing its operational development as a means for Europeans to run crisis management operations, including operations using NATO assets and capabilities. The requirement that full members of the WEU are also NATO members, and the role of WEU in the arrangements for ESDI in the Alliance, mean that action taken by the WEU must be consistent with obligations in NATO.

  Mr. Peter Lowes
  Mr. Gerald Howarth
  To ask the Secretary of State for Foreign and Commonwealth Affairs when he expects to answer the letter from the hon. Member for Aldershot, dated 13 May, concerning Mr. Peter Lowes. [6562]

  Mr. Tony Lloyd
  The subject matter of the hon. Member's letter of 13 May was complicated and required wide consultation. A substantive reply has been sent by my noble Friend the Parliamentary Under-Secretary of State for Foreign and Commonwealth Affairs, and a copy will be placed in the Libraries of the House.

  Human Rights
  Dr. Kumar
  To ask the Secretary of State for Foreign and Commonwealth Affairs what plans he has to accede to those international human rights instruments to which the United Kingdom is not yet party. [6915]

  Mr. Tony Lloyd
  We will review over the next year the United Kingdom's position under various international human rights instruments. This will include the question of accession to Protocols to the European Convention on Human Rights and the International Covenant on Civil and Political Rights, and acceptance of the rights of individual petition under other UN human rights treaties. We shall also examine whether any of the United Kingdom's reservations to human rights treaties can be withdrawn.

  UN Register of Conventional Arms
  Ms Southworth
  To ask the Secretary of State for Foreign and Commonwealth Affairs when the United Kingdom submitted its 1996 return to the UN register of Conventional Arms; and if he will place a copy of the submission in the Library. [6916]

  Mr. Tony Lloyd
  The UK's return to the UN Register covering calendar year 1996 was submitted to the UN Secretary General on 29 April 1997. A copy of the return has been placed in the Libraries of the House and is available to members of the public on request.

  As part of our commitment to increasing transparency in the field of defence exports, we shall work to strengthen the UN Register of Conventional Arms, encouraging greater disclosure of information on arms exports and arms transfers by all countries. We hope that the work of the UN Panel of Experts currently reviewing the operation and development of the Register will contribute to achieving this objective.

DUCHY OF LANCASTER

  Better Regulation
  Mrs. Betty Williams
  To ask the Chancellor of the Duchy of Lancaster if he will make a statement about better regulation. [7045]

  Dr. David Clark
  The Government is committed to making government work better. My Department's White Paper on 'New Government', to be published later this year, will set out a unified programme for the renewal of government. Better regulation is an integral part of this renewal. Our aim is to ensure that regulations are simple, helpful and fair for business and the citizen.

  It is essential that we involve those who are affected by regulation. We are committed to giving small business and ordinary citizens a greater voice on the Better Regulation Task Force. I have today appointed Christopher Haskins, Chairman of Northern Foods plc, to chair the Task Force. Their terms of reference are to advise the Government on action which improves the effectiveness and credibility of government regulation by ensuring that it is necessary, fair and affordable, and simple to understand and administer, taking account of the needs of small business and ordinary people.
  222
  We will find practical measures that will respond to people's needs. For example, I have set up a cross-departmental initiative called 'Access Business' to assist small business. This will draw together regulatory advice and forms into a simpler, more unified service, in particular using modern technology. For the citizen we will look at key groups like the elderly, the young and the voluntary sector and identify how we can make improvements.

  I will take the opportunity presented by the EU Presidency next year to promote better quality regulation at the European level. I am planning a centrepiece Better Regulation Presidency event in March looking at improving access to Government for citizens and business, keeping legislation simple and improving consultation. And we are working with the Austrian government to provide a sustained push to improve the quality of EU legislation throughout our consecutive Presidencies.

LORD CHANCELLOR'S DEPARTMENT

  Legal Aid (Personal Injury Litigation)
  Mr. Dismore
  To ask the Parliamentary Secretary, Lord Chancellors Department what was(a) the annual cost of legal aid for personal injury litigation before cost recovery and retention of contributions, (b) the amount of costs recovered, (c) the amount of contributions retained and (d) the net cost after deduction of costs recovered and contributions retained, for (i) all personal injury litigation, (ii) medical negligence cases only and (iii) personal injury cases only, excluding medical negligence, in each of the last four financial years. [5808]

  Mr. Hoon
  A breakdown of legal aid expenditure and receipts in respect of personal injury litigation in each of the last four years for which information is available, in respect of cases that were closed in each year, was as follows:

  £ million

  1992–93

  1993–94

  1994–95

  1995–96

  Gross payments

  All personal injury litigation

  143.5

  195.6

  238.2

  284.7

  Medical Negligence

  20.6

  34.1

  38.6

  50.2

  All personal injury (excluding medical negligence)

  122.9

  161.5

  199.6

  234.5

  Costs recovered

  All personal injury litigation

  104.3

  138.7

  166.4

  205.2

  Medical Negligence

  9.4

  11.2

  13.3

  22.0

  All personal injury (excluding medical negligence)

  94.9

  127.5

  153.1

  183.2

  Contributions retained

  All personal injury litigation

  1.1

  1.6

  1.8

  2.1

  Medical Negligence

  0.3

  0.6

  0.6

  0.7

  All personal injury (excluding medical negligence)

  0.8

  1.0

  1.2

  1.4

  223

  £ million

  1992–93

  1993–94

  1994–95

  1995–96

  Net of costs recovered and contributions retained

  All personal injury litigation

  38.1

  55.2

  70.0

  77.3

  Medical Negligence

  11.0

  22.3

  24.5

  27.5

  All personal injury (excluding medical negligence)

  27.1

  32.9

  45.5

  49.8

  Net of costs recovered, contributions retained and damages retained

  All personal injury litigation

  35.2

  52.0

  66.6

  72.8

  Medical Negligence

  10.8

  22.0

  24.0

  26.8

  All personal injury (excluding medical negligence)

  24.4

  30.0

  42.6

  46.0

EDUCATION AND EMPLOYMENT

  Further Education Colleges
  Mr. Chaytor
  To ask the Secretary of State for Education and Employment how many(a) management, (b) teaching and (c) support staff (i) were employed in 1992–93 and (ii) are employed in the current financial year by further education colleges in England and Wales. [5326]

  Dr. Howells
  Comprehensive information on the number of full and part-time further education staff for academic year 1992–93 is not available. The total "full-time equivalents" of further education lecturers in FE and sixth form colleges, as well as HE institutions, in England for 1992–93 are shown below.

  Full-time equivalent lecturers providing FE in FE or HE institutions (including sixth form colleges)

  Academic

  Number

  1992–93

  67,700

  The figures available for 1994–95 and 1995–96 academic years for full-time equivalent staff in further education (including sixth form) colleges in England are shown below. Management staff are included in "other support" but cannot be identified separately. These figures are based on incomplete data sets: the number of colleges included for each year are noted.

  1994–95

  Full-time equivalents (FTEs)

  Teaching and learning

  56,000

  Supporting teaching and learning

  12,000

  Other support

  34,000

  Total

  102,000

  Based on data from 374 out of 446 colleges.

  1995–96

  Full-time equivalents (FTEs)

  Teaching and learning

  56,000

  Supporting teaching and learning

  13.000

  Other support

  37,000

  Total

  106.000

  Based on data from 342 out of 452 colleges.

  Youth Service
  Helen Jones
  To ask the Secretary of State for Education and Employment what are his proposals for the youth service; and if he will make a statement. [6078]

  Dr. Howells
  The Government is committed to raising the profile of the youth service which it values as an important provider of personal and social education for young people. Details about our proposed legislation to place the youth service on a clearer and more specific statutory basis will be included in the White Paper on Lifelong Learning.

  We are taking forward proposals for an audit of youth service provision in local authorities and are also considering how the youth service can contribute to educational policies more generally.

NATIONAL HERITAGE

  Millennium Commission and Lottery Awards
  Dr. Kumar
  To ask the Secretary of State for National Heritage if he will list the awards made to date by(a) the Millennium Commission and (b) the Heritage Lottery Fund in the constituency of Middlesbrough, South and East Cleveland. [5559]

  Mr. Banks
  The Heritage Lottery Fund has made one award of £77,000 to Cleveland county council for the Margrove Heritage Centre. The Millennium Commission has made no awards in the Middlesbrough, South and East Cleveland constituency.

  McDonald's (Advertising)
  Mr. Dafis
  To ask the Secretary of State for National Heritage if he will meet representatives of the Independent Television Commission to discuss the implications of the recent High Court ruling on the impact of advertising by McDonald's on children. [5852]

  Mr. Fisher
  The Commission maintains and enforces a code of advertising standards and practice for broadcasters, which includes detailed guidance on advertising and children, and which is from time to time reviewed to ensure it reflects current best practice. I understand that the Commission has no plans to revise the code in light of the judgment referred to, though it would naturally consider carefully any complaints made to it concerning particular advertisements and their potential impact on children. The Government recognise their special responsibility to protect children from exploitation, but the existing Code allows the ITC scope to act in their defence.

  County Record Offices
  Mr. Gordon Marsden
  To ask the Secretary of State for National Heritage what assessment he has made of the impact of unitary authorities on the future funding and operation of county record offices and the Victoria County History. [5953]
  225
  Mr. Fisher
  My Department has issued guidance on the care and maintenance of local authority archives to every local authority affected by local government reorganisation, and monitored closely the effect of reorganisation on archives services, to help ensure that standards are maintained.

  I am aware that the Victoria County History project has experienced difficulties due to the reduction or withdrawal of local authority funding in some cases. The National Heritage Act has widened the scope of the Heritage Lottery Fund to include support for the compilation and maintenance of archives. I understand that Victoria County History intends to bid for Lottery funds next year to support its important work.

  Digital Broadcasting
  Mr. Woolas
  To ask the Secretary of State for National Heritage what assessment he has made of the availability of suitably qualified candidates from colleges and universities for the new jobs in broadcasting that may be expected from the advent of digital broadcasting. [6147]

  Mr. Fisher
  The Government are committed to the objective that all new entrants into the industry should have a suitable qualification by 2000. My right hon. Friend the Secretary of State for Education and Employment and I will be working closely with broadcasters and training providers to ensure that this target is met.

  Mr. Woolas
  To ask the Secretary of State for National Heritage what estimate he has made of the number of jobs which will be created as a result of the successful bid by British Digital Broadcasting in(a) the United Kingdom and (b) Greater Manchester. [6146]

  Mr. Fisher
  It is not possible at this stage to identify the number or location of new jobs which will be created. Undoubtedly, however, the successful launch of digital television in the UK offers the prospect of a large number of jobs across the country, in broadcasting, production, equipment manufacturing and associated services.

  Sport Sponsorship
  Mr. Bercow
  To ask the Secretary of State for National Heritage what estimate his Department has made of the extent of sponsorship by drink manufacturers of(a) sporting events in the United Kingdom, (b) United Kingdom sportsmen and women competing abroad and (c) arts events and institutions in the United Kingdom in each of the last three years. [6302]

  Mr. Banks
  [holding answer 1 July 1997]: Total reported sponsorship of sport in the UK by alcoholic drink manufacturers was an estimated £23½ million in 1994, £27½ million in 1995, and £22 million in 1996. My Department has made no estimate of the extent of sponsorship by alcoholic drink manufacturers of United Kingdom sportsmen and sportswomen competing abroad or sponsorship by other sorts of drinks manufacturers.

  Figures for sponsorship by drink manufacturers of arts events and institutions are unavailable. However, the amount of sponsorship matched by all drinks companies under the National Heritage Arts Sponsorship Scheme was £1,182,277 in 1996–97; £774,375 in 1995–96; and £516,500 in 1994–95.

  Museums
  Mr. Garnier
  To ask the Secretary of State for National Heritage what is his Department's policy with regard to the funding of university museums; and if he will make a statement. [6317]

  Mr. Fisher
  [holding answer 1 July 1997]: My Department is keen to support and enhance the vitality of the cultural sector in this country and museums, including university museums, form a valuable part of that sector. Several university museums were included among those museums recently given designation status. Responsibility for the funding of university museums lies with their parent universities, together with the Higher Education Funding Councils and the appropriate Government Departments.

  Mr. Garnier
  To ask the Secretary of State for National Heritage what proposals he has to co-ordinate policy with the Department for Education and Employment and the Scottish Office with regard to the funding of university museums; and if he will make a statement. [6305]

  Mr. Fisher
  [holding answer 1 July 1997]: The Department for Education and Employment, the other education departments and the Department of National Heritage work together closely on policy for funding university museums. Funding for university museums in Scotland and Wales is the responsibility of my right, hon. Friends the Secretaries of State for Scotland and for Wales.

  Mr. Garnier
  To ask the Secretary of State for National Heritage if he will list the museums in England and Wales registered under the Museums and Galleries Commission's registration scheme. [6313]

  Mr. Fisher
  [holding answer 1 July 1997]: There are about 1,000 museums in England and Wales which are currently registered under the Museums and Galleries Commission's registration scheme. Copies of the list have been placed in the Libraries of the House.

  Mr. Garnier
  To ask the Secretary of State for National Heritage if he will list the museums in England and Wales(a) owned and (b) managed by universities. [6315]

  Mr. Fisher
  [holding answer 1 July 1997]: A list of university museums in England and Wales owned or managed by universities, and registered with the Museums and Galleries Commission, has been placed in the Libraries of the House. The list contains nearly 60 such museums. The Commission are in the process of completing a survey of all university collections in this country.

  Digital Terrestrial Television
  Mr. Hancock
  To ask the Secretary of State for National Heritage who will be responsible for supplying digital terrestrial television signals to those segments of the United Kingdom population what are most expensive to reach. [6356]

  Mr. Fisher
  The BBC and Independent Television Commission are responsible for television transmission arrangements in the UK. The invitation to apply for the
  227
  digital multiplex service licences issued by the Independent Television Commission set out the predicted coverage for each of the six digital multiplexes as a percentage of the total UK population. The multiplex service licensees must ensure that the ITC coverage requirements are met, and the BBC is committed to achieving similar targets on the multiplex awarded to it.

  The planned transmission coverage of digital terrestrial television does not at this stage extend to 100 per cent. of the UK population because of technical constraints.

  Millennium Commission

  Role

  Name

  Start date of present term

  Expiry date of present term

  Chairman

  Rt. hon. Chris Smith MP

  19 May 1997

  31 December 2000

  Member

  Rt. hon. Michael Heseltine MP

  17 February 1994

  31 December 2000

  Member

  Rt. hon David Clark MP

  19 May 1997

  31 December 2000

  Member

  Dr. Heather Couper

  17 February 1994

  31 December 2000

  Member

  Earl of Dalkeith, DL

  17 February 1994

  31 December 2000

  Member

  Sir John Hall, Bt

  17 February 1994

  31 December 2000

  Member

  Mr. Simon Jenkins

  17 February 1994

  31 December 2000

  Member

  Ms Patricia Scotland

  17 February 1994

  31 December 2000

  Member

  The Lord (Robin) Glentoran, CBE DL

  17 February 1994

  31 December 2000

HEALTH

  Haemophiliacs
  Mr. Syms
  To ask the Secretary of State for Health what plans he has to promote greater use of recombinant Factor 8 clotting products for haemophiliacs. [5124]

  Mr. Boateng
  We have no plans to recommend the greater use of recombinant Factor 8. The Department of Health has advised health authorities that they should weigh the claimed benefits of recombinant Factor 8 against the high costs, bearing in mind the good safety record of the plasma-derived product since the introduction of viral inactivation processes in 1985.

  We have made clear our policy that treatment decisions should focus on high quality research evidence about clinical effectiveness, safety and long-term patient outcomes.

  GPs (Home Visits)
  Mr. Waterson
  To ask the Secretary of State for Health how many home visits were made by general practitioners during each of the last three years in the United Kingdom. [5478]

  Mr. Milburn
  The information requested is not available on a United Kingdom basis. However, sample information is available within the General Household Survey (conducted by the Office for National Statistics), which gives the proportion of National Health Service general practitioner consultations within Great Britain. In the last three years for which information is available—1993, 1994, and 1995—the proportion of NHS GP consultations at patients' homes as a percentage of total NHS GP consultations was 9 per cent., 10 per cent. and 9 per cent. respectively. Copies of the report on the 1995 General Household Survey—entitled "Living in Britain"—are available in the Library.
  228
  However, the Government are considering how the delivery of digital services to viewers (through whatever technical means) might be expedited and extended.

  Millennium Commission
  Ms Roseanna Cunningham
  To ask the Secretary of State for National Heritage if he will list the names, designations and salaries of the Members of the Board of the Millennium Commission. [6127]

  Mr. Chris Smith
  The names of the Millennium Commissioners, who are unpaid, are as follows:

  Adoption
  Ms Beverley Hughes
  To ask the Secretary of State for Health what plans he has for the reform of adoption law to address(a) the problem of drift for children in care and (b) issues arising from inter-country adoption and the United Kingdom's responsibilities under The Hague convention. [5940]

  Mr. Boateng
  Preparation has already begun to mount a series of national seminars towards the end of the year which will focus on improving the quality of management within the adoption service; the seminars will address important issues such as delay in placing children and preventing children from drifting within the care system. We are currently considering a number of possible options which will enable the Government to ratify the 1993 Hague Convention and address issues arising from intercountry adoption.

  Bed Blocking
  Mr. Fearn
  To ask the Secretary of State for Health what steps he is taking to reduce the incidence of bed blocking in hospitals. [5976]

  Mr. Boateng
  We shall explore proposals to address the difficulties around hospital discharge procedures and the problems which are caused by ensuing delays. We acknowledge that there are concerns about the current level of delayed discharges in some areas. Responsibility for hospital discharge delays rests with one agency but sometimes delays occur through the local authority or the health authority and sometimes in meeting the particular needs of the individual patient and their family.

  III Health Costs
  Mr. Sheerman
  To ask the Secretary of State for Health what steps his Department is taking to assess the cost to the economy of a period of serious ill health of men and women(a) in full-time employment and (b) not in paid employment. [6079]
  229
  Ms Jowell
  No such assessment has been made by the Department of Health. The Health and Safety Executive estimate that the total cost to the economy of work-related ill health was between £2 billion and £2.5 billion in 1990. The next updating of these costs by the Health and Safety Executive will be in 1998. The updating will cover costs for 1995–96, using the necessary data from the Labour Force Survey.

  Television Programme Sponsorship
  Mr. Dafis
  To ask the Secretary of State for Health if he will make representations to the Independent Television Commission urging it to give prominence to public health considerations in its code of programme sponsorship. [5853]

  Ms Jowell
  The Independent Television Commission's code of programme sponsorship already takes account of health considerations and the Commission keep the code under regular review. For instance, companies are prohibited from sponsorship if their name is known to the public chiefly through their tobacco business, even if they also market other non-tobacco goods and services. My right hon. Friend the Secretary of State for National Heritage, whose Department has policy responsibility for broadcasting, has noted the hon. Member's suggestion on public health considerations for programme sponsorship.

  Workshop on Sexuality
  Sir Richard Body
  To ask the Secretary of State for Health if he will make a statement on the material used in the workshop on sexuality supported by the European Commission, as detained in COM(96)720; and what funds were used to support the project. [6095]

  Ms Jowell
  We understand that the workshop on sexuality was a project submitted in 1993 to the European Commission by a Spanish non-governmental organisation, and that it received funding in 1994 of 61,301 ECU (£43,830 at current exchange rates). From the information available, the purpose of the project was to train instructors in providing sex education for 13 to 21 years olds with the aim of preventing HIV/AIDS and of enabling young people to discover values to assist them in their personal sexual development. The materials used included three videos about love and sexuality and a guidebook for trainers. We are informed that 56 people were trained under the project in Spain, and 10 in the United Kingdom.

  As we have not been able to obtain much information about the project in the time available, I will write to the hon. Member shortly with further details.

  Private Finance Initiative
  Dr. Brand
  To ask the Secretary of State for Health what studies his Department has undertaken on the outcome of the contracting out of NHS trust non-clinical services to private sector providers; and what assessment he has made of(a) those studies and (b) the experience of contracting out for the PFI programme. [6162]

  Mr. Milburn
  National Health Service trusts have supplied the NHS Executive with information on the outcome of market tests. In the areas covered by compulsory market testing (cleaning, catering and laundry services) about 30 per cent. of contracts by value have 230
  been awarded to commercial contractors. Overall some 86 services have been market tested and about half by value have been awarded to commercial contractors. A review of the operation of the market testing policy is currently being undertaken by Departmental officials. In drawing up our programme for the review of Private Finance Initiative we have taken into account the experience of market testing in the NHS.

  Mr. Olner
  To ask the Secretary of State for Health, pursuant to his answer of 10 June,Official Report, columns 427–28, if he will make a statement about the PFI in the NHS. [7128]

  Mr. Milburn
  In my answer to my hon. Friend the Member for Slough (Fiona Mactaggant) I announced my intention to review the 43 major acute sector Private Finance Initiative (PFI) schemes in the National Health Service. I have today arranged for copies of the full results of the review to be placed in the Library. I have also written to all Members and stakeholders in health PFI, enclosing copies of the results. Fourteen major acute schemes have been selected, representing almost £1.3 billion of new capital investment in NHS hospitals.

  The review was undertaken by officials and all schemes were graded according to three criteria: (i) their service need; (ii) status—how far and well negotiations have progressed and (iii) "PFI ability"—how well the scheme fits with the PFI process and hence its likelihood of delivering a successful outcome.

  This process was both fair and open. Officials from the Department shared with the trusts the criteria against which the projects were judged and their relative markings. I, and my right hon. Friend the Secretary of State for Health as far as the schemes in the Northern and Yorkshire region are concerned, examined the gradings and the reasons why officials recommended schemes either be included or excluded. We also received representations from many Members.

  The 14 schemes which most successfully met the three criteria will be asked to continue with their PFI proposal, with the objective of reaching an early and acceptable financial close over the next 18 months. A complete table listing all the scores, along with a note explaining the criteria, has been placed in the Library. We have instructed officials to prepare programmes and milestones for every successful scheme. The schemes will be subject to the normal rigorous approval processes and any of these 14 schemes that subsequently fail to deliver to time or price will be cancelled.

  Those schemes not selected will be asked to cease any further action on their contract. They should stand down their partners if they have selected one and cancel all tendering procedures.

  Any trust or consortium whose scheme has to met the three criteria and which wishes to make representations to the Secretary of State should do so within the next 10 days. Otherwise such trusts should now take steps to stand down their partners or cancel the tendering procedure.

  Those schemes not selected will be eligible for consideration as part of a national capital prioritisation exercise by the NHS Executive's Capital Prioritisation

  231
  Advisory Group. This group will review major acute schemes for health service need and will recommend those which should go forward either as part of the next tranche of PFI schemes which we plan to announce in spring 1998, or for funding from the public sector capital that is available.

  The exercise did not consider the schemes affected by the London review which is due to report in the Autumn. These schemes are also listed in papers deposited in the Library.

  The longer term review of the PFI product and process will report its recommendations later this year. This will look to consolidate the improvements in the PFI begun with this prioritisation exercise.

  Turner Village Hospital, Colchester
  Mr. Bob Russell
  To ask the Secretary of State for Health (1) if he will ensure that Turner Village mental hospital, Colchester, is retained and upgraded; and if he will make a statement; [6279]

  (2) what representations he has received concerning the future of Turner Village mental hospital, Colchester. [6280]

  Mr. Boateng
  We are not aware of any such representations. Decisions about services for people with learning disabilities are for local determination. We understand that North Essex Health Authority has consulted on and agreed proposals which will provide the patients of Turner Village with a choice over where they are to live including community homes and an existing village community.

  CS Gas
  Mr. Livingstone
  To ask the Secretary of State for Health what assessment of the health effects of the CS gas solvent, methyl isobutyl keytone, has been made by the medical officers of his Department since 1990; how many(a) published and (b) unpublished reports have been written by his Department's medical officers since 1990; and how many of these reports are currently unclassified. [6361]

  Ms Jowell
  Medical officers of the Department have not made any assessment of the CS gas solvent, methyl isobutyl ketone.

  General Social Services Council
  Mr. Burstow
  To ask the Secretary of State for Health (1) which organisations he will be consulting in developing his proposals for a General Social Services Council; [5883]

  (2) when he expects to publish his proposals for a General Social Services Council; [5884]

  (3) what is his policy in respect of procedures for involving users, carers and the public in a General Social Services Council; [5885]

  (4) if he will consult (a) by way of survey and (b) by other means, the opinions of the work force who will come under the General Social Services Council. [5886]

  Mr. Boateng
  We expect to publish our proposals for a General Social Services Council in a consultation document in autumn 1997. We intend to consult all those 232
  with an interest in such a Council including employers, users and carers, staff and the wider public. Our proposals will outline how the essential interest of those who use social services, their carers and the general public will be secured in the arrangements for a Council.

PRIME MINISTER

  Minister without Portfolio
  Mr. Hawkins
  To ask the Prime Minister what additional responsibilities he has given to the Minister without Portfolio since 2 May. [5424]

  The Prime Minister
  [holding answer 25 June 1997]: I have asked my hon. Friend to take responsibility within Government for the Millennium Experience at Greenwich. My hon. Friend is also now the shareholder for the operating company, Millennium Central Limited, thus ensuring the position of the shareholder is clearly separated from that of my right hon. Friend, the Secretary of State for National Heritage as Chairman of the Millennium Commission. My right hon. Friend retains overall responsibility for matters relating to the Millennium Celebrations.

  Mr. Baker
  To ask the Prime Minister if he will list those projects for which the Minister without Portfolio has specific responsibility; and if he will make a statement. [6167]

  The Prime Minister
  [holding answer 1 July 1997]: My right hon. Friend has specific responsibilities in relation to the implementation and presentation of Government policy, and the Millennium Experience at Greenwich.

  Mr. Baker
  To ask the Prime Minister what factors underlie the allocation of new responsibilities for specific projects to the Minister without Portfolio. [6141]

  The Prime Minister
  [holding reply 1 July 1997]: I invite my hon. Friend, the Minister without Portfolio, to take responsibility for specific projects if I consider him to be the most appropriate person within Government to do so.

  Intelligence and Security Committee
  Mr. Nigel Jones
  To ask the Prime Minister when he expects to appoint the member of the Intelligence and Security Committee. [6292]

  The Prime Minister
  I will be consulting the Leader of the Opposition shortly under the terms of the Intelligence Services Act 1994 and will appoint members to the Committee after that.

  Ministers (Transport Costs)
  Mr. Flight
  To ask the Prime Minister what is Her Majesty's Government's policy with regard to securing value for money in respect of transport costs for Ministers attending overseas engagements. [6285]

  The Prime Minister
  Ministers attending overseas engagements are under a responsibility to ensure that their travel arrangements represent best value for money consistent with propriety.

  Policy Reviews
  Mr. Luff
  To ask the Prime Minister, if he will list(a) the departmental policy reviews established by the Government and (b) the names of those individuals other than civil servants and Ministers assisting those reviews (i) as chairman and (ii) in other capacities. [4002]

  The Prime Minister
  {pursuant to his answer, 26 June 1997, c. 605–607}: The following reviews, which were also initiated before 20 June, should have been included:
  A fundamental review of transport policy in Scotland leading to the publication of a White Paper on our long-term strategy for an integrated transport policy.
  A review of the Scottish roads programme.
  A review of the Crown Prosecution Service.
  Chairman: The right hon. Sir Ian Glidewell, retired Lord Justice of Appeal, Sir Geoffrey Dear, retired HM Inspector of Constabulary Mr. Robert McFarland, former senior executive, British Oxygen.
  A review of the tax and benefits system.
  Chairman: Martin Taylor, Chief Executive Barclays Bank.

  Sustainable Development
  Mr. Corbett
  To ask the Prime Minister if he will make a statement on the outcome of the United Nations General Assembly Special Session on Sustainable Development. [6460]

  The Prime Minister
  The Special Session reviewed the progress made on sustainable development since the Rio Earth Summit in 1992. One of the most important problems discussed was the need to take action to reduce greenhouse gas emissions, and thus limit the problems caused by climate change. In my address to the General Assembly, I urged other developed countries to recognise their responsibilities in this area, by pointing to the example that the United Kingdom and other European Union countries have already set. Later in the week, President Clinton acknowledged the role of the European Union in focusing the debate on this issue, and gave his personal commitment of significantly reducing greenhouse gas emissions. I expect this to be translated into action at Kyoto. Unfortunately, the agreement at Special Session on climate change did not have the specific commitment to reductions that we had sought. Much hard negotiating work remains to be done, but the UK will continue to make every effort to get developed countries to agree legally binding targets for significant reductions in greenhouse gas emissions at Kyoto in December.

  I also emphasised the UK Government's commitment to reversing the decline in Britain's development assistance and improving its quality by refocusing our efforts in eradicating poverty. Although some other developed countries could not go as far as the UK, the meeting stressed the need to increase aid towards the UN target of 0.7 per cent. and pledged to negotiate a satisfactory replenishment of the Global Environment Facility. We cannot expect the poorest countries to take action themselves, if the developed world is not more constructive about its aid programmes.

  The continuing threat to the world's forests was a key issue for the Special Session. Although the European Union pressed hard for a Convention on forests, we were unable to secure agreement from other major countries.
  234
  Nonetheless the establishment of an Intergovernmental Forum on Forests is a good step forward. The Forum will report in 1999 on the possible elements of a Forest Convention, and will also consider finance and trade issues. In addition it will monitor implementation of the Intergovernmental Panel on Forests 1997 report, which contained over a hundred action points. As the United Kingdom's contribution to this effort, I announced that the United Kingdom intended to adopt a new Forest Standard to provide a benchmark for the regeneration of our forests. I also promised an increase in our development assistance for forestry management.

  Together with our partners from the European Union, we have secured agreement for a plan of action to provide universal access to clean water and sanitation. One fifth of the world has no access to clean water and one half has no proper sanitation, so a new initiative is urgently needed. A series of meetings will take place to prepare for the 1998 meeting of the Commission on Sustainable Development when there will be negotiations on the plan. A successful outcome of these negotiations will be a key objective for our presidency.

  The European Union pressed for international action on sustainable energy management, and was successful in securing commitment to preparatory discussions in advance of the debate on energy in the 2001 session of the Commission on Sustainable Development. There was also agreement on the importance of energy management for both developed and developing countries, and on the need for energy prices to reflect their true environmental costs, as well as a gradual elimination of subsidies that inhibit sustainable development. The Special Session confirmed the importance of promoting integrated transport policies, since transport is the largest end user of energy in developed countries and the fastest growing one in most developing countries.

  Under strong pressure from the European Union the Special Session agreed that the possibility of an aviation fuel tax should remain on the international agenda. Studies will continue in international fora, especially the International Civil Aviation Organisation, on the use of economic instruments for the mitigation of the negative impacts of aviation.

  Lastly, the European Union ensured that there would be further work at a global level to address the problems facing the world's oceans, especially the depletion of fish stocks.

  There were also discussions on the financial implications of the Convention on Desertification. We supported the conclusion that the Convention should help channel existing resources more effectively, but should not create a new and dedicated fund.

  In conclusion a number of modest but positive steps were made at the Special Session. Nevertheless much remains to be done, and the UK will continue to use its best endeavours to pursue these issues in the months to come.

  The United Kingdom delegation included people representing the broad range of sustainable development interests in the UK, and dependent territories. As a result of our strong commitment and constructive approach, the

  235
  UK has now established itself as one of the leading players in international negotiations on sustainable development.

  I will place a copy of the final text of the document in the Library as soon as it is available.

  Single Market
  Mr. Mitchell
  To ask the Prime Minister, pursuant to his oral statement of 18 June,Official Report, column 314, concerning the outcome of the European Council Meeting in Amsterdam, what further Community legislation is required to complete the single market. [6484]

  The Prime Minister
  I refer the hon. Member to the Single Market Action Plan agreed at Amsterdam, setting out a programme for improving and completing the single market. A copy of the Plan has been deposited in the Library of the House.

  NATO Summit
  Mr. Barry Jones
  To ask the Prime Minister if he will make a statement on the agenda of his visit to Madrid between 8 and 9 July for the NATO summit. [6918]

  The Prime Minister
  I plan to join the other NATO Heads of Government in Madrid on 8 July. We will discuss the enlargement of NATO and expect to announce that a small number of countries should be invited to begin accession negotiations. I would be content for the number of countries to be set at three. We will also review progress on the development of the European Security and Defence Identity in NATO, following the decision taken by NATO Foreign Ministers at Berlin in 1996; and on the development of a new NATO Command Structure.

  On 9 July we will sign with President Kuchma of Ukraine the NATO/Ukraine Charter which will symbolise Ukraine's importance to European security and provide for increased NATO/Ukraine co-operation.

  Heads of Government will also discuss greater co-operation with NATO's partner countries in the EURO-Atlantic Partnership Council, including military co-operation through NATO's programme of Partnership for Peace.

HOME DEPARTMENT

  Crime Victims
  Ms Ward
  To ask the Secretary of State for the Home Department if he will make a statement on the position of victims within the criminal justice system. [5566]

  Mr. Straw
  The Government are committed to improving the position of victims and those who give evidence to the police and in court. Our election manifesto said: "Victims of crime are too often neglected by the criminal justice system".
  236
  Therefore, I am pleased to announce today the following measures which will give victims a greater priority within the criminal justice system:

  an extra £1 million to Victim Support to provide further court-based and local scheme support for victims of crime and for witnesses, and to provide a national telephone helpline for victims:

  an inter-departmental review to look at further ways of assisting vulnerable witnesses—such as victims of rape or of domestic violence—and providing witnesses with greater protection from intimidation;

  an examination of measures to ensure that the Crown Prosecution Service (CPS) is more responsive to the needs of victims as part of the independent review of the CPS under the chairmanship of Lord Justice Glidewell.

  Victim Support

  Victim Support receives the Government's full support for the dedicated work it does helping victims of crime. Its 365 local schemes and branches support more than a million victims a year, and there is now a witness support service at all the 77 Crown court centres in England and Wales. Despite this, the previous Government froze the £11.7 million grant to Victim Support and made it clear that no more money would be forthcoming. However, support for victims of crime is a top priority for this Government. I have therefore decided to make an additional £1 million available to Victim Support to re-inforce both its court-based and local scheme support for victims and witnesses. It will also establish a new national telephone helpline to provide an easy source of help and information to victims of crime.

  Vulnerable witnesses and witness protection

  Many victims and witnesses find the criminal justice process daunting and stressful, particularly those who are vulnerable because of personal circumstances or the nature of certain serious crimes, such as rape. Some witnesses are not always regarded as capable of giving evidence while others are in fear of intimidation. Our manifesto stated that "greater protection will be provided for victims in rape and serious sexual offence trials and for those subject to intimidation, including witnesses". The Government have therefore established an inter-departmental group to undertake a wide-ranging review. It will have the following terms of reference:

  to identify measures at all stages or the criminal justice process to improve the treatment of vulnerable witnesses, including those subject to intimidation;

  to encourage such witnesses to give evidence of crime and enable them to give best evidence in court;

  to consider which witnesses should be classified as vulnerable;

  to identify effective procedures for applying appropriate measures in individual cases; and

  to make costed recommendations.

  The group will have regard to the interests of justice, the importance of preventing and detecting crime, the needs of witnesses and cost effectiveness; and take into account the National Standards for Witness Care in England and Wales.

  Crown Prosecution Service

  Our manifesto also said:
  "We will ensure that victims are kept fully informed of the progress of their case, and why charges may have been downgraded or dropped".

  237
  My right hon. Friend the Attorney-General has already announced the creation of local Chief Crown Prosecutors for each police force area as part of his reforms to the CPS. The Government believe this will ensure that prosecutors are more sensitive to the needs of victims, particularly on decisions to discontinue or downgrade cases. My right hon. and learned Friend the Attorney-General has also established an independent review under the chairmanship of Lord Justice Glidewell which will examine how the CPS can be made more aware of the needs of victims and witnesses.

  Sex Offenders
  Dr. Starkey
  To ask the Secretary of State for the Home Department what steps he is taking to prevent people with convictions for serious sexual offences involving children and teenagers from being accepted as volunteers to work with young people. [5876]

  Mr. Michael
  The Sex Offenders Act 1997 requires people convicted of serious sexual offences to register their address and any change of address with the police and we are working on plans to ensure that this information is used effectively, principally for the protection of children and vulnerable adults. In addition, part V of the Police Act 1997 provides a statutory basis for criminal record checks to be carried out on any person applying for a position, paid or as a volunteer, which will involve regular contact with children and young people under the age of 18. We are currently considering how best to implement the provisions of this part of the Act. In addition, a consultation paper was issued in January 1997 setting out options for making it an offence for a convicted sex offender to seek work with or offer services to children. The responses are currently being analysed. It is intended that new vetting arrangements should complement good practice in respect of the recruitment, supervision and management of volunteers set out in the Home Office guidance "Safe from Harm".

  Identity Cards
  Mr. Blizzard
  To ask the Secretary of State for the Home Department if he will take steps to introduce ID cards. [6161]

  Mr. George Howarth
  We have yet to decide whether national identity cards should be introduced in the United Kingdom.

  Fire Stations, Wales
  Mr. Touhig
  To ask the Secretary of State for the Home Department if he will list the number of call-outs that(a) Cefn Forest fire station, (b) Abercarn fire station and (c) Risca fire station in Islwyn received in each year since 1990. [6250]

  Mr. George Howarth
  The information requested is not available centrally.

  Cookham Wood Secure Training Centre
  Mr. Stephen Twigg
  To ask the Secretary of State for the Home Department what plans he has for Cookham Wood secure training centre. [6736]
  238
  Mr. Straw
  The Government are committed to ensuring, as a priority, that courts have appropriate powers to deal with the small group of persistent young offenders who wreak havoc in their communities. Our aim is to provide the courts with a more coherent and flexible set of powers to deal with persistent juvenile offenders than those left by the previous Government.

  In the meantime, the Government have inherited a contract signed by the previous Government in March 1997 for a secure training centre at Cookham Wood, Kent, for persistent offenders aged 12 to 14. The contract involves significant monthly payments to the contractor from April 1998 whether the facility is used or not.

  To avoid the waste of public money which would be involved in withdrawing form the previous Government's commitment, and to enable the courts to deal with those persistent young offenders who fail to respond to community sentences, I intend to continue with the contract to develop Cookham Wood. This will involve introducing the secure training order provided in the Criminal Justice and Public Order Act 1994 and taking forward plans to procure four other centres to provide facilities across England and Wales. However, I am determined to ensure that Cookham Wood provides a high standard of education and training and that it helps young offenders to face up to their crimes and address their offending behaviour.

  I am commissioning a review of the whole range of secure accommodation for young offenders, and I will be receiving advice on this issue, and on the nature of the custodial penalties available to the courts, from the new Youth Justice task Force. I shall ensure that plans for the four other secure facilities, and the use of Cookham Wood, are sufficiently flexible to be consistent with the outcome of this review.

  The Government remain committed to ending prison remands for 15 and 16-year-old boys as quickly as possible and hope that their review of secure accommodation will help in this regard. The original commitment was made in February 1991. Although a building programme of 170 new secure local authority places is nearing completion, the number of 15 and 16-year-old boys held in prison has increased substantially since 1991. This makes implementation of the provisions in the Criminal Justice Act 1991 for court-ordered secure remands, which would end the need for prison remands for juveniles, much more difficult.

  Alcohol (Minors)
  Mr. Coaker
  To ask the Secretary of State for the Home Department what steps the Government are taking to(a) reduce the consumption of alcopops, particularly by those under the age of 18, (b) persuade more retailers to stop stocking alcopops and (c) encourage voluntary changes of behaviour by the advertising and brewing industries in respect of alcopops. [6581]

  Mr. George Howarth
  As chairman of the Ministerial Group on Alcopops, I have had urgent talks with the drinks industry and other interests about under-age drinking. I expect to make an announcement later this month.

  Electoral Register
  Mr. Barnes
  To ask the Secretary of State for the Home Department if he will commission a comparative study of the forms of electoral registration used(a) in the United Kingdom and (b) overseas. [6023]

  Mr. George Howarth
  [holding answer 1 July 1997]: We have no immediate plans to do so but we will keep the matter under consideration.

  Mr. Barnes
  To ask the Secretary of State for the Home Department what assessment he has made of the factors underlying non-registration on the electoral roll; and if he will make a statement. [6018]

  Mr. Howarth
  [holding answer 1 July 1997]: Research commissioned by the Home Office after the 1991 Census indicated that a number of groups were less likely to register than others. These included people aged under 30, those living in private rented accommodation and inner city areas, people who changed addresses frequently, and members of ethnic minority communities. We are considering how best to publicise this autumn's canvass for electoral registration to encourage members of such groups to register.

  Mr. Barnes
  To ask the secretary of State for the Home Department what estimate his Department has made of numbers and percentage of people missing from electoral registers who are entitled to be registered(a) in total and (b) in the categories (i) those living in private rented accommodation, (ii) residents of inner London, (iii) 21 to 24-year-olds, (iv) attainers, (v) ethnic minorities, (vi) new commonwealth citizens, (vii) those who moved in the year before a general election, (viii) homeless people and (ix) disabled people. [6011]

  Mr. Howarth
  [holding answer 1 July 1997]: On (a), I refer my hon. Friend to the answer given to the hon. Member for Leicester, East (Mr. Vaz) on 2 June, Official Report, columns 90–92. On (b), the most recent material on which to base estimates for most of the categories listed is the study carried out after the last census by the Office of Population Censuses and Surveys on behalf of the Home Office and the Scottish Home and Health Department, entitled "Electoral registration in 1991". No information is available on homeless or disabled people.

  General Election
  Mr. Barnes
  To ask the Secretary of State for the Home Department if he will estimate the turnout at the last general election as a percentage of those able to vote. [6009]

  Mr. George Howarth
  [holding answer 1 July 1997]: The turnout at the last general election has been reported in the media as around 71 per cent. Official figures provided by acting returning officers will be published in due course, together with information on election expenses.

  Mr. Barnes
  To ask the Secretary of State for the Home Department what estimate his Department has made of the electoral participation rates of(a) those living in private rented accommodation, (b) residents of inner London, (c) 21 to 24-year-olds, (d) attainers, (e) ethnic
  240
  minorities, (f) new commonwealth citizens, (g) those who moved in the year before a general election, (h) homeless people and (i) disabled people. [6012]

  Mr. Howarth
  [holding answer 1 July 1997]: No estimates have been made of the extent to which members of any of these groups take part in the electoral process. 521,083 attainers were included in the 1997 Electoral Register but information on the other categories listed in the question is not required by the electoral registration officers.

  Deportation
  Mr. Andrew George
  To ask the Secretary of State for the Home Department what action he will take to ensure that(a) illegal immigrants and (b) overstayers in the United Kingdom who have children born and raised in the United Kingdom are not separated from their families by being deported. [5464]

  Mr. Mike O'Brien
  The existence of children is always taken into account when considering whether a person should be deported or removed as an illegal entrant. Where, in the light of all the circumstances of the case, it is decided to proceed with deportation or removal, it is our practice to offer to meet the costs of departure for any dependants who wish to accompany the person abroad.

  Abdul Onibiyo
  Mr. Andrew George
  To ask the Secretary of State for the Home Department what steps he is taking to allow Abdul Onibiyo to re-enter the United Kingdom. [5465]

  Mr. Mike O'Brien
  It is open to any person to apply for an entry clearance for the purpose of seeking entry to the United Kingdom and a decision to refuse such a request, other than as a visitor, attracts a right of appeal to the independent Immigration Appeals Authority. The details of applications from individuals are normally treated in confidence unless the applicant initiates or consents to their disclosure.

  Asylum Seekers
  Mr. Andrew George
  To ask the Secretary of State for the Home Department what is the time scale for the present review of detention of asylum seekers and immigration detainees. [5467]

  Mr. Mike O'Brien
  The review is being conducted internally in the Home Office. We expect the results to be available by the autumn.

ENVIRONMENT, TRANSPORT AND THE REGIONS

  Railings (World War II)
  Mr. Fearn
  To ask the Secretary of State for the Environment, Transport and the Regions if he will reimburse local authorities in England and Wales for the loss of railings removed form council land during world war II. [5461]

  Mr. Raynsford
  We have no plans to make such reimbursements.

  Regional Development Agencies
  Mr. Dafis
  To ask the Secretary of State for the Environment, Transport and the Regions through what mechanism regional development agencies will take into account environmental considerations. [5836]

  Angela Eagle
  On 11 June the Government launched a wide ranging consultation on our proposals for regional development agencies in England. As we take forward these proposals in the light of the consultation, we will want to ensure that regional development agencies take proper account of environmental considerations.

  European Regional Development Fund
  Mr. Blizzard
  To ask the Secretary of State for the Environment, Transport and the Regions if he will introduce measures to assist councils to obtain the matched funding necessary to access ERDF grants. [6160]

  Angela Eagle
  European Structural Funds, including the European Regional Development Fund (ERDF), make an important contribution to economic development in the regions. The issues behind matched funding requirements for ERDF and the need for synergy between European and domestic regeneration programmes are being considered in the comprehensive review of regeneration expenditure in England now underway. However, as a net contributor to the EU budget, the UK also has an interest in ensuring that the best value for money is obtained from Structural Funds' expenditure. Requiring applicants to provide some level of matching funding gives them a strong incentive to produce projects which do represent good value for money and to make a real choice between competing priorities.

  Recycling
  Mr. Bill O'Brien
  To ask the Secretary of State for the Environment. Transport and the Regions what research his Department has(a) commissioned and (b) evaluated into the impact of (i) recycling and (ii) burning secondary fuels; and if he will make a statement. [6245]

  Angela Eagle
  My Department has not commissioned any research on these subjects. However, both the recovery of solvent waste to make fuel and the burning of secondary liquid fuels (SLF) are regulated by the Environment Agency under the Integrated Pollution Control (IPC) regime. Each application for authorisation to burn SLF requires assessment of the likely environmental impacts. Details of these assessments must be placed in public registers in the relevant locality.

  In addition, on 14 June, the Agency published the results of an extensive air monitoring study in the Clitheroe area of Lancashire. This study comprised emissions monitoring from industrial sites including Castle Cement's Ribblesdale cement works—which burns blended waste solvents together with traditional fuels—together with ambient air quality testing. The full results of the study have been forwarded to the Department of Health for evaluation.

  The Environment Agency's response of 16 June to the House Environment Committee's report on the Environmental Impacts of Cement Manufacture also
  242
  commits it to carry out further research and to publish guidance in respect of appropriate disposal routes for waste solvents.

  Affordable Housing
  Mr. Sanders
  To ask the Secretary of State for the Environment, Transport and the Regions what plans he has to ensure that affordable housing continues to be available following transfers of council housing stock. [6163]

  Mr. Raynsford
  Local authority housing will be transferred to registered social landlords only on the basis that it will remain in the social rented sector with affordable rents. Following transfer the Housing Corporation proposes to monitor the rents charged by the new landlord to ensure they remain affordable.

  Area Cost Adjustment
  Mr. Laurence Robertson
  To ask the Secretary of State for the Environment, Transport and the Regions what plans he has to set up a commission to review the area cost adjustment; what time scale he proposes; and if he will make a statement. [6154]

  Mr. Raynsford
  The work of the review of the area cost adjustment during 1996 provided an examination of the issues, though not one which the local authority associations wanted implemented for 1997–98 SSAs. The Department has recently commissioned research to examine some of the concerns of local government about the review's proposals. It will report this month and we shall discuss with local government both the findings and the way forward on the area cost adjustment.

  English Partnerships
  Mr. Rendel
  To ask the Secretary of State for the Environment, Transport and the Regions how much grant has been given to English Partnerships in each year since 1993; and if he will make a statement. [5720]

  Angela Eagle
  [holding answer 2 July 1997]: The grant given to English Partnerships in each year since 1993 is as follows:

  £ million

  Year

  Grant-in-aid

  Derelict Land Grant1

  1993–94

  21.728

  Nil

  1994–95

  118.306

  72.079

  1995–96

  155.721

  54.391

  1996–07

  2190.965

  13.002

  1 English Partnerships acts as the Department for the Environment, Transport and the Regions' agent for making Local Authority Derelict Land Grant payments on projects approved before 1 April 1994. The number of projects remaining to be completed is declining quickly.

  2 Excludes funding for the Greenwich project.

  Mobile Homes
  Mrs. Ballard
  To ask the Secretary of State for the Environment, Transport and the Regions what plans he has to amend the Mobile Homes Act 1983 in respect of the entitlement of the owners of the land on which mobile homes are sited to deduct 10 per cent. of the sale price of a home. [6227]
  243
  Mr. Raynsford
  This is one of a number of issues relating to mobile homes which my Department is currently reviewing at the instigation of the all party working group on mobile homes. At this stage, it is too early to say what will be the outcome of that review.

  Public Buildings (Access)
  Mr. Burstow
  To ask the Secretary of State for the Environment, Transport and the Regions by what means a disabled person will be able to challenge an approving body's assessment of a public building designated as providing reasonable access. [5845]

  Mr. Raynsford
  [holding answer 2 July 1997]: Part M of schedule 1 to the Building Regulations 1991, which is applicable to most new building work other than dwellings, requires that reasonable provision shall be made for access and facilities for disabled people. Building work to which the regulations apply will be subject to building control by either the local authority or an approved inspector. With regard to these approving bodies, the Building Act 1984 provides for action to be taken against an approved inspector who recklessly gives a final certificate. Section 113 of the Act allows proceedings in respect of an offence under the Act to be taken by a party aggrieved. Whilst there is no parallel provision to challenge local authorities within the Building Act, they are subject to action for judicial review.

  There is no requirement for public buildings to be assessed by an approving body under the Disability Discrimination Act 1995.

  Mr. Burstow
  To ask the Secretary of State for the Environment, Transport and the Regions if he will make a statement on the relationship between Part M of the Building Regulations 1991 and proposals contained in the Disability Discrimination Act 1995. [5846]

  Mr. Raynsford
  [holding answer 2 July 1997]: Part M of the Building Regulations applies only to the control of new building work. The DDA places duties on employers and service providers to make adjustments to existing premises which are reasonable in all the circumstances of the case. There is no requirement for such adjustments to comply with Part M.

  Under the Disability Discrimination (Employment) Regulations 1996 employers cannot be required to alter any physical characteristic which satisfied the requirements of Part M of the Building Regulations at the time building works were carried out, and which continues to meet those requirements. This protects employers against being required to meet differing requirements in respect of the same physical feature under different regulations. Similar protection for service providers will be considered when regulations for implementing that part of the Act are prepared.

  Building Regulations
  Mr. Burstow
  To ask the Secretary of State for the Environment, Transport and the Regions if he will place in the Library a copy of the completed study carried out by his Department and the Housebuilders Federation into the costings of extending Part M of the Building Regulations to include new residential dwellings. [5848]
  244
  Mr. Raynsford
  [holding answer 2 July 1997]: This study had not yet started. Before deciding whether or not to let this I want to see the results of some work done jointly by the Joseph Rowntree Foundation and the House Builders Federation. If the study does go ahead, it should provide additional information for the compliance cost assessment which will be prepared to accompany our proposals to amend Part M of the Building Regulations. The finalised compliance cost assessment will be placed in the Libraries of both Houses of Parliament at the time any amending regulations are laid.

  Watercraft
  Mr. Ottaway
  To ask the Secretary of State for the Environment, Transport and the Regions what plans he has to restrict the use of personal watercraft(a) along Britain's beaches and (b) on inland waters. [6321]

  Angela Eagle
  [holding answer 2 July 1997]: Section 76 of the Public Health Act 1961 provides for local authorities to make byelaws to regulate seaside pleasure boats for the prevention of danger, obstruction or annoyance to persons bathing in the sea or using the seashore. It is likely that personal watercraft can be regulated as pleasure boats under this Act, although a definitive interpretation is a matter for the courts.

  My Department is leading an inter-departmental working party which is undertaking a review of byelaw powers for the coast. A discussion document issued in December 1996 identified coastal recreation management as a major issue and the many responses to this document are being analysed. The working party will meet again before the end of the year to consider this analysis and agree an appropriate way forward.

  Local authorities, water companies and some navigation authorities have powers to regulate the use of inland waters to ensure their safe use and enjoyment. There are no plans to amend the powers.

  Planning Appeals (Fast Food Restaurants)
  Mr. Burstow
  To ask the Secretary of State for the Environment, Transport and the Regions if he will list the planning appeal decisions by his Department in the last three years where his inspectors have upheld a planning authority's decision to refuse permission for drive-through, fast food restaurants; and what planning reasons were upheld in each case. [6052]

  Mr. Raynsford
  The provision of information on planning appeals is the responsibility of the Planning Inspectorate. I have asked the Inspectorate's Chief Executive, Mr. Chris Shepley, to write to the hon. Member.

  Letter from C. J. Shepley to Mr. Paul Burstow, dated 3 July 1997:
  The Secretary of State has asked me to reply to your Question about appeal decisions for drive-through, fast-food restaurants.
  I enclose details of 9 planning appeals for such developments which have been dismissed, i.e. the decision of the local authority upheld (except in one case which the local authority failed to determine), since 1 April 1994. I believe this list to be exhaustive but I cannot be certain, especially when such uses may have been combined with others. The details include the issues considered to be relevant to the inspector's decision.

  245
  I am arranging for copies of the inspector's decision letters to be sent to you. From these you will be able to see whether the inspector agreed or disagreed with any reasons for refusal by the local authority.

  Case record no. 1

  Details

  Floor space

  Case key

  R3705/A/94/233558

  Local authority

  North Warwickshire

  County

  Warwickshire

  Site address

  Dordon filling station, Watling Street, Dordon, Warwickshire

  Description

  Erection of drive-through fast food facility

  Land use 1

  S12 hot food; take away food; fish and chip shops

  Floor space:

  Land use 2

  —No code recorded—

  Floor space:

  Land use 3

  —No code recorded—

  Floor space:

  Final decision

  Dismissed

  Decision date

  27 May 1994

  Decision issue 1

  Effect on neighbouring building, surroundings

  Decision issue 2

  Traffic: highway safety, congestion, access

  Case record no. 2

  Details

  Floor space

  Case key

  U4610/A/95/258157

  Local authority

  Coventry

  County

  West Midlands

  Site address

  6 Station Avenue, Coventry, West Midlands

  Description

  Change of use from residential to A3 hot food takeaway (Dial-A-Pizza), removal of side garage to create a hardstanding and service driveway, rear single storey extension to create a kitchen

  Land use 1

  S12 hot food; take away food; fish and chip shops

  Floor space:

  Land use 2

  —No code recorded—

  Floor space:

  Land use 3

  —No code recorded—

  Floor space:

  Final decision

  Dismissed

  Decision date

  4 November 1996

  Decision issue 1

  Noise, disturbance (including vibration)

  Decision issue 2

  Traffic: highway safety, congestion, access

  Case record no. 3

  Details

  Floor space

  Case key

  E5330/A/93/230046

  Local authority

  Greenwich

  County

  G.L.C.

  246

  Case record no. 3

  Details

  Floor space

  Site address

  583–585 Woolwich Road, Charlton, London SE7, L.B. Greenwich

  Description

  Restaurant with ancillary staff, storage and office accommodation, together with drive thru facility and associated car parking. Non-determination

  Land use 1

  S41 restaurants, canteens, cafes

  Floor space:

  Land use 2

  —No code recorded—

  Floor space:

  Land use 3

  —No code recorded—

  Floor space:

  Final decision

  Dismissed

  Decision date

  14 April 1994

  Decision issue 1

  Growth of employment, provision of jobs

  Case record no. 4

  Details

  Floor space

  Case key

  F5540/A/93/230413

  Local authority

  Hounslow

  County

  G.L.C.

  Site address

  Hope and Anchor Public House, Twickenham Road, Hounslow L.B.

  Description

  Restaurant with ancillary staff, storage and office accommodation together with drive-through facility and associated car parking. Non-determination

  Land use 1

  S41 restaurants, canteens, cafes

  Floor space:

  Land use 2

  W00 miscellaneous storage etc. development

  Floor space:

  Land use 3

  F00 miscellaneous office uses

  Floor space:

  Final decision

  Dismissed

  Decision date

  29 April 1994

  Decision issue 1

  Traffic: highway safety, congestion, access

  Case record no. 5

  Details

  Floor space

  Case key

  Q2310/A/95/258143

  Local authority

  Blackpool

  County

  Lancashire

  Site address

  Ashworth Road, Marton, Blackpool, Lancashire

  Description

  Single storey drive-thru restaurant and gift shop

  Land use 1

  S41 restaurants, canteens, cafes

  Floor space:

  247

  Case record no. 5

  Details

  Floor space

  Land use 2

  S10 small retail store/warehouse (LT 5,000 sq m or I ha)

  Floor space:

  Land use 3

  —No code recorded—

  Floor space:

  Final decision

  Dismissed

  Decision date

  11 January 1996

  Decision issue 1

  Growth of employment, provision of jobs

  Decision issue 2

  Traffic: highway safety. congestion, access

  Case record no. 6

  Details

  Floor space

  Case key

  U2425/A/94/234244

  Local authority

  Leicester

  County

  Leicestershire

  Site address

  197–201 Narborough Road, Leicester

  Description

  Redevelopment of former service station to provide freestanding restaurant with drive thru facility and ancillary accommodation. High court challenge

  Land use 1

  S41 restaurants, canteens, cafes

  Floor space:

  Land use 2

  —No code recorded—

  Floor space:

  Land use 3

  —No code recorded—

  Floor space:

  Final decision

  Dismissed—High court challenge

  Decision date

  7 October 1994

  Decision issue 1

  Effect on neighbouring building, surroundings

  Decision issue 2

  Dirt, dust, smoke, smell, fumes

  Decision issue 3

  Noise, disturbance (including vibration)

  Decision issue 4

  Traffic: highway safety, congestion, access

  Decision issue 5

  High court determinations

  Case record no. 7

  Details

  Floor space

  Case key

  Y0815/A/94/244710

  Local authority

  Kerrier

  County

  Cornwall

  Site address

  Lower Crahan Farm, Trevenen, Wendron, Helston, Cornwall

  Description

  Change of use of dwelling to form restaurant on ground floor with residential accommodation over, formation of new access drive with car parking area

  Land use 1

  S41 restaurants, canteens, cafes

  Floor space:

  248

  Case record no. 7

  Details

  Floor space

  Land use 2

  H00 miscellaneous residential uses

  Floor space:

  Land use 3

  T21 car park

  Floor space:

  Final decision

  Dismissed

  Decision date

  8 February 1995

  Decision issue 1

  Effect on landscape

  Decision issue 2

  Sewerage: sewage treatment

  Decision issue 3

  Effect on the listed building itself

  Case record no. 8

  Details

  Floor space

  Case key

  F2360/A/96/264043

  Local authority

  South Ribble

  County

  Lancashire

  Site address

  Adjacent Tickled Trout Hotel and Mobil petrol station, A59/M6, Preston

  Description

  Erection of restaurant (class A3) with associated drive-thru facility and parking and with ancillary staff, storage and office accommodation

  Land use 1

  S41 restaurants, canteens, cafes

  Floor space:

  Land use 2

  S12 hot food: take away food; fish and chip shops

  Floor space:

  Land use 3

  —No code recorded—

  Floor space:

  Final decision

  Dismissed

  Decision date

  5 February 1997

  Decision issue 1

  Approved green belt—as an issue

  Case record no. 9

  Details

  Floor space

  Case key

  G3110/A/96/275489

  Local authority

  Oxford

  County

  Oxfordshire

  Site address

  McDonalds, London Road, Oxford, Oxfordshire

  Description

  Provision of drive- through facility; new service road utilising access to car parking area for entrance/exit; extension of existing parking area; new rear exit road onto the roundway. Erection of three 6 m high flood-lights. Minor alterations to restaurant

  Land use 1

  S41 restaurants, canteens, cafes

  Floor space:

  Land use 2

  S12 hot food; take away food; fish and chip shops

  Floor space:

  Land use 3

  T00 transport utilities and miscellaneous uses

  Floor space:

  249

  Case record no. 9

  Details

  Floor space

  Final decision

  Dismissed

  Decision date

  15 April 1997

  Decision issue 1

  Traffic: highway safety, congestion, access

  Mr. Corbyn
  To ask the Secretary of State for the Environment, Transport and the Regions what research his Department has evaluated on the effect on the environment of pressurised gases in training shoes. [6346]

  Mr. Meacher
  Sulphur hexaflouride, a powerful greenhouse gas, is used as a cushioning agent in some training shoes.

  My Department recently published information showing that the major man-made sources of sulphur hexafluoride in the United Kingdom contribute just 0.1 per cent. to the current global warming from all national greenhouse gas emissions. Any additional contribution due to emissions of sulphur hexafluoride from the disposal of training shoes is likely to be very small, but this source will be evaluated in more detail in the near future.

  Pressurised Drink Containers
  Mr. Corbyn
  To ask the Secretary of State for the Environment, Transport and the Regions what evaluation has been undertaken by his Department of the effects of HFC coolants in pressurised drink containers. [6343]

  Mr. Meacher
  Last month's meeting of the EU Environment Council noted with concern reports about the development of self-chilling drinks cans using certain substances which have a high global warming potential, including HFC—134a which has a global warming potential 1,300 times greater than carbon dioxide. The Council invited the European Commission to investigate this situation and its possible implications for global warming and to bring forward proposals for appropriate action.

  My Department has estimated that if self-chilling drink cans using HFC—134a captured 10 per cent. of the UK market by 2000, they would produce emissions equivalent to around 43.6 million tonnes of carbon dioxide: equivalent to over half the projected reduction in UK greenhouse gas emissions by 2000.

  Arctic Warming
  Mr. Corbyn
  To ask the Secretary of State for the Environment, Transport and the Regions what research his Department has(a) commissioned and (b) evaluated on the global effects of Arctic warming on world temperature. [6344]

  Mr. Meacher
  Global surface temperature records are maintained by the Hadley Centre, on behalf of the Government. They take account of the effects of Arctic warming when calculating world temperatures by including long-term observations from nearly 60 land-based monitoring stations in the Arctic in their records. Additional ship-borne measurements from the Arctic are also incorporated.
  250
  Observed temperature trends vary significantly between different regions of the world, but the general trend in Arctic surface temperatures over the past century is similar to that for the global average. In particular, there has been a period of rapid warming in recent decades.

  Local Government Pension Scheme
  Mr. Tony Colman
  To ask the Secretary of State for the Environment, Transport and the Regions when he intends to issue new regulations to govern the local government pension scheme in England and Wales; and if he will make a statement. [6495]

  Ms Armstrong
  I have placed in the Library of the House today new regulations for the local government pension scheme (the LGPS) to apply in both England and Wales with effect from 1 April 1998. They provide less central control of pension arrangements, increase the scope of local decision-taking and offer improved flexibility in pension provision.

  The Local Government Pension Scheme Regulations 1997 are the product of careful preparation, consultation and discussion with many interested parties. They provide a modernised legal framework and give local government employers greater scope to manage pension scheme benefits. They offer new pension flexibility to both employers and employees while continuing to provide secure, statutory-based pensions for all scheme members and pensioners. Employers will be able to offer members a shared-cost additional voluntary contributions arrangement to improve their pensions. Improved death benefits and spouses pensions have been added to the scheme's benefit package and new options have been added to allow employers and employees greater scope in the provision of retirement benefits, including new criteria to decide when pension benefits may be paid early. New standardised employees' contribution rates, to apply from 1 April 1998, are also included in the package.

  The improved regulations ensure that the scheme provides the right qualities and benefits to meet the pension needs of local government employees and pensioners into the next century. The new regulations create a more accountable administrative and benefit framework for local authority employers who are responsible for the scheme's day to day management. They also provide a basis for considering with all the interested parties further scheme developments.

  To allow scheme managers and other interested parties sufficient time to adapt their existing policy and administrative procedures to the new arrangements, the regulations come into force on 1 April 1998. My Department's Local Government Pensions Unit will continue to work closely with the interested parties to explain the purpose and operation of the regulations and to monitor their effectiveness. The unit is producing guidance material for scheme members to explain the new provisions and assisting the United Kingdom Steering Committee on Local Government Pensions in the production of explanatory material for local authority employers and other LGPS users.

  New regulations governing transitional arrangements to protect the benefit rights for existing scheme members and draft proposals for the management and investment of local authority pension funds will be issued shortly.

  Home Insulation Grants
  Mr. Öpik
  To ask the Secretary of State for the Environment, Transport and the Regions what proposals he has to review the(a) administration of and (b) expenditure on home insulation grants; how much his Department has given in home insulation grants in each of the last four years; and if he will make a statement. [6324]

  Angela Eagle
  We have no plans to review the administration of the home energy efficiency scheme (HEES), which is carried out by Eaga Ltd. of Newcastle upon Tyne, and which is monitored by my Department. Expenditure on HEES is considered, along with that for all the Department's programmes, as part of discussions on public expenditure.

  Expenditure on HEES grants over the last four years is as shown, for Great Britain as a whole and for Wales. The figures for the current year are estimates.

  £ million

  Year

  Great Britain

  Wales

  1993–94

  38.3

  1.8

  1994–95

  77.0

  3.7

  1995–96

  99.7

  5.2

  1996–97

  68.2

  3.4

  1997–98(estimated)

  69.0

  3.8

  Major changes to HEES, which were made by the previous administration, came into force on 1 July. I shall take an early opportunity to review the operation of the scheme in order to check that it is meeting the needs of customers.

  European Funds
  Mr. Ben Chapman
  To ask the Secretary of State for the Environment, Transport and the Regions if the Government are to implement the revised arrangements for administering the European Regional Development Fund and the European Social Fund in England announced by the previous Administration. [6917]

  Mr. Caborn
  I have reviewed the proposed new arrangements, which are based on action plans, in the light of representations made to me. I recently met Commissioner Wulf-Mathies to hear the Commission's views.

  The Government's view is that the action plan approach provides a real opportunity to improve the administration of the structural funds in England. Action plans will allow partnerships to bring together individual projects in a way which reflects regional priorities, tackles issues in a coordinated way and streamlines bureaucracy. However, we recognise that circumstances vary across the country and between regions and we do not wish to impose a uniform system. We have decided, therefore, that it will be for each programme monitoring committee to decide to what extent it wishes to adopt the new action plan approach.

  A concern of local partners is that resources should be available to assist with management and administration costs. The Commission has agreed that technical assistance funds could, in principle, be available for
  252
  partnerships where it was clear that they were taking on an additional role which added to the quality and effectiveness of implementation.

  I am today writing to the chairmen of the programme monitoring committees to let them know of the Government's decision and to encourage them to take advantage of the potential offered by the new action plan arrangements.

  Channel Tunnel
  Mrs. Dunwoody
  To ask the Secretary of State for the Environment, Transport and the Regions what was the length of time before(a) the loss of a door and (b) the collision between another train and the door, referred to in paragraph 75 of the Channel Tunnel Safety Authority Report 1995–96, were reported; and what factors underlay the length of time taken. [5873]

  Ms Glenda Jackson
  The Channel Tunnel Safety Authority Report for 1995–96, paragraph 66, says that arrangements for formal reporting by Eurotunnel of incidents and accidents were concluded during the year covered by the report. These arrangements cover the detailed circumstances where Eurotunnel is required to make immediate reports, reports within 72 hours or regular daily, monthly, half yearly and annual reports.

  The incident involving the loss of the emergency door from a tourist shuttle on 28 April 1995 occurred before the formal reporting arrangements were in place. The incident was reported in Eurotunnel's daily report received on the day following the incident and a detailed report was received from Eurotunnel on 2 May 1995.

  Mobile Telephones
  Mr. Chaytor
  To ask the Secretary of State for the Environment, Transport and the Regions what proposals he has to limit the use of mobile phones in cars. [6226]

  Ms Glenda Jackson
  Failure to have proper control of a vehicle is already an offence and the police can and do successfully prosecute driving offences that arise from the use of mobile phones while driving. My noble Friend Baroness Hayman will be meeting representatives of the police this month to consider whether additional measures are required. These are likely to include strengthening the advice in the Highway Code and good practice guidelines for drivers and for employers. Discussions are also being held with the mobile phone industry on how best to publicise the potential dangers of this practice.

  Mixed Oxide Fuel
  Dr. Lynne Jones
  To ask the Secretary of State for the Environment, Transport and the Regions in what forms mixed oxide fuel is transported by(a) road, (b) air and (c) sea. [5460]

  Ms Glenda Jackson
  Mixed oxide fuel (MOX) is normally transported by all modes in the form of fuel rods, consisting of ceramic pellets encased in metallic sheaths, or as finished fuel elements, consisting of a bundle of such rods in a supporting structure. MOX fuel is carried in packages approved by this Department.

  Roads Programme Review
  Mr. Keetch
  To ask the Secretary of State for the Environment, Transport and the Regions what plans the Government have to provide funding for alternative measures to address the environmental and transport problems which originally gave rise to road schemes dropped following the roads programme review; what the priorities will be for transport expenditure in that respect; and if he will make a statement. [5962]

  Ms Glenda Jackson
  We are currently taking forward our review of the roads programme. No decisions have yet been taken on specific schemes. The review will be very closely co-ordinated with the work on an integrated transport policy and the comprehensive spending review. Future funding of transport will be a major consideration of this work.

  Traffic Accidents (Alcohol)
  Mr. Kidney
  To ask the Secretary of State for the Environment, Transport and the Regions how many people(a) who died in road traffic accidents were found to have been driving with excess blood alcohol levels and (b) tested positive for driving with excess alcohol in respect of fatal road traffic accidents in England and Wales in each of the last three years. [5966]

  Ms Glenda Jackson
  (a) Rounded estimates of drivers or riders of motor vehicles killed in road accidents in Great Britain with illegal blood alcohol levels are shown in the following table. Estimates for England and Wales are not available separately.

  1994 340

  1995 300

  1996 320 (provisional).

  (b) Reported numbers of drivers or riders of motor vehicles who tested positive following a fatal road accident are shown in the following table. These numbers will exclude a small proportion of fatal drink drive accidents where it was not possible to administer a breath test.

  Great Britain

  England and Wales

  1994

  123

  115

  1995

  128

  119

  1996

  117

  111

  Traffic Enforcement Officers (Powers)
  Liz Blackman
  To ask the Secretary of State for the Environment, Transport and the Regions if he will remove the limitations on the powers of traffic enforcement officers to seize driver and vehicle records. [6243]

  Ms Glenda Jackson
  The Government accept that there is scope for clarifying the powers of enforcement officers to inspect and remove tachograph charts as well as to search for other evidence and will promote amending legislation when a suitable opportunity arises.

  Driving Hours
  Liz Blackman
  To ask the Secretary of State for the Environment, Transport and the Regions if he will ensure that United Kingdom drivers are immediately prohibited from driving when they are found to have exceeded permitted driving hours. [6242]

  Ms Glenda Jackson
  Where the driver of a UK registered vehicle is found to have exceeded permitted driving hours, or taken inadequate rest, he or she would normally be advised to take the rest or face the prospect that any refusal to do so would be reported to the court in any subsequent prosecution, or cause possible further charges to be brought. Although there is no evidence that this procedure is inadequate, the Government accept that there is a case for a power to prohibit the drivers of UK registered vehicles and will promote amending legislation when a suitable opportunity arises.

  Liz Blackman
  To ask the Secretary of State for the Environment, Transport and the Regions if he will ensure that United Kingdom domestic drivers' hours regulations are as stringent as those obtaining in the European Union. [6251]

  Ms Jackson
  The United Kingdom legislation on drivers' hours pre-dated the European Union rules and now applies only to certain types of vehicle operation which are exempt from European Union rules. We shall be considering the practical and legal implications of bringing some or all of those types of operation within the European Union rules. Such a change would require primary legislation and we would consult operators and their employees before making it.

  Liz Blackman
  To ask the Secretary of State for the Environment, Transport and the Regions if he will list the(a) United Kingdom and (b) EU regulations governing HGV drivers' hours; and if he will make a statement on areas of disparity between (a) and (b). [6249]

  Ms Jackson
  The United Kingdom regulations on drivers hours are contained in part VI of the Transport Act 1968 as amended. The European Union regulations are contained in Council Regulation (EEC) 3820/85. The main differences between the UK and EU rules for goods vehicle drivers are:

  UK rules

  EU rules

  Continuous driving (max)

  No limit

  4½ hours (after which a break of 45 minutes must be taken)

  Daily driving (max)

  10 hours

  9 hours (10 hours twice a week)

  Fortnightly driving

  No limit

  90 hours

  Daily rest (min)

  None but there is a daily duty limit of 11

  11 hours (reducible to 9 hours 3 times a week)

  Weekly rest (min)

  None

  45 hours (after 6 days)

  Dartford Crossing (Toll)
  Mr. Mackinlay
  To ask the Secretary of State for the Environment, Transport and the Regions if he will meet the Dartford Crossing operators to discuss the advantages of avoiding an increase in the toll being triggered under the Dartford-Thurrock Crossing Act 1988. [6288]
  255
  Ms Glenda Jackson
  I have no immediate plans to discuss with the operators of the Dartford Crossing changes to their current entitlement to toll increases in line with the RPI.

  Mr. Mackinlay
  To ask the Secretary of State for the Environment, Transport and the Regions when he expects tolling to end on the Dartford Crossing. [6282]

  Ms Jackson
  The current legislation requires tolling to end when the concessionaire has achieved its financial objectives and a fund for future maintenance has been accumulated. On current projections that point would be reached in 2001.

  Mr. Mackinlay
  To ask the Secretary of State for the Environment, Transport and the Regions what was(a) the total received in tolls on the Dartford Crossing and (b) the number of vehicles using the crossing in each year since 1988. [6284]

  Ms Jackson
  The information is as follows:

  Year to

  Vehicles (000)

  Revenue (£000)

  2 months to 30 September 1988

  5,252

  4,330

  30 September 1989

  28,735

  26,642

  30 September 1990

  30,386

  28,230

  30 September 1991

  29,361

  29,952

  30 September 1992

  34,798

  35,966

  30 September 1993

  37,385

  40,952

  30 September 1994

  39,947

  44,849

  30 September 1995

  42,557

  48,320

  30 September 1996

  44,364

  51,749

  M25 Widening
  Mr. Mackinlay
  To ask the Secretary of State for the Environment, Transport and the Regions when the Regional Director for the Government Office for the South East will reply to the letter of 21 April from Mr. Chris Fisher on behalf of FLAME relating to air quality within the vicinity of the proposed widening of the M25 in Surrey. [6341]

  Ms Glenda Jackson
  [holding answer 1 July 1997]: The Government Office for the South East acknowledged Mr. Fisher's letter on 23 April, explaining that the letter had been forwarded to the Highways Agency as the agency responsible for this scheme, but that it would not be possible to respond before the general election.

  The scheme in question now falls within the roads review announced by my right hon. Friend, the Minister of Transport, on 19 June 1997 and is one of those that are subject to the accelerated review procedure. The outcome of the accelerated review will be known by the end of July and the Highways Agency will respond once this is announced.

  Mr. Mackinlay
  To ask the Secretary of State for the Environment, Transport and the Regions if he will refer the representations he has received from FLAME to those bodies charged with assessing the proposed widening of the M25 under the accelerated highways review. [6338]

  Ms Jackson
  [holding answer 1 July 1997]: The proposed widening of the M25 between junctions 12 to 15 has been included in the accelerated review of urgent
  256
  schemes which is currently taking place. In the course of that review, account will be taken of views that have been expressed about the schemes under consideration.

  Aircraft Noise, Heathrow
  Mr. Tony Coleman
  To ask the Secretary of State for the Environment, Transport and the Regions if he will make a statement on aircraft noise monitoring on the Heathrow flight paths, [6420]

  Ms Glenda Jackson
  Noise from aircraft taking off from Heathrow has been monitored successively by Government Departments, the British Airports Authority, and by Heathrow Airport Ltd. (HAL) on behalf of the Government.

  The Government also undertake annual surveys of aircraft noise around Heathrow, Gatwick and Stansted airports, which are published in the form of noise contours for the 16-hour day. The most recent available are for 1994.

  Special noise monitoring exercises are also carried out from time to time to collect data on particular aspects of airport operations.

DEFENCE

  Strategic Defence Review
  Mr. Blunt
  To ask the Secretary of State for Defence when the policy baseline for the Strategic Defence Review will be completed; and if it will be published. [5568]

  Dr. Reid
  The Strategic Defence Review is foreign policy led. Its first stage will reassess Britain's essential security interests and defence needs in the changing international environment. This work is expected to be completed during the Summer and will provide the policy baseline for the Review. We shall consider then whether anything should be published in advance of the completion of the Review.

  Trident
  Mr. McAllion
  To ask the Secretary of State for Defence what plans his Department has to order Trident missiles before the Strategic Defence Review is concluded. [5608]

  Mr. Spellar
  As my right hon. Friend the Secretary of State for Defence told the House on 16 June,(Official Report, Columns 9 and 10), procurement business will proceed as normally as possible during the Strategic Defence Review. Where procurement decisions on major equipment programmes are required before the Review is concluded, and this will include the seven Trident missiles planned to be ordered in US Fiscal Year 1998, they will be considered on their individual merits and in relation to progress with the Review.

  Gulf War Veterans
  Mr. Kidney
  To ask the Secretary of State for Defence, when he last met representatives from the Gulf War Veterans Association to discuss Gulf War Syndrome. [2054]
  257
  Dr. Reid
  [pursuant to his answer, 16 June 1997, c. 76]: I regret that there was an erroneous reference to chemical warfare which should have been to biological warfare. For convenience the full corrected answer should have been as follows: As part of our commitment to listening to their concerns, the Secretary of State for Defence and I met veterans' representatives, including members of the Gulf Veterans Association, on 29 May. I was encouraged by the welcome extended by veterans to the new measures I announced last month, including new research on the effects of vaccines, additional resources for the medical assessment programme and a full and open explanation of the scientific basis in which our troops were protected against biological warfare in the Gulf.

  Logistic Information Systems Agency
  Mr. Alan Keen
  To ask the Secretary of State for Defence what are the key targets for the Logistic Information Systems Agency for 1997–98. [7060]

  Dr. Reid
  The Chief Executive of the Logistic Information Systems Agency has been set the following key targets for 1997–98.

  To deliver the agreed levels of service whilst achieving a 2.5 per cent. cut in unit costs for LISA output in FY 1997–98.

  To achieve a 10 per cent. improvement in delivery performance to customers' requirements.

  To secure the benefits of the Partnership at 10 per cent. above contractual commitment.

  To achieve Investors in People accreditation by April 1998.

  To improve LISA recruitment levels such that 95 per cent. of funded posts are filled with appropriately qualified personnel.

  Gordon Foxley
  Mr. Jim Murphy
  To ask the Secretary of State for Defence if he will make a statement about negotiations with the companies involved in the payment of commissions to Gordon Foxley relating to defence companies. [7090]

  Mr. Spellar
  Following the settlement reached with my Department in June 1996, under which Raufoss AS of Norway paid an agreed sum in redress, the company became eligible from that time to be considered for Ministry of Defence orders, but normal commercial relations were not to be resumed for some months while the operation of the agreement was monitored. I am pleased to report that the company has continued to co-operate fully with my Department since that date, including provision of full access to their relevant accounting records, and has satisfied my Department in respect of its management arrangements and approach to future contracts. We have therefore decided to resume normal commercial relations with the company.

  Discussions are continuing with the other companies involved in the Foxley case, against whom proceedings are still in train.

  Defence Postal and Courier Services Agency
  Mr. Alan W. Williams
  To ask the Secretary of State for Defence what are the key targets for the Defence Postal and Courier Services Agency for 1997–98. [7091]
  258
  Dr. Reid
  The Chief Executive of the Defence Postal and Courier Services Agency has been set the following key targets for 1997–98.

  1. Under Competing for Quality, to expose £2 million of Agency business to competition.

  2. Under the Private Finance Initiative, to pursue the automation of Forces Post Office counters world-wide with Post Office Counters Ltd., the Benefits Agency and Industry by March 2001.

  3. To complete the implementation of the Triennial Review by 31 March 1998.

  4. To identify the ratio of overheads to outputs (1996–97) and establish savings targets (1997–98) and achieve targets by 31 March 1999.

  5. To rationalise the technical funding and responsibility for Postal and Courier Service Units across MOD Top Level Budgets following the Triennial Review.

  6. To benchmark the unit costs of output over a 3 year period ending 31 March 1999.

TREASURY

  Domestic Fuel (VAT)
  Mr. Heathcoat-Amory
  To ask the Chancellor of the Exchequer (1) if he will estimate the impact on the index by which the state retirement pension is uprated of a reduction in VAT on domestic fuel to 5 per cent.; [5999]

  (2) if he will estimate what the effects on the retirement pension would have been at the last uprating if VAT on domestic fuel and power had been reduced to 5 per cent. in September 1996. [6000]

  Dawn Primarolo
  [holding answer 30 June 1997]: The state retirement pension is uprated in April of each year by the annual Retail Prices Index (RPI) inflation rate for the preceding September. The effect of reducing VAT on domestic fuel from 8 per cent. to 5 per cent. would be to reduce RPI inflation.

  Building Society Conversions
  Mr. Mitchell
  To ask the Chancellor of the Exchequer if he will introduce a moratorium on further building society conversions. [6225]

  Mrs. Liddell
  No.

  Bank of Credit and Commerce International
  Mr. Mitchell
  To ask the Chancellor of the Exchequer which of the recommendations contained in chapter 10 of the report by Senators Kerry and Brown on the closure of BCCI, he has(a) implemented and (b) rejected. [6476]

  Mrs. Liddell
  The recommendations to the Government and the Bank of England in the report of the Bingham Inquiry into the supervision of BCCI have all been implemented.

  Banking Ombudsman
  Mr. Paul Marsden
  To ask the Chancellor of the Exchequer what plans he has to regulate the Banking Ombudsman by statute. [6633]

  Mrs. Liddell
  There are no plans at present.
  259
  Mr. Marsden
  To ask the Chancellor of the Exchequer how many cases were dealt with by the Banking Ombudsman each year, over the past five years; and what percentage each year were found in favour of the claimant. [6632]

  Mrs. Liddell
  This information is provided in the Annual Reports of the Banking Ombudsman Scheme, copies of which are in the Library.

AGRICULTURE, FISHERIES AND FOOD

  Sheep Scab Order 1997
  Mr. Ieuan Wyn Jones
  To ask the Minister of Agriculture, Fisheries and Food when he expects the Sheep Scab Order 1997 to come into force; and if he will make a statement. [3804]

  Mr. Rooker
  The Sheep Scab Order 1997 was made on 19 March 1997 under the previous Government and came into force on 1 July 1997. The order is designed to support the majority within the sheep industry who take their welfare responsibilities seriously and treat their animals against sheep scab.

  It is intended to enable local authorities to order the treatment of sheep which are visibly affected with sheep scab. Local authorities will also be able to assist farmers deal with confirmed sheep scab on common land by ordering the clearance of the commons and requiring that sheep are treated for sheep scab before they are permitted to return. We shall be monitoring the operation of the order against its objectives.

  Departmental Advisers
  Mr. Alan Simpson
  To ask the Minister of Agriculture, Fisheries and Food if he will list each person advising or assisting his Department who has(a) membership of and (b) involvement in (i) the European Round Table of industrialists, (ii) the European Centre for Infrastructure Studies, (iii) the Competitiveness Advisory Group, (iv) Transatlantic Business Dialogue, (v) the Association for the Monetary Union of Europe, (vi) Union of Industrial and Employers Confederations of Europe, (vii) Europe Bio and (viii) the World Business Council for Sustainable Development. [5307]

  Mr. Morley
  Membership of the European Round Table of industrialists, the Competitiveness Advisory Group and the Transatlantic Business Dialogue is on a personal basis. We have no central record of whether each person advising or assisting the Minister is a member of, or involved in, these groups.

  Membership of the European Centre for Infrastructure Studies, the Association for the Monetary Union of Europe, the Union of Industrial and Employers Confederations of Europe, Europa Bio and the World Business Council for Sustainable Development is on a corporate basis. Representatives from companies and organisations involved with these groups may advise this Ministry from time to time.
  260
  Mr. Mitchell
  To ask the Minister of Agriculture, Fisheries and Food if he will list the special advisers in his Department, the Minister to whom each is responsible, the subjects on which they advise and the number of advisers in his Department in the year up to 1 May. [5346]

  Mr. Morley
  This Department has two special advisers who are employed under the terms and conditions based on the model contract for special advisers, a copy of which has been placed in the Library of the House. Ms Cathy McGlynn and Mr. Tim Walker advise my right hon. Friend the Minister of Agriculture, Fisheries and Food in accordance with Schedule 1 (Part 1) of the model contract. Their subjects are:

  Cathy McGlynn

  Tim Walker

  Fisheries

  Food safety and standards

  Countryside matters

  Meat hygiene

  Forestry

  Animal health (including BSE)

  Agricultural policy and the CAP

  Pesticide safety

  Production and trade in agricultural commodities

  Veterinary medicines

  External trade

  Plant health

  Food and Drinks Industry

  Research

  Competition issues

  Animal welfare

  Export promotion

  Flood defence

  During the year up to 1 May 1997, this department employed one special adviser. His employment ended on 31 March 1997.

  Sewage Outfall, Falmouth
  Ms Atherton
  To ask the Minister of Agriculture, Fisheries and Food what assessment he has made of the likely impact of South West Water's plans for a sewage outfall in Carrick Roads, Falmouth, on the quality of(a) oysters and (b) other shellfish. [5476]

  Mr. Morley
  The Department has made a partial assessment of the impact of the plans for a sewage outfall and has asked for further information to allow this assessment to be completed.

  Animal Slaughter
  Sir Richard Body
  To ask the Minister of Agriculture, Fisheries and Food how many(a) pigs, (b) cattle, (c) sheep, (d) broiler chickens and (e) turkeys were slaughtered in (i) the last available 12 months period and (ii) the previous 12 months period; and if he will make a statement. [6064]

  Mr. Rooker
  The information requested is available from the United Kingdom Slaughter Statistics notice and the Poultry and Poultrymeat Statistics notice, copies of which are available in the Library of the House.

  Minestone Tipping (Northumberland)
  Mr. Beith
  To ask the Minister of Agriculture, Fisheries and Food if he will make a statement about the licensing of minestone tipping in the sea of Lynemouth, Northumberland. [6333]
  261
  Mr. Morley
  The deposit of material anywhere below the mean high water mark requires a licence under the Food and Environment Protection Act 1985. Licences for the disposal of minestone as waste on to beaches and into the sea have not been issued since 1995.

  The deposit of minestone has been authorised since 1995 for the purpose of coast protection at Lynemouth, Northumberland. The licensee, R. J. B. Mining, has recently submitted a report on the agreed programme of monitoring on the environmental effects of the use of this material which is at present under consideration by the Department.

  Green Pound
  Mr. Green
  To ask the Minister of Agriculture, Fisheries and Food what plans he has to compensate farmers for the recent revaluations of the green pound. [6158]

  Mr. Rooker
  Payment of the aid available, as agreed by the March Agriculture Council, would have significant implications for UK public expenditure. We are considering carefully the case made by interested parties for payment.

  Beef Assurance Scheme
  Mr. Green
  To ask the Minister of Agriculture, Fisheries and Food if he will simplify the requirements of the Beef Assurance Scheme. [6152]

  Mr. Rooker
  The Reef Assurance Scheme rules are strict in order to command the confidence of consumers. They were written in consultation with the Spongiform Encephalopathy Advisory Committee (SEAC) and minimise any risk of BSE occurring in a scheme herd. The scheme rules are kept under review, but the Government have no present plans to amend them.

  Cohesion Cod
  Sir Richard Body
  To ask the Minister of Agriculture, Fisheries and Food what is the definition of the term cohesion cod in EU documentation. [6150]

  Mr. Morley
  This term is not defined in EU legislation. However it is commonly understood to refer to a quota to fish cod in Norwegian waters north of 62°N, granted to the EU by Norway as part of the European Economic Area Agreement, which is allocated among those Member States eligible for cohesion funds: Greece, Ireland, Portugal and Spain.

  Sand Eels
  Mr. Salmond
  To ask the Minister of Agriculture, Fisheries and Food (1) what plans he has to control industrial fishing for sand eels off the British East Coast; and if he will make a statement; [6264]

  (2) what representations he has made to his European colleagues concerning measures to control industrial fishing for sand eels in the North Sea; and if he will make a statement; [6265]

  (3) if he will ban the industrial fishing for sand eels in the Wee Bankie area; [6266]
  262
  (4) if he will make a statement on the measures being taken to implement section 9.2 of the Statement of Conclusions of the March 1997 Intermediate Ministerial Meeting of the North Sea Conference. [6267]

  Mr. Morley
  The Government believe that all industrial fisheries should be subject to the same requirement as other fisheries to operate on a sustainable basis. We remain concerned that the present restrictions on industrial fisheries may not adequately protect some particularly sensitive areas. As there have been no meetings of the Council of Fisheries Ministers since 1 May I have not had the opportunity to raise this issue there. However, discussions at official level with the Danish Ministry led to their facilitating scientific observation by the Scottish Office Marine Laboratory of this year's sand eel fishery by the Danish fleet off the British East Coast, where the observed catch was more than 99.6 per cent. sand eels.

  The Sea Mammal Research Unit, along with the Danish Institute of Fisheries Research, the Natural Environment Research Council, the Scottish Office and others, is undertaking a collaborative three-year project (ELIFONTS), ending in 1999, to examine the impact of industrial fishing on sand eel abundance and the effects of variations in that abundance on predators in the Wee Bankie and neighbouring fisheries. The contractors have undertaken to give early warning of any interim results which show that the fishery is having adverse effects on the various species. We are also funding Newcastle University's research vessel to carry out sampling of sand eel populations within the study area as part of the project.

  Section 9.2 of the Statement of Conclusions of the Intermediate Ministerial Meeting on the Integration of Fisheries and Environmental Issues, invites the competent authorities to consider (inter alia) restrictions on fishing in any areas where it is judged the ecosystem requires protection. The European Commission will decide in the light of the ELIFONTS project and other research, what action is appropriate to propose to the Council of Ministers. We would expect them to consider options for introducing quantitative restrictions or complete bans in particularly sensitive areas, always bearing in mind the need to avoid displacing fishing effort in a way that has a net adverse effect.

  The Wee Bankie lies outside UK territorial waters and the Government are unable to take unilateral action to restrict fishing there.

TRADE AND INDUSTRY

  European Assistance (Cornwall)
  Ms Atherton
  To ask the President of the Board of Trade what plans she has to secure objective 1 status for Cornwall. [5230]

  Mrs. Roche
  Eligible areas for the European structural funds will not change before the end of 1999. Once the Commission has put forward proposals for reform of the structural funds and these have been negotiated and agreed, the Government will then consider proposing particular areas within the United Kingdom.
  263
  My hon. Friend was part of the delegation of Cornish members of the House who came to the Department of Trade and Industry on 18 June while I was in Brazil, and I can assure her that the Government will pay close attention to the needs of Cornwall along with other areas of the United Kingdom.

  Competitiveness
  Mr. Touhig
  To ask the President of the Board of Trade what steps her Department is taking to improve the competitiveness of British companies. [5231]

  Mrs. Heal
  To ask the President of the Board of Trade what steps her Department is taking to improve the competitiveness of British companies. [5241]

  Mrs. Beckett
  I refer my hon. Friends to the answer I gave in response to my hon. Friends the Members for Dundee, West (Mr. Ross) and for Lincoln (Gillian Merton) earlier today.

  Mr. Fabricant
  To ask the President of the Board of Trade what steps she is taking to promote the competitiveness of small British companies in export markets; and if she will make a statement. [5235]

  Mrs. Beckett
  My noble Friend the Minister for Trade announced on 22 May that the Government would be setting up an Export Forum, with representation from business as well as from Whitehall. The Forum's remit will be to review the effectiveness of current official export promotion programmes and report to Ministers by the autumn with recommendations for a new export initiative.

  Child Labour
  Mr. Corbyn
  To ask the President of the Board of Trade what proposals she has to prevent the import of goods produced by child labour; and if she will make a statement. [5234]

  Mrs. Roche
  The Government are firmly committed to using our best endeavours to eliminate the exploitation of child labour around the world. We intend to increase our financial support for the International Labour Organisation's International Programme on the Elimination of Child Labour and we welcome the proposal for a new ILO Convention on this issue. We will also explore how the processes of the World Trade Organisation can contribute to achieving our objective.

  Clean Coal Technology
  Mr. Tipping
  To ask the President of the Board of Trade what new steps she intends to take to promote clean coal technology. [5236]

  Mr. Battle
  Over the next few months we will be conducting a detailed review of the UK's future clean coal technology requirements. As a key part of this review we have recently agreed to contribute some £50,000 to an industry led study as part of the Foresight exercise. The current plans will be included in the Comprehensive Spending Review announced by the Chief Secretary to the Treasury on 1 June 1997.

  We are working closely with industry to promote UK expertise in clean coal technology for the substantial world export market that exists for these technologies.
  264
  Already the Department has led one clean coal technology trade mission to India and an inward mission from China will take place in the autumn. Further outward and inward missions are planned for 1998. We are also working closely with the International Energy Agency to promote the development of clean coal technologies in developing countries which are expected to be the main market for these technologies over the next decade and beyond.

  Partnership in Industry
  Mrs. Osborne
  To ask the President of the Board of Trade what is her policy on social dialogue and partnership in industry; and if she will make a statement. [5237]

  Mr. Ian McCartney
  The Government support social dialogue and partnership in Europe, at the national level and in individual undertakings. Social partnership is the best means of identifying and pursuing common objectives. It can make a real contribution to improving economic performance and social equity. The Government are looking for ways to develop social partnership at all levels.

  Manufacturing Investment
  Mr. Rendel
  To ask the President of the Board of Trade what plans she has to encourage manufacturing investment in the United Kingdom. [5238]

  Mrs. Beckett
  Increased investment will come only with economic stability, an appropriate tax regime and the pursuit of competitiveness through partnership. My right hon. Friend the Chancellor has laid the foundations for economic stability and introduced tax changes to encourage business investment in the Budget. I have established an agenda for pursuing competitiveness through partnership starting with a Competitiveness summit on 23 July.

  Greenpeace
  Mr. McAllion
  To ask the President of the Board of Trade when she next intends to meet Greenpeace to discuss oil exploration licences. [5239]

  Mr. Battle
  I have no immediate plans to meet Greenpeace.

  Late Payment of Bills
  Mr. Page
  To ask the President of the Board of Trade what research she has evaluated into comparisons carried out between the countries that make up the European Union over the effect of a statutory right of interest on late payment. [5240]

  Mrs. Roche
  My Department has closely analysed the findings of research into late payment problems across Europe and the effect of a statutory right to interest, including recent surveys carried out by NOP and Grant Thornton.

  Research undertaken by Grant Thornton identified that those Member States where businesses use legislation for statutory interest most frequently had much quicker payment periods. Additionally the research undertaken by NOP showed that 80 per cent. of British businesses wanted a statutory right to interest.
  265
  We are determined to end the culture of late payment in the UK and will introduce the Fair Payment of Commercial Debts Bill to give businesses a statutory right to claim interest on the late payment of commercial debts. We will consult on the most appropriate way of introducing legislation and will issue a Green Paper soon.

  Aerospace Industry
  Mr. Jack
  To ask the President of the Board of Trade what is her Department's assessment of the key factors which will affect the prospects for the aerospace industry in the next decade. [5242]

  Mr. Battle
  The key factors that will influence the aerospace industry over the next decade are likely to be competitiveness on a global scale and a commitment to excellence. The Department will be actively supporting the UK aerospace sector in these areas.

  Gas and Electricity Industries
  Mr. Watts
  To ask the President of the Board of Trade what steps she has taken to encourage greater competition in the gas and electricity industries. [5344]

  Mr. Battle
  I refer my right hon. Friend to the answer I gave earlier today to the hon. Member for Buckingham (Mr. Bercow).

  Sustainable Energy
  Mr. Martyn Jones
  To ask the President of the Board of Trade if she will make a statement on her plans for encouraging research and development in sustainable energy technology. [5207]

  Mr. Battle
  The Government are undertaking a new and strong drive to develop renewable energy options as a means of ensuring diverse secure and sustainable energy sources.

  I shall also examine the role of research and development to maximise the benefit to the economy of the emerging new environmentally friendly energy industries.

  Post Office
  Mr. Simon Hughes
  To ask the President of the Board of Trade what is Her Majesty's Government's policy on the future of the Post Office. [5218]

  Mr. Ian McCartney
  Our policy on the future of the Post Office, in accordance with our election manifesto commitment, is to grant it greater commercial freedom, to take advantage of new challenges and opportunities. A consideration of options for implementing this commitment is now under way.

  Inward Investment
  Rev. Martin Smyth
  To ask the President of the Board of Trade what plans she has to match inward investment to the United Kingdom to(a) the available skills and (b) regional needs. [5219]

  Mr. Ian McCartney
  It is the needs of individual inward investors and projects including skill requirements that will influence which regions are most attractive from case to case. The Government's role is to ensure that 266
  across all regions we have a skills base and other features which help maintain the UK's competitive position as an inward investment location.

  Small Businesses
  Ms Beverley Hughes
  To ask the President of the Board of Trade what plans she has to improve support for small businesses. [5225]

  Mr. Cotter
  To ask the President of the Board of Trade what plans she has to make business support and advice more accessible to small businesses. [5227]

  Mrs. Roche
  Business Links are central to our strategy for delivering business services to small businesses. Improving the Business Link service to small and medium sized businesses is one of my key priorities. I am committed to ensuring that all Business Links deliver a service which is of the highest quality. Many are already doing so, and I am discussing with the national Business Link partners and others how we can ensure that all Business Links are brought up to the standard of the best.

  Defence Industry
  Mr. Corbyn
  To ask the President of the Board of Trade what was the annual cost of export credit guarantee certificates to the arms export industries in each of the past 10 years. [4752]

  Mrs. Roche
  [holding answer 23 June 1997]: The Export Credits Guarantee Department has paid to date the following claims on guarantees related to business with Defence Ministries underwritten in the last 10 years.

  Year of underwriting

  £ million

  1987–88

  48.3

  1988–89

  76.7

  1989–90

  31.7

  1990–91

  —

  1991–92

  0.7

  1992–93

  —

  1993–94

  —

  1994–95

  1.1

  1995–96

  —

  1996–97

  —

  Edgware Sorting Office
  Mr. Dismore
  To ask the President of the Board of Trade if she will investigate the adequacy of the postal service given by Edgware Sorting Office; and if she will make a statement. [5661]

  Mr. Ian McCartney
  Operational responsibility for postal services rests with the Post Office. I understand that Royal Mail has experienced problems at Edgware because of staff shortages but a revision of staff duties planned for the autumn is expected to resolve the problems. In the meantime, Royal Mail has introduced interim measures to improve the quality of service which customers in Edgware receive.

  Electrical Goods
  Mr. Bill O'Brien
  To ask the President of the Board of Trade if she will discuss with representatives of the electrical goods industry the public response to their recommended retail price regime. [4605]
  267
  Mr. Nigel Griffiths
  As the MMC report is currently being considered by my right hon. Friend the President of the Board of Trade it would not be appropriate to comment.

  Mr. O'Brien
  To ask the President of the Board of Trade what representations she has received from the electrical goods industry concerning profitability, profit margins and manufacturing costs of goods supplied by the industry; and if she will make a statement. [4603]

  Mr. Griffiths
  My Department has received representations on these issues from the electrical goods sector. However since the MMC report is currently being considered by my right hon. Friend the President of the Board of Trade it would not be appropriate to comment.

  Company

  Inspectors

  Accountant inspector's costs (including support staff and VAT) £(000)

  Legal inspector's costs (including support staff and VAT) £(000)

  Total costs of inspection to date (including disbursements) £(000)

  Guinness plc

  Mr. D. Donaldson QC

  2,469

  660

  3,137

  Mr. I. Watt FCA

  Wace UK Holdings Limited

  Mr. A. Robertshaw

  —

  —

  15

  Tinsley Robor plc

  Mr. C. Mayhew

  European Colour plc

  (both departmental officers1)

  Mirror Group Newspapers plc

  Sir R. J. L. Thomas

  6,718

  1,650

  8,368

  Mr. R. Turner FCA

  Chancery plc

  Mr. R. Chandler ACA

  622

  —

  622

  Mr. A. Fausett (departmental officer1)

  Queens Moat Houses plc

  Mr. P. Phillips QC

  2,487

  907

  3,396

  Mr. A. Burn FCA

  1 Excludes departmental staff costs. A decision on publication cannot be made before inspectors submit their report.

  Office of Science and Technology
  Dr. Starkey
  To ask the President of the Board of Trade how many full-time equivalent staff were employed at the Office of Science and Technology on(a) permanent and (b) temporary contracts, in each year from 1994 to 1997 broken down by grades. [6156]

  Science and engineering base group

  Grade

  Permanent

  Contract

  Total

  1994

  1995

  1996

  1997

  1994

  1995

  1996

  1997

  1994

  1995

  1996

  1997

  DGRC

  —

  —

  —

  —

  1

  1

  1

  1

  1

  1

  1

  1

  SCS

  2

  2

  3

  3

  1

  1

  —

  —

  3

  3

  3

  3

  G6

  2

  2

  3

  3

  —

  —

  —

  —

  2

  2

  3

  3

  G7

  9

  8

  8

  8

  —

  —

  1

  1

  9

  8

  9

  9

  SEO

  3

  2

  1

  1

  —

  —

  —

  —

  3

  2

  1

  1

  AT/HEOD

  1

  1

  1

  1

  —

  —

  —

  —

  1

  1

  1

  1

  HEO/HSO

  8

  7

  7

  8

  —

  —

  —

  —

  8

  7

  7

  8

  EO

  5

  5

  4

  4

  —

  —

  —

  —

  5

  5

  4

  4

  AO

  5

  5

  6

  5

  —

  —

  —

  —

  5

  5

  6

  5

  AA

  —

  —

  —

  —

  —

  —

  —

  —

  0

  0

  0

  0

  SPS

  1

  1

  2

  2

  —

  —

  —

  —

  1

  1

  2

  2

  PS

  4

  4

  3

  3

  —

  —

  —

  —

  4

  4

  3

  3

  Typist

  2

  1

  —

  —

  —

  —

  —

  —

  2

  1

  0

  0

  42

  38

  38

  38

  2

  2

  2

  2

  44

  40

  40

  40

  Accountancy Firms
  Mr. Mitchell
  To ask the President of the Board of Trade if she will list those investigations currently being carried out by her Department under the Companies Act, Financial Services Act and Insurance Companies Act legislation, indicating the cost of each investigation, the manner in which the costs are being apportioned between inspectors and the likely date of publication. [4821]

  Mr. Nigel Griffiths
  [holding answer 25 June 1997]: The Department carries out a number of enquiries under the Companies, Financial Services and Insurance Companies Acts, most of which are confidential. There are currently five Companies Act inspectors which were publicly announced. The information requested by the hon. Member in respect of these is as follows:

  Mr. Battle
  The average number of full-time equivalent staff employed in the two groups within OST in the years requested was as follows:
  269

  Transdepartmental group

  Grade

  Permanent

  Contract

  Total

  1994

  1995

  1996

  1997

  1994

  1995

  1996

  1997

  1994

  1995

  1996

  1997

  CSA

  —

  —

  —

  —

  1

  1

  1

  1

  1

  1

  1

  1

  SCS

  4

  4

  4

  4

  —

  —

  —

  —

  4

  4

  4

  4

  G6

  4

  5

  2

  2

  —

  —

  —

  —

  4

  5

  2

  2

  G7

  15

  21

  24

  21

  —

  —

  —

  —

  15

  21

  24

  21

  SSO/SEO/SIO

  1

  2

  2

  3

  1

  1

  1

  1

  2

  3

  3

  4

  AT/HEOD

  1

  —

  2

  4

  —

  —

  —

  —

  1

  0

  2

  4

  HEO/HSO

  6

  9

  8

  10

  —

  —

  —

  —

  6

  9

  8

  10

  EO

  5

  5

  8

  10

  —

  —

  —

  1

  5

  5

  8

  11

  AO

  6

  5

  8

  8

  —

  —

  —

  —

  6

  5

  8

  8

  AA

  3

  2

  2

  4

  —

  —

  1

  —

  3

  2

  3

  4

  SPS

  1

  1

  1

  1

  —

  —

  —

  —

  1

  1

  1

  1

  PS

  5

  4

  4

  4

  —

  —

  —

  —

  5

  4

  4

  4

  Typist

  3

  2

  3

  2

  —

  —

  —

  —

  3

  2

  3

  2

  54

  60

  68

  73

  2

  2

  3

  3

  56

  62

  71

  76

  The Transdepartmental Group numbers include the secretariat of the Chief Scientific Adviser (CSA) and the Management Support Unit for all of OST, and reflect the initiation and development of the Foresight Programme, the transfer of a section from elsewhere in DTI into the Group's International Directorate, the establishment of the secretariat for the Human Genetics Advisory Commission and, in 1997, a temporary increase in staff for the 1988 UK presidency of the EU and Framework V negotiations. The Science and Engineering Base Group includes the Director General of Research Councils (DGRC) and is responsible for the Science Budget and the Research Councils. Its numbers take into account the transfer in January 1996 of the Development Unit for Women in Science, Engineering and Technology from the Transdepartmental Group, and an increase in the number of Research Councils from six to seven.

  The permanent staff figures in each year include about 20 staff on secondment from other Departments and Non Departmental Public Bodies including the Research Councils, and four secondees from private companies.

  Trade and Aid
  Mr. Redwood
  To ask the President of the Board of Trade what assessment she has made of the loss of business and jobs in the United Kingdom as a result of ending the link between trade and overseas aid. [5717]

  Mrs. Roche
  [holding answer 1 July 1997]: I expect there to be no significant effect on business or jobs in the UK following the Prime Minister's announcement that the UK would untie all of its pledge to the fourth phase of the Special Programme of Assistance to Sub-Saharan Africa.

  There is no change to the tying status of the rest of the aid programme and thus there would be no effect on business or jobs.

  Social Chapter
  Mr. Paterson
  To ask the President of the Board of Trade what assessment she has made of the Benefits for industry from the United Kingdom's adoption of the social chapter. [5233]

  Mr. Ian McCartney
  Decent minimum standards for workers in Europe will promote good working relations. That can only be good for business. By ending the last Government's futile opt-out, we will play a full part in 270
  negotiations and ensure that the Social Chapter promotes flexibility and employability, but not unnecessary social costs.

  Machine Tool Industry
  Mr. Purchase
  To ask the President of the Board of Trade if she will make a statement about her plans to support the machine tool industry. [5208]

  Mr. Battle
  I met the Machine Tool Technologies Association on 20 May and am aware of its concerns. The machine tool industry will continue to be eligible for the range of Government support services to industry.

INTERNATIONAL DEVELOPMENT

  Mineral Exploitation
  Mr. Healey
  To ask the Secretary of State for International Development what is Her Majesty's Government's policy towards the protection of(a) the environment and (b) indigenous tribes in areas of the world vulnerable to mineral exploitation; and if she will make a statement. [6244]

  Clare Short
  The Department for International Development (DFID) is committed to the sustainable eradication of poverty. Protection of the environment is an essential requirement for this. All bilateral DFID projects are appraised to ensure they take full account of environmental issues and many directly contribute to environmental protection. In 1995–96, expenditure on projects which contributed to conserving the environment as an objective totalled £196 million.

  DFID seeks to ensure that, through their enhanced participation, indigenous people and ethnic minorities benefit from those projects and programmes, including mineral projects, which affect them and that any adverse effects upon them are minimised.

  DFID also seeks to ensure that multilateral organisations such as the EC and the World Bank pursue development policies consistent with our own objectives.

  Philippines
  Mr. Healey
  To ask the Secretary of State for International Development what representations she has received from organisations expressing concern at the mining activities of RTZ in the Philippines. [6277]

  Clare Short
  We have received no such representations and have no involvement with the mining sector in the Philippines.

  Financing Institutions (Development Criteria)
  Mr. Goodlad
  To ask the Secretary of State for International Development what social and human development criteria she intends to ask the International Monetary Fund to use when assessing countries requesting funding. [6367]

  Clare Short
  I regard it is as important for all multilateral financing and development institutions to be guided in their operations in developing countries by the need to create economic conditions and local capacity which will enable each developing country to meet the social and human development objectives launched by the Development Assistance Committee of the OECD, with the key objective of reducing and eventually eliminating poverty.

  Aid Projects
  Mr. Goodlad
  To ask the Secretary of State for International Development what new criteria she will use to assess projects seeking development aid. [6369]

  Clare Short
  We will ensure that all projects are not just developmentally sound, but contribute directly or indirectly to our core policy objective of eliminating poverty.

  Poverty
  Mr. Goodlad
  To ask the Secretary of State for International Development what are her Department's targets for the number of people living in absolute poverty by 2015. [6371]

  Clare Short
  The Government is committed to the internationally accepted development target of reducing the proportion of people living in extreme poverty by half by 2015.

  Debt Burden
  Mr. Goodlad
  To ask the Secretary of State for International Development what measures the Government took to reduce the debt burden on the poorest countries between 9 April 1992 and 1 May 1997. [6392]

  Clare Short
  I have already acknowledged the good record the previous government had on introducing measures to reduce the unpayable debts of the poorest countries, pushing for the introduction both of Naples Terms for the rescheduling of government to government debts, and the Heavily Indebted Poor Countries debt initiative which will tackle the problem of unpayable debt owed to all creditors, including the multilateral institutions. The previous government also continued the policy of forgiving the development loans of the poorest countries, a policy introduced under the last Labour government in 1978.
  272
  We welcome the progress made so far, but believe that much remains to be done, and are pressing the international community collectively to provide further debt relief. We need to make sure debt relief is implemented flexibly to reflect individual country needs, that it is accompanied by policies in debtor countries which are targeted on poverty elimination and that countries which are burdened with debt but have demonstrated their commitment to such policies get the relief they need as soon as possible.

  Small and Medium Businesses
  Mr. Goodlad
  To ask the Secretary of State for International Development what steps Her Majesty's Government are taking to encourage small and medium businesses in developing countries. [6372]

  Clare Short
  The Department for International Development is actively promoting micro, small and medium enterprise development to create jobs, especially to improve poor people's access to income earning opportunities. The Department is seeking to develop local capacity to deliver cost effective business development and financial services. We place a particular emphasis on micro-finance. Approved commitments to 190 current projects exceed £95 million.

  Developing Countries (Investment)
  Mr. Goodlad
  To ask the Secretary of State for International Development what steps she is taking to encourage British investment in developing countries. [6374]

  Clare Short
  The Government wishes to work more closely with the private sector to promote economic growth in developing countries. Improving the investment climate is a key target. We are seeking to improve our partnership with the private sector and consulting all interested groups. I will be setting out some thoughts on this in a speech at the Institute of Directors next week.

  Functions Transfer
  Mr. Goodlad
  To ask the Secretary of State for International Development what was the cost to public funds of transferring functions formerly carried out by the Overseas Development Administration to the Department for International Development. [6370]

  Clare Short
  There was no cost to public funds associated with the transfer of functions formerly carried out by the Overseas Development Administration to the Department for International Development.

  United Nations Industrial Development Organisation
  Mr. Leslie
  To ask the Secretary of State for International Development if she has reached a decision on United Kingdom membership of UNIDO. [6640]

  Clare Short
  I have today informed the UN Secretary-General of our decision to remain a member of United Nations Industrial Development Organisation (UNIDO). We will work within the organisation in order to demonstrate the Government's strong commitment to support the United Nations and its agencies and reforms which increase their effectiveness. This decision
  273
  recognises both the chances made so far in UNIDO and the UN Secretary-General's efforts to bring about a more effective UN.

SCOTLAND

  EU Afforestation Budget
  Sir Richard Body
  To ask the Secretary of State for Scotland what was the European Union afforestation budget for 1993 to 1997. [6092]

  Mr. Chisholm
  The European Union's afforestation budget for the period 1993 to 1997 was 1,340 million ecu.

  GP Fundholding
  Mr. McAllion
  To ask the Secretary of State for Scotland what steps he is taking to abolish general practitioner fundholding in Scotland. [5861]

  Mr. Galbraith
  The Government intend to publish a White Paper on the Scottish Health Service in the Autumn which will set out the options for new models of involving GPs in the design and delivery of patient care services. In the meantime, steps have already been taken to change the financial regime for GP fundholders to ensure the patients of non-fundholding GPs are not disadvantaged.

  Ferry Services (Orkney and Shetland)
  Mr.Wallace
  To ask the Secretary of State for Scotland, pursuant to his answer of 16 June,Official Report, column 55, how many tenders are currently being evaluated in respect of (a) the passenger ferry service to Orkney, (b) the passenger ferry service to Shetland and (c) a passenger ferry service for both Orkney and Shetland; and if he will make a statement. [6002]

  Mr. Dewar
  [holding answer 30 June 1997]: Tenders for a block grant subsidy for the operation of passenger ferry services to Orkney and Shetland are currently being considered by Ministers. A number of options have been proposed for the operation of these services. Three proposals were made in respect of the services to Orkney, two of which also made proposals in respect of the services to Shetland. An announcement on the outcome of the tendering exercise will be made shortly.

  Pyrethroid Sheep Dips
  Mrs. Golding
  To ask the Secretary of State for Scotland if he will make a statement on the effect of pyrethroid sheep dips on aquatic life in rivers and streams in Scotland. [6157]

  Mr. Chisholm
  I understand from the Scottish Environment Protection Agency that much of the impact in watercourses affected by the disposal of spent pyrethroid sheep dip has been on aquatic invertebrates such as river insects, although there have been a number of reported cases of significant fish kills.

  There are serious practical difficulties in disposing of spent pyrethroid sheep dip particularly in the more remote areas of the Highlands and Islands. However, the Scottish Environment Protection Agency considers environmental risks can be greatly reduced by the adoption of good farming practice. Comprehensive advice can be found in
  274
  The Scottish Office Code of Good Practice for the Prevention of Environmental Pollution from Agricultural Activity, a revised edition of which will be available at the end of this month. The Scottish Environment Protection Agency actively promotes such good practice through the publication of educational material and undertaking farm visits.

  Legal Services (Orkney and Shetland)
  Mr. Wallace
  To ask the Secretary of State for Scotland in how many cases in(a) Orkney and (b) Shetland the Procurator Fiscal proceeded by way of a fiscal fine in each year since 1992. [6049]

  Mr. McLeish
  [holding answer 2 July 1997]: The numbers of criminal reports concluded by way of a fiscal fine by the Procurator Fiscal at Kirkwall (Orkney) and Lerwick (Shetland) are as follows:

  Year

  Kirkwall

  Lerwick

  1992–93

  41

  145

  1993–94

  27

  50

  1994–95

  32

  43

  1995–96

  28

  42

  1996–97

  76

  67

  Mr. Wallace
  To ask the Secretary of State for Scotland in how many cases reports were submitted to the Procurator Fiscal in(a) Orkney and (b) Shetland marked for no proceedings in each year since 1992. [6048]

  Mr. McLeish
  [holding answer 2 July 1997]: The information is as follows:

  Year

  Kirkwall

  Lerwick

  Total reports received

  No proceedings

  Total reports received

  No proceedings

  1992–93

  742

  89

  870

  86

  1993–94

  708

  81

  794

  143

  1994–95

  715

  94

  758

  167

  1995–96

  704

  38

  768

  60

  1996–97

  786

  46

  854

  80

  RAF Edzell
  Mr. Swinney
  To ask the Secretary of State for Scotland by what means he will support the economic development initiatives proposed by the RAF Edzell Task Force, in their bid for Challenge Funding in early 1997; and if he will make a statement. [6378]

  Mr. Chisholm
  Four million pounds is being made available through the Central Challenge Fund over the next three years for a package of measures put forward by Angus and Aberdeenshire Councils, with the support of the Edzell Task Force, to strengthen the local economy following the withdrawal of the US Navy from RAF Edzell.

  Skye Bridge
  Mr. Charles Kennedy
  To ask the Secretary of State for Scotland when he expects the Lord Advocate to reply to the requests from the hon. Member for Ross, Skye and
  275
  Inverness, West for a meeting to discuss the Skye Bridge tolls non-payment campaign; and if he will make a statement. [6496]

  Mr. McLeish
  My noble and learned Friend the Lord Advocate has asked the Procurator Fiscal at Dingwell to undertake a review of pending cases. The Lord Advocate will write to the hon. Member once the review has been completed.

NORTHERN IRELAND

  Gallaher (Subsidy Payments)
  Ms Jane Griffiths
  To ask the Secretary of State for Northern Ireland if she will make a statement on her plans for future subsidy payments to Gallaher's tobacco company in Northern Ireland. [2440]

  Mr. Ingram
  Any future application for financial assistance by Gallaher under programmes of support for industry in Northern Ireland will be considered against the normal criteria of eligibility for such support.

  Ice Making Plant (Portavogie)
  Mr. John D. Taylor
  To ask the Secretary of State for Northern Ireland what proposals there are to provide a new ice making plant at Portavogie; and if she will make a statement. [5593]

  Mr. Paul Murphy
  Approval has been given for grant aid to the Northern Ireland Fishery Harbour Authority towards the cost of constructing a replacement ice-making plant at the fish auction hall in Portavogie. Consideration of the possible replacement of the other, larger ice plant at Portavogie Harbour is being given in the context of the Authority's Development Plan, which is currently under preparation.

  Water Meters
  Mr. Robert McCartney
  To ask the Secretary of State for Northern Ireland how many and what percentage of properties in(a) North Down and (b) Northern Ireland have water meters; how many were charged for excess use and how much was collected in each of the last three years; and when she expects metering to become universal. [5638]

  Mr. Paul Murphy
  Responsibility for the subject in question has been delegated to the Water Service under its Chief Executive, Mr. H. R. F. Plester. I have asked him to arrange for a reply to be given.

  Letter from H. R. F. Plester to Mr. Robert McCartney, dated 30 June 1997:
  The Secretary of State has asked me to reply your recent Parliamentary Question asking what percentage of properties in Northern Ireland and North Down have water meters, how many were charged for excess use and how much was collected in each of the last three years, and when water metering is expected to become universal.
  In Northern Ireland domestic properties are unmetered. Domestic customers pay for water and sewerage services through their contribution to the regional rate. Water supplies to non-domestic properties, mainly in the commercial, industrial and agricultural sectors, are metered where it is assessed that consumption may exceed the domestic property allowance of 100 cubic metres in any six month period. A farm with a metered supply, which also includes
  276
  a domestic household, is given the domestic usage allowance for that proportion of the property comprised by the household. All supplies serving properties on which full rates are not payable are also metered.
  There are currently 68,787 metered water supplies in Northern Ireland of which 51,562 are chargeable. There are a number of reasons why a property may be metered but not charged including usage recorded below the domestic allowance level, test metering for leakage control purposes, etc. Income received in the last three financial years was £26.5 million in 1994–95, £27.7 million in 1995–96 and £29.4 million in 1996–97.
  There are no charges levied for excess use. Metered water customers are responsible for paying for all water recorded by their meters as passing from the public water supply network to their private pipework. If a metered water customer encounters very high demand because of a burst, or fittings failure, or their private pipework, they may apply for a reduction on their bill. Such an allowance is, however, granted on a strictly 'once only' basis. The experience of one such episode of exceptional use or wastage is considered to have put a customer on guard that they are in future responsible for all water their meter records as being used on their property. They should, thereafter, put in place appropriate monitoring to identity at an early stage any unexplained rise in consumption on their premises.
  Records maintained by the Water Service relate to the numbers of metered supplies rather than properties supplied. A metered supply may service more than the property to which it was initially provided and, therefore, it is not possible to determine the number of individual properties which are provided for by metered supplies. The North Down constituency boundaries do not equate to Water Service metering areas and information on the number of water meters in this area, or on the income received from them, is not available.
  The Water Service has no plans to introduce universal water metering in Northern Ireland.

  Trade Union Subscriptions
  Mr. Robert McCartney
  To ask the Secretary of State for Northern Ireland if she will make it her policy to have Northern Ireland included in the proposed amendment of legislation to permit trade union subscription to be paid by check-off without regular reballoting of members. [5640]

  Mr. Ingram
  Any amendment of legislation in Great Britain to permit trade union subscriptions to be paid by check-off without regular reballoting of members will be replicated in Northern Ireland.

  Traffic (Bangor)
  Mr. Robert McCartney
  To ask the Secretary of State for Northern Ireland (1) what steps she is taking to provide adequate car-parking spaces near Bangor station; and what plans she has to charge for car-parking at Bangor market; [5642]

  (2) what is her policy with respect to road traffic reduction on the Rathgael and Balloo roads in Bangor and promotion of the use of the existing Bangor dual-carriageway ring road. [5643]

  Mr. Paul Murphy
  Responsibility for the subject in question has been delegated to the Roads Service under its chief executive, Mr. W. J. McCoubrey. I have asked him to arrange for a reply to be given.
  277
  Letter from G. P. Fraser to Mr. Robert McCartney, dated 30 June 1997:
  The Secretary of State for Northern Ireland has asked the Chief Executive to respond to your recently tabled PQs about traffic reduction on the Rathgael and Balloo Roads and car parking in Bangor. In the Chief Executive's absence, I will reply on his behalf.
  Rathgael Road/Balloo Road acts as a distributor road serving the housing developments on the eastern side of Bangor. It is complementary to, rather than an alternative for, the Bangor Ring Road and there are no plans to reduce traffic on it.
  Roads Service has 393 car park spaces in close proximity to Bangor Station (232 free) and is working closely with Northern Ireland Transport Holding Company to encourage the use of bus and train.
  Finally, charging is being introducing at the Castle Square car park (Bangor Market) before the end of July. Charging will be implemented in approximately 50% of the car park with the remainder being free.

  Departmental Mergers
  Mr. Robert McCartney
  To ask the Secretary of State for Northern Ireland what plans she has to integrate the

  (i) Employer expenditure

  (ii) Investment proceeds expenditure

  (a) Percentage

  (b) Amount £ million

  (a) Percentage

  (b) Amount £ million

  Principal Civil Service Pension Scheme (NI)

  72.5

  81.2

  Nil

  Nil

  Health and Personal Social Services Superannuation Scheme (NI)

  23.9

  21.9

  Nil

  Nil

  Northern Ireland Local Government Officers Superannuation Scheme

  23.5

  12.0

  38

  19.5

  Teachers Superannuation Scheme

  40

  41.5

  Nil

  Nil

  RUC Pension Scheme

  100

  41.8

  Nil

  Nil

  Figures for financial year ended 31 March 1997.

  Scrabo High School
  Mr. John D. Taylor
  To ask the Secretary of State for Northern Ireland how many pupils applied for places in Scrabo High School, Newtownards for the academic year 1997–98; how many of these were new applicants; how many were accepted; and if she will make a statement.[5683]

  Mr. Worthington
  A total of six pupils applied as new entrants for places in Scrabo High School in the 1997–98 academic year. All the applicants would have been accepted if the school had remained in operation.

  I have recently approved a proposal by the South Eastern Education and Library Board to close Scrabo High School. This decision was taken after very careful consideration of all relevant information, including the school's existing and projected enrolments, the enrolment capacities of neighbouring schools, and financial, community and educational factors. Account was taken also of the various representations which were made to the Department of Education during the statutory objection period. I concluded that the school was financially and educationally unviable and that closure was in the long-term interest of the children concerned.

  Teachers and Lecturers
  Mr. Roy Beggs
  To ask the Secretary of State for Northern Ireland how many(a) teachers in schools and (b) college and university lecturers in Northern Ireland are employed on one year contracts of employment. [6294]
  278
  functions of the various Northern Ireland departments and to merge some into her own Department; what advice she has received on this issue; and if she will make a statement. [5637]

  Mr. Paul Murphy
  My right hon. Friend the Secretary of State announced on 6 May that my hon. Friend the Member for Clydebank and Milngavie (Mr. Worthington) would take Ministerial responsibility for both the Training and Employment Agency and the Department of Education, but without integrating their functions. She has no other plans to integrate any functions of the Northern Ireland departments or to merge some into the Northern Ireland Office. She has neither sought nor received any advice on these issues.

  Pension Schemes
  Mr. Robert McCartney
  To ask the Secretary of State for Northern Ireland what(a) percentage of the expenditure of the five largest public sector pension schemes and (b) amount was received from (i) the employer and (ii) investment proceeds last year. [5641]

  Mr. Paul Murphy
  The information requested is listed:

  Mr. Worthington
  The information requested is not held centrally and could be obtained only at disproportionate cost.

  However, 614 teachers in schools and 35 lecturers in colleges and universities were employed in a full-time temporary capacity for the 1996–97 school year.

  Social Security Agency
  Ms Moran
  To ask the Secretary of State for Northern Ireland what performance targets have been set for the Social Security Agency for the current financial year. [6913]

  Mr. Worthington
  The targets are in line with the objective of improving the service provided to customers and fully support the standards established in the Northern Ireland Citizen's Charter. I am satisfied that the targets represent a demanding challenge for the Agency. The targets will be included in the Agency's 1997–98 Strategic and Business Plan, which is due for publication in July. A copy of the Plan will be placed in the Library.

  The targets are as follows:

  Benefit clearance times1

  Jobseeker's Allowance claims:

  71 per cent. in 10 days

  93 per cent. in 21 days.

  Faster Family Credit:

  93 per cent. in 5 days.

  279
  Benefit accuracy

  Income Support:

  to pay the correct amount in at least 87 per cent. of cases.

  Incapacity Benefit:

  to pay the correct amount in at least 98 per cent. of cases.

  Family Credit:

  to pay the correct amount in at least 93 per cent. of cases.

  Disability Living Allowance:

  to pay the correct amount in at least 99 per cent. of cases.

  Jobseeker's Allowance:

  to pay the correct amount in at least 87 per cent. of cases.

  Customer satisfaction2

  90 per cent. of customers to regard the Agency's service as satisfactory or better.

  Financial recovery

  recovery of Social Fund loans—£27.17 million

  recovery of overpayments—£4.6 million3

  benefit savings from detection and prevention of fraud—£15.00 million sign-offs as a result of anti-fraud activity—5,500

  sign-offs as a result of anti-fraud activity—5,500

  Class I contributions identified as underpaid to the National Insurance Fund—£1.65 million

  Collection of Contributions owing to the National Insurance Fund4—£1.4 million

  Contributions identified as underpaid to the National Insurance Fund—to provide a return on Challenge Fund investment of 9:15.

  Resource Management

  to live within a gross allocation of £40.34 million for Social Fund loans and Community Care grants

  to live within the Agency's gross running cost budget allocation

  to achieve cash efficiency savings of the order of £5.50 million.

  1 Clearance time is measured from the date of receipt of a claim or application in the office to the date on which the claim or application is decided. The measure, therefore, excludes the time taken to issue notification of the decision and any payment.

  2 The customer satisfaction target is presently measured by independent survey and usually covers a two year period, in this case 1997–98.

  3 It has been decided to combine the previous figures for Income Support Centralised Benefits and Unemployment Benefit with the new figure for Jobseeker's Allowance into one overall Overpayment Recovery Target. This target is based on a percentage of the overall outstanding debt, which will be much more challenging than the existing system. The yield in 1996–97 was £2.56 million.

  4 This was an internal target in 1996–97, but has been raised to Ministerial status in line with the Contributions Agency in GB.

  5 This is a new target for the Agency.

  Public Record Office
  Ms Moran
  To ask the Secretary of State for Northern Ireland what performance targets have been set for the Public Record Office of Northern Ireland in 1997–98. [6914]

  Dr. Mowlam
  For 1997–98 the following performance targets have been set for PRONI:

  Financial Performance

  To meet the challenge of managing the Agency's workload by:

  (a) absorbing a 13.3 per cent. reduction in staff numbers;

  (b) providing for an estimated 4 per cent. increase in readers:

  280

  (c) maintaining extended opening hours;

  (d) ensuring that expenditure is within the financial limits approved.

  Output

  1. To appraise at least 4,000 linear metres of records, including the reappraisal of records so as to eliminate low-grade material.

  2. To list and index at least 500 linear metres of records, including ensuring that 100 per cent. of all new "open" material is thus processed within one year of receipt.

  Quality of service

  1. To survey the conditions in which 10 per cent. of 33,360 metres of records are stored; and, in a related exercise, to take remedial action on upgrading c.1,800 linear metres of records as presently stored on mobile shelving at Balmoral Avenue so as to bring them up to defined standards of archival protection.

  2. With the help of the computerised document request system, to improve the speed of on-site production to the public by reducing waiting time from 40 minutes to 37 minutes or less in 90 per cent. of cases.

  3. To process customer queries within 10 working days of receipt in 90 per cent. of cases and within 14 working days in 96 per cent. of cases, thus improving PRONI's Citizen's Charter commitment.

  4. To ensure the smooth completion of the annual release for 1998—c.680 files, but with the possible addition of court records—as well as the ongoing release of identified blocks of records at earlier than 30 years.

  Efficiency

  1. To reduce PRONI's composite Unit Cost in the areas of selecting and accessioning, records listing, records storage. document production and reader service by 3 per cent., from £99.95 to £96.95.

SOCIAL SECURITY

  Late Claims
  Ms Walley
  To ask the Secretary of State for Social Security (1) if she will make a statement on the legislation relating to late claims for benefit; [2236]

  (2) what plans she has to review the three-months limit on the backdating of benefits; and if she will make a statement. [2235]

  Mr. Bradley
  I refer the hon. Member to the reply given by my right hon. Friend the Secretary of State on 2 July,Official Report, columns 207–209.

  Benefit Claimants (Motherwell and Wishaw)
  Mr. Roy
  To ask the Secretary of State for Social Security what was the number of claimants for each benefit in the Motherwell and Wishaw Benefits Agency district in the most recent year for which figures are available. [5014]

  Mr. Field
  One of our key aims is to improve the service provided to claimants and other customers. Particular queries on Benefits Agency operational matters are the responsibility of Peter Mathison, its Chief Executive. I have asked him to write directly and for his reply to be published with the answer.
  281
  Letter from Peter Mathison to Mr. Frank Roy, dated 2 July 1997:
  The Secretary of State for Social Security has asked me to reply to your recent Parliamentary Question asking about the number of claimants for each benefit in the Motherwell and Wishaw Benefits Agency District in the most recent year for which figures are available.
  Motherwell and Wishaw benefit offices are part of the Benefits Agency Clyde Valley District which also includes offices at Hamilton, Lanark and Shotts. The information requested is not available in the format requested. Such information as is available is shown in the attached Annex.
  Information for Child Benefit, Child Benefit (Lone Parent), Guardians Allowance and Invalid Care Allowance is not available and could only be obtained at disproportionate cost.
  I hope you find this reply helpful.

  Annex: Number of benefit customers for Clyde Valley district April 1996—March 1997

  Benefit

  Number of customers

  Incapacity Benefit

  9,878

  Maternity Benefit

  273

  Severe Disablement Benefit

  697

  Retirement Pension

  4,317

  Widow's Payment

  317

  Widow's Benefit

  232

  Income Support

  13,364

  Job Seekers Allowance1

  7,441

  Disability Living Allowance2

  5,200

  Attendance Allowance2

  2,400

  Industrial Injuries Disablement Benefit

  503

  Disability Working Allowance3

  32

  Family Credit4

  1,562

  Figures are provisional and subject to change.

  1 Figures are from the introduction of the benefit—October 1996 to March 1997.

  2 Figures are estimates based on 5 per cent. data sample of successful claims and are rounded to the nearest hundred. The figures relate to a "snap shot" of customers receiving benefit at 28 February 1997. Details of unsuccessful claims are not available.

  3 Figures are only available as cumulative for successful claims for the period 1992 to date. The figures are for Motherwell and Wishaw benefit offices.

  4 Figures are for Motherwell and Wishaw benefit offices. The figures show the number of families in receipt of Family Credit at 27 March 1997.

  Child Support Agency
  Mr. Hinchliffe
  To ask the Secretary of State for Social Security what guidance is issued to the Child Support Agency in cases where parentage is contested and the courts have not ruled on such a dispute. [5058]

  Mr. Keith Bradley
  We believe that children are entitled to the support of both parents wherever they live. It is important that the Child Support Agency effectively and efficiently establishes paternity where this is in dispute.

  The administration of the Child Support Agency is a matter for the Chief Executive, Mrs. Faith Boardman. She will write to the hon. Member.

  Letter from Mrs. Faith Boardman to Mr. David Hinchliffe, dated 2 July 1997:
  I am replying to your Parliamentary Question to the Secretary of State for Social Security about Child Support Agency procedures concerning disputed paternity.
  282
  The guidance followed by Child Support Officers in cases where paternity is disputed is contained in the Child Support Agency Paternity Guide (which will shortly be available in the Library of the House). Officers are first advised to interview the parent with care; this is necessary to establish certain facts and whether the parent with care is willing to undergo DNA testing to resolve the dispute. Depending on the outcome, an interview with the alleged absent parent is arranged.
  If the alleged absent parent continues to dispute paternity, it is then considered whether the ease is suitable for court proceedings and whether the alleged absent parent should be offered a DNA test to be arranged through the Agency.
  Once the issue of paternity has been satisfactorily resolved, then a maintenance assessment is completed as soon as possible.
  I hope this is helpful.

  Mr. Hinchliffe
  To ask the Secretary of State for Social Security what efficiency targets she has set for the Child Support Agency to respond to inquiries from parents (i) with and (ii) without care and their representatives. [5059]

  Mr. Bradley
  We expect the Child Support Agency to provide an efficient and effective service to all its clients throughout the child support assessment process. We are looking for substantial and sustained operational improvements from the Agency, in particular on getting more maintenance paid, reducing the backlog and improving customer service.

  The administration of the Child Support Agency is a matter for the Chief Executive, Mrs. Faith Boardman. She will write to the hon. Member.

  Letter from Mrs. Faith Boardman to Mr. David Hinchliffe, dated 2 July 1997:
  I am replying to your Parliamentary Question to the Secretary of State fur Social Security about targets for answering enquiries to the Child Support Agency.
  The Agency Charter sets out the standards the Agency aims to achieve for answering the telephone, written enquiries and visits to local offices by customers and their representatives. I have listed below the targets and the Agency performance against each standard during 1996/97.
  We aim to answer general telephone enquiries (through the Agency's National Enquiry line) within 20 seconds during normal working hours. Performance against this standard was 64%. Case specific enquiries are handled through the Agency's Client Helplines. The Agency has no target which covers this area, but it is clear that this is an area where the service offered by the Agency has not fully met its customers needs.
  I am committed to improving this and plans are in place to improve the service. The Agency plans to employ staff to work a wider more flexible range of working patterns over six days a week. This will provide more opportunities for customers to contact the Agency and vice versa, and will enable the Agency to deliver a better standard of customer service through greater use of the telephone. The Agency has also recently initiated an Early Positive Customer Contact project which will increase the use of the telephone by Agency staff at an early stage in our dealings with customers. The aim is that much more of our business will be conducted over the telephone rather than by correspondence, giving customers more opportunity to raise any issues or concerns earlier than at present.
  We aim to reply to letters within 10 working days of receiving them. If we cannot send a full reply within 10 days, we aim to send an initial reply within 10 days and confirmation of when we can send the full reply. Performance against this standard was 52 per cent.
  We aim to see customers within 10 minutes of their appointment time. Performance against this standard was 100 per cent.

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  We aim to acknowledge complaints within two working days and aim to send a full reply within ten working days. Performance against this standard was 92 per cent. for acknowledgements and 62 per cent. for full replies.
  Whilst some of the results against our Charter Standards are encouraging, 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.

  Citizens Advice Bureau
  Mr. Burstow
  To ask the Secretary of State for Social Security in what circumstances Benefits Agency staff are required to ask for faxed authority from a citizens advice bureau adviser before discussing a specific client's case; and what plans her Department has to review the procedures to reduce the time required of citizens advice bureau advisers. [5722]

  Mr. Field
  One of our key aims is to improve the service provided to claimants and other customers as well as to protect the confidentiality of customers. Questions on Benefits Agency operational matters are the responsibility of Peter Mathison, its Chief Executive. I have asked him to write directly to the hon. Member and for his reply to be published with the answer.

  Letter, from Peter Mathison to Mr. Paul Burstow, dated 2 July 1997:
  The Secretary of State for Social Security has asked me to reply to your recent Parliamentary Question in what circumstances Benefits Agency staff are required to ask for faxed authority from a Citizens' Advice Bureau adviser before discussing a specific client's case; and what plans her Department has to review the procedures to reduce the time required of Citizens' Advice Bureau advisers.
  There are no national instructions in place within the Benefits Agency which require staff to request a faxed authority from Citizens' Advice Bureaux advisers before a customer's case can be discussed.
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  However, the Benefits Agency has a duty to ensure that confidential customer information is not disclosed improperly. In dealing with any enquiry from a customer's representative, Agency staff should confirm that both the enquiry and the person making it are genuine, and that the enquiry is being made on behalf of the customer. However, the method by which this is achieved is subject to local procedures, forming part of local liaison arrangements between the Benefits Agency and other welfare organisations.
  I meet the Chief Executive of the National Association of Citizens' Advice Bureaux on a six monthly basis. Local managers are also encouraged to maintain regular liaison with local Citizens Advice Bureaux and the Agency has produced guidance for field staff entitled 'Building Effective Relationships with Citizens Advice Bureaux'. Using their established liaison channels, the Benefits Agency will keep under review the operation of the arrangements for the disclosure of information to Citizens Advice Bureaux.
  I hope you find this reply helpful.

  Asylum Seekers
  Mr. Andrew George
  To ask the Secretary of State for Social Security what plans she has to restore social security benefits to destitute asylum seekers; and if she will make a statement. [5466]

  Mr. Keith Bradley
  We are committed to a wide ranging review of Social Security. With the Home Office, the Department of Health and other Departments we will consider all arrangements for asylum seekers to ensure they are dealt with fairly and promptly.

  Under current rules, asylum seekers who make their asylum application immediately on arrival are eligible to claim benefit. In addition following the Home Secretary's declaration on 1 July 1997 of Sierra Leone as a country of upheaval, a Sierra Leonean national who entered the country previously and applies for asylum within three months of the declaration being made is eligible to claim income support, income based jobseeker's allowance, housing benefit and council tax benefit while their asylum application is considered by the Home Office. Zaire was also declared a country of upheaval on 16 May 1996 and Zairean nationals have three months from the date of the declaration to apply for asylum and thereby become eligible to claim benefit.

Preamble
The House met at three of the clock: The LORD CHANCELLOR on the Woolsack.
Prayers—Read by the Lord Bishop of Lichfield
Lord Leconfield and Egremont—Took the Oath.

Paramedics
Lord Rowallanasked Her Majesty's Government:
Whether, as reported in the recent programme "Frontline Scotland" (broadcast on 25th March 1997, repeated on BBC2 on 17th June 1997), it is possible for people who have no relevant qualifications to set themselves up as paramedics and attend major sporting and other events; and, if so, whether they propose to take any action to remedy this.
The Parliamentary Under-Secretary of State, Scottish Office (Lord Sewel): My Lords, it is the responsibility of event organisers to make sure that staff they expect to attend to injured or ill people are appropriately qualified. They should seek advice from local health boards or from the Health and Safety Executive.
Although we have no current proposals for compulsory registration of paramedics at present, our minds are not closed and the issue will be kept under active consideration.
Lord Rowallan: My Lords, I thank the Minister for that reply. I am concerned that along the length and breadth of the country organisations which have even been employed by the Crown Office have people who purport to be paramedics. As was shown in the two programmes, those people can cause great hurt and damage to persons who believe that they are receiving the best of treatment. Are the Government aware that the BMA has passed a motion that the title "paramedic" should be legally protected and urges the Government to take the necessary legislative steps to ensure that that occurs?
Lord Sewel: My Lords, I appreciate the noble Lord's concern on this matter. The issue seems to have mushroomed recently. Clearly government and ministerial colleagues in general would wish to give considerable consideration to the views of the BMA. However, at this moment I cannot give an undertaking that we shall come forward with definite proposals. It is a matter that we shall wish to consider. I shall take back to them the noble Lord's message from the BMA.
Lord Howell: My Lords, in view of the reopening of the Hillsborough inquiry into an event in which there were many unfortunate deaths and injuries, will my
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noble friend consider asking Lord Justice Stuart-Smith if he will kindly consider the ancillary matter of properly trained people at sporting occasions?
Lord Sewel: My Lords, the point raised is more general than the specific matters to be dealt with under the Hillsborough inquiry. We would wish to come forward with a general proposition affecting the whole country rather than basing it on a specific inquiry.
The Earl of Lindsay: My Lords, how widespread does the Minister believe the problem to be? At what point would the Minister be prepared to do something about it?
Lord Sewel: My Lords, I am aware that it is a growing problem; I am not sure of its dimensions. At this stage I pay tribute to the considerable work undertaken by the Red Cross, the Saint Andrew's Ambulance Association, and the St. John Ambulance Association and Brigade in attending sporting events. I seriously urge all those connected with organising sporting events to make sure that they take the proper advice and seek the assistance of reputable organisations.
Lord Swinfen: My Lords, the Minister's first Answer struck me as being extremely complacent. Do the Government appreciate that people who are not properly qualified who set themselves up as paramedics can be extremely dangerous to those who are injured or ill?
Lord Sewel: My Lords, the difficulty is that the profession of paramedics is relatively new. I do not think that anyone is yet certain about the appropriate qualification for a paramedic. Considerable progress has still to be made on that issue.

Terminally Ill Patients: Medication
3.11 p.m.
Lord Ashley of Stokeasked Her Majesty's Government:
Whether they will clarify and explain the law regarding the administration of drugs to relieve the pain and distress suffered by terminally ill patients.
The Minister of State, Department of Health (Baroness Jay of Paddington): My Lords, the Government recognise that this is an extremely difficult ethical and legal question. With the forgiveness of the House, I shall answer the Question in a little more detail than I would normally hope to do. We are very sensitive to the needs of people who are terminally ill and to the concerns of their families. We recognise that there are differing views about the range of responses that should be available in some cases. Wherever possible, patients should have a choice of treatments and care. However, the law does not permit euthanasia but recognises that sometimes the level of medication required to control the overall symptoms may shorten the patient's life. Provided that the primary intention in administering the

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medication is the relief of pain and suffering and not the deliberate shortening of the patient's life, then this is lawful. In forming a judgment about treatment, the doctor will assess the overall symptom control, the views of the patient if those are known, any relevant advance refusal of treatment, and, of course, the best interests of the patient.
We have no plans to legalise euthanasia but will follow very carefully developments relating to the care of terminally ill people as well as the strong public debate that surrounds these very difficult issues.
Lord Ashley of Stoke: My Lords, I warmly appreciate that comprehensive and very specific reply. Is my noble friend aware of the assessment by Dr. Finlay, a professor of palliative medicine, that up to 30,000 cancer patients die each year in unnecessary distress as a result of the reluctance of their doctors to use morphine? That is indefensible. Will the Government consider changing the law so that, instead of doctors being permitted to prescribe drugs of their own free will for terminally ill patients who are in intolerable pain, they are required to do so if that is the wish of the patient?
Baroness Jay of Paddington: My Lords, it is worth reminding my noble friend that the development of palliative care has done much to change our attitude to death and the process of dying, teaching health professionals that death is not a failure. With appropriate palliative care, pain can be greatly reduced and people can be helped to cope with it. We are committed to expanding palliative care for the dying in all settings, not merely in the hospice movement. It is our policy that all patients needing these services should have access to them and we are seeking to encourage their provision throughout the NHS. As my noble friend will be aware, if an advance directive about the withdrawal of treatment is given by a patient and is accepted as being valid at a time when that treatment is under question, then it will be accepted by the medical profession.
The Duke of Norfolk: My Lords, are the Government aware that within the hospice movement people can die without pain? My wife is intimately concerned with this. For those who enter a hospice, with the administration of drugs, there is no pain at all. Hospitals are not quite so up-to-date in this matter. Secondly, are the Government aware that in my faith, which is the Christian faith, and in the Jewish, Mohammedan and no doubt other faiths—to all those of us who believe in religion—the idea of euthanasia is totally repugnant?
Baroness Jay of Paddington: My Lords, I am grateful to the noble Duke for reminding us of the extraordinarily good work done by the hospice movement and by all of those involved with palliative care. The NHS and the Government will continue to work very closely with the movement. In fact, I have had a very successful personal meeting with the executive director, Mrs. Gaffin, within the past few
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weeks. I accept that those who are fortunate enough to have that kind of care have a great deal of pain eased. As the noble Duke said, it may even cease. Unfortunately, that is not the experience of everyone facing terminal illness. It is that difficulty that we seek to address.
Viscount Tonypandy: My Lords, is the Minister aware that the country is in very great debt to Professor Finlay. At a hospice in Cardiff it has been proved that people can die without pain. However, if patients believe that a doctor has the right to make up his mind rather than theirs, then there will be fear. Does the Minister agree that those who suffer terminal illness above all want to make up their own mind and not have it made up for them by anyone else?
Baroness Jay of Paddington: My Lords, I welcome the noble Viscount's comments. I am very happy to see him in his place making a contribution to this important debate. The points he makes are exactly those about the ability of people to control their own lives and to understand the treatment they are given. That is why there is a role for the advance directive whereby people can, if possible, say how they would like to be treated at a later stage in their life.
Lord Molloy: My Lords, will my noble friend consider the possibility of her department getting in touch with the appropriate department of the Royal British Legion which recognises that this issue concerns ex-servicemen and women who have been badly wounded serving their nation? Noble Lords laugh. I must tell the party opposite that I do not find this a humorous matter. Will my noble friend give the issue the serious consideration that it justly deserves?
Baroness Jay of Paddington: My Lords, I am grateful to my noble friend for drawing attention to this particular group who have a special interest in the matter. I assure him that the Department of Health will consult as widely as it normally does on this and other difficult issues.
Lord Lester of Herne Hill: My Lords, does the Minister agree that there is one awkward area of ambiguity, namely, the meaning of "suffering" or "distress" as distinct from pain? Does she further agree that the Walton Committee on medical ethics recommended that doctors should be able to relieve severe distress as well as pain but that there is no lawful authority establishing that that is what doctors can do using the principle of double effect? Is that not a serious gap in our understanding of the law?
Baroness Jay of Paddington: My Lords, having been a member of the committee chaired by the noble Lord, Lord Walton, I remember our long consideration of that issue. Perhaps I may draw the noble Lord's attention to the judgment made in the case of Dr. Cox,

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who was charged with manslaughter in relation to a case of this kind. The judge, summing up the evidence, said:
"If a doctor genuinely believes that a certain course is beneficial to his patient, either therapeutically or analgesically, then even though he recognises that that course carries with it a risk to life, he is fully entitled, nonetheless to pursue it".
Lord St. John of Fawsley: My Lords, perhaps I may congratulate the Minister on her brilliant encapsulation of the law on this difficult subject. Does she agree that there is guidance for the medical profession in the wise words of the late Lord Horder? He said that the good doctor is able to distinguish between prolonging life and prolonging the act of dying.
Baroness Jay of Paddington: My Lords, I am grateful for the noble Lord's kind words. That thought is expressed exactly in the whole consideration of the double effect, described by the noble Lord, which is considered to be relevant to the practice of medicine in this field.
Lord Jenkins of Putney: My Lords, is my noble friend aware that there is a case for clarifying the law, having regard to the movement of public opinion on the matter? Will she look into the subject again, with the idea of making it possible for a doctor to act in accordance with the patient's desire and the doctor's own judgment of what is right without the doctor risking the possibility of being charged with murder?
Baroness Jay of Paddington: My Lords, perhaps my noble friend will forgive me for saying that I believe that I dealt with that point in the question about the law relating to advance directives. The problem involves those who may be mentally incapable at the time when the necessary decisions are taken. I know that my noble and learned friend the Lord Chancellor is looking at the report of the Law Commission which raises difficult additional problems about the law.
Baroness Cumberlege: My Lords, does the noble Baroness agree that some of the greatest skills and best expertise on pain control for dying people is exercised by Macmillan and terminal care nurses? If so, will she honour our commitment to introduce nurse prescribing nationwide next year, especially when evaluations of the pilot scheme show it to be popular with patients, good for nurses, efficacious and cost effective?
Baroness Jay of Paddington: My Lords, I believe that that is slightly wide of the Question on the Order Paper. However, I am delighted to respond. I spoke at the national rally of the Macmillan nurses last week and I am glad to say that I was well received by them. They seem to feel that the present Government are fulfilling their responsibilities for that important movement.
Nurse prescribing, as the noble Baroness will know, was referred to a national piloting scheme in April. We shall take a decision when the results are known.

Strikes
3.22 p.m.
Lord Campbell of Allowayasked Her Majesty's Government:
Whether they will act against industrial action which subjects everyday life and business activity to significant disruption and where there is a manifest disproportion between the purpose of the strike and its consequences to the community.
The Minister of State, Department of Trade and Industry (Lord Clinton-Davis): My Lords, the Government see no justification for adding to the existing controls on industrial action.
Lord Campbell of Alloway: My Lords, does the Minister recall that at the time when ACAS was unable to resolve a series of disputes in London Underground, his right honourable friend the Prime Minister appeared to favour mandatory arbitration to seek to resolve that dispute?
Without going into the merits of any industrial dispute, I wish to ask the Minister whether in such disputes as the ones affecting Connex and BA there should be an effective regime which proscribes and contains disproportionate industrial action where there is no alternative provision.
Lord Clinton-Davis: My Lords, this Government do not believe that further legislation is required. Of course we would support recourse to any avenue to resolve disputes. Arbitration is one. Whether mandatory arbitration would be the appropriate way of dealing with the matter, I am not sure.
The important point is that it is surely for the parties to find the right way to go about the resolution of disputes; arbitration may be one of the courses.
Lord Evans of Parkside: My Lords, will my noble friend acknowledge that when an employer arbitrarily worsens the pay and conditions of his employees and then, following a legal ballot, threatens to sack or sue any of his employees who participate in industrial action, the employer is at least as guilty as the trade union in subjecting everyday life and business activities to significant disruption?
Lord Clinton-Davis: My Lords, in expressing his concern about the matter, my noble friend is inviting me to comment about a current dispute—which I decline to do. I do not believe that my intervention from this Dispatch Box in relation to that dispute can do other than exacerbate the position. All I can say is that I hope that the avenue of conciliation through ACAS will be properly explored by both sides.
Lord Rochester: My Lords, will the Minister go a little further than he did in his Answer to the noble Lord, Lord Campbell? Will he positively encourage employers

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and trade unions to reach voluntary no-strike agreements, committing themselves to arbitration if no common ground can be found?
Lord Clinton-Davis: My Lords, that is an option for trade unions and employers to consider. However, we need to tackle the whole issue in a rather more fundamental way. How do we ensure that there is a greater sense of partnership in industry, with one side respecting the other more than is the case at present? What I decline to do is to condemn people when they are in the course of negotiations, as our predecessors frequently tended to do. The butt of their criticism was always the trade union movement.
Baroness Turner of Camden: My Lords, does the Minister agree that in a democratic society the right of employees to withdraw labour after appropriate procedures have been followed—such as balloting— should be safeguarded? Any negotiating agreements which are entered into should have as their objective the requirement to adhere to that right.
Lord Campbell of Alloway: My Lords, will the House—
Lord Clinton-Davis: My Lords, the noble Lord, Lord Campbell, is being a little precipitous since my noble friend is entitled to a response. Not only is she right, but in addition, we have obligations under our arrangements with and our membership of the International Labour Organisation to observe fundamental rights at work. That is one of them.
Lord Fraser of Carmyllie: My Lords, I wish to save the noble Lord's breath by saying that of course we recognise, following on the mandate secured on 1st May this year, that the Government are entitled not to follow the wise course proposed, to which my noble friend drew attention in his Question. Clearly, the BA strike is extremely serious and it has potentially global consequences for the United Kingdom. Can the Minister tell us, from what is contained within the Labour Party manifesto, whether that dispute is more or less likely to be satisfactorily resolved?
Lord Clinton-Davis: My Lords, I find that question strange coming from the noble and learned Lord. I very much doubt whether he, standing at this Dispatch Box, would have entered the terrain which he invites me to enter. First, the so-called "wise course" on which he commented has been significantly rejected in the mandate given to this Government.
Secondly, as concerns the BA dispute, I repeat that what we need now is for both parties, in a bona fide way, to look at the possibilities of conciliation. ACAS is ready, willing and able to assist in that direction. Let us hope that the conciliation procedure will be properly explored by both sides at this stage.
Lord McCarthy: My Lords, does the Minister agree that the real problem is that there was once a system of
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standing arbitration affecting the greater part of public industry, including air transport? In the years between 1980 and 1995, with privatisation, the great majority of the system was abolished by the employers, with the encouragement of the then government. That is why we are where we are now.
Lord Clinton-Davis: My Lords, my noble friend is absolutely right. That was done frequently in connection with privatisation and it has not been a successful operation. It gives the lie to the suggestion that there was any wisdom on the part of the previous government in the way they handled such matters.
Lord Campbell of Alloway: My Lords, will the House accept that the object of this Question was not, as suggested by the noble Lord, to criticise the trade unions in any way? It was to seek, irrespective of the merits, to get some sense into industrial relations.
Lord Clinton-Davis: Well, my Lords, you could have foxed me.
Lord Renton: My Lords, would not it be very helpful if the leaders of trade unions were invited to draw the attention of their members to the consequences of strikes?
Lord Clinton-Davis: My Lords, I find that an extraordinary question, too. From my knowledge of trade unions and employers—which is not inconsiderable, to cite a phrase from a previous Prime Minister—they all tell their members what will be the consequences of certain actions. That goes without saying.

Camelot: Directors' Bonuses
3.31 p.m.
Lord Inglewoodasked Her Majesty's Government:
Why they have condemned the performance-related bonuses paid by Camelot to its directors while they have approved a scheme of performance-related payments contained in Millennium Central's contract with the International Management Group.
Lord McIntosh of Haringey: My Lords, the Government believe that pay levels should be closely related to performance. International Management Group will be paid a commercial fee for raising funds from private sector companies. If they raise nothing, they will receive nothing. The Government expressed the public's concern over the scale of Camelot directors' bonuses. Subsequently, Camelot agreed to pay the interest on undistributed prize money, worth around £24 million over four years, to the good causes and the directors will pay some of their future bonuses to charity.
Lord Inglewood: My Lords, I am most grateful to the Minister for his reply. Can he confirm that the

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Government will place pressure on IMG similar to that placed on the Camelot directors to give at least some of its performance related payments to charity?
Lord McIntosh of Haringey: My Lords, all the IMG receipts will be performance related. There is a legal contract with IMG, originally drawn up by the Millennium Commission under the previous government, and that contract will be adhered to.
Lord Dean of Beswick: My Lords, will the Minister confirm that at the time of the agreement with Camelot, Mr. Richard Branson described it as "a licence to print money"? Is it not the case that that has yet to be proved by the people who are to carry out the Millennium project? Is it not right that the Government should review the agreement in view of the money that is floating about in Camelot?
Lord McIntosh of Haringey: My Lords, my noble friend is correct to say that the Camelot agreement is subject to review. We shall publish a White Paper later this month about the National Lottery and legislation will be introduced later this year. Camelot's contract will expire in due course. In our manifesto we expressed the view that the National Lottery should be conducted on a not-for-profit basis.
Lord Burnham: My Lords, have the Government any intention, in the light of what the Minister has just said, of initiating legislation which will enable them to interfere with contracts freely entered into?
Lord McIntosh of Haringey: My Lords, I have explained the kind of legislation that is to be introduced. It will be concerned with the direction of funds for the National Lottery. In due course, the contract of Camelot will come up for renewal and will be reconsidered at that time. We have no other legislative intention.
Lord Boardman: My Lords, by his reply does the noble Lord mean that only profit related bonuses which are first approved by the Government will not be attacked by them?
Lord McIntosh of Haringey: No, my Lords, I did not say that and I did not imply it in any of my answers.
Baroness Rawlings: My Lords, the Government state that when Camelot's franchise expires they will replace it with a non-profit lottery operator. Will they forbid it from paying performance related bonuses?
Lord McIntosh of Haringey: My Lords, the purpose of a not-for-profit contract will be to provide the highest possible quality service and to receive a reasonable management fee. The details of that and how it will be paid have not yet been worked out; nor could they be. I am very familiar with the difference between a not-for-profit and a for-profit organisation, having run a for-profit company for 30 years—not that we always made a profit.
Lord Inglewood: My Lords, we are told that new Labour's policy is influenced by a series of great gurus.
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Can the Minister confirm that in this area of policy its guru is Pontius Pilate, who was flaccid, populist and inconsistent?
Lord Monson: My Lords, can the noble Lord say whether individuals are under any legal obligation to go to see Ministers of the Crown if those Ministers request their attendance?
Lord McIntosh of Haringey: I do not suppose they are, my Lords. But the directors of Camelot are directors of a company which benefits from an agreement with the Government and are collecting money from the people of this country. It seems to me the very minimum of courtesy that they should respond to a request by the Government who wish to put to them concerns which have been publicly expressed.
Lord Sefton of Garston: My Lords, now that the Government have addressed the iniquities of low pay, will they look at the obscenities of high pay, as featured in the financial pages every day?
Lord McIntosh of Haringey: My Lords, the specific Question relates to the pay of the directors of Camelot. As I said in my first Answer, we are pleased to recognise that, in response to pressure from the Government following public concern, the directors of Camelot agreed, first, to allocate £24 million more to good causes and, secondly, to give some part of their future bonuses to charities. That seems to me a thoroughly satisfactory outcome in this particular case.

Southampton International Boat Show Bill
3.36 p.m.
Read a third time, and passed.

National Health Service (Private Finance) Bill [H.L.]
3.38 p.m.
Read a third time.
Clause 1 [Powers of NHS trusts to enter into agreements]
Lord Brightman Lord Brightman moved the amendment:
Page 1, line 26, leave out subsection (6) and insert—
("(6) The fact that an agreement made by a National Health Service trust has not been certified under this section does not affect its validity.").
The noble and learned Lord said: My Lords, this amendment worded in plain English is designed to replace the original, wholly obscure, wording of subsection (6) of Clause 1.
Subsection (6) was described by my noble and learned friend Lord Simon of Glaisdale as "incomprehensible". The noble Lord, Lord Hooson, a

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Queen's Counsel of many years' standing, as your Lordships will know, told your Lordships that he could not understand it. Happily, the problem is now behind us, thanks to the helpfulness of the noble Baroness the Minister. I should like to express my grateful thanks to her and also to parliamentary counsel for drafting the amendment.
The amendment reads:
"The fact that an agreement made by a National Health Service trust has not been certified under this section does not affect its validity".
With your Lordships' approval, I should like just to add a word for the future. I came to this Bill at the Committee stage with one main purpose: to plead that subsection (6) should be written in plain English. It read:
"Nothing in this section affects the validity of any agreement made by a National Health Service trust if the agreement—

(a) has not been certified under this section; but

(b) would have been an externally financed development agreement for the purposes of this section if it had been so certified".

I tendered three alternative versions of subsection (6) for the consideration of the Government. I was supported in my crusade for plain English by my noble and learned friend Lord Simon of Glaisdale, who, at Report stage, spoke these memorable words:
"We have simply no right to legislate in a manner that is incomprehensible to the people to whom the legislation is addressed … It is extremely important because the legislation is a vital part of the process whereby democratic society frames rules … If the rules are incomprehensible, then the process of democratic legislation has broken down".—[Official Report, 26/6/97; col. 1649]
The same sentiment was expressed by the noble Lord, Lord Renton, when he said,
"we have a duty to make our laws easily understood",—[col. 1649.]
and added that we should be vigilant in performing that duty.
I should like to say to all parliamentary draftsmen, with the greatest respect to their profession, please draft our Bills in plain English. I beg to move.
Lord Simon of Glaisdale: My Lords, I am very disappointed that the noble Baroness did not add her name to this amendment. It was obvious from her speech in Committee that her brief on Report would end with the word "reject". I encouraged her to follow the example of the noble Earl, Lord Ferrers, when he was faced with that situation. He solemnly read out the negative brief and finally, in obedience to common sense, accepted the amendment. The noble Baroness could not go quite that far, but she did depart from what I surmised was at the end of her brief to say that she would consider the matter. I am sorry that the consideration has not led to support for the amendment of my noble and learned friend.
It was obvious from the reply of the noble Baroness at Report stage that parliamentary counsel and other advisers had a point. Naturally they want to close every possible loophole. But the point was an extremely subtle, remote and exiguous one. It is the sort of case where a Minister is fully entitled to override the advice
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that is tendered. I am extremely sorry that we are to foist on the ordinary people to whom this provision is addressed a farrago of incomprehensibility.
Lord Renton: My Lords, for the first time—and possibly for the last time—perhaps I can come to the rescue of the noble Baroness. She may have decided not to add her name to the amendment so that the credit for it could go to the noble and learned Lord, Lord Brightman.
Baroness Anelay of St. Johns: My Lords, I thank the noble and learned Lord, Lord Brightman, for his courtesy in writing to me on this amendment as he did at the last stage in relation to the amendments he tabled then. There are some issues upon which all sides of your Lordships' House can unite. The need to frame legislation in plain English has proved to be just such an issue.
We on these Benches made it clear at every stage of the Bill that we welcome efforts to improve the clarity and intelligibility of the Bill, with two provisos: first, that the amendment should not undermine the policy intention behind Clause 1(6); and, secondly, that amendments which seek to achieve clarification should not unwittingly create the loopholes which give lawyers the opportunity to while away fruitful hours—fruitful to them, that is—arguing different constructions of a clause.
As the noble and learned Lord, Lord Brightman, said, this is the third time upon which he has sought to help this House by amending Clause 1(6) so that it has greater clarity and yet still preserves the policy intention which underlies it. At Report we on these Benches supported the amendment which the noble and learned Lord tabled at that stage. I argued that he had successfully overcome the objections which the Minister had raised previously at Committee stage to the amendment he tabled then. But, since Report, I have had the opportunity to read carefully in Hansard the reasons put forward by the Minister for rejecting the amendment. At col. 1653 she pointed out that the amendment in a sense required precognition of the Secretary of State's opinion. She said:
"The amendment sets out to identify the class of agreements to which subsection (6) is to apply by reference to the conditions in subsection (3) [and that] on close examination of the conditions, the exercise turns out to be very difficult, because it is necessary first to determine the attitude of the Secretary of State to the particular agreement. Paragraph (a) of subsection (3) requires that: 'in his [the Secretary of State's] opinion the purpose or main purpose of the agreement is the provision of facilities in connection with the discharge by the trust of any of its functions'".—[Official Report, 26/6/97; col. 1653].
I recognise that the Minister made a valid point on that occasion. The history of the discussions on the noble Lord's amendment has been one of the pursuit of that elusive creature—the simple but effective clause. I believe that the noble and learned Lord's persistence in pursuit of that elusive creature has brought him and thereby all of us in this House success in that the Minister has given assistance in this matter and shown that she is receptive to the amendment tabled today.

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The amendment overcomes all the objections raised by the Minister at Report stage. However, I hope that in general terms this will not be the end of our concerns for the pursuit of plain English. Last week I made the mistake of referring to my aversion to the complexities of Latin syntax. I say a mistake because, after that Report stage, a wag on my own Benches presented me with his own version of a Latin quote which he expected me to translate and scan. With that in mind I would say today that I hope that our efforts to improve the clarity of this Bill will be seen as a terminus a quo rather than a terminus ad quem—I risk being followed up on that later.
At Report stage the noble and learned Lord, Lord Simon of Glaisdale, reminded us that we have no right,
"to legislate in a manner that is incomprehensible to the people to whom the legislation is addressed".
and that it behoves us all, including parliamentary counsel, to show a little humility.
I appreciate the fact that the Minister was receptive at that stage to the advice of the noble and learned Lord, Lord Simon, and to the efforts of the noble and learned Lord, Lord Brightman, to improve the drafting of Clause 1(6). I hope that the Minister is able to confirm today that she can accept the amendment. We on these Benches support it.
3.45 p.m.
Lord Hooson: My Lords, from these Benches it is our hope and I am sure the hope of all noble Lords that the noble Lord, Lord Renton, from his chivalrous position on his white charger, will be proven to be correct; that is, that the noble Baroness did not put her name to the amendment because she wished to give credit for it to the noble and learned Lord, Lord Brightman.
Baroness Jay of Paddington: My Lords, I am sure that I speak on behalf of the whole House—I am tempted to say on behalf of all democrats or at least all legislators—when I say how grateful we are to the noble and learned Lord, Lord Brightman, for what he has done in the course of our animated discussions on this subject. I am grateful to all noble Lords who have taken part this afternoon in continuing this discussion, particularly the noble Lord, Lord Renton, for what the noble Lord, Lord Hooson, rightly described as his accurate chivalry.
Since we debated this matter at Report the noble and learned Lord, Lord Brightman, has been extremely courteous in discussing his concerns with me, the parliamentary draftsman and counsel and with officials from my department. The amendment before us today sets out in the most plain and simple language what is a relatively straightforward notion: that is, that an agreement which has not been certified is unaffected by the Bill; it is left to stand or fall on its own merits.
Of course, those are my words and not the words of the Bill or the amendment. As we discovered in the course of our discussions both in Committee and at Report, those words alone would not suffice because they are too imprecise and open to legal
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misunderstanding. That is the essence of the problem we have faced in trying, all of us, to improve the wording of the Bill; there is always a danger that we may sacrifice precision on the famous altar of simplicity.
However, today we have before us an amendment which strikes a satisfactory balance, meeting the objectives of precision but translating the words into a form which may be more readily understood by all concerned. Your Lordships will see at a glance that the wording could not he more straightforward or transparent. As such it has achieved one side of the balance: it is obviously simple. But is it precise? The answer, I am advised by all of my advisers, both legal and in terms of the officials drafting the original Bill, is that it is precise enough.
The only direct consequence of accepting the amendment is that Clause 1(6) will refer to all agreements entered into by trusts and not just those which have been EFDAs—externally financed development agreements—if they had been certified. The subsection now makes clear that no agreement by an NHS trust, not even those which are patently not PFI deals, is invalidated simply because it does not have a certificate. This enlargement of the coverage of subsection (6) does not materially affect the Bill in any way. It is a very small price to pay for the clarity it brings. Importantly, banks waiting to lend into the lending schemes have confirmed that they are content with the change and the British Bankers' Association has also signalled its agreement.
Given your Lordships' enthusiastic support for the noble and learned Lord's proposal to simplify the Bill and indeed to simplify legislation in general, and in recognition of the fact that we have now before us both clarity and precision, I invite your Lordships to agree that amended Clause 1(6) should stand part of the Bill.
On Question, amendment agreed to.
3.52 p.m.
Baroness Jay of Paddington: My Lords, I beg to move that the Bill do now pass. This is an important if rather simple piece of legislation. The National Health Service is very much in need of new hospitals and the private finance initiative offers in many cases the best ways of providing them, the way that we feel offers the best value for money.
However, the banks which are ready to lend into the leading schemes have been concerned that NHS trusts might not have the legal power to enter into private finance contracts. For that reason, they have been reluctant to sign on the dotted line, and this has left us until now with many potential schemes but not a single major hospital actually built. I am glad to be able to tell the House this afternoon that the passage of the Bill through your Lordships' House in conjunction with the review of the private finance initiative schemes conducted by my honourable friend the Minister for Health in another place has already borne fruit.
The Department of Health has announced today that 14 major acute schemes have been selected for development, representing almost £1.3 billion of new capital investment in the NHS. The contracts for the

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hospitals at Gravesham and at Norwich which we have all awaited for so long have now been signed. The details of the announcement and the prioritisation review are being placed in the Library in response to a Written Question. With your Lordships' permission, I shall outline the Answer to the House as I feel it is clearly appropriate to do so as the Bill will be passing from this House to another place, we hope this afternoon.
The review—that is the prioritisation review—was undertaken by officials and all schemes were graded according to three criteria: (i) their service need; (ii) status—how far and well negotiations have progressed; and (iii) "PFI-ability"—how well the scheme fits with the PFI process and hence its likelihood of delivering a successful outcome.
This process was both fair and open. Officials from the department shared with the trusts the criteria against which the projects were judged and their relative markings. My honourable friend Mr. Milburn, the Minister of Health in another place, and the Secretary of State for Health as far as the schemes in the Northern and Yorkshire region are concerned examined the gradings and the reasons why officials recommended schemes either to be included or excluded. They also received representations from many local bodies and from many Members of Parliament.
The 14 schemes which most successfully met the three criteria will be asked to continue with their PFI proposals, with the objective of reaching an early and acceptable financial close over the next 18 months. A complete table listing of all the scores, along with a note explaining the criteria, has been placed in the Library. Officials have been instructed to prepare programmes and milestones for every successful scheme. The schemes will be subject to the normal rigorous approval processes and any of the 14 schemes that subsequently fail to deliver on time or price will be cancelled.
Those schemes not selected will be asked to cease any further action on their contract. They should stand down their partners if they have selected one and cancel all tendering procedures.
Any trust or consortium whose scheme has not met the three criteria and which wishes to make representations to the Secretary of State should do so within the next 10 days. Otherwise such trusts should now take steps to stand down their partners or cancel the tendering procedure.
Those schemes not selected will be eligible for consideration as part of a national capital prioritisation scheme exercised by the NHS Executive's Capital Prioritisation Advisory Group. This group will review major acute schemes for health service need and will recommend those which should go forward either as part of the next tranche of PFI schemes which we plan to announce next spring or for funding from the public sector capital that is available.
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The exercise did not consider the schemes affected by the London review, which is due to report in the autumn. These schemes are also listed in papers deposited in the Library.
The longer-term review of the PFI product and process will report its recommendations later this year. This will look to consolidate the improvements in the PFI begun with this new exercise.
As I said earlier, 14 schemes will go ahead immediately and two contracts have been signed. That was the object of the Bill before us. The Bill identified a specific issue—of blocking progress—which urgently needed resolving. It addresses that issue briefly, simply and effectively.
Moved, That the Bill do now pass.—(Baroness Jay of Paddington.)
Baroness Cumberlege: My Lords, I am aware that this is the first Bill the noble Baroness has taken through your Lordships' House as a Minister for Health. I congratulate her and thank her for her courtesy and her willingness to meet the improvements put forward with such skill and determination by the noble and learned Lord, Lord Brightman, throughout the course of the Bill. I hope that will become a pattern for the future. I should also like to thank my noble friends for their participation in the Bill, and particularly my noble friend Lady Anelay of St. Johns who has responded from our Front Bench.
I shall be brief because I know there is a long session before us today. But I cannot leave the Bill without making two points. The first concerns the definition of "clinical support services" about which there has been so much discussion. At Second Reading the Minister acknowledged that it was a "grey area". At Committee stage we were still in a fog, for the Minister told us that it was difficult to define those services in a way which was legally and professionally watertight. She described her discussions with officials as discussions which,
"more resembled linguistic philosophy seminars than drafting committees for a Bill".—[Official Report, 19/6/97; col. 1359.]
She told us that every attempt she had made had met with objections. But government is not about intellectual aerobics; it is about ensuring that those affected by legislation have a clear and precise understanding of the law. This issue sadly leaves your Lordships' House still unresolved. That is a great pity. We should not pass on our Bills with so little clarity, with so much ambivalence and so many grey areas, especially when, as the noble Baroness knows, there is no need for it.
We gave her the solution at the very beginning. Indeed, when we initially drafted the Bill we had thought through all the implications—for of course, in essence, this is our Bill. But like borrowed clothes it does not quite fit this Government, for this Government are of a different shape; they have a different philosophy which cannot always be disguised by borrowed clothes.
Our solution was very simple. It was simply to trust the local people. Unlike the Government, we believe that they should be in charge of their destiny. They know locally what works best. They are grown-ups and do not need nannying and central bureaucratic direction.

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The second issue that goes forward unresolved is the Government's review of PFI schemes. I feel sorry for the noble Baroness. She must take this legislation forward while there is a general review of PFI, a departmental review of PFI and, as the noble Baroness told us last Thursday, on top of a review of a review there is a third review taking place in London. The Minister was unable to tell us whether schemes in which private companies had invested huge sums and were being stopped mid-stream by the Government would receive compensation. Only this afternoon the Minister has informed us that out of 43 schemes 14 are to go ahead, with two that have been previously agreed. That leaves a large number of firms and companies disappointed. What is more, together they have invested millions which will prove to be abortive. The issue of compensation has not been addressed even this afternoon. That issue must be addressed. This bodes ill for the private/public partnership for the future. This matter must be speedily resolved if the Government are to maintain the private sector's confidence in PFI schemes and the NHS is to get its hospitals.
This is a simple, modest Bill, but despite the successful efforts of the noble and learned Lord, Lord Brightman—I again congratulate him on clarifying the wording—it goes forward with very ragged edges. I hope that it will return from the other place in better condition and that by then the Government will have decided what they want to do on these issues. We wait in anticipation.
Baroness Robson of Kiddington: My Lords, I am certain that all noble Lords hope that the passing of this Bill will be instrumental in getting at least some of the backlog of much needed hospital building off the ground. The Minister has just told us about the recent decisions on 14 schemes, two of which have been signed. I very much regret my inability to be present at the Committee stage of this Bill. I am grateful to my noble friend Lord Ezra for moving the amendment standing in my name.
I have the same concern about clinical services but looked at from a point of view different from that of the noble Baroness, Lady Cumberlege. In an amendment to subsection (5) we attempted to exclude clinical services from other services that might be provided by the private contractor. I regret that the Minister was unable to accept that, but I am grateful that she provided a definitive statement that at least pathology and radiology would be excluded. However, I should like to have that assurance on the face of the Bill because, however strong may be the present Government's commitment, it is no guarantee of the policies and actions of any future administration.
In his Budget Statement yesterday the Chancellor of the Exchequer announced that the Government had accepted Mr. Malcolm Bates's report in full and foreshadowed further legislation to implement the report. It is to be hoped that any further legislation that is introduced will provide us with further opportunities to clarify which services can be provided by private
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contractors. With those few words, I wish the PFI experiment—we must still look at it in those terms— success in the 14 schemes that have been approved.
Lord Donaldson of Lymington: My Lords, for a variety of reasons I was prevented from attending the House on the previous occasions when this Bill was considered. For this reason I hope that I may be permitted to say a few words in support of it. I do so with greater enthusiasm because it seeks to remove actual or perceived uncertainties in the law, which is one of the primary objectives of the Financial Law Panel of which I am chairman. It does so simply and neatly. It declares, bluntly, that NHS trusts have power to enter into externally financed development agreements. Although such agreements are not expressly defined, their nature is clear enough from Clause 1(3). So far so good.
The Bill then rightly recognises the difficulty with which a person providing the financial assistance may be faced in ascertaining whether the main purpose of the agreement or agreements is in fact and in law the provision of facilities in connection with the discharge by the trust of any of its functions. The Bill takes that head on. It meets the problem by providing a system of certification. If the agreement or agreements are certified by the Secretary of State to be externally financed, ipso facto they are agreements that an NHS trust is empowered to enter into. Furthermore, Clause 1(3) gives the Secretary of State a margin of appreciation. Although others may have doubts, within that margin of appreciation the view of the Secretary of State prevails. But—this is the problem—surprisingly the Bill fails to contemplate the possibility that the Secretary of State may have misdirected himself in law, or may have taken account of an irrelevant consideration, or that he may have ignored a relevant consideration.
What then? Probably no one will object, so the answer is that nothing will happen. But if someone does object, as indeed he may, the courts will have to consider whether the certificate should be set aside. It does not follow that if the Secretary of State has been mistaken in one respect or another the courts will set aside the certificate. They will have to take account of the public interest in deciding how their undoubted discretion should be exercised. But if the worst comes to the worst and the Secretary of State's certificate is set aside, it will be upon the basis that the agreement was not in fact or in law an externally financed agreement within the meaning of the Bill, or that there have been serious procedural irregularities. The likelihood is that it will be because the agreement is outwith the powers of the NHS trust and that the Secretary of State should never have certified it.
I do not suggest that this is a likely contingency but it is a possibility. Where does that leave the external financiers? It leaves them in a wholly unenviable position, and one to which in my view they should not be exposed bearing in mind that they will have relied on the validity of the Secretary of State's certificate.

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My noble and learned friend Lord Brightman raised this issue at Committee stage by moving a somewhat complex amendment (col. 1366 of the Official Report of 19th June). The amendment was taken from the terms of the Local Government (Contracts) Bill. I understand fully his reasons for adopting that course, but the structure of that Bill is somewhat different from this.
The noble Baroness the Minister rejected it upon three grounds. First, she said that local authority contracts were bilateral whereas NHS contracts were multilateral. I am not entirely certain that that is correct but I am quite sure that it is immaterial. Secondly, she said that the amendment would validate an ultra vires contract, which I agree would be a quite unacceptable concept. However, it would do nothing of the sort. It would provide compensation for innocent third parties who were the victims of an invalid contract.
Thirdly, she said that the Bill was designed to remove uncertainty as to the validity of PFI contracts and it could not he seen to contemplate that there might still be some uncertainty; in other words, one should not frighten the horses. But the plain fact is that it is a very sophisticated bunch of horses that is well capable of evaluating the risk such as it may he. I do not doubt that that is a factor when the price structure is being formulated.
An objection based on not frightening the horses shows an ostrich-like mentality. Everyone involved is aware that Ministers are not infallible, even if on the basis of experience of the previous administration it can fairly be said that some Ministers were more fallible than others.
In my judgment, expressly contemplating that possibility cannot increase or create uncertainty. If the certificate is set aside and not reinstated upon further consideration, as could happen, it would not be right for the external providers to be left out in the cold. Nor would it be right that they should he in exactly the same position as though the agreement was performed. What would be right, fair and reasonable is that they should be compensated on exactly the basis on which they would have been compensated if at that moment the National Health Service trust had voluntarily repudiated the contract.
I welcome the Bill. It is a good Bill. I hope that it will he made a very much better Bill in the other place on the lines that I have suggested. It would be simple to draft a clause to give effect to my suggestion.
Baroness Jay of Paddington: My Lords, I am grateful to noble Lords who have taken part in this brief debate, in particular to the noble Baroness, Lady Cumberlege, for her kind personal remarks. In the interests of time—I know the pressures on the timetable of your Lordships' House today—and following the successful comments of the noble and learned Lord, Lord Brightman, about simplicity, which we have all taken so much to heart, perhaps I may make two brief points in response.
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The first relates to clinical services. I hope that the noble Baroness, Lady Cumberlege, will be reassured that I am aware of the difference between intellectual discussion and legislation when I say that I am sure she will remember that on Report we accepted that there were particular issues about specific clinical support services which should be specifically excluded from the Bill. The noble Baroness, Lady Robson, mentioned them in her contribution. They were pathology and radiology. The rest will be identified in a clear and specific list before the new PFI agreements are undertaken.
As has been mentioned several times, this is a simple Bill with a simple objective. It has been demonstrated today that it has done what it is intended to do. Two new hospital agreements to build have already been signed and the others are in the process of reaching financial conclusion. I commend the Bill to your Lordships.
On Question, Bill passed, and sent to the Commons.

Referendums (Scotland and Wales) Bill
4.12 p.m.
Lord Sewel: My Lords, I beg to move that the House do now again resolve itself into Committee on this Bill.
Moved, That the House do now again resolve itself into Committee.—(Lord Sewel.)
On Question, Motion agreed to.
House in Committee accordingly.
[The DEPUTY CHAIRMAN OF COMMITTEES (Baroness Serota) in the Chair.]
Clause 1 [Referendum in Scotland]:
[Amendment No. 8A not moved.]
Lord Mackay of Ardbrecknish Lord Mackay of Ardbrecknish moved Amendment No. 8B:
Page 1, line 9. leave out ("papers") and insert ("paper").
The noble Lord said: Amendment No. 8B is a paving amendment to the more important Amendment No. 74BA, in which the new schedule to replace the current schedule puts the same questions but on one ballot paper. There would therefore be no reason for two ballot papers.
I propose the amendment for a number of reasons. First, we are not used to two ballot papers in the British electoral system. One ballot paper would make life a great deal more simple for those who run the ballot and for the electorate. Secondly, there is a legitimate interest in knowing how the variations in possible answers play out. At the beginning of Committee stage on Tuesday, I pointed out that there were four potential combinations of answers: "Yes, yes"; "Yes, no"; "No, yes"; and "No, no". As a result of the way in which the Government intend to conduct the count and issue the ballot paper, there would be no way of knowing about the relationship between the first and second votes.
However, by placing all the questions on one ballot paper the count can be done so as to show the number of people who agree that there should be a Scottish

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parliament and that it should have tax-raising powers. It will also show those who agree with the Scottish parliament but, like the noble Earl, Lord Perth, believe that it should not have tax-raising powers. Similarly, those who do not agree that there should be a Scottish parliament will be asked whether, if there were to be one, they want it to be tax-raising or not tax-raising. Therefore, we will have a better idea of the variations and Parliament will be better able to judge the outcome of this complex referendum—we were told last Tuesday that that was the intention—when deciding on the nature of the Scottish parliament if the first question receives a "Yes".
The difficulty is that someone such as the noble Earl, Lord Perth, who told us on Tuesday that he wants a Scottish parliament but does not want it to have tax-raising powers, may easily decide that if it is to have tax-raising powers he would prefer not to have it. There may be some people who want a Scottish parliament only if it has tax-raising powers. The Government have brought the problem upon themselves by having two questions in the referendum. If they had accepted, for example, the proposition put by Mr. Jim Wallace in another place to combine the questions and to have only one, my amendment would be unnecessary.
I believe that the Minister should consider the proposition of placing the questions on the same ballot paper so that in the count we will be able to subdivide the "Yes" and the "No" vote according to those who want or do not want tax-varying powers. I look forward with some interest to hearing what the Minister has to say. I am not alone in hoping that today we shall have Ministers addressing the amendments in more detail and giving more satisfactory answers than they gave on Tuesday.
Lady Saltoun of Abernethy: I support the amendment because people may well get two ballot papers in a muddle.
Lord Desai: I am surprised because at the recent general election some constituencies also had a local election and people handled two ballot papers. To believe that the electorate cannot handle two ballot papers and put two crosses on them is to think very low of them. We must have better reasons for the amendment.
Lord Sewel: I had thought for a moment that in tabling the amendment the noble Lord, Lord Mackay, was seeking to display his concern for the environment and wished to reduce the number of trees to be felled. As I have responsibility for the environment in Scotland, I was somewhat sympathetic to that view. However, as I also have responsibility for forestry, I can see that there is great merit in the alternative argument, too.
There are good practical reasons for using two separate ballot papers, as my right honourable friend the Secretary of State for Scotland made clear at the launch of the Bill. The main reason is one of simplicity. Each ballot paper will ask only one
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question. The more that is written on them the greater the risk of confusion. That is the view not only of the Government. We have taken advice from the very people to whom the noble Lord, Lord Mackay, referred. We have sought the views of those running elections; we have gone to the returning officers and have sought the views of the Association of Electoral Administrators, the body representing them. They are clear in their advice that it would be better to go for two questions on two pieces of paper, avoiding the risk of confusion and spoilt papers. We also wish to make it absolutely clear to the electorate that they have a completely free choice in casting their votes. Voters may wish to cast a vote on only one of the questions and that is their right. If both questions appeared on the same ballot paper, voters might feel obliged to answer both questions. If there are two separate papers, they can decline to answer a question if they wish.
This is an issue of practicality that has been determined solely on the basis of the professional advice we received from those experienced in running elections.
I recognise that that method will not enable us to identify the precise number of "Yes" votes and "No" votes in their various combinations. As a former academic who has written articles on electoral behaviour, I can see an attraction in that argument. It opens up vast possibilities for writing learned articles, but we cannot arrange electoral procedures on the basis of what might suit academics in years to come in order to fill academic journals which will remain largely unread.
The essential point is that this decision has been taken by the Government on the basis of the advice of people who have had the responsibility of running elections. It is their advice that this is the simplest and clearest way forward and that the electorate will understand this way much better than having a ballot paper with a number of questions when they may not be clear which question to answer or whether they have to answer both. In this way there will be one sheet of paper for one question and one sheet for the other question.
This matter has been decided purely on the basis of practical advice from those experienced in these matters, and therefore I hope the noble Lord will withdraw the amendment.
Lord Mackay of Ardbrecknish: I have listened carefully to the answers and I appreciate the point of simplicity. It would be much simpler if the Government only asked one question, that posed by Mr. Jim Wallace in another place, but the Government declined to do so. That would be the simplest question. The Government state in their manifesto that they want a tax-raising assembly. Why did they not put that question to the Scottish people? The simplicity argument can easily be resolved by asking the one question, which I am sure is the proper way to proceed.
I think that the reason for rejecting the amendment and for asking two questions is that the Government do not want us to know how many people agree that there

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should be a Scottish parliament and do not want tax-raising powers and how many do want it to have such powers. The Government want to confuse the issue if possible, and this is the way they have set about confusing it.
Some people who do not want an assembly may decide that, if there is one, it ought to have tax-raising powers, or they may not. Their votes will not be known. The numbers will not be known to your Lordships or to the other place. As we were told on Tuesday, this is an advisory referendum. In that case I should like as much information as possible from the referendum. The right way to achieve that is to ask the questions in the way I have indicated. I am not satisfied with this answer and I would like to test the opinion of the Committee.
4.23 p.m.
On Question, Whether the said amendment (No. 8B) shall be agreed to?
Their Lordships divided: Contents, 91; Not-Contents, 131.

Division No.1

CONTENTS

Addison, V.

Kinnoull, E.

Ailsa, M.

Kintore, E.

Alexander of Tunis, E.

Lauderdale, E.

Ashboume, L.

Lindsay, E.

Astor of Hever, L.

Liverpool, E.

Belhaven and Stenton, L.

Lucas, L.

Beloff, L.

Lucas of Chilworth, L.

Blatch, B.

McColl of Dulwich, L.

Bowness, L.

Mackay of Ardbrecknish, L.

Boyd-Carpenter, L.

Mackay of Drumadoon, L.

Broadbridge, L.

Mayhew of Twysden, L.

Buckinghamshire, E.

Merrivale, L.

Cadman, L.

Milverton, L.

Caithness, E.

Monckton of Brenchley, V.

Camegy of Lour, B.

Monson, L.

Charteris of Amisfield, L.

Mottistone, L.

Chesham, L. [Teller.]

Mountevans, L.

Clanwilliam, E.

Mowbray and Stourton, L.

Coleridge, L.

Murton of Lindisfame, L.

Cranbome, V.

Napier and Ettrick, L.

Crickhowell, L.

Norfolk, D.

Cullen of Ashbourne, L.

Norrie, L.

Cumberlege, B.

O'Cathain, B.

Davidson, V.

Oxfuird, V.

De Freyne, L.

Pearson of Rannoch, L.

Dean of Harptree, L.

Pender, L.

Denham, L.

Plummer of St. Marylebone, L.

Denton of Wakefield, B.

Prentice, L.

Dilhome, V.

Rankeillour, L.

Dixon-Smith. L.

Reese, L.

Downshire, M.

Rennell, L.

Ellenborough, L.

Renton, L.

Elliott of Morpeth, L.

Renwick, L.

Hailsham of Saint Marylebone, L.

Romney, E.

Halsbury, E.

Rowallan, L.

Hamilton of Dalzell, L.

Saltoun of Abernethy, Ly.

Harding of Petherton, L.

Sanderson of Bowden, L.

Hayhoe, L.

Seccombe, B.

Hemphill, L.

Shaw of Northstead, L.

HolmPatrick, L.

Strathclyde, L. [Teller]

Hooper, B.

Taylor of Warwick, L.

Keyes, L.

Trefgame, L.

Kingsland, L.

Trumpington, B.

320

Vivian, L.

Wise, L.

Wedgwood, L

Young, B.

Wilcox, B.

NOT-CONTENTS

Addington, L.

Kilbracken, L.

Ailesbury, M.

Kirkhill, L

Alderdice, L.

Lester of Heme Hill, L.

Allen of Abbeydale, L.

Lofthouse of Pontefract, L.

Ashley of Stoke, L.

Lovell-Davis, L.

Birdwood, L.

McCarthy, L.

Blackstone, B.

McConnell, L.

Borrie, L.

McIntosh of Haringey, L. [Teller.]

Bruce of Donington, L.

McNair, L.

Callaghan of Cardiff, L.

Mallalieu, B.

Calverley, L.

Mar and Kellie, E.

Carlisle, E.

Mason of Bamsley, L.

Carmichael of Kelvingrove, L.

Merlyn-Rees, L.

Carter, L. [Teller.]

Methuen, L.

Castle of Blackburn, B.

Mishcon, L.

Clancarty, E.

Molloy, L.

Clinton-Davis, L.

Monkswell, L.

Cocks of Hartcliffe, L.

Morris of Castle Morris, L.

Currie of Marylebone, L.

Murray of Epping Forest, L.

Dahrendorf, L.

Nicol, B.

David, B.

Ogmore, L.

Dean of Beswick, L.

Parry, L.

Dean of Thomton-le-Fylde, B.

Paul, L.

Desai, L.

Perth, E.

Diamond, L,

Peston, L.

Donaldson of Kingsbridge, L.

Plant of Highfield, L.

Donoughue, L.

Ponsonby of Shulbrede, L.

Dormand of Easington, L.

Prys-Davies, L.

Dubs,L.

Ramsay of Cartvale. B.

Eatwell, L.

Rea, L.

Elis-Thomas, L.

Redesdale, L.

Evans of Parkside, L.

Rees-Mogg, L.

Ewing of Kirkford, L.

Richard, L. [Lord Privy Seal.]

Ezra, L.

Ritchie of Dundee, L.

Falconer of Thoroton, L.

Robson of Kiddington, B.

Falkender, B.

Rochester, L.

Falkland, V.

Rodgers of Quarry Bank, L.

Farrington of Ribbleton, B.

Rogers of Riverside, L.

Fisher of Rednal, B.

Sainsbury, L.

Fitt, L.

St. Davids, V.

Gallacher, L.

Sefton of Garston, L.

Geraint, L.

Serota, B.

Gilbert, L.

Sewel, L.

Glasgow, E.

Shepherd, L.

Gould of Potternewton, B.

Shore of Stepney, L.

Graham of Edmonton, L.

Simon, V.

Grenfell L.

Simon of Highbury, L.

Hampton, L.

Smith of Gilmorehill, B.

Hanworth, V.

Stoddart of Swindon, L.

Hardie, L.

Strabolgi, L.

Harris of Greenwich, L.

Strafford, E.

Haskel, L.

Symons of Vemham Dean, B.

Hayman, B.

Taveme, L.

Hilton of Eggardon, B.

Tenby, V.

Hollis of Heigham, B.

Thomas of Gresford, L.

Holme of Cheltenham, L.

Thomas of Walliswood, B.

Hooson, L.

Thurlow, L.

Howell, L.

Thurso, V.

Howie of Troon, L.

Tordoff, L.

Hoyle, L.

Turner of Camden, B.

Irvine of Lairg, L.

Wallace of Coslany, L.

[Lord Chancellor.]

Wedderburn of Charlton, L.

Jay of Paddington, B.

Wigoder, L.

Jeger, B.

Williams of Crosby, B.

Jenkins of Putney, L.

Williams of Elvel, L.

Judd, L.

Williams of Mostyn, L.

Resolved in the negative, and amendment disagreed to accordingly.
4.33 p.m.
The Deputy Chairman of Committees (Baroness Serota): In calling the next amendment, Amendment No. 9, I should point out that if this amendment is agreed to, I cannot call Amendments Nos. 10 to 21.
[Amendment No. 9 not moved.]
The Deputy Chairman of Committees: I call Amendment No. 10. If this amendment is agreed to I cannot call Amendment No. 11.
Lord Mackay of Ardbrecknish Lord Mackay of Ardbrecknish moved Amendment No. 10:
Page 1, line 13, leave out ("local government election in any electoral area") and insert ("parliamentary election").
The noble Lord said: My name is also attached to this amendment and, in the absence of my noble friend Lord Gray, I will speak to it. I wish I could say that it is a novel experience to be beaten, but some of your Lordships will recall that on a number of occasions when I was on the Government side I was also beaten. So it is not a novel experience to be beaten. But I always win the arguments and that is the most important thing.
We discussed this issue on Second Reading. It concerns who should vote in the referendum. Essentially, the great bulk of people are on both the local government electoral register and the parliamentary register. However, there are some people who are on one but not the other. Your Lordships, for example, are on the local government register but not on the parliamentary register. I understand, thanks to research carried out by the noble Baroness, Lady Ramsay of Cartvale—or, rather, the advice given to her—that there are 123 Peers resident in Scotland who are on the local government register but not on the parliamentary register.
Another group of people on the local government register but not on the parliamentary register are European Union nationals, other than citizens of the Irish Republic who are on both our registers. We very generously allow citizens of the Irish Republic to vote in our parliamentary and local elections. As a passing thought, I wonder if the Minister, when he comes to reply, can help me. If in a year or two's time angling becomes so politically incorrect that it is banned and I decide to move to the Republic of Ireland to carry on my sport—as probably many people have to do as the party opposite bans one innocent pursuit after another— will I be immediately allowed to register a vote in the Republic's elections? I want to know because I might need to start studying the political complexities of the Republic.
Lord Ewing of Kirkford: If the noble Lord gives an absolute undertaking that he will move to the Republic of Ireland, I give him an undertaking that I will support his claim for a vote.
Lord Mackay of Ardbrecknish: I thought that the noble Lord was going to say that he would back a ban on angling, but he was careful enough not to do that.
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Citizens of the Republic and citizens of the Commonwealth are on both registers, but one group on the local government register but not on the parliamentary register are citizens of the European Union who are resident for the moment in Scotland. According to the noble Baroness they number 12,000.
One group of people on the parliamentary register but not on the local government register are overseas voters. They are people who have moved abroad—within the last 20 years, it must be said—and who are able to vote as overseas voters, arrange proxies and so on. To adopt the local government register for the referendum means that those of us who are resident in Scotland will be able to vote, as will the 12,000 European Union nationals. But the overseas voters—there are 1,500 of them—will not be allowed to vote. I would imagine that, by and large, they are all Scottish. They have lived in Scotland, had a vote in Scotland and have gone abroad.
I give as an example the situation of my daughter, who lives in a little place called Bosisio Perini in Italy. I pose the question: why should my daughter and other overseas voters, who are entitled to vote at parliamentary elections, not be allowed to vote in this important election whereas the waiter from the Gelateria in Bosisio Perini, who is in Scotland for a short visit but long enough to allow him to register, will be able to vote about the future of a country which he intends to leave very shortly to return to the warmer and drier climate of northern Italy? However, it was not warmer or drier last week. So your Lordships are as well on holiday here as on the Continent.
It is a very good question, but I have not received a very good answer. The noble Lord, Lord Williams of Mostyn, tried saying that in the 1979 referendum the local government register was used. But there is this difference. I do not think that European citizens were on that register. The system had not yet arisen where, thanks to one of the various treaties we have made, European Union citizens are on each other's registers for European and local government elections.
I asked my daughter how easy it was to get on the local government election register in Italy as a non-Italian. She laughed and said "How easy do you think it is?", which probably means that it is excessively bureaucratic and not something that is openly encouraged. But that is by the by.
The point is that in 1979 such people were not on the register. Nor were overseas electors. So, rather unusually, the noble Lord, Lord Williams of Mostyn, did not have a very good argument. The registers are quite different today from the registers in 1979. At that time the only difference between the two concerned the Peers of the realm and no one was actually disqualified from voting if the local government register rather than the parliamentary register was used. Everyone on the parliamentary register was on the local government register in 1979.
We have a situation which involves one very small group—frankly, not very many people. The Government seem to think that the referendum will be as close as 1,500. They are frightened that 1,500 largely young Scots living abroad may decide that they do not want to

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return to live in a rather more heavily taxed part of the United Kingdom. They may think that the referendum will be as close as that, but, the polls certainly do not show it. I am more than delighted at this stage, eight weeks out, when I remember how the margin narrowed during the eight weeks preceding the 1979 referendum.
I believe that it would be fair and reasonable for the Government to accept the amendment or to explain why 1,500 overseas voters from Scotland who would have been able to vote before they left and who received Labour Party documentation at the last election, as my daughter did in an effort to try to persuade her to vote for Maria Fyfe in the constituency of Glasgow Maryhill, should be deprived of a vote? Incidentally, that would probably have been an easier task, although I do not think a successful one, than persuading her to vote for the Labour candidate in Glasgow Govan where I live, but that is another matter. If my daughter was trusted to vote in a parliamentary election, why should she not be trusted to vote in the proposed referendum? Why should the privilege of deciding the future of her country—and, indeed, my country—be given to some European nationals, who are in our country for a short time? Why should it be taken away from some young Scots who were perfectly entitled to vote at a parliamentary election but who now seem about to be deprived?
That is fairly mean spirited, and I cannot understand the logic behind it. I know that I shall be told all about residency. But there will be people voting in the referendum who will have left Scotland and who will vote by post or by proxy. Therefore, to be logical about residency, the Government would have to prevent or take away postal or proxy votes from anyone who is now resident outside Scotland. If residency is the Government's basis for the proposal, it should be residency on the day of the referendum. That ought to be the test. It is not, and I understand why. All I ask the Government to do is to use the parliamentary election register. After all, they did pretty well with that register on 1st May; I do not know why they do not stick to it. I beg to move.
Lord Crickhowell: I have but one simple question to ask and I do not intend to make a long speech. I should like to take this opportunity to inquire so that we have an answer which will enable me to begin to understand the situation. Why is it proposed that the referendum should be held on a local government basis in Wales this time when, under the 1978 Act, it was on a parliamentary basis with Peers added? I do not understand the change.
The Earl of Onslow: I was most interested to hear my noble friend Lord Mackay passionately talking about his country and asking why Greeks and Italians should be allowed to vote on its future. I find it quite odd that he does not want Englishmen to do so, but that is a different matter altogether. However, I must support my noble friend. It seems rather odd that people who live in the Peloponnese or in Dusseldorf who happen to be temporarily resident in Scotland should have a say in ruining the British constitution.
4.45 p.m.
Baroness Ramsay of Cartvale: I found the speech of the noble Lord, Lord Mackay, very puzzling. The Bill seems to propose an extremely fair and straightforward way of deciding who should vote in an election about what form of devolved parliamentary government will be established in Scotland. It seems to me to be fair that you should restrict the right to vote to people who are actually resident in the country. The noble Lord acknowledged that he would be told all about residency; indeed, he has been told about it time and time again. But he keeps returning to it.
The noble Lord has a mixed line of argument into which he throws some ethnicity, talking about people who say, "My country", and so on, and asking why certain people do not have a vote in their country, even though they are living abroad. Moreover, rather surprisingly, the noble Lord also introduced a slightly anti-European tinge into his remarks, asking why people from the European Union should have a vote. Well, they do have a vote in our local government elections as we have in theirs. The fact is that we are in 1997 and, so far as I am concerned, that is an advance. Indeed, I thought that that was the view of the noble Lord, unlike some other Members. I give way to the noble Lord.
Lord Mackay of Ardbrecknish: I am much obliged. If the noble Baroness is right, does she think that those 12,000 Europeans who live in Scotland ought to be on the parliamentary register? Surely the logic of her argument is that if they are good enough to vote in the referendum, they were good enough to vote on 1st May.
Baroness Ramsay of Cartvale: The noble Lord knows as well as I do that the whole question of European Union nationals and their rights of franchise in one another's country is an issue which has been discussed in the Councils of the European Union and all its organs. Of course, that may well happen; but we are not there yet. At present, there is an agreement among all the countries of the European Union that their nationals can vote in local government elections. I happen to believe that that is a very good thing and that it is an advance. I also happen to think that there is every ground for allowing people who are actually living in a country and who are resident there—not just visitors on holidays, but actually resident—to have a right to vote and decide on this kind of issue.
I am rather taken back by the kind of justification that the noble Lord gives for the roughly 1,500 overseas voters who would have a right to vote if we gave it to them on a parliamentary franchise. The noble Lord has no idea whether or not those people will return. I do not suppose that he undertook a trawl of the 1,500. He referred more than once to mainly young people, but I am not sure that that is true. I believe that many are older people who have gone to more comforting climes than those of Scotland. Therefore, we cannot make any generalisations about the 1,500 people. In any event, it is very dangerous to start speculating. We have a clear and straightforward criterion: people who are resident and who are on the roll to vote in local government elections.

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There is one other matter I should like to mention. Although it relates to another amendment, I might just as well make my remarks now so that I will not have to repeat them later. To go for the parliamentary franchise and then introduce an additional measure to enable Peers to vote seems to me a very dubious exercise; indeed, a very self-serving kind of measure. Further, for it to come from this Chamber would definitely put this place into some kind of disrepute. It would look as if this Chamber wanted to introduce something its Members were not normally entitled to enjoy; namely, an extra which would enable Peers to vote alone as an exception. That is really not a very sensible way to proceed.
Lady Saltoun of Abernethy: What is fair about a register which excludes people who have been sent abroad by their firms to work for a limited period? I know a chap who is a banker. He has just been sent to Australia for two years by his firm, but he still has property in Scotland. At the end of the two-year period, he will return. What is fair about excluding him?
The Earl of Balfour: I have one question to ask at this stage because the amendment has been grouped with Amendment No. 15. Under the Government's proposals, is it possible for a person to be entitled to vote in more than one electoral area in Scotland?
Lord Beloff: I have been, as noble Lords are aware, wholly perplexed about this Bill. I do not understand it; I do not understand devolution; and every time the noble Baroness opposite gets up and makes a speech I am even more confused as to the purposes of our sitting here. It seems to me—and this is related to the amendment— that there is a large class of people with whom all others are intimately acquainted who will not be able to vote in a matter which we are told is of such importance to their country. I refer to a great many Scots people who live in this country of England, practise a profession, live here for some years and then, reasonably enough with the pull of their homeland, go back to retire to Scotland. Why should their views be excluded? They are often admirable people.
My hostility to the Bill has nothing to do with any prejudice against the Scots. In fact it seems to me that many of the arguments on the other side tend to imply that the Scots are not to be trusted. If they are in contact with the English for a couple of years in London, they may decide that it was not such a good idea as they were told by the Scottish press. Could we have some explanation as to why Scots people earning their living successfully, as many of them do, in England should not have a voice? They are even more likely, I would have thought, to go home on retirement when they reach that age, but of course if their pensions are now to be reduced they may think less of it. Could we have a straight answer to that question?
Lord Monson: When the Minister comes to reply I wonder whether he could tell us whether nationals of other EU countries resident in France and Denmark
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respectively in 1992 were allowed to vote in those countries' referendums on the Maastricht Treaty? I rather suspect not.
Lord Mishcon: I am sure the whole of Scotland will be indebted to the noble Lord, Lord Beloff, for putting on record that he has no prejudice against them. I believe also that all Members of your Lordships' House will invite the noble Lord to say that he is confused by their speeches, because they will regard that as a great compliment.
May I just put in one matter which has not been put in so far? It is that those who are ordinarily resident in Scotland, in England or in Wales are in fact liable for tax in this country. May I also mention that those who go abroad, if they go abroad for a sufficient time, claim to be quite properly domiciled in the country to which they have gone and are therefore not liable to United Kingdom tax? It seems to me that this is rather a relevant statement to make when dealing with the question of qualification by residency.
Lord Simon of Glaisdale: Your Lordships may remember the story of the two opening batsmen for a county side who decided that they would confuse the field by calling "Yes" when they meant "No" and "No" when they meant "Yes". Of course they merely confused each other and ran each other out. The noble Lord, Lord Sewel, has decided that there should be no confusion in our minds at all because he consistently said "No". It is fair to say that, if one is to have obdurate negatives, it could not be done more gracefully or more pleasantly than it has been done; and the same goes for the noble Lord, Lord Williams.
However, this is an occasion where he can say "Yes". The reason why local government elections are on the electoral basis that they are is that they affect practically entirely residents, but the powers it is proposed to give the Scottish parliament go very much beyond affecting residents. One can think of many examples. May I give just one? The noble Lord, with his consistent use of the South Sea Bubble technique, has kept under wraps what the Government propose to do. But at one point he let out that he was proposing to follow what was advised by the Scottish Constitutional Convention.
Certainly the Scottish Constitutional Convention recommended that Scottish law, public and private, civil and criminal, should be within the jurisdiction of a Scottish parliament. I am bound to say that that seems to me to be eminently reasonable since Scotland has a different system of law from that which obtains in England. In many respects the Scottish system of law goes beyond residents. A good deal of the criminal law goes beyond residents also as we have been developing it recently. The war crimes legislation, and even anciently the crime of piracy, went far beyond national boundaries.
But perhaps the most important is personal law. Every person in the kingdom has a personal law. It is that which defines his status; in other words, to what extent he is a member of a particular class of the community to whom the law assigns special rights and disabilities, capacities and incapacities. This is very important. For

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example, there is the capacity to form the mental state sufficient to constitute a crime. There is the mental capacity, and there is the general capacity, to marry. What could be more important than that?
But those matters are referred not to the law of residence—the noble Lord, Lord Mishcon, used the word—they are referred to domicile. That takes up the point made by the noble Lord, Lord Beloff. So there is outstanding reason why we should move away from residency for the election that is proposed to the wider electorate that votes in a general election. That wider electorate are those who will be affected by the decrees of a Scottish parliament. I hope that the noble Lord, Lord Sewel, having spurned our efforts to frame what he wants to do and to put them into the Bill in favour of some vaguer and more dangerous generality, will on this occasion accept the amendment.
5 p.m.
Lord Desai: I am somewhat surprised by the amendment. We are debating a referendum for devolution. We are not debating Scottish independence. It is not a referendum to canvass the opinion of Scots wherever they may live. If that were the case, people of Scottish birth living in England would feel even more disenfranchised than people living in Italy.
I believe that the point that the noble Lord, Lord Mackay, makes is wrong. In our elections we allow Commonwealth citizens and citizens of the Republic of Ireland to vote. Neither citizenship nor nationality is a criterion for eligibility to vote. Let us get that straight.
The fact that European nationals vote in local government elections and not in parliamentary elections is an anomaly. There are many other anomalies. Does the principle involve local residence, or does it involve parliamentary elections? As my noble friend Lord Mishcon argued—Members of the Committee opposite make a lot of fuss about taxation—it is the people who live there and will pay the local taxes who should have a say in this limited devolution proposal. Therefore, issues of nationality should not be invoked, especially by people who care so much about the Union.
Lord Rees: Before the noble Lord sits down, will he explain at least for my benefit why a Scotsman who has been transferred, say, by the Scottish Office or by some great company, to work temporarily in London for three, four or five years with the intention ultimately of returning to Scotland should not have a vote on the matter?
Lord Desai: We are not discussing independence for Scotland. We are discussing a devolution of limited powers to a parliament in Scotland. It is not a national issue. It is a regional issue.
Lord Parry: From this side of the Chamber, I feel bound to ask this question. Are we not making much of very small figures? The noble Lord, Lord Mackay of Ardbrecknish, has given us figures which apparently
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have been properly accounted. I do not question them. Nor do I question the right of the House to make its protests over the matter. I wonder how many of those people who were quoted as being disenfranchised because they are overseas care about that fact. I know a Neyland man who lives in China. He seldom thinks about Wales, let alone about the referendum about which we are working ourselves into such a frenzy. It is only those of us who care who have expressed our concerns. I believe that this number of people among those eligible to vote is minimal. We are getting very excited about it.
Lord Mackay of Drumadoon: Perhaps I may ask a couple of questions arising from what was said by my noble friend Lord Balfour on Amendment No. 15. Can the Minister confirm that it is possible to be resident in more than one place in the United Kingdom? In other words, one could have two residences in Scotland; one could have a residence in Scotland and in England; one could have two in Wales; or one could have one in England and one in Wales. If that is so, and such residence entitles one to register as a local elector in more than one electoral area, what is the harm in putting Amendment No. 15 on the face of the Bill?
Lady Saltoun of Abernethy: I believe that it was the noble Lord, Lord Desai—or was it my noble friend Lord Parry?—who asked what all the fuss is about; the referendum is not about Scottish independence. No, it is not, but many of us believe that the constitutional changes proposed will inevitably lead to Scottish independence.
Lord Sewel: In replying to the debate I shall try to focus on some of the questions asked, in particular the terms of the amendments as they stand. I remind the Committee that this group of amendments seeks to change the electorate for the referendums from that for local government elections to that for parliamentary elections with the possibility of adding in Peers. The net effect—it is what the debate on the amendments is about, although wider points were raised—of the change would be to disenfranchise EU citizens resident in Scotland and Wales and to allow overseas electors to vote. That is the guts of the amendments. The issue is as narrow as that.
However, before I deal with it, I hope to answer a few points raised. The noble Lady, Lady Saltoun, asked about the person sent abroad by reason of his work. I understand that by virtue of Section 5(2) of the Representation of the People Act 1983, a person's residency in a dwelling house for the purposes of his right to vote is not interrupted if he goes abroad as part of his employment as long as he intends to resume actual residence there within six months of giving up that employment. I hope that that deals with the matter that the noble Lady raised.
Lady Saltoun of Abernethy: I am grateful to the noble Lord. That means that the chap working abroad who is rich enough to keep his home in Scotland while

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doing so will be all right; but the chap who cannot afford to keep a home in Scotland at the same time will lose his vote.
Lord Sewel: We are getting down to the minutiae of the issue. I shall seek to give the noble Lady as much assurance on that point as I can at some later stage. It is a developing point; we shall return to it.
On the point raised about EU nationals in France qualified to vote in their referendum on Maastricht. EU nationals in France did not have the right to vote on the referendum on Maastricht because it was the Maastricht Treaty which conferred that right on EU nationals. It did not exist then.
We have already made clear beyond doubt—the noble Lord, Lord Mackay of Ardbrecknish, anticipated this point—that the key criterion for deciding who should vote on our proposals must be residency in the countries concerned. We make no apology about that. It is so eminently fair and obvious. That is right in principle and it is workable in practice. That is where we start from: identifying the principle. The principle is that those who are most directly affected should be the people to determine the outcome. Having decided that principle, one then looks for the franchise which comes nearest to that; and that is the local government franchise.
The Earl of Onslow: Is the noble Lord saying, therefore, that because the principle is those who are most affected, a temporary Greek resident will be considered to be more affected by British constitutional change than a temporary Scots absentee who wishes to return to continue his career over the long term? I find that logic totally unacceptable.
Lord Sewel: The difficulty is that the word temporary does not get into any definition of franchise. How long anyone will live in any one place is pure speculation. We can only take the point of residency in terms of qualifying for the franchise itself.
Let us develop this point. At Second Reading, and again today, the noble Lord, Lord Mackay of Ardbrecknish, raised the question of the Italian waiter. Scotland must be full of Italian waiters. I hasten to add that they do a very good job and I look forward to being served by them more frequently in the future than in the past. We believe that that person, who will be affected by the result of the referendum every bit as much as any other person residing in Scotland, should have a say in the outcome of the referendum. It would be wrong to question his entitlement on some grounds of ethnic origin. There is a slight undertone in the arguments that we have heard today that indicates—
Lord Simon of Glaisdale: The noble Lord returns to the issue of ethnic origin, which has not been mentioned in this debate but was mentioned earlier. Will he accept that this amendment has absolutely nothing to do with ethnicity as it was put? Whether the franchise is general or local, there will be an ethnic mix in the electorate.
Lord Sewel: I accept entirely that the noble and learned Lord would not for one moment introduce an
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ethnic factor. However, I am concerned that we continue to hear a reference to Italians, which seems to carry with it an ethnic colouring.
Lord Mackay of Ardbrecknish: Really, if that is the best the noble Lord can do, we might as well all pack up. The point about the Italian is that I am using a real, live example. I am not being theoretical; I am talking about where my daughter lives. If she had lived in France, I should have used the example of a French waiter; had she lived in Germany, a German waiter. There is nothing wrong in this. I am served by Italian waiters constantly in Glasgow.
Lord Sewel: I am sure that that is so, and I envy the noble Lord. The point is, an argument seems to be arising that some definition of Scottishness is required and non-Scottishness—particularly the non-Scottishness of a person living in Scotland—is somehow a form of semi-disqualification from voting in the referendum. That is fundamentally wrong.
Conversely, the émigré Scot living in Italy, however good is the Scottish blood coursing through his or her veins (I am sure it is of the highest quality), simply does not have the same direct interest in the result because he or she does not live in Scotland. People who decide to make their place of residence in some other country clearly do not have the same direct interest in the outcome of a referendum determining the form of government for their original country once they have moved their residency elsewhere. It is just not good enough—
Lord Beloff: I should simply like to clarify my mind again. The noble Lord is saying that the principle is those who are likely to be directly affected by the legislation. Since alterations in the constitution of the United Kingdom affect everyone in the United Kingdom, why should the English not vote?
5.15 p.m.
Lord Sewel: The words I used are, "most directly affected". The fact that these sovereign Houses of Parliament will ultimately have the say on the devolution Bill protects the interests of all the people of the United Kingdom. It must be remembered that the charge we face, and have faced continually, in Scotland from our opponents is that our proposals do not enjoy the support of the people of Scotland. That is why we are holding a referendum: to deal finally and conclusively with that point. That is why the test as to who are the people of Scotland is: those who live in Scotland, those who will be affected by the change in the nature of the government of Scotland.
Let us return to the idea of the émigré Scot. It is not good enough to say of the émigré Scot who has been away five, six, seven or 10 years, living in Italy, France, Germany, China or wherever, that he or she intends to return. We cannot base a decision on some intention to return, or indeed on the fact that an Italian waiter may not continue to live in Scotland forever. We do not know. Individuals themselves do not know. Personal events change matters. They may have a full intention

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to return and then perhaps fall in love, or fall out of love, and that may affect their decision as to whether to return or stay. I am saying that any decision based on intention, hypothecating some form of action in the future, is a matter of pure speculation. The only certain thing is residency. That is why it is a robust and necessary test. Entitlement to vote in any election is predicated on residence on a specific date and not on any possible future residence. That is why we say that residency is right in principle and right in practice.
An interesting side-effect of the specific amendments we are discussing is that they would create something of a tension. The Scot living in Benidorm, so long as he had been there for fewer than 20 years, would be able to vote; the Scot living in Blackpool would not. These amendments would establish that sort of tension.
I am interested in Amendment No. 14 tabled by the noble Lord, Lord Gray, which would reinstate voting rights for Peers if the parliamentary election franchise is used. I am afraid that, whatever the opinions of the 123 Members of this House who would be entitled to vote in Scotland on this basis, it might sound rather like special pleading if we made that adjustment. Why should—
Lord Howie of Troon: It would not be special pleading at all. The reason why we are not on the parliamentary register is that it is not necessary as we are here already. Voting for ourselves would be otiose at best. This is an entirely different matter. I am talking now about Scottish Peers resident in Scotland. It would be very simple to tag them onto the back end of the electorate and there would be no alarm raised in Scotland by anybody, except perhaps my noble friend.
Lord Sewel: I am thinking about the difficulty of trying to persuade the electorate of Scotland that we were so intent on bringing about a new and modern parliament that we went out of our way to ensure, exceptionally, that Members of this place should have a vote in the referendum, whereas if the normal franchise were used, they would not. That would present some difficulty.
I am aware that the noble Lord's amendment would replicate the franchise for the 1975 and 1979 referendums. That is true. However, it must be remembered that there have been changes to the franchise since then. Overseas electors are now entitled to vote at parliamentary elections and EU citizens are entitled to vote at local government elections. Neither of those groups was considered in 1979. That brings me back to the point made by the noble Lord, Lord Crickhowell, that these two categories did not exist in 1975 and 1979. I continually return to the idea that, as we believe, the criterion for eligibility to vote must be residence. That is why we have chosen the local government register.
I now turn to Amendment No. 15 in the name of the noble Lord, Lord Gray, and to the point made by the noble and learned Lord, Lord Mackay of Drumadoon, and raised by the noble Earl, Lord Balfour. This amendment seeks to prevent any person from voting
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more than once in the referendum in Scotland. That is absolutely right. We can fully agree that that should be prevented. However, I can give a complete and utter assurance that this matter is already dealt with in the Order in Council which will apply the necessary provisions of the Representation of the People legislation—in particular Section 61—to prevent multiple voting. The matter of multiple voting has been identified and we are dealing with it through the orders.
On the basis of this (I hope at least partly convincing) explanation, I urge noble Lords to withdraw their amendments.
Lord Mackay of Ardbrecknish: I thank the Minister for his final point and for the clarification he gave. I see that matter is covered in the draft order. I shall not rehearse an argument I shall develop later; namely, that a draft order of this complexity ought to be part of the Bill. We should not then have to raise such issues in relation to primary legislation.
We have had an interesting debate, and it is most interesting that the noble Lord, Lord Sewel, had difficulty with his argument. The longer he went on, the more it began to appear to me that perhaps his right honourable friend the Prime Minister was right when he described this parliament as no more than a parish council. He seemed to me to be saying that you should have the same qualifications as those for a parish council.
Lord Sewel: We do not have parish councils in Scotland.
Lord Mackay of Ardbrecknish: Well, the Minister's noble friend Lord Desai described it as "very limited devolution". So, in a way, by not having the important parliamentary electoral register as the key factor in this, the Government are saying that it will not be much of a parliament. They must be careful about that argument.
To take my daughter as an example, of course I accept that she may or may not return to Scotland within 20 years, (the right for overseas voters does not last more than 20 years). That is true, and the Minister— I shall try to avoid his ire—has no idea whether the Italian waiter will return to Italy. He has no evidence that this chap or "chap-ess" will be back in Italy by the time the assembly is set up, if the referendum is won.
It is a pretty weak argument and the impression I get, especially from the noble Baroness, Lady Ramsay of Cartvale, is of a grim determination that those European nationals in Scotland at the moment who are permitted to vote in a local election should be able to vote in the referendum. She seems extremely keen that they should vote. I do not know whether she thinks that they would vote for a Scottish assembly, but it looks as though she thinks that and wants them on the register. Perhaps it is just her pro-European credentials.
Baroness Ramsay of Cartvale: I am grateful to the noble Lord for giving way. Yes, it is part of my pro-European credentials. This has nothing to do with which way such people would vote. I feel passionately

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that it is an advance in European matters that we have agreed that European nationals can vote in each other's local election franchises. That franchise is the correct one to use for the referendum in Scotland and therefore it is right and I am happy that they should have the vote. I make no apology to the Committee or to the noble Lord for that.
Lord Mackay of Ardbrecknish: If that happened, with all the elections the Italians have, my daughter would be voting far more often in Italy than any of us vote in the United Kingdom. That point is interesting. We could already do that because we do not need reciprocal arrangements. The question was not answered as to whether we have a reciprocal arrangement with the Republic of Ireland; I doubt whether we have reciprocal arrangements with the Commonwealth countries, so we could already do it. The noble Baroness, Lady Ramsay, may be expounding Labour Party policy, I do not know.
Lord Sewel: I failed to answer the question on Ireland and I have to say that if an Irish referendum were held under the local government franchise at the time when the noble Lord had decamped to do his angling, he would be able to vote.
Lord Mackay of Ardbrecknish: I am grateful to the Minister but I notice that I would not be able to vote in parliamentary elections. Yet the citizens of the Irish Republic can do so here.
Leaving that aside, it seems that the Government are keen that European nationals should vote. I can understand the point about residency and people being in Scotland and on the register. However, I still fail to understand why the Government will not accept that the 1,500 other people on the register who are allowed to vote in parliamentary elections and who are overseas voters should not have an overseas vote in this election.
As the noble Lady, Lady Saltoun, said, many people are sent abroad by their companies in order to advance the cause of industry and commerce in Scotland. For example, the Scotch whisky industry sends many people around the world to work for the industry and for the good of the economy of Scotland. There are problems with people who live in England, but there is no problem at all with people who live overseas and who have bothered to register themselves. They can easily have a vote in the referendum.
I shall not go on. I think I understand the Government's determination that European Union nationals should vote. There is an easy amendment which would accommodate their position and mine and I shall come back with it at Report stage, when I expect it to be accepted. In the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 11 not moved.]
Lord Mackay of Drumadoon Lord Mackay of Drumadoon moved Amendment No. 12:
Page 1, line 13, at end insert ("or who are included in a central register to be established in accordance with Schedule (Central register of electors for referendums (Scotland))").
The noble and learned Lord said: With the leave of the Committee, in speaking to this amendment 1 wish also to speak to Amendments Nos. 17, 34, 37, 79 and 80.
The amendments fall into two groups, three dealing with Scotland and three with Wales. They seek not to delete anything from the Government's proposals for the franchise but to add to them. They do so in the first place by allowing those who were born in Scotland and live or reside elsewhere in the United Kingdom to vote in the Scottish referendum and those who were born in Wales and live elsewhere in the United Kingdom to vote in I he Welsh referendum.
The noble Lord, Lord Sewel, said a moment ago that the only certain requirement is residency. I suggest that one can be equally certain where an individual was born and that, having been born in Scotland or Wales, that person is now resident elsewhere in the United Kingdom. Therefore, the proposals that are incorporated in the amendments do not fall to be criticised because they add any uncertainty to the situation.
The Labour manifesto stated that,
"As soon as possible after the election, we will enact legislation to allow the people of Scotland and Wales to vote in separate referendums on our proposals".
There is a strong argument that a person who is one of the people of Scotland or Wales does not cease to be so merely because that person leaves the land of his birth and resides elsewhere for a short or even a longer time. Recently, in reply to a Question put down by my noble and learned friend Lord Fraser of Carmyllie, the House was informed that over the last 10 years some 500,000 people had moved their residence from Scotland and slightly fewer had moved their residence from other parts of the United Kingdom to Scotland. So there is a constant traffic in people moving one way and another. Many people born in Scotland or Wales leave the country of their birth for a while, possibly to pursue education or employment. But they remain, in their own minds at least, part of the people of Scotland or Wales and strongly linked to those places. They will have parents and other members of the family residing where they were born and in the fullness of time they may send their children back to that country for secondary or tertiary education. In certain instances, they may maintain second homes there to which they intend to retire in time.
At Second Reading, when my noble friend Lord Mackay of Ardbrecknish told us about his daughter in Italy, I believe that he was on the point of saying that it could be referred to as the "Mackay Question". However, an intervention came from the noble Lord, Lord Sewel. My noble friend used his daughter as an example to illustrate the argument that he had advanced. I wish to use a similar example. My best man, with whom I went to school, was born in Scotland of Scottish parents. He received all his education in Scotland, qualified as a doctor there and, like his father before him, ended up working in England. Indeed, his father was a Member of your Lordships' House, Lord Hunter of Newington, who was created such when the noble Lord, Lord Callaghan, was Prime

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Minister. He took as his title "Lord Hunter of Newington" because it was the area of the City of Edinburgh where he was brought up. The area is known well to my successor, the noble and learned Lord, Lord Hardie.
If my best man intends to return to Scotland, as I suspect he does in the fullness of time, why should he and his Scottish-born wife, who was similarly born and educated in Scotland as a doctor and who practised for a while in England, not have some say in the future government of the country to which they hope to retire?
We are dealing not just with issues of local government, where people are elected for a period of three or four years to serve in the local authority and discharge statutory responsibilities for that period of time before they have to face the electorate again. We are dealing with issues which could change the system for governing Scotland and indeed the system for governing Wales, one suspects for a substantial period of time. I can see no harm in the Government extending the franchise, if they obtain support from those additional voters whom the central registers would incorporate. It can only fortify their position when they bring a devolution Bill before the House, assuming that the questions are answered in their favour.
On the other hand, if people who are born in one of those two countries express concern about the proposals, then so far as the referendums are meant to be advisory, one would like to think that the Government might pay some regard to that advice. Those who were born in the country but have not moved from the United Kingdom and therefore remain taxpayers in the country are concerned about these particular proposals. I beg to move.
5.30 p.m.
Lord Desai: I am sorry to have to rise to my feet again on this question. But perhaps I may put to the noble and learned Lord once again that we are not discussing a national question. We are discussing a regional devolution. If he continues to go down his present path, it will cause immense problems. For example, let us imagine that in the near future a referendum is held in Northern Ireland. Suppose that someone says that everybody born in Ireland should have a say in the future of Northern Ireland—even those only born in Northern Ireland. Half of Boston would vote. Does the noble and learned Lord really want that?
Traditionally, the franchise in the United Kingdom has not been based on the issue of citizenship or nationality. I need hardly remind the noble and learned Lord that all subjects of the British Empire were entitled to vote in British elections. The Republic of Ireland is an anomaly. Commonwealth citizens still have a right to vote. European nationals are a recent addition in the Maastricht Treaty. Origin or birth has never been a criterion for having the vote.
The noble and learned Lord is trying to escalate the referendum into something much bigger than in fact it is. Again and again he invokes the impression that everybody born in Scotland or Wales should have
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entitlement in this matter. But very soon people would say, "What about people who were not born in Scotland but who live there? Why should not they be entitled to vote?"
Let me give a counter-example to that of the noble and learned Lord's best man. I have a cousin twice removed who is a doctor in Perth. He and his wife have lived there for 37 years. His children were born there and brought up there. One son, who is a doctor, practises in Newcastle-upon-Tyne; his daughter is in London. Obviously, the children should vote but the parents should not vote. As soon as one says that only those people—or everybody—born in Scotland should be allowed to vote, very quickly there will be the counter-arguments about not just Italian waiters but people from the Commonwealth. I request the noble and learned Lord not to go down that path, which is a very dangerous path to tread.
Lord Mackay of Drumadoon: Before the debate proceeds any further, I should make clear to the noble Lord that I do not seek to exclude the Italian waiter or his relative who has resided in Perth for 37 years. I seek to add to the franchise the children of his relative, who, under the Government's proposals as I understand them, would be excluded from voting.
Lord Desai: If this is considered as a regional question and not a national question, residence is by far the most relevant property.
Lady Saltoun of Abernethy: With great respect to the noble Lord, Lord Desai, Scotland is not a region. It is a nation.
Lord Desai: With respect, we are not discussing independence of the nation. We are discussing devolution in a very limited sense.
The Earl of Mar and Kellie: The noble Lord, Lord Desai, must accept that Scotland is not a region of Britain. It is a sovereign country, which has placed its sovereignty in a union.
Lord Howie of Troon: Those noble Lords who have known me in this Chamber for quite a number of years will probably have come to realise that in fact I am a Scotchman—"Scotchman" was good enough for Walter Scott and it is good enough for me.
I am a temporary resident in London and have been for some time. But I wish to vote in this referendum. I support the amendments tabled by the noble and learned Lord, Lord Mackay of Drumadoon.
When the previous referendum was held, I went through a similar trauma in a very personal kind of way. We heard of the daughter of the noble Lord, Lord Mackay of Ardbrecknish, and we very much hope that in due course she will return to this country, especially if she is as entertaining as her father. At the last referendum, being resident in London, I was denied a vote. However, by coincidence, my daughter and my niece were both temporary residents in Edinburgh as students for a relatively short period of years. My

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daughter, who was born in London, has blood of the purest Ayrshire on both sides of her family. My niece is not quite so fortunate. She is only Ayrshire on one side; she is half Ayrshire and half English and was born in Johannesburg. But they both had votes in the referendum and I did not; nor indeed did my wife, who is also from Ayrshire. My daughter saw the injustice of that situation and on the day of the referendum she telephoned me and asked me how she should vote. Of course, I said, "Annabel, my dear, it is entirely up to you"—and she did what she was told.
My noble friend Lord Desai totally misses the point— some of the points, at any rate—when he speaks of this issue as a regional matter. So has my noble friend Lord Sewel, when he denies the ethnicity of this matter. We should cast our minds back to how this question of devolution all began. In the middle 1960s a lady called Winnie Ewing won a by-election in Hamilton in the Scottish national cause. That caused a great deal of disturbance, uproar and even anxiety in parliamentary circles. From that upsurge of Scottish national feeling— not regional nor residential feeling but genuine national feeling— arose the whole question of devolution. So, to regard this issue as a matter of local government or regional government is quite mistaken. It is a response to national feeling and because it is a response to national feeing, the ethnic element in it does matter.
Many Scots—I do not know how many there are— are temporarily resident in England. There must be three-quarters of a million, maybe even more—perhaps a million, so far as I know. It is a very large number, not the small number which so irked my noble friend Lord Parry during our discussion on the last group of amendments. It is not a small number but a very large one. Most of those people are Scots in strong feeling.
I do not want to go on at any great length about this matter. I simply want to remind your Lordships with regard to this ethnic or nationalistic question of a point which was brought to our attention by both the noble Lord, Lord Steel, in his maiden speech, and my noble friend Lord Hughes later, when he reminded us about the Queen of Scots. She was not the Queen of Scotland but was the Queen of Scots.
In the same way, I see the planned parliament not as a parliament of Scotland but as a parliament of Scots. As I am one of them, I should dearly like my noble friend to accept the amendment or at least say that he will take it away, consider it and return with some variant of it which will give the¾million of us the vote that we so richly deserve and so much desire.
Lord Thomas of Gresford: I have been sitting on my hands for most of the afternoon but cannot resist following the noble Lord, Lord Howie of Troon. I have a specific problem in my family just as he has in his.
My wife was born in Scotland. She came to live in Wales at the age of 10 and has not so far told me that she has any intention of returning to Scotland. On the other hand, her sister was also born in Scotland, lives in Scotland and the colleague of mine from my home town to whom she is married also lives in Scotland. What are they to have? Should they have a vote in Scotland or a vote in Wales?
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We talk of returning to each other's country; my wife talks of going back to Scotland and my brother-in-law of coming back to Wales. But surely devolution is about sensible, accountable government. We are trying to improve the constitution of this country to bring accountable government closer to the people. All this business about who is Scots and who is Welsh gives me another problem: what about my children? They could play for either Scotland or Wales if they were good enough, which they are not. They may be qualified to do all kinds of things, being Scots and Welsh. Why should not they vote in both places?
Do not bring ethnicity into this discussion. Let us look calmly at what devolution is about; that is, sensible government.
Baroness Ramsay of Cartvale: I could not agree more with the concluding remarks of the noble Lord, Lord Thomas. It has been fascinating to hear the family details of noble Lords, but I am not sure that they clarify any of the issues.
Ethnicity is a bizarre kind of qualification for a franchise. Where one is born should neither qualify nor disqualify one in relation to voting. We are discussing a referendum on how Scotland will be governed through a devolved Parliament. The selection is extremely important but we should go for a franchise which is simple, straightforward and practical, and that is the local government franchise. As it stands at the moment, that is perfectly acceptable to everybody. I do not see why we are trying to play around with it. The idea of trying to prove who is or who is not a Scot is an extremely complicated one.
Lord Hooson: Many years ago I remember hearing of a distinguished Welshman—some would argue the greatest Welshman of the century. It was said of him that he would do anything for Wales but live in it. If that was his attitude, he should not have a vote in the referendum.
Lord Hughes: I am encouraged to come in to the debate only because the noble Lord, Lord Howie of Troon, mentioned what I had to say about Mary Queen of Scots. Many years ago, when I was a Minister in the Scottish Office, there was a period when I looked round and there was not a single Scot who could be regarded as a possible supporter of what I was putting forward as a Minister. I remind the noble Lord that I then noticed him. I asked whether he would be good enough to give me support on a specific matter. He said, honestly, "It is a long time since I have lived in Scotland and I am not knowledgeable on this. Will you forgive me if I do not help you?". Perhaps he will remember that.
Lord Howie of Troon: I must say that that must be a case of mistaken identity.
Lord Hughes: Does the noble Lord think for one moment that there is anybody in this Chamber who could be mistaken in appearance for the noble Lord,

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Lord Howie of Troon? There is a certain amount of fantasy in what he said, but that is carrying it a bit too far.
Lord Howie of Troon: Oddly enough, a respected senior Member of this Chamber—I see him present here this evening, though I shall not name him—constantly confuses me with my noble friend Lord Carmichael.
Lord Hughes: The noble Lord is now going from fantasy to myth. My main point was not to remind him of his modesty on that occasion, but to refer to what he said as to when devolution started. He said that it started in Scotland only after Winnie Ewing won the by-election in Hamilton. He is not only years out in that; he is decades out.
Many years before, a Scottish Member of Parliament tabled a Bill to establish an independent Scotland. That was perhaps even before Winnie Ewing was born. Therefore the noble Lord's idea of when devolution started is quite wrong. I am now 86 years of age and cannot remember any time as an adult when this subject was not talked about at some time or other in Scotland.
5.45 p.m.
Lord Elis-Thomas: I rise to support the remarks of the noble Lord. Of course devolution has been an issue in the politics of Scotland and Wales for all our lives. I remind the Committee, to get the historical record straight, that there was a by-election in the constituency of Carmarthen a year before the by-election in the constituency of Hamilton. In fact, my noble friend Lord Prys-Davis was a candidate in that by-election and well remembers having lost narrowly to Mr. Gwynfor Evans, the former president of Plaid Cymru and at one time a colleague in another place.
I did not intend to mention any of that, but there is a serious point here. We are in danger of lapsing into what I call the worst kind of narrow ethnic nationalism. As the representative of post-nationalism on these Benches, it is important that we should get the matter straight. When we are talking about affiliation to a national or cultural group, it can be dealt with in all sorts of ways. If one is a Scot in England or wherever, one can participate in Scottish life in all kinds of ways in cultural forms, whether it be music, finance or whatever. We are talking about the franchise for the structure of government which is to be devised for Scotland and Wales within the next two years.
This is not a question of national affiliation; it is a question of the arrangements for government. Surely the arrangements of government have to be based upon a notion of citizenship. I would argue that the only possible notion of citizenship which can be a franchise for this kind of intermediary level of government is residency. Any other form of franchise calls into question the whole issue of nationality and ethnicity. Once we go down that road there is the question of the people from outside Wales who live in Wales and from outside Scotland who live in Scotland. It has been raised already.
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I have spent my whole life in politics trying to argue that the people who are resident in Wales are ultimately the only people who should make a decision about the future arrangements for that country, and similarly in Scotland. Clearly if arrangements arise which affect our brothers and sisters in England or in Ireland, those are matters to be decided by the people of those countries as well. There may well be a stage when the people of England need to be consulted about these matters. I do not doubt that at all. But, in the limited proposals we are facing in the Bill, to extend the franchise on what can only be described as a basis of nationalistic affiliation is unacceptable.
My final point must surely carry weight in this Chamber. If there were to be a referendum in Derby about autonomy and regional government in Derby, my president in another place, Mr. Dafydd Wigley, would have a vote because he was born in Derby.
Lord Sewel: I remind the Committee that these amendments seek to allow Scottish and Welsh born people living elsewhere in the United Kingdom to vote at the referendums regardless of where they are registered to vote in the United Kingdom. By definition, that brings into play concepts of nationality or ethnicity and we cannot turn our face away from that—that somehow being born in a place carries some right to vote for the government of that country no matter how long you have been away from that country.
Lord Simon of Glaisdale: Does the noble Lord accept that being born in a place does not merely affect nationality but affects domicile? If he does not, I am sure that the noble Lord, Lord Williams, will confirm it to him. What we are concerned with here is people who were born in Scotland and therefore have Scottish domicile—not Scottish nationality.
Lord Sewel: I understand that it may, in that one can have domicile of origin; but one can also have domicile of choice as well. That is an important distinction. For the lay person the fact is that the amendment would carry a heavy nationalist overlay. That is something no part of the House would wish to encourage in any way, shape or form.
If place of birth were to be a deciding factor in having a vote about the future governmental arrangements of a country one could soon get to total absurdities. I understand that Sir Cliff Richard was born in India. I understand that we are soon to be joined by a former captain of the England cricket team who was similarly born in India. If place of birth is important, can the claim really be made that people who have been born in one country but left at a very early age—I am in the same category in that I left the country I was born in, England, at a very early age—should have a continuing right to have a say in the arrangements for the government of that country? That is a difficult argument to sustain. The noble Baroness, Lady Ramsay of Cartvale, was right when she said that where you are born should neither qualify you nor disqualify you from voting in this type of referendum. That must surely be right.

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As the debate has gone on it has been clear that what I accept may well have been a well-intentioned amendment from the noble and learned Lord, Lord Mackay of Drumadoon, somehow to give some sense of ownership to people who are Scots of what is happening in Scotland would produce immense difficulties. There is the difficulty referred to by one of my noble friends of what should happen if there were a referendum about Northern Ireland. Would it mean that everyone who was born in Northern Ireland should have a vote in that referendum? We would go down a very dangerous and perilous path if we go down the route advocated by the noble and learned Lord.
Lord Butterfield: I am grateful to the Minister for giving way. I am concerned because as I understand it American citizens born in America but living abroad can vote in the American presidential election. Furthermore, American citizens living abroad have to pay tax to the American people. I cannot quite make that fit together with what the noble Lord is saying about eligibility to vote in a referendum. I have not thought deeply about this but I know that Americans can vote from overseas in the election of their president. They are taking part in the government of their country.
Earl Russell: If the noble Lord, Lord Butterfield, will forgive me, perhaps he will consult the noble Viscount, Lord Montgomery of Alamein, about the damage done by the American concept of extra-territoriality. It is a road I do not think we want to go down.
Lord Sewel: I cannot add anything more to the comments of the noble Earl. We have to decide what are the best arrangements for dealing with an internal problem in the United Kingdom, which is the move towards devolved government within the United Kingdom. That is the point we have to resolve. We ought to keep the concept of nationality and ethnicity well out of it because in our country, above all countries, that is a particularly dangerous and perilous path.
There is another point. The central register that the proposal would imply would be the most monstrous bureaucratic nightmare. How would it be set up? One would somehow have to verify place of birth and residency. There would have to be checks on birth certificates. There would be a requirement either to have polling stations throughout the United Kingdom or to have a totally massive postal voting system. We would have an enormous bureaucratic exercise which would break under its own internal contradictions.
I would not make the claim that the amendment was moved out of any sense of mischief. I am sure it was not. I am sure the intention was to generate a wider sense of ownership in a Scottish parliament. However, the way chosen, resurrecting the idea of nationality and ethnicity, which is central as soon as one starts using the definition of place of birth or country of birth as a qualifier, would be an extremely dangerous course of action. I strongly urge the Committee to reject the amendment.
Lord Campbell of Croy: I wish to put a short point arising from the Minister's remarks. If the Bill remains
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in its present form I would ask the Government to refrain from referring to "the Scottish people-. It will not be the Scottish people who are being asked to give their views in the referendum; it will be the residents of Scotland at a particular time. I am quite happy that that should be so—there are a great many difficulties—but the Government should not go around saying that it is the will of the Scottish people or that the Scottish people have determined something or other. That is false. Then to go on to say that it is "the settled will of the Scottish people" makes it even worse. Of course a referendum based on the electorate in Scotland—the latest register— gives a good view of opinion in Scotland. But do not call it the will of the Scottish people.
Lord Sewel: I have toyed with that one myself on many occasions. The formulation I tend to favour is "the people of Scotland".
Lord Mackay of Drumadoon: I am grateful to those noble Lords who have contributed to the debate. I am particularly grateful to the Minister for saying that he treated the amendment as being well intentioned. I have to say that chuckles from noble Lords on the Benches to my right may suggest that they do not entirely agree with that compliment. I accept it in the way it was intended.
In putting forward the amendment I feel that I was speaking for a number of people born in Scotland and Wales who no longer live there. The noble Baroness, Lady Ramsay of Cartvale, suggested that the franchise chosen is perfectly acceptable to everyone. I suggest that it is not. However, I accept that there might be certain bureaucratic problems in taking forward the amendments I propose. I beg leave to withdraw it.
Amendment, by leave, withdrawn.
6 p.m.
Lord Mackay of Ardbrecknish Lord Mackay of Ardbrecknish moved Amendment No. 13:
Page 1, line 13, at end insert ("and members of the United Kingdom armed forces and their spouses who were born in Scotland and who would be entitled to vote in a general election in any electoral area of the United Kingdom").
The noble Lord said: In a way this is a subset of the previous amendment. Amendment No. 13 is grouped with Amendment No. 35, to which my noble friend Lord Crickhowell will speak.
I outlined the position at Second Reading. It concerns those Scottish members of the Armed Forces who find themselves in a position where they are commanded to go with their regiment, or move their homes to another Air Force base, or to move to the south of England in the case of a Scot in order to be near their Royal Navy base. They then find themselves south of the Border when the referendum comes along. If they have moved with their wives and families they may well have registered at their bases and homes south of the Border without realising the consequences as regards the referendum. I use again the example of the Royal Scots, currently based at Colchester. There may be at least 400 of them. I suspect that the young unmarried ones

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will have registered at home in Scotland; I suspect equally that a number, particularly those living in married quarters, will not.
I understand the difficulty. I have tried to phrase my amendment carefully. It says,
"members of the…armed forces and their spouses…born in Scotland".
I may even be able to accept some of the arguments put forward by the noble Lord, Lord Sewel, and re-define that to, "having once had a vote in Scotland". That is in order to try to make the link even stronger so that the noble Lord cannot say that someone born in Scotland could have left at the age of two or three years and might never been back and that it would not be right if that person had a vote.
I am grateful to both the noble Lords, Lord Williams of Mostyn and Lord Sewel, for their explanations—one in debate and the other in a letter. Of course, I know the rules for service declarations. Perhaps I may quote from the letter of the noble Lord, Lord Sewel. It states:
"Thus members of the forces can retain through a service declaration their right to vote in Scotland. Accordingly no member of the forces will lose his right to vote in this referendum simply because he is on duty outwith Scotland".
That is a carefully and brilliantly drafted couple of sentences. It is exactly true, but it is not really true because, when posed with the question about how to use their service declaration, members of the forces did not know that they were going to have this dilemma imposed on them. They were unaware of the considerable consequences when it came to a referendum.
Am I allowed to talk about parliamentary elections? They seem to be so unimportant. But in an ordinary parliamentary election the servicemen are voting for the same United Kingdom Parliament, although how long that will last, if these proposals ever see the light of day, I do not know. They are voting for the same United Kingdom Parliament so whether they vote in Colchester or somewhere in Scotland to that extent is neither here nor there. Probably at the time they said, "We are going to be here for a few years so we had better register here which will save us the bother of the postal or proxy votes we shall need if we continue to vote in Scotland." So they end up registered in Colchester, based with a Scottish regiment and without a vote.
I appreciate all the logistical difficulties that the Ministers have. But it is a very real problem. It seems to me that it is totally the luck of the draw. My daughter decided to go and live in Italy and the best man of my noble and learned friend Lord Mackay of Drumadoon decided to come and doctor to the English. My understanding of these matters is that one does not have too much say in the matter. If the regiment moves to Colchester you move with it and that is the end of the discussion. If you are posted to an air force base in the south of England from Lossiemouth you move to the air force base in the south of England. The servicemen are the serving forces of the Crown.
We deserve a better answer than either my right honourable and honourable friends received from Mr. Henry McLeish down the corridor or we received
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at Second Reading. Even a little sympathy and the words, "We are sorry. We know that it is not right, but we cannot think of a way round it" would be at least helpful. To brush these young men and women aside as though they and their votes do not matter does not seem right. My amendment may not be right, I hope, however, that Ministers will give much more consideration to the position of these young men and women. I beg to move.
Lord Mackie of Benshie: Can the noble Lord explain whether spouses who are not born in Scotland will be eligible or is he going to exclude them? That would be grossly unfair. They may be dragged back to Scotland by their spouse to live and therefore they have as much right as spouses born in Scotland. Will he clarify that point?
Lord Mackay of Ardbrecknish: To be honest, I believe that the noble Lord is making a mountain out of a molehill. The amendment is quite clear. It states,
"armed forces and their spouses who were born in Scotland'".
Given the distinguished career of the noble Lord, Lord Mackie, in the Royal Air Force, I am surprised that he shows absolutely no sympathy for the position of young Scots who have joined the forces and who are now resident in England.
The Parliamentary Under-Secretary of State, Home Office (Lord Williams of Mostyn): Before the noble Lord sits down perhaps I may point out that this is not a trivial point. It is perfectly plain from the drafting of the amendment,
"members of the…armed forces and their spouses who were born in Scotland".
That means that the categorisation of "spouse" limits the spouse in this instance—and, subsequently, in Wales in the amendment of the noble Lord, Lord Crickhowell— to a spouse of a member of the Armed Forces who herself or himself was born in either Scotland or Wales.
Lord Mackay of Ardbrecknish: When I was a Minister I never nitpicked at all—
Noble Lords: Oh!
Lord Mackay of Ardbrecknish: Members of the Committee are free to look back through many acres of Hansard. I hope that the noble Lord will confirm what I have said.
Earl Russell: Never?
Lord Mackay of Ardbrecknish: Well, almost never. If the Government wish to accept this amendment in principle they have all the power of the draftsman behind them and it is no problem. The amendment says that if the spouse wants a vote she has to be born in Scotland as well. I would have thought that that anchors them in Scotland in the way that the noble Baroness, Lady Ramsay of Cartvale, is so keen to do.
Lord Mowbray and Stourton: Is it not true that young men and girls in the forces who have not got

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property of their own are able to register in their parents' homes in Scotland and would therefore automatically have a proxy vote, being in the forces?
Lady Saltoun of Abernethy: Even if the Government cannot accept the amendment as it stands, I hope that they can go some way towards meeting the spirit of it because the Armed Forces are a very special case. Also, if the Government are not able to go some way towards meeting the spirit of the amendment I wonder what effect it may have on recruitment.
Lord Crickhowell: Perhaps I may speak to Amendment No. 35, which is grouped with this amendment, and refer particularly to the situation in Wales. I start by taking up the question which has been asked about the right to vote. It was commented on by the noble Lord, Lord Williams of Mostyn, at Second Reading. Of course it is true that there are special arrangements for the Armed Forces. I know that the Adjutant-General's Office is punctilious in drawing attention to the forces of their rights in this matter.
As my noble friend pointed out, the trouble is that many of the people involved had no idea at the time that their registration was going to be so significant. It is of course true that quite a large number of members of the forces and their spouses do take the trouble to arrange a postal vote or proxy at their own homes. But, as the noble Lord, Lord Parry, will know from his experience in my former constituency and his home county of Pembrokeshire, a very large number of servicemen were based at one time in the county. They registered in the married quarters where they were stationed. I can vouch for that fact, because I took a great deal of trouble canvassing them and soliciting their votes. I believe that I obtained quite a lot of votes and I have no doubt that the noble Lord, Lord Parry, obtained a few. I obtained rather more because I used to beat him. There is no doubt at all that a significant proportion of servicemen register their votes where they are stationed.
I give the example of two particular regiments that make my point. A short time ago my own regiment, the Royal Welch Fusiliers, returned from a gallant and distinguished tour in Bosnia. After the briefest possible stay in Chepstow it was sent to Northern Ireland. It returned from Northern Ireland just a couple of weeks ago. Because it was stationed in Northern Ireland throughout its tour, spouses remained in Chepstow. Noble Lords who know that area will be aware that the camp at Chepstow is on the spit of land under the Severn bridge that separates the Severn estuary from the river Wye. The camp is therefore separated from the border of Wales by a couple of hundred yards as represented by the width of the river Wye. The situation is that the senior regiment of Wales, a very high proportion of whom are Welsh-speaking and who have been born and brought up in Wales, and their spouses will not be able to vote in this referendum that will profoundly affect the future of their country.
I am informed that the Royal Regiment of Wales is at the moment on public duties in London and is stationed in Hounslow. No doubt its situation is similar to that of the Royal Welch Fusiliers. I confess that
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I have not inquired about the whereabouts of the Welsh Guards. However, I can say that a very large number of the two out of the three regiments of Wales will be disfranchised from this election. That is deplorable. I believe that an effort should be made to amend the Bill to enable them to have a vote.
I should like to refer back to the 1978 Act. If it was possible to do as we then did—namely, to have the parliamentary elections as the basis of voting but to have the Peers—surely it would not be too difficult to use whatever basis on which the Government intend to proceed (they seem determined to proceed on the local government electorate) and add the Armed Forces and their spouses in the way that we propose.
I have the greatest possible respect for the noble Lord, Lord Williams of Mostyn. I am sure that he has no intention of nitpicking in this matter and that if he gives his mind to it, and the parliamentary draftsman is able to do it, suitable amendments can be made if our amendments are faulty. I ask the noble Lord to give most careful consideration to this point. I am not alone in Wales in believing that it would be a matter of great regret if these men and women who perform so gallantly and so well in the service of their country were disfranchised from this important election.
6.15 p.m.
Lord Simon of Glaisdale: I had counted on having left the area of controversial politics, particularly on issues that divided the two main parties. I was drawn into this Bill originally because I had great sympathy with the concept of devolution as an aspect of subsidiarity in bringing decision-making nearer the people. I was retained, however, in engagement with this Bill when I saw this amendment. If it is necessary, it appears to me to be absolutely outrageous. If the noble Lord intervenes now and says that it is unnecessary or that it will be dealt with in the draft Order in Council I shall sit down, but if it is necessary in any form it should be accepted. It may need to be redrafted but that is no answer.
What your Lordships will look for is acceptance in principle. I feel very strongly about this. During the war I was fortunate enough to serve in a brigade with two famous regiments whose successors would be affected. One was the first Royal Scots Fusiliers and the other was the second Royal Welch Fusiliers, which has been referred to by the noble Lord, Lord Crickhowell. Not only did I have tremendous admiration for them as soldiers, but I was continually impressed by their sense of patriotism to their countries of origin—the countries with which those regiments were associated. This is not to be disposed of by saying that they could have registered in some way last September when this was not an active issue. I beg the noble Lord, Lord Sewel, who has conducted this Bill so skilfully, to recognise that this is a matter of major importance and to accept the amendment in principle.
Lord Parry: The Committee will expect me to respond pleasantly to the remarks of the noble Lord, Lord Crickhowell. He did beat me on three occasions. I could not understand then and I cannot understand it

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now. However, I can go two-thirds of the way in supporting with sympathy the case that he makes specifically for the regiments of Wales. He is quite right that the regiments of Wales have no barracks in Wales. At present, there is nowhere where a Welsh regiment can be housed at home. That seems to me to be a good argument for giving Wales further devolution so that it can control matters in its own way. I shall not go too far down that road. Incidentally, I believe that the Welsh Guards are currently stationed at Wellington Barracks in the City of London.
The point that is made today about disfranchisement is important, but it would be quite easy to resolve the issue as to where a regiment was stationed at any given time. Certainly it would be possible to make arrangements for one of the regiments of Wales to be stationed at home. The plea that I make is that we go back to the real intention of the Bill that is before the Committee. The Bill is intended to devolve authority to Wales on certain matters and to create a senate within Wales that is able to deal with the specific issues that have been mentioned this afternoon. I believe that the amendments that have been dealt with, although put forward in good faith, do not contribute to the main thrust of the Bill.
Lord Monson: In discussing this amendment inevitably one will go over some of the same ground as when we discussed the two previous amendments. I am glad to see the noble Earl, Lord Russell, in his place. Earlier this week, in a most powerful speech based on his profound historical expertise, he told noble Lords in no uncertain terms that Scotland was a nation, as indeed Wales and England were nations. He went on to deny emphatically that Britain was a nation. If true, this has interesting consequences which doubtless we shall address on another occasion. When the noble Earl states that Scotland is a nation, I do not believe that it is a random geographical area containing a random group of people from all over the place who just happen to be there at the particular time when the electoral register is compiled. Surely a nation comprises people with a common heritage, culture and interest in the long-term future of their nation. I stress "long-term" because people who are there on a three-year contract do not have the same interest. Surely, people who fall into this category have the moral right to vote on major constitutional issues that affect the future of their nation.
I am sorry that the noble Lord, Lord Desai, is no longer in his place. He was sanguine about this and denied that it was a major constitutional issue. I prefer the view of my noble friend Lady Saltoun, who pointed out that it might not be intended to be a major constitutional issue but it would almost certainly become one because one way or another devolution would probably lead to independence. That was what I inferred from the comments of my noble friend, and I believe that she is right.
I accept what the Minister said about the difficulty of including all expatriate Scots, and Welsh for that matter, in the electorate for the referendum, but this is a very
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much smaller group of people. I hope that in the circumstances the noble Lord can see his way to accepting the principle of the amendment.
Lord Campbell of Alloway: I have no personal interest to declare because, although I am a Scot, I am not entitled to vote anyway.
If the Government were not prepared to say now that they accept the amendment in principle, I could understand that. However, I could not understand it if, having heard the debate, they could not say, without commitment, that they will take this back and consider it, because there really is an injustice.
Lord Elis-Thomas: I do not want to argue in favour of any amendment that will delay the Bill because we should move towards the referendum as soon as possible. However, in this case I support the noble Lord, Lord Crickhowell, and my noble and learned friend Lord Simon of Glaisdale and the noble Lord, Lord Parry. I ask the Government to look at this matter again. In relation to an issue such as the RWF the noble Lord and I always stand together.
Lord Williams of Mostyn: The whole tone of this amendment has been one of reasoned constructive appeal, for which I am most grateful. Perhaps the noble Lord, Lord Crickhowell, and I are getting too old and intolerant of each other.
There is no doubt that any government should give a sympathetic ear to arguments concerning the Armed Forces. Other people similarly serve the state and are subject to direction as to where they are to live. Others serve a different, higher cause, for example, ministers of religion who are required to move in some denominations. The problem, though a lesser one, arises in those cases.
It is nostalgia time at the OK Corral tonight and I think it is now my turn. I was born in a taxi travelling between Mostyn and Prestatyn—Point of Ayr, as the noble Lord, Lord Thomas of Gresford, says. The taxi therefore turned left at the bottom of School Lane (Tŷr Ysgol), Mostyn. If he had turned right and gone to Chester I suppose I would have been entitled to vote in an English referendum. My wife is Indian and was born in Durban. I am registered to vote in the local election in Evenlode and she is registered to vote in the local election in London. If there were a referendum about London government she would vote in London and if there were to be a referendum about regional devolution in Gloucestershire or Oxfordshire I would vote there and she would not.
This is a serious point. In any system constructed there are bound to be anomalies. At the end of the day one has to strike a balance. One has to ask what the purpose is of this referendum. I cannot do better than repeat what the noble Lord, Lord Thomas of Gresford, said when he encapsulated the matter so perfectly and pithily. That is a fundamental approach. The second approach is to look at the detail. The noble Lord, Lord Mackay of Ardbreckish, said that we should look at the subset. He did not mean that offensively and nor do I. I entirely agree with him. I will not weary your Lordships by going over old ground.

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As the noble Lord, Lord Mackay of Ardbrecknish, stated, and as has been mentioned in careful correspondence, the service declaration is a mechanism that is available. I do not pretend that it is perfect. No electoral arrangements are perfect. They are never perfectly symmetrical. One can find anomalies, and noble Lords have spent many a happy hour finding anomalies this evening. I dare say there are more anomalies to come.
To take an earlier example, if the serviceman moves to Colchester, on the noble Lord's illustration, he can register there. He is not then entitled to vote in a parliamentary election or a local election in Scotland. I hope your Lordships will accept that I have a good deal of sympathy for the arguments that have been put forward, but the best I can do— in answer to the proposal put by the noble Lord, Lord Campbell of Alloway—is to give careful consideration, with my colleagues, to everything that has been said. However, there are no guarantees of a changed mind. I have gone as far as I can in answer to the thrust of the noble Lord's point and in answer to the question put by the noble Lord, Lord Campbell of Alloway.
Lord Mackay of Ardbrecknish: I am grateful for the response and I appreciate the difficulties of trying to solve this problem. I do not think that any noble Lord would deny that. This is not an easy issue to resolve but I am delighted to hear that the Government appreciate and accept that it is worthy of a bit of attention and effort on the part of officials, draftsmen and politicians to see if it can be resolved. The Scottish example highlighted a real difficulty. If the Royal Scots had been based in Scotland they would have a vote.
The issues raised by my noble friend Lord Crickhowell make a strong case; there is no possibility of these regiments being based in Wales at all. That is a point worthy of consideration.
I am very grateful to the noble Lord, Lord Williams of Mostyn. I hope that we can see some solution to this difficult but important problem by Third Reading. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment Nos. 14 to 19 not moved.]
Lord Simon of Glaisdale Lord Simon of Glaisdale moved Amendment No. 19A:
Page 2, line 3, after ("for") insert ("each local government area in Scotland and").
The noble and learned Lord said: My noble friend Lord Elis-Thomas left me to draft the amendment and then went off on a lengthy weekend without telling me that it needed to be translated into Welsh. The consequential amendment is defective in that respect. He is entitled, indeed honour bound, to lead on Amendments Nos. 19A and 39A. I beg to move.
Lord Elis-Thomas: This amendment is in the later group starting at Amendment No. 28.
The Deputy Chairman of Committees (Lord Ampthill): The amendment has now been moved. Would you be so kind as to withdraw it?
Lord Elis-Thomas: I apologise. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 20 and 21 not moved.]
Clause 1 agreed to.
[Amendment No. 22 not moved.]
6.30 p.m.
Clause 2 [Referendum in Wales]:
[Amendments Nos. 23 and 24 not moved.]
Lord Mackay of Ardbrecknish Lord Mackay of Ardbrecknish moved Amendment No. 25:
Page 2, line 4, at end insert ("under section 1 (1)").
The noble Lord said: In the spirit of co-operation shown by the Government Front Bench a few minutes ago I thought we would try and speed up the process to arrive at this interesting amendment. The amendment proposes that the Scottish and Welsh referendums should be held on the same day. For some mysterious reason which nobody, especially the noble Lord, Lord Thomas of Gresford, was able to persuade me of at Second Reading, the Welsh referendum is to be held a week after the Scottish referendum. I do not understand why that has to be. No good reason was given on Second Reading and I shall be interested to hear what is said tonight about the decision to hold the Welsh referendum a week after the Scottish referendum.
The only explanation offered was that of the noble Lord, Lord Thomas of Gresford. It appeared to be that the Welsh needed "clean air time" away from the Scots in order that they could make up their minds. I have not made inquiries, but I do not suspect that too many editions of the Scottish newspapers have great sales in Wales. I must disappoint the Welsh Members of your Lordships' House by saying that not many editions of the Western Morning Post will be sold in Scotland—
Noble Lords: Mail!
Lord Mackay of Ardbrecknish: I am sorry, the Western Mail. I have illustrated the point clearly; it is not the morning reading even of newspaper junkies such as myself who believe that we must read every newspaper. I am sure that in Wales, The Scotsman, the Herald, the Daily Record—
Lord Parry: I am grateful to the noble Lord for giving way. I recommend that he reads the Western Mail of yesterday which shows the latest poll on the state of support for devolution and a Welsh assembly.
Lord Mackay of Ardbrecknish: I accept that invitation. I assure the noble Lord that I am capable of reading the Western Mail, understanding the points it makes, reading the Herald or The Scotsman, understanding the points they make and realising that they are dealing with two different countries and two different referendums. I appear still to have a vote in the referendum, despite my earlier amendments. I hope that Ministers will not threaten me with losing my vote. Perhaps a special clause will be put into the Bill if I am not careful! However, I will have no difficulty differentiating between the two.

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Of all the poor arguments I have ever heard, the poorest is that the Welsh need a week free of the Scots in order to be able to make up their minds. If there were any logic in that proposition there would be a demand for the Welsh referendum four weeks before the Scottish one, or even four weeks after. But that would enter Labour Party conference territory and I have already been reprimanded about that.
There is no logical reason why we should not have two referendums on the same day. If the issues are important let them be resolved in Wales and Scotland at the same time. The principal issues are identical: do Scotland and Wales want devolved parliaments? I appreciate that the detail is different. Somehow the Welsh are not being offered quite the same bunch of supposed goodies which the Scots are being offered. I do not believe that Scots will be in any doubt about what they are being offered. They will know that they are being offered a tax-raising assembly, if that is agreed, and they will know that they are not being offered the same weak assembly as the Welsh. The Welsh are being offered a much weaker assembly. Equally, I am sure that the Welsh will know that they are being offered an assembly which will have no law-making or tax-raising powers.
If that is the best argument that the Government can put forward I suggest that they ring up the white flag right now before some of my noble friends from Wales join in the argument. I see no reason why the two issues should not be resolved on the same day. After all, people throughout the United Kingdom are asked to vote on the same day for Members in another place and that does not appear to cause any difficulty. I cannot for the life of me see why Scotland and Wales should not vote on the same day. I shall not even tempt the Government into telling me which day it is—it appears to be one of the official secrets—but journalists are telling me that it is 4th September. If that turns out to be correct it will look very much as though the journalists are told but Parliament is not. I beg to move.
Lord Thomas of Gresford: It is a great failing on my part that I did not make myself clear to the noble Lord when I spoke previously on this topic. I am not complaining that Wales will be swamped by the Scottish press but that if the two referendums are held together the national press will be concerned mainly with what is happening in Scotland. I made the point that more than 90 per cent. of the newspapers which circulate in Scotland are published in Scotland, but only 13 per cent. of the newspapers which circulate in Wales are published in Wales. That means that the national press—the UK press—has much greater influence in Wales than in Scotland.
It does not stop there because as regards broadcasting there is an area of overlap in Wales of some 35 per cent. of the territory. Television broadcasts can be received from England in 35 per cent. of the Welsh heartland. In Scotland, the figure is 0.2 per cent. One has to think only of the Borders to realise why that is so. Often people in north-east Wales turn to Granada Television and to BBC North. People in Mid-Wales turn to the Birmingham area
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and to the Midlands channels and in south Wales, in particular south-east Wales, they turn to Bristol television programmes.
That means that the problem of raising the consciousness of people in Wales to the issues involved in the referendum is that much greater than it is in Scotland. Furthermore, there are significant differences of principle between the Scottish and Welsh referendum proposals. What I and my noble friends are concerned to avoid is that the people of Wales should believe that they are being offered what is on offer in Scotland. A different proposition is being put before them. It is a question of information. I am sure that all Members of the Committee agree that the better and more fully informed the voters are, the fairer and more democratic the vote will be, whichever way it goes. That is why we contend that there should be a distinction between the dates of the referendums. That is why we are glad to see the proposal in the Bill.
Lord Crickhowell: I can agree with at least one comment of the noble Lord, Lord Thomas of Gresford, and I am glad that he made it. It is that plenty of information should be provided to the electorate. We shall address the best way of doing that in later amendments. I wish to deal with the points that he made in two parts. First, on the general proposition, he is proved wrong by what happened on the previous occasion. We have a good precedent. Some of us spent perhaps too much time— certainly a considerable amount of time—debating the issue when the referendums were held on the same day. I was so sleepy the other day that when the noble Earl, Lord Russell, challenged me about the absurdity of having a referendum in February I entirely overlooked the fact that on the previous occasion we campaigned all through February, despite the weather, and held a referendum on 1st March.
On that occasion, there was a vigorous debate on Welsh issues which was carried right around the country. I do not believe that anyone who took part in the debates could conceivably have argued that the result was decided because information had not reached the people of Wales and that they had somehow followed with fascination the detailed debate of affairs in Scotland. It is simply untrue and an absurd rewriting of history.
Lord Thomas of Gresford: I thank the noble Lord for giving way. Of course, I was campaigning in 1979, having been involved in the debate since 1967, and I well remember what went on. What concerned me about the campaign in 1979 was not the information that was being circulated but the disinformation. That is what I want to avoid.
Lord Crickhowell: That is a totally different issue. Certainly, a good deal of disinformation was circulated but I suggest not necessarily by the campaigning groups to which the noble Lord referred. However, I shall not become involved in that argument because I wish to turn to the subject of television.
I know a certain amount about television on the borders of Wales. I live in Wales, close to the Welsh border, and understand that a good many people along the Welsh

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border, for one reason or another, receive television from English transmitters. I am a director of HTV and have some responsibility for television broadcasting on both sides of the border. I am at this moment in the uncomfortable position of being taken over by United Media and the noble Lord, Lord Hollick. However, for the time being my responsibilities extend to both sides of the border.
If the noble Lord, Lord Thomas of Gresford, really thinks that Granada in putting out programmes for its listeners will be filling them with information about Scotland, or that HTV West will be packing its news programmes with broadcasts about the Scottish referendum debate rather than the Welsh, he knows nothing at all about television. The simple fact is that BBC Wales and HTV, and I suspect Granada because of its interest in retaining viewers in North Wales, will be following the subject quite closely. Granada has an added reason for doing so because, as the noble Lord will know and welcome, HTV has just opened, is now getting access to a new transmitter in Wrexham and will be able to reach a considerable part of the electorate that earlier broadcasting arrangements prevented it from reaching in the past.
The proposition of the noble Lord is that somehow the viewers in Wales will be plugged in—I am not sure how—to Scottish television in order to follow the debate there but will be deprived of the arguments in their own patch. That is so improbable that I find it hard to understand how such a distinguished and sensible noble Lord could have seriously advanced the argument in a debate in this House. There are compelling reasons for having the vote on the same day and I strongly support the amendment of my noble friend.
The Earl of Onslow: I hope that the noble Lord, Lord Thomas, will not be too offended if I say that I think that his attitude to the voters in Wales that they can hardly read or write—which he is saying by implication—is patronising in the extreme. The Welsh are quite capable of understanding.
Noble Lords: Order!
The Earl of Onslow: Is it out of order to suggest that somebody is patronising? I said that the noble Lord's remarks struck me as being patronising. I am very sorry, but I will stand by that opinion. I thought he was being unkind and illiberal to the Welsh people, who are quite capable of making up their minds. Whether they will make them up in the way I would like them to is a different issue altogether, but they are quite capable of making up their minds. They have a lively local press; there is a special Welsh channel in north Wales which broadcasts in Welsh to the Welsh people; and they are covered by just as much television as we are in England and Scotland. The suggestion that they cannot understand these issues is quite beyond me.
Earl Russell: The noble Earl, Lord Onslow, has not understood what my noble friend was saying. My noble friend said nothing whatsoever which in any way denigrated the understanding of the Welsh people. He was
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talking about the task of getting space within the UK-wide media. That is a very different problem indeed. When the noble Earl has had longer experience of belonging to a minority party he will understand this a great deal better than he does now.
I thank the noble Lord, Lord Crickhowell, for reminding me that the previous referendum was held on 1st March and for drawing my attention to what may very likely be the reason why the vote failed to reach the threshold.
The point about the UK-wide media is crucial. People may have a vast amount of ability to understand an argument but not the ability to get it into the columns of one of the national dailies. Many good arguments are sent off in press releases to the national dailies, which do not print them. All of us on every side of this Chamber have had experience of that.
It is unfortunately clearly the case that because Scotland is the larger country it attracts more attention from the UK-wide media. It has a slightly bigger share of leading journalists in London and a slightly bigger representation in Cabinet, and so it gets the lion's share of attention. The difficulty in getting Welsh arguments— especially specifically Welsh arguments—into the press during the Scottish referendum will be very much greater than it will be later.
As I am sure the noble Lord, Lord Elis-Thomas, will confirm, that will be particularly true because, regrettably, many Englishmen do not speak or read the Welsh language and, therefore, many will find it a great deal harder to get somebody to pay attention to arguments which are being conducted in the Welsh language and which may be of considerable importance. It will be easier to get a journalist with the requisite linguistic skills assigned to cover those arguments when there is not another referendum going on in Scotland. These are very good reasons for the Bill doing what it does.
6.45 p.m.
Lord Rowallan: There is a quite large Gaelic-speaking minority in Scotland, so what is right in Scotland must be right in Wales. It cannot be argued that the Welsh will be less likely to try to find out what they want to do and how they are going to vote than the Scots. They are quite as capable of making up their minds as the average Scot, and should be encouraged so to do.
To give them a week or a fortnight, whatever we choose, to think about it—and maybe to say the Scots did that; perhaps we should do the same, or something completely different—is completely illogical. The answer must be that they should vote on the same day. It will be ascertained that the voters are not stupid in this country—if they are we should not be asking them to vote in a referendum at all; we have to assume that they know what they want—which is why we are giving them this referendum. Having said that, why do we not hold the referendums on the same day? There is nothing to be frightened of.
Lord Simon of Glaisdale: This is an important amendment which raises a matter of political decency and respectability. If the Government believe that they will

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have a good chance of getting a favourable result in Scotland (which I think they have) and are doubtful or a little doubtful of getting a favourable result in Wales (which I think is also justified), they have every reason to bring the Scottish referendum on first in order to influence the Welsh. That would be quite reprehensible.
We had that system in England at one time when elections took place on different days. Lancashire voted first, and it used be said that what Lancashire said today the rest of England would think tomorrow. It is undoubtedly true that one can influence the other. That is why national polls are forbidden in a number of European countries a week or a fortnight before an election. People like to shout with a bigger mob. Therefore, I very much hope that the amendment will be accepted. If the noble Lord is inclined to treat it at this stage as a probing amendment, I venture to think that it is so important that it should be brought forward at a later stage.
Lord Williams of Mostyn: I have known the noble Lord, Lord Thomas of Gresford, for a long time. We normally disagree on political matters and almost invariably, in the nature of our past employment, we have disagreed about legal issues. I have never heard anyone suggest that the noble Lord is patronising towards the people of the country from which we both originate and where he still lives. Incidentally, Sianel Pedwar C is not a small television station broadcasting to North Wales; it is actually based in Cardiff and broadcasts to the whole of Wales.
The general thrust of the amendments has been that it is absolutely essential politically, and virtually a moral imperative, that the referendums should be held on the same day in Scotland and Wales. Therefore, I focus my eye and my mind on Amendment No. 26. I do so because it says that the referendum in Wales shall be held,
"not less than seven days before the day appointed … for a referendum to be held in Scotland".
I am sorry. I do not have my reading spectacles with me, but my noble friend Lord Sewel has just pointed out to me that the amendment is tabled in the name of the noble Lord, Lord Mackay.
Lord Mackay of Ardbrecknish: I feel that I should explain. In tabling such amendments, I was trying to be helpful to the Government. Amendment No. 25 seeks the same day, which I believe to be a very compelling argument. However, if the Government believe that the referendums ought to be held on different days, then Amendment No. 26 gives them the option of having the Welsh referendum before the Scottish one. It is up to the Minister to accept whichever amendment he wishes.
Lord Williams of Mostyn: Well, well, well. How the world turns! A little while ago the noble Lord, Lord Mackay, was saying that he had never heard such a footling argument as that put forward by the noble Lord, Lord Thomas of Gresford. I would not of course be as graceless as to say that I have heard better arguments in my time in the Gowerton Magistrates' Court. This was going to be the perfect distilled question of principle; but it is not so at all.
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The noble and learned Lord, Lord Simon of Glaisdale, who can plead not guilty to this particular amendment, said that the cry of the mob was not to be heard. I do not describe the electorate in Scotland as a mob; I believe that they are perfectly capable and entitled to make their own judgment on properly conducted campaigns. It seems acceptable to those noble Lords who have attached their names to the amendment that the cry of the mob in Wales is perfectly all right, if they wish to categorise it in that way, because there will not be any pollutant consequence upon the voters of Scotland.
The Earl of Onslow: My noble friend is quite capable of speaking for himself. However, it seems to me that what he is saying is this. What is the point of having the referendum in Scotland or in Wales first? Please justify which way round it should be? That is the point. We actually believe that it would be better to have them on the same day. Noble Lords opposite obviously feel that there is a moral supremacy in voting for Scotland first. Some of us may say later that there is a moral supremacy for the Welsh to vote first. That is the difference between the two amendments. The basic and fundamental difference between the two of them is that they lead to quite different roads.
Lord Williams of Mostyn: I hear what the noble Earl says. However, I am entirely unconvinced by this attempt to dig a tunnel out of Amendment No. 26 and escape, first, through the tunnel and then jump over the barbed wire. Although I do not know this for certain, I believe that the material upon which the noble Lord, Lord Thomas of Gresford, was relying was not anecdotal evidence which he had gathered himself. I have read the document and I understand that the evidence came from the publication, The Road to the Referendum, to which the noble Lord, Lord Crickhowell, referred on Second Reading. It was produced by the independent Institute of Welsh Affairs. I shall not repeat the points about the disparity in media coverage in Wales and its origin because I believe that the statistics given by the noble Lord, Lord Thomas of Gresford, are correct.
The Institute of Welsh Affairs made another significant finding. It reported on the London-based press and its consequences in 1979. The detail is set out in the statistical material and I shall not repeat it. The institute found that:
"The London-based press was largely uninterested in the devolution issue. When it did consider the subject, it concentrated far more on the Scottish dimension. Nearly twice as much television news time was devoted to the campaign in Scotland than that in Wales".
That is not something which has been conjured up out of the air; it comes from that independent report. We believe that we should seek to avoid that situation. They are distinctly different questions; distinctly different consequences. We believe that there ought to be a gap

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between the Scottish referendum and that for Wales. Therefore, I do not accept the amendments on behalf of the Government.
Lord Rees: Before the Minister sits down, can he tell Members of the Committee what he would regard as a reasonable time, and on what basis, between the two referendums if they are to be held on different days?
Lord Williams of Mostyn: I personally would regard a reasonable time as sufficient to give a calm reflection to the electorate in Wales. Whether that is to be one or two weeks is a matter of judgment at which the Government will arrive and announce in due time.
Lord Mackay of Ardbrecknish: We have had an interesting short debate. I believe that my noble friend Lord Rees has just put his finger on the point. If the Welsh need clear time, I have to tell the Minister that, whatever the result of the Scottish referendum on, say, Thursday 4th September—although we cannot be given that information—I suggest that for the next few days thereafter, and certainly over the weekend and well into Monday and Tuesday, the national UK press (which I am told is so important in Wales because it penetrates so much of the Principality and upon which everyone depends, ignoring the TV points made by my noble friend Lord Crickhowell, and so on) will be dealing with the result. Indeed, for days after the Scottish referendum, the Minister should understand that the national press—that is, The Times, the Telegraph, the Independent, the Guardian, the Mirror, though perhaps not the Sun because it has a Scottish edition which will deal with those aspects—will be concentrating on the aftermath of the result of the Scottish referendum.
If the answer is genuine, it is not a week that the Minister should be asking for; it is three or four weeks so that there can be two clearly differentiated campaigns. I accept and appreciate that the Minister's clever way of picking on the second amendment in an attempt to show contradictions might well convince juries in courtrooms throughout the country, but I doubt whether it will convince the jury in this Chamber tonight.
I listened to the arguments put forward by the noble Lord, Lord Thomas of Gresford, and then to my noble friend Lord Crickhowell, who I believe comprehensively demolished them. When they looked at the Liberal Democrats, it seemed to me that the Government Front Bench should have been saying to themselves, "God protect me from my friends; I can look after my enemies myself". However, perhaps they were not saying that because the Minister then seemed to agree.
As I said at Second Reading, I cannot understand how the Government and the Liberal Democrats can possibly think that the noise in the press, and especially in television broadcasts, as regards interest in the Scottish referendum will so dominate life in Wales that the Welsh people will be unable to realise that they have a separate referendum campaign going on in their own country—
Earl Russell: Perhaps we may make one final attempt to draw to the attention of the Opposition the fact that our
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arguments do not concern the capacity of the Welsh people; they concern the quantity of information put before them.
7 p.m.
Lord Mackay of Ardbrecknish: I have tried to explain that, and perhaps I can just go over it again. I tried to explain that the chances are that in the week's interval which the Government and their friends on the Liberal Democrat Benches so want, the aftermath of the Scottish result, whichever way it goes—I ask the Committee to be in no doubt about this—will dominate the United Kingdom-based papers. If the noble Earl really wants clear blue water— or perhaps clear yellow water— between the two referendums, he should be proposing four weeks: that is what he should do. But frankly, as the Liberal Democrats have failed to put down any amendments bar one about re-establishing a parliament that has not existed since 1707 I am not surprised by the absence of any proposal to that effect.
Lord Tebbit: Will my noble friend allow me? I apologise both to him and to the Committee. I was delayed in coming back into the proceedings on the Bill and I may have missed the most vital part of the discussion. Has the noble Lord, Lord Williams of Mostyn, explained why it is so essential in his judgment that the Scottish referendum should he first?
Lord Mackay of Ardbrecknish: No, indeed he has not: not at all. But the noble and learned Lord, Lord Simon of Glaisdale, as always—I must warn the new Ministers that this is something they will have to watch—has told us exactly why the decision has been made by the Government to hold the Welsh referendum a week after the Scottish one. I would have more respect for the Government if they actually advanced that argument instead of trying to put all these "pretend" arguments which the noble Lord, Lord Williams, knows do not hold water.
The reason why the Government want it this way is quite simple. As the noble and learned Lord, Lord Simon of Glaisdale, said, they think—and opinion polls certainly bear this out—that it is possible they will get the result they want in Scotland but they are very, very uncertain of Wales. Even the poll in the Western Mail which was drawn to my attention is not exactly the kind of poll that you would be inclined to put the rest of your fortune on regarding the result of the referendum in Wales. So the reason they want the referendum in Wales a week later has nothing to do with the press or anything else; it has everything to do with the hope that they can persuade the Welsh to do the same as the Scots—to ignore the actual issue before the Welsh people and just do the same as the Scots. I find that thoroughly unsatisfactory. The other place had no chance to discuss this important matter. I therefore think I should test opinion.
7.2 p.m.
On Question, Whether the said amendment (No. 25) shall be agreed to?
Their Lordships divided: Contents, 101; Not-Contents, 94.

Division No.2

CONTENTS

Allenby of Megiddo, V.

Lucas, L.

Anelay of St. Johns, B.

Lucas of Chilworth, L.

Ashboume, L.

Lyell, L.

Astor of Hever, L.

Mackay of Ardbrecknish, L.

Attlee, E

Mackay of Drumadoon, L.

Baker of Dorking, L.

Masham of Ilton, B.

Belhaven and Stenton, L.

Mayhew of Twysden, L.

Biddulph, L.

Mersey, V.

Blatch, B.

Miller of Hendon, B.

Bowness, L.

Milverton, L.

Brabazon of Tara, L.

Molyneaux of Killead, L.

Brookeborough, V.

Monson, L.

Brougham and Vaux, L.

Mountevans, L.

Burnham, L.

Mountgarret, V.

Byford, B.

Mowbray and Stourton, L.

Cadman, L.

Moynihan, L.

Campbell of Alloway, L.

Munster, E.

Campbell of Croy, L.

Norrie, L.

Camegy of Lour, B.

Northesk, E.

Chalker of Wallasey, B.

Onslow, E.

Chesham, L.[Teller.]

Oxfuird, V.

Colwyn, L.

Pearson of Rannoch, L.

Courtown, E.

Pilkington of Oxenford, L.

Cranbome, V.

Prentice, L.

Crickhowell, L.

Prior, L.

Cumberledge, B

Rankeillour, L.

Rawlings, B.

De Freyne, L

Rees, L.

Denton of Wakefield, B

Rennell, L

Dixon-Smith, L.

Renton, L.

Downshire, M.

Rowallan, L.

Eccles of Moulton, B.

Saltoun of Abemethy, Ly.

Elton, L.

Sanderson of Bowden, L.

Feldman, L.

Seccombe, B.

Ferrers, E.

Sempill, L.

Flather, B.

Shaw of Northstead, L.

Fraser of Carmyllie, L.

Simon of Glaisdale, L.

Gardner of Parkes, B.

Skelmersdale, L.

Hamilton of Dalzell, L.

Soulsby of S waffham Prior, L.

Hankey, L.

Strange, B.

Harding of Petherton, L.

Strathclyde, L. [Teller.]

Henley, L.

Swinton, E.

HolmPatrick, L.

Taylor of Warwick, L.

Home, E.

Tebbit, L.

Howe, E.

Trumpington, B.

Kingsland, L.

Vivian, L.

Kintore, E

Waddington, L.

Lauderdale. E.

Weatherill, L.

Leigh, L.

Wharton, B.

Lindsay, E.

Willoughby de Broke, L.

Liverpool, E.

Wise, L.

NOT-CONTENTS

Addington, L.

Clinton-Davis, L.

Alderdice, L.

Currie of Marylebone, L.

Ashley of Stoke, L.

David, B.

Blackstone, B.

Dean of Thomton-le-Fylde, B.

Borrie, L.

Desai, L.

Brooks of Tremorfa, L.

Diamond, L

Carlisle, E.

Donoughue, L.

Carter, L. [Teller.]

Dormand of Easington, L.

Castle of Blackbum, B.

Dubs, L.

Chandos, V.

Eatwell, L.

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Elis-Thomas, L.

Lofthouse of Pontefract, L.

Evans of Parkside, L.

Lovell-Davis, L

Falconer of Thoroton, L.

McIntosh of Haringey, L. [Teller.]

Falkender, B.

Mackie of Benshie, L.

Falkland, V.

Mallalieu, B.

Farrington of Ribbleton, B.

Mar and Kellie, E.

Fitt, L.

Mishcon, L.

Gallacher, L.

Molloy, L.

Geraint, L.

Monkswell, L.

Gilbert, L.

Morris of Castle Morris, L

Glasgow, E.

Nicol, B.

Gould of Pottemewton, B.

Ogmore, L.

Graham of Edmonton, L.

Parry, L.

Gregson, L.

Paul, L.

Grenfell, L.

Prys-Davies, L.

Hamwee, B.

Ramsay of Cartvale, B.

Hardie, L.

Rea, L.

Harris of Greenwich, L

Redesdale, L.

Richard, L [Lord Privy Seal]

Haskel, L.

Hayman, B.

Rogers of Riverside, L.

Hilton of Eggardon, B.

Russell, E.

Hollis of Heigham, B.

St Davids, V.

Holme of Cheltenham, L.

Serota, B.

Hooson, L.

Sewel, L.

Howell, L.

Simon of Highbury, L.

Smith of Gilmorehill, B.

Howie of Troon, L.

Stoddart of Swindon, L.

Hoyle, L.

Symons of Vernham Dean, B.

Hughes, L.

Thomas of Gresford, L.

Irvine of Lairg, L. [Lord Chancellor]

Thomas of Walliswood. B.

Thurso, V.

Jay of Paddington, B.

Tordoff, L.

Jeger, B.

Turner of Camden, B.

Jenkins of Putney, L.

Wallace of Saltaire, L.

Judd, L.

Wedderbum of Charlton, L.

Kilbracken, L.

Whitty, L.

Lestor of Eccles, B.

Williams of Crosby, B.

Lester of Heme Hill, L.

Williams of Mostyn, L.

Resolved in the affirmative, and amendment agreed to accordingly.
[Amendment No. 26 not moved.]
7.10 p.m.
Lord Simon of Glaisdale Lord Simon of Glaisdale moved Amendment No. 26A:
Page 2, line 4, at end insert ("being such day as is appointed under section 1(1),").
The noble and learned Lord said: This amendment has to do, I think, with the date of the Welsh referendum, has it not? Really, I would like to take this opportunity of asking the noble Lord, Lord Sewel, about the White Papers that are due to lead to it. I hope that I am not out of order and speaking on the wrong amendment.
What worried me were two things the noble Lord, Lord Sewel, said at Second Reading. At col. 1112 of the Official Report of 17th June 1997, the noble Lord said:
"White Papers setting out our proposals for a Scottish Parliament and a Welsh Assembly will be published well ahead of the referendum".
That is what we always understood. However, the noble Lord also said,
"We shall be publishing a separate White Paper on our detailed plans for Wales. Immediately following a majority in the Welsh referendum, legislation will be introduced to implement these plans".
That seems to say that there may be two referendums. One is suggested before the referendum, and the other post-referendum before the legislation is introduced. The

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two statements seem to say two different things. I thought that I should give the noble Lord an opportunity to clear up the matter.
Lord Sewel: I have not been able to follow what the noble and learned Lord said. Perhaps I may rehearse what I hope I have always said. I have sought always to say exactly the same thing on this point.
There will be two White Papers: a Scotland White Paper; a Wales White Paper. There will be two referendums: one in Scotland, one in Wales, on the proposals contained in the White Paper. Legislation will be brought in on the basis of the White Papers once they have received the endorsement of the electorate in Scotland and Wales.
Lord Simon of Glaisdale: That is the referendum legislation, is it not?
Lord Sewel: The referendum legislation is what we deal with now. The referendum legislation establishes the means by which the views of the people in Scotland and Wales will be ascertained.
Lord Simon of Glaisdale: I think that the noble Lord has answered my question. He has now made clear, I think, that it was referendum legislation and not devolution legislation.
Lord Sewel: I think that I have done so, but I am certainly happy to discuss and resolve the matter outside the Committee with the noble and learned Lord.
Lord Rees: I do not wish to gild the noble Lord's lily, but what account will the Government be able to take of the views expressed in this Chamber or in another place about the detailed proposals contained in the White Paper? Will the Government Front Bench be able to respond to the criticisms—perhaps constructive or destructive—made in the course of a debate on the White Paper which we are assured will be held before we rise for the Summer Recess?
Lord Mackie of Benshie: With due respect, should the Committee now get on with the business on the Order Paper?
Lord Sewel: I am not sure which amendment we are discussing, to be brutally honest. I am not sure that this relates to the matter about which I am being asked. I just say that Her Majesty's Government are always open to constructive suggestions and criticisms.
Lord Simon of Glaisdale: I thought that we were discussing Amendment No. 26A; and I still think that. I had better write to the noble Lord because I am not clear in my mind what he meant at Second Reading. It seems to me that he is stating two different dates, two different White Papers: one after this Bill passes, and dealing with the process of Welsh devolution, and the other after the referendum has resulted in an affirmative vote for a Welsh assembly. That is how I read it. If the noble Lord can clear that up in correspondence, I shall be very grateful.
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Perhaps I may also say that I find the interventions of the noble Lord, Lord Mackie of Benshie, however well meant and favourable to the Government in the present mood of the Liberal Democrats, most unhelpful.
Lord Sewel: I shall deal with the matter through correspondence with the noble and learned Lord.
Lord Simon of Glaisdale: I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 27 not moved.]
Lord Elis-Thomas Lord Elis-Thomas moved Amendment No. 28:
Page 2, line 5, leave out ("establishment of a Welsh Assembly") and insert ("governance of Wales").
The noble Lord said: This group of amendments enables us to discuss in greater detail, although not at greater length, it is to be hoped, the form of the referendum relating to Wales: the forms of the questions; and how the Welsh people should be consulted. Some detailed preferences are set out. At the outset, wearing my hat of the Welsh Language Board, perhaps I may congratulate the learned Clerks of this House on their effectiveness in dealing with bilingual legislation. This legislation has had the most detailed, bilingual amendments put forward. I can only congratulate the Clerks on handling it, and say that it provides a good precedent for a Welsh Assembly or a Scottish Parliament should it arise.
Rather than making the referendum a simple "yes" or "no" response to the Government's proposals, this set of amendments deals with the various possible options that might be put forward. As the noble Lord, Lord Parry, mentioned, they follow on the latest opinion poll on this matter published in yesterday's Western Mail. It is worth citing some of those figures; they are produced in a poll by Beaufort Research for the Western Mail and are therefore doubly reliable.
A sample of the electorate was asked:
"Do you agree with the Government's Welsh Assembly proposals?"
In response, 39 per cent. said "yes"; 27 per cent. said "no"; and the "don't knows" did rather well at 34 per cent. When the "don't knows" were "squeezed", the projections resulted in a figure of 43 per cent. voting "yes"; 29 per cent. purporting to say that they would vote "no"; and 28 per cent. indicating "don't know".
The reason for quoting those figures in detail is that they set out the varied opinions within Wales on this issue. When in a further question people were asked:
"Do you want an assembly with tax-varying and law-making powers?",
31 per cent. favoured that option and 40 per cent. said no. When the question was asked,
"Do you want Wales to be an independent republic in Europe. severing all constitutional links with the UK?",
the answer was a surprising 16 per cent. saying yes to that and 61 per cent. saying no. The "don't knows" were fairly constant at 24 per cent. Those figures indicate the variety of opinion within Wales.
One significant fact was that, according to the poll, there seemed to be a "yes" majority in all regions of Wales, with the highest regional breakdown showing a "yes" majority, after squeezing the "don't knows", in Mid-Wales at 49 per cent.; followed by the Valleys of South Wales at 45 per cent.; North Wales and West Wales, 42 per cent. and 44 per cent. respectively; and Cardiff and the south-east at 37 per cent. "yes".
The poll indicates the varied views that the people of Wales hold on this subject. Those views appear to come together at this stage in a majority "yes" vote with a 10 per cent. majority—that is, not counting all the high proportion of "don't knows".
In this group of amendments I want to argue that voting by the expression of preferences on governance could actually strengthen the Government's case for a "yes" vote rather than undermine it; that the registering of preferences would in fact ensure a wider debate on the governance of Wales, and not merely treat it as a simple "yes/no" matter. I am arguing that we could have a better debate if all the options were debated rather than if the electorate were merely asked to reply "yes" or "no" to the Government's proposals. That is why I have set out some options in Amendment No. 78, which is included in this group.
The options canvassed in these amendments are not exactly those of the Western Mail. In paragraph (a) of Amendment No. 78, the electorate is offered, "The present constitutional arrangements". I use that form of words in the amendment because "The present constitutional arrangements" are not the same as "no change", which was one of the options offered in a multi-option referendum in another place. The reality is that in terms of the constitutional development of Wales over the period since the Welsh Office was established, we have seen a substantial dynamic, a substantial change in the Welsh Office system itself. It is not for us to argue this evening in the context of the referendum what other alternatives the Government might have were it to turn out that the Western Mail opinion poll is not reflected in the result of a referendum. I see that the noble Lord, Lord Crickhowell, cannot wait to enter the debate. I suggest he is as lively as the RWF Goat on this matter. (That has no other connotations, I hasten to add.) Were the Western Mail opinion poll not to be reflected in the result of a referendum, the political system—the administrative system—in Wales would continue to exhibit the kind of dynamic that it has exhibited over the past 25 years. I am sure that executive decentralisation would continue, regardless of whether it had an elected component. I therefore think that option (b) in Amendment No. 78, "An elected Executive Assembly", is a clearer description of what, in advance of seeing the White Paper, I understand government policy to be than is the mere statement that there shall be a Welsh assembly. It makes clear that this is not a parliamentary or a legislative type
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body, but is an executive body, taking over the executive functions of the department.
Option (c),
"A subsidiary Parliament with law-making and tax-varying powers",
is an attempt to translate into the Welsh context the Government's option in Scotland. I know that my noble and learned friend Lord Simon will have further comments to make on this matter as we debate this group of amendments. Option (c) makes clear that the proposal is to establish a subsidiary body. This is not, of course, federalism; it is devolved parliamentary law-making, which is not the same. Clearly, in a well-structured federal system the powers are separated within a unitary system between the different levels of government according to the principle of subsidiarity.
Option (d) contrasts with the alternative question put by the Western Mail, which, as I said had 16 per cent. voting for what was described as,
"an independent republic in Europe, severing all constitutional links with the UK".
I believe that the version I propose in Amendment No. 78 of self-government for the Principality more closely reflects a position which I hold, and the tradition from which I come, a tradition represented both by the Liberal Party and Plaid Cymru, and indeed by sections of the Labour Party in different guises. The emphasis is on ymreolaeth, self-rule, self-government or autonomy, rather than independence, and a parallel emphasis on the role in relation to Wales of UK, British, Britannic, or whatever word one might choose, institutions. That is a form of federal, or confederal relationship, including a clear role for the monarchy and for your Lordships' House.
I shall not enter into the historical debate on that. I wish merely to emphasise that, so far as my option is concerned, there is no slippery slope. As I said at Second Reading, there can be no further progress towards greater devolution without further consent. Further constitutional changes would require further consultation by referendum. There is no slippery slope; my option has a series of safety nets—or "constitutional cushions", if that metaphor is preferred. Then, to confuse the Committee entirely, I might say that the slippery slope has become a level playing field within the European Union, or it can potentially become so if we obtain the consent of the Principality for the equivalent of a European regional assembly.
It is important to rehearse these alternatives and to rehearse the argument that the referendum as a consultation process might benefit from a deeper debate. I beg to move.
7.30 p.m.
Lord Simon of Glaisdale: I wish to speak to Amendment No. 30A which is grouped with Amendment No. 28. It is in the name of myself and my noble friend Lord Elis-Thomas and reads:
"at end insert ('with, so far as is practical, similar powers over Welsh affairs as a Scottish Parliament has over Scottish affairs')".

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I realise that I charged my noble friend prematurely with treachery and desertion. In fact, it was one of the consequentials of this amendment that he left me with the task of translating into the Welsh language. I am a great admirer of Welsh literature but I have only read the proposal in English. When I found that I had been treacherously deserted, I looked round wildly for the noble Lord, Lord Williams of Mostyn, to help me, but unfortunately he had disappeared too.
I regard the referendum as wholly unnecessary. Thus far I agree entirely with what was said from the Liberal Democratic Benches. I add—which they would not in their present mood of formal complaisance—that I am satisfied in my mind that the reason we have this quite unnecessary referendum is twofold. The affirmative answer will give the Government greater power to bully your Lordships; and as for tax-raising, it is to save the face of Mr. Blair, after the trouble that he got into in Scotland.
If we are to have a referendum, we might as well make the best of it and use it to tell us something useful about the subsequent legislation. The Committee will want to know why the Welsh people are not being offered a legislature, assembly or whatever with the same powers as for Scotland. I can understand that there are differences. The Welsh legislature is much more closely integrated with that of this country. There is now no longer any separate Welsh system of law, as there is a separate Scottish system of law. I remember when I used to go on circuit to South Wales that we were always harangued by the then Lord Lieutenant of Glamorgan on the great virtues of the ancient Welsh code. I see the noble Lord, Lord Williams of Mostyn, nodding. Perhaps he will tell us about it.
What the Welsh people will want to know is that they are given a choice. What are they being given? Why are they denied the same powers as the Scottish assembly? Little is known about the Government's intentions. The noble Lord, Lord Sewel, has persistently taken refuge in his South Sea Bubble defence. What he says is: "Just invest in my prospectus and you will find later that we will tell you what wealth it will bring you. Be good little boys and girls, vote for my referendum Bill and later there will be a White Paper—jolly holiday reading— which will tell you what questions you ought to have asked and put into the referendums Bill". It will be too late then. I want to see both the Scottish and the Welsh people given a wide range of choice.
So far as I understand it, the Welsh assembly will have power over such functions as are carried out by the Welsh Secretary of State at the moment and the Welsh Office. The noble Lord will correct me if I am wrong, but I understand that it will extend the power over secondary legislation. That in itself is important. It runs to thousands of pages every year—far more than the primary legislation. But the crucial question will be: will the assembly have power to amend that secondary legislation?
With great difficulty, your Lordships have finally achieved a resolution that you have full power to reject secondary legislation. The noble Earl, Lord Russell, has already ingeniously found ways of getting round the
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supposed ban, but so far we have entirely failed to get an equivalent concession on the amending of secondary legislation. Will that be in the power of the Welsh assembly? I support the amendment.
Lord Crickhowell: I do not intend to spend long on this group of amendments and it is a pleasure to follow the noble Lord, Lord Elis-Thomas, and the noble and learned Lord, Lord Simon of Glaisdale. At least I know exactly where I am with both of them. It is rather more difficult to know where you are with the Liberal Democrat party. We had a startling intervention on an earlier amendment from the noble Earl, Lord Russell, who referred to the Conservative Benches as "the Opposition", from which I can only assume that he places himself and his colleagues as the alternative Labour Party. If he is going to pursue that line, I wish he would give us a little more room on the Benches this side and move himself and his colleagues to the Benches opposite, where they clearly feel at home. I am sorry that the noble Lord, Lord Elis-Thomas, is not going to give them a welcome.
I see that the noble Lord, Lord Mackie, wishes to intervene. But I do not wish to give way but to get on to more serious points. He is urging that we get on. I shall do so and deal with the points that have been made.
The noble and learned Lord, Lord Simon of Glaisdale, asked an important and significant question: why no tax-raising powers? I believe that Mr. Ron Davies, when asked the question elsewhere, said: "Well, we didn't put it in the manifesto". That seems to be about the thinnest offering ever made by a Minister. It makes even the replies we have got used to from the Benches opposite sound solid, substantive and informative. But that is what we have on offer at the moment.
If the noble and learned Lord, Lord Simon of Glaisdale, was guided on his visits to Wales by that notable Lord Lieutenant, Sir Cennydd Traherne he could have no better guide. He knows everything that needs to be known about Wales. I say to the noble Lord, Lord Elis-Thomas, that he may be attaching too much significance to the poll published yesterday in the Western Mail. Earlier this year I had a tragedy in my garden in Wales. We had some ducks which laid 11 eggs. Then my grandchildren came to stay for the weekend. I am sorry to say that the ducks deserted and the 11 eggs were still there, never likely to be hatched, for several weeks afterwards. I remind the noble Lord, Lord Elis-Thomas, that at about the same stage at the end of 1978 and in early 1979 there were a number of similar polls in the Western Mail. The result declared on 1st March 1979 bore no resemblance to them. So the noble Lord should not be too confident about the end result.
I term this group of amendments the "slippery slope" amendments. The noble Lord, Lord Elis-Thomas, said that he was not creating a slippery slope because he was introducing a safety net at every stage. Therefore there would have to be a referendum before one went any further. But he has tabled an amendment which suggests a series of preferences and asks the electorate to say now which of those preferences it wants. He is already

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trying to take us down the slippery slope quite fast before the snow melts or any rocks appear in his path. If there is one thing we have learnt about this referendum debate over more than 20 years it is that it is the detail that matters.
I cannot remember exactly how many years we spent debating this topic 20 and more years ago and how many weeks we spent on the legislation. But I have no doubt at all that it was the detail which emerged that had a decisive influence on the judgment of the electorate. Until then, the electorate had had nearly no idea of what was intended.
The trouble about having a list of preferences is that, unless there is a most extraordinary information-providing system—presumably to be financed by the state, as it is hard to see how otherwise it would be financed—it is simply totally impossible to put in front of the electorate the kind of information that it would need to make sensible judgments on each of the preferences offered. Indeed, even the question, "Why should we not have the same legislation as in Scotland?", raises some major issues. The Government, in their White Paper and indeed in any material that they present to the electorate, would have to set out a string of further arguments which I do not believe they contemplate including in their White Paper at the moment. They would have to set up a whole series of arguments on why things were the same as those in Scotland or why they should be different. So it is a complex set of questions that are raised in this set of amendments.
As the noble Lord, Lord Elis-Thomas, said, the reality is that we are involved in a dynamic process. He said that the Welsh Office had emerged and extended its responsibilities and that will continue. But he hastily added, "Of course, I shall introduce some safety nets". Well, it is dynamic in that sense. That is what some of us fear. We are not happy or confident about the safety nets. We have a genuine fear that once one starts on this process, it is not easy to stop. As I understand it—I have not yet seen, nor has anyone else outside the Government, even a draft White Paper—what is being proposed is quite an extensive change in the present practice. Mr. Ron Davies, speaking in the Welsh Grand Committee in North Wales on 30th June said that the assembly would be responsible for almost all aspects of public life for which the Welsh Office is currently responsible: health, education, housing, sport, the arts, culture, heritage and so on. Later said, in answer to a question from one of his honourable friends, he said that the overwhelming majority of the present responsibilities of the Welsh Office were going to be transferred.
So, in the proposed legislation to which the referendum refers, we are confronted with a very major change indeed. Essentially, it is the abolition of the entire system of government which has been developed by successive governments of different political persuasions over the past 30 years in Wales and which has had a significant impact not only on the governance of Wales but on the economic successes in Wales and the transformation of the Welsh economy. It is quite
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clear that, if the powers of the Welsh Office are to he transferred in that way—I noted the suggestion of the noble and learned Lord, Lord Simon of Glaisdale, that it was intended to transfer to the assembly the powers as well as dealing with secondary legislation—it is almost inconceivable that a Secretary of State for Wales could remain in a British Cabinet. What would be his role? It would be hardly even that of a messenger boy.
A whole series of detailed questions are posed about the role of the Civil Service, the responsibilities of Welsh Members of Parliament and every aspect of government. So even this one step, which is likely to be less extensive than in Scotland, is a very big step indeed on to a very slippery slope. For one thing is absolutely certain: if there is an assembly which is given those responsibilities, it will not be content with what it is first given. When anything goes wrong, whenever the people of Wales utter a word of criticism, the assembly will say, "Of course, it is not our fault. It is that Government back at Westminster". It probably will not be able to say that it is the fault of the Secretary of State because no doubt the Secretary of State will no longer exist, but whoever is given the responsibility in a government at Westminster will be blamed. Therefore, there will be tension created between Westminster and the assembly which will be deeply dangerous and damaging.
We have in this set of amendments a very interesting revelation of the road down which we are being asked to advance. I, for one, am deeply grateful to the noble Lord, Lord Elis-Thomas, for putting before this Chamber and, for the first time in this current debate, before the electorate the real issues that will confront the electors of Wales when the referendum takes place, issues which so far have been disguised by the Government and kept from that electorate.
7.45 p.m.
Lord Hooson: It is a pleasure to follow the noble Lord, Lord Crickhowell, but I am very amused by the fact that he defends the status quo of the secretaryship of Wales, when the Conservative Government did nothing to establish it. I remember putting forward the proposition that there should be a Secretary of State for Wales and it was turned down by the Conservative Government of the day. That is the nature of political life.
The noble Lord referred to the attitude of the Liberal Democrats on this matter. I want to make quite clear what that is. It faces political reality. For the whole of my political life I have fought for a domestic parliament for Wales. In fact, I fought within my own party and outside it. I supported every campaign for a domestic parliament for Wales. As the noble Lord, Lord Elis-Thomas, knows, I have always opposed a separate Wales and an independent sovereign state in Wales.
The reality of the political situation is that the Labour Party is dominant in Scotland and in Wales. It fought an election with the issues set out clearly as regards their proposals for Scotland and for Wales. I would go much further than the Government are prepared to go. But the reality is that they democratically won an election. They have a very large majority in the elected Chamber. We

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make our comments as nominated or hereditary Members of another place. We must face the political reality. We have to take or reject what is on offer. We may be able to amend the eventual proposals but we shall probably he able to amend them in only a minor way.
The Bill provides for a referendum to be held in Wales and in Scotland. I made quite clear that I do not believe in referendums. Let us look at the history of some other countries—for example, Germany, before the war. There were referendums continually in the Weimar Republic and they nearly always produced the wrong results. I believe that a government should govern.
Having said that, the position regarding this Bill is that it provides the machinery for referendums. I cannot support the proposal of the noble Lord, Lord Elis-Thomas, for what he would accept is really a "preferendum". To open the political debate again, he and I would go much further than what the Labour Party and the Government propose. But it has one supreme merit so far as Wales is concerned; that is, for the first time in the history of Wales we would have a directly, democratically elected body to represent Wales. Whatever its powers, it would be an enormous milestone in the history of the Welsh people. The fact that, incidentally, it could deal with other matters such as the nominated bodies that so proliferate in Wales and that are unaccountable to the people of Wales, is a different matter. For the first time in our history we would have a directly elected assembly.
The issue of whether our personal preferences are for an independent Wales, a domestic parliament or an assembly with tax-raising powers, is not relevant to the present discussion. The only question is whether we vote for this Bill to allow the referendums to take place and vote "Yes" or "No" on a simple issue. I would not do anything to cloud that issue. The real test is facing political reality; that is, are we for or against what the present Government—which have a huge majority in the elected Chamber—propose?
Lord Lucas: I am fascinated by the excellent exposition of the noble Lord, Lord Hooson, on the nature of opposition. We are not in the dispirited state in which the Liberal Party finds itself; we are in opposition, not in eternal opposition. We believe that one day we will find ourselves once again on the Benches opposite and contributing all our skills and understanding to the governance of this country.
That makes us considerably more interested in this Bill, and I am particularly interested in hearing what the noble Lord, Lord Williams of Mostyn, will have to say about the amendments of the noble Lord, Lord Elis-Thomas. The noble Lord, Lord Elis-Thomas, demonstrated quite conclusively that the difference between what the Welsh and the Scots are being offered is merely a matter of scale not of substance; that the two issues are as one and that we were entirely right to press to a Division the amendment we have just won.
My noble friend Lord Crickhowell, in an exceptionally powerful speech, and the noble Lord, Lord Hooson, demonstrated that the road down which we are
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being invited to go by this Government—one that will no doubt be followed if the Welsh choose to vote for it—is a slippery slope which will lead to something far more like what the Scots are getting and what the Scots will undoubtedly get in the end—their independence.
I am also interested in hearing the answer of the noble Lord, Lord Williams, to the question posed by the noble and learned Lord, Lord Simon of Glaisdale, as to why the Welsh are getting less. If the Government know that the Welsh want less, why do they need a referendum? If they do not know that the Welsh want less, why do they not ask them?
Perhaps I may conclude by adding one small piece of knowledge to the great store of that possessed by the noble and learned Lord, Lord Simon of Glaisdale. Yes, the assembly will have considerable powers over secondary legislation. It is clear from what Ron Davies said on 30th June in the Grand Committee that extensive powers for altering legislation and changing matters are envisaged for the assembly, presumably through some massive Henry VIII clause to be incorporated in the Bill to come before us. It is clear from what Mr. Davies said that the Welsh White Paper is long written and prepared; it is sitting there waiting only for the Scots to deal with the difficulties which may arise. I hope that we will see it soon. I do not see any reason why the Welsh should have to wait on the Scots forever.
Lord Williams of Mostyn: As the noble Lord, Lord Hooson, said, what is being sought by the noble Lord, Lord Elis-Thomas, is really a "preferendum"; a choice of a range of alternatives which could he four. The question set out indicates that the voter does not have to use all the preferences and therefore one could have 25 per cent. for (a), for (b), for (c), and for (d), which would not be illuminating as a guide to future political arrangements.
We will put to the people of Wales the question which is in the referendums Bill. We are not offering the establishment of a tax-varying or law-making parliament.
Lord Simon of Glaisdale: If the noble Lord will give way, perhaps I can point out that it is not a question of what is offered to the Welsh. They are being asked what their view is. That is what these amendments are concerned with.
Lord Williams of Mostyn: I understand what the amendments seek and I am stating the Government's position, which is not that held by the noble Lord, Lord Elis-Thomas; in fact, it is virtually the opposite.
If we go down the road advocated by the noble Lord, Lord Elis-Thomas, it is perfectly possible that the result of the "preferendum" could be wholly inconclusive. That would be the worst of all possible worlds for the people in Wales, where this matter has now been under discussion for around 100 years in one form or another. I am not claiming personal knowledge of 100 years ago, but I remember as a small child of five being brought up, as were most of my Welsh colleagues on these Benches, in an actively political household that that was the important topic of the day, particularly among

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people who involved themselves in political life in Wales. There were the most violent, horrendous disputes between neighbours and colleagues about these questions.
As has been said on many occasions, Scotland is different. It has a different system of law, of education, of health and of local government. Its modern history is utterly different from the modern history of Wales and therefore we are offering to the people of Wales in the referendum the opportunity to say "Yes" or "No" to the Government's proposals, the detail of which will be in the White Paper. I shall deal with the White Paper specifically, if it is convenient, on Amendment No. 29.
We say that Wales has been different in its modern history; it is also different in its present relationship to England. We are intent—if I may put it in that way—to give the people of Wales their choice. It is for them to decide and I hope that the noble Lord, Lord Elis-Thomas, will withdraw his amendment.
Lord Simon of Glaisdale: Before the Minister sits down, will he deal with the questions I asked? Is it intended that the assembly should have power over secondary legislation? If so, is it intended that there should be power to amend secondary legislation?
Lord Williams of Mostyn: I said, I hope without being unduly repetitive, that the detail will be contained in the White Paper. The White Paper will be full; it will be debated in your Lordships' House and I am not proposing to be drawn—I know the noble and learned Lord will accept that I am not being discourteous—on detail which is in the White Paper and has not yet been published.
Lord Elis-Thomas: I am grateful to my noble and learned friend Lord Simon for his persistent questioning on this issue. Indeed, I look forward to his contribution to the debate on the White Paper which may or may not already be written and sitting in the Welsh Office in Cardiff. I do not presume to know about those things.
I was glad for the historical perspective brought to the subject by the Minister. He is right to emphasise that the whole question of a degree of autonomy for Wales has been a major issue of public debate among those who have been concerned about political developments on a cross-party basis. That has been exhibited again tonight. There is a party in Wales which still apparently insists on not being part of that debate. That was fairly clear from the responses of the noble Lords, Lord Lucas and Lord Crickhowell.
The noble Lord, Lord Hooson, emphasised the campaigns that had taken place to establish the office of Secretary of State. The noble Lord, Lord Crickhowell, made a fascinating and powerful speech in defence of the office of Secretary of State. But what has happened down the road? His leader, Mr. William Hague, has apparently abolished the office already. He has established in Mr. Michael Ancram a constitutional supremo and has
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brought in Mr. Nigel Evans, who is now reduced to the rank of a protester, a supplicant to the Welsh Grand Committee, leading a picket line—
Lord Williams of Mostyn: Of 12.
Lord Elis-Thomas: I am grateful to the Minister. He was leading a picket line in Mold the other day. Are we seriously to believe that the Conservative policy to be canvassed in the referendum when it comes will be to retain the office of Secretary of State when that office does not exist? The Conservative opposition have to have a rethink on this matter. If my contribution to this debate has done nothing else except once again draw out the totally negative attitude of the Conservative Party towards constitutional progress in Wales—
Lord Crickhowell: Is the noble Lord suggesting that he would wish the role of Secretary of State to be abolished? While I can see all kinds of reasons for continuing to develop the system of government in Wales—I took some fairly substantial steps myself when I was Secretary of State—I would robustly defend the continuing existence of a Welsh Secretary, playing the influential role that he can in the government of Britain as a whole and in defending the interests of the Welsh people. I hope that the noble Lord's party is not resiling from that position.
Lord Elis-Thomas: Most certainly not. It is not my party or the parties of other colleagues which are riven with contradiction on the matter. Our position is clear. As long as the United Kingdom is operated as a unitary state, with one central government, without division of powers and without subsidiarity and federalism, there is a continuing case—I am glad to have agreement, as always, from those on the Liberal Benches on these matters because they are the experts on federalism, whatever may be the caricature of their position today—for the offices of Secretary of State for Wales and for Scotland to remain.
As I understand the Government's proposals, the office of Secretary of State as an office of the United Kingdom Government Cabinet cannot be affected in its detail. We are dealing there with a different operation. I see that noble Lords opposite are dissenting. Clearly they want to go back to the days when the Secretary of State determined everything in Wales—either the Secretary of State himself or his officials, totally unaccountable to the people of Wales directly, although accountable to Parliament indirectly through Question Time and so on. They want to remain with that system—in which I again declare an interest because I am part of it: I serve on an NDPB—but that is not an acceptable way of running a country. Indeed, I was often distressed by having Conservative colleagues along the corridor and outside the House referring to me as if I were a justification for the fact that the nominated system worked, because here was a quango chair who was not a Conservative. I am now publicly expressing all this disquiet because there has been a change of government. However, it is important that all of us who have been involved in the present system of operating government in Wales should come out and make it clear that it is not an acceptable way to run a

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modern democratic nation or region of Europe. Therefore, having carefully considered all the detailed arguments which I have heard in the debate, particularly the trenchant advice of my sponsor in the House, the noble Lord, Lord Hooson, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Baroness Gould of Potternewton: I beg to move that the House do now resume. In moving this Motion, perhaps I may suggest that the Committee stage begins again not before 9.10 p.m.
Moved accordingly, and, on Question, Motion agreed to.
House resumed.

Northern Ireland Act 1974 (Interim Period Extension) Order 1997
8.4 p.m.
The Parliamentary Under-Secretary of State, Northern Ireland Office (Lord Dubs)rose to move, That the draft order laid before the House on 17th June be approved [4th Report from the Joint Committee].
The noble Lord said: My Lords, this draft order will extend for a further 12 months the temporary provisions of the Northern Ireland Act 1974 under which the government of Northern Ireland is continued by means of direct rule.
It is with a sense of regret that we do this. It is, of course, necessary because for the moment there are no alternative political structures.
The House will be aware of the Government's commitment to put power back into the hands of the people of the United Kingdom. We intend to do this in Northern Ireland as much as we do elsewhere. Northern Ireland is equally entitled to its share of power and responsibility and we believe that such a move will play an important part in healing the divisions that exist there.
Any devolution of power to Northern Ireland must involve sharing power and responsibility among representatives of the main sections of the community there. It is also recognised that such a development will also address what we refer to as the "totality of relationships" within these islands. We believe a political settlement is possible and we are determined to achieve our goal.
The current multi-party negotiations on the future of Northern Ireland have a further 12 months to run. Those negotiations have made significant beginnings. Rules of procedure have been agreed. The machinery for building a consensus on constitutional issues is there for us to use. The Government are determined that that machinery will be used and used in a way which will result in real progress over the coming months.
As noble Lords will be aware, nine of the 10 elected parties are already in the talks. We want the tenth party, Sinn Fein, to be there also representing its electorate. However, as we have made clear in the other House, the
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political settlement will not wait. It will move on whether or not Sinn Fein is involved. Both in the other House and elsewhere my right honourable friends the Prime Minister and the Secretary of State for Northern Ireland have made plain what Sinn Fein must do to join the talks: an unequivocal restoration of the IRA ceasefire borne out by words and deeds. It is they who must rise to the challenge and take part in the democratic process which will decide the future arrangements for Northern Ireland.
The British and Irish Governments have tabled a joint paper setting out how the complex issue of decommissioning should be taken forward. The participants in the talks know that the Government want to see the matter resolved within weeks. Agreement on the decommissioning issue will also enable us to make substantial progress in the arena of a political settlement.
Progress on the political front will also be directly influenced by outside factors. A successful resolution of the parades issue will help to create the climate for meaningful and constructive discussions. As the Secretary of State has indicated, the problem is one of the competing rights: the right to march and the rights of people to live free of fear from intimidation and insecurity in their own homes. The Secretary of State and her senior officials have already made strenuous efforts to find a resolution to the problem of contentious marches in general and to the situation in Drumcree in particular. They have held numerous meetings with groups on both sides in an attempt to identify the common ground and above all else to urge local accommodation and agreement between marchers and residents, as this is the only equitable long-term solution to this complex and difficult issue.
Last week talks were held at Hillsborough Castle to which the Orange Order and the residents of the Garvaghy Road were invited. While no agreement was reached at these talks, further discussions have taken place and continue to take place with both groups and the Government will make very effort to facilitate a solution which is acceptable to all. We must avoid last year's appalling scenes which cost so much in terms of lives and property and considerably damaged community relations.
Your Lordships will also wish to be aware of other areas where the Government are seeking to discharge our responsibilities in Northern Ireland. The comprehensive spending review is being carried out in Northern Ireland as elsewhere in the United Kingdom. We want to consult all the parties on how best we can meet the needs of the people of Northern Ireland within the budget that is available.
We are also continuing to combat unemployment by getting people off benefit and into work. Unemployment in Northern Ireland is now at its lowest level for 17 years. We are continuing to work, however, to reduce the number of the young and long-term unemployed, the numbers of which remain unacceptable. The House will have heard yesterday of the announcement of my right honourable friend the Chancellor on our comprehensive welfare-to-work strategy which will be funded from the windfall levy on the privatised utilities. Northern Ireland will get its share of that money.

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I would also pay tribute to the recent publication by the Standing Advisory Commission on Human Rights for its comprehensive report on employment equality. The Government will give a full and considered response in due course.
We shall continue to seek to reduce the health service bureaucracy, to improve patient care and to improve education standards in Northern Ireland, as we are seeking to improve them elsewhere in the United Kingdom.
We are convinced that development of the social and economic side of life must proceed alongside our efforts to create peace in Northern Ireland. Economic progress cannot be made where there is fear and violence. Political progress cannot be made against a background of economic difficulty and social deprivation.
To sum up, in the coming year this Government will continue to do all they can to bring about a political settlement which is acceptable to the people of Northern Ireland, to combat terrorism and the threat of terrorism, to help build confidence in the community and to reduce the sources of tension that exists there.
Your Lordships will recognise that this is what is needed, but that it cannot succeed without the support and assistance of all those involved in the political and community life in Northern Ireland. We would in particular encourage all those with influence, on both sides of the community, to bring about a successful resolution to the problems associated with contentious parades. For their part, Her Majesty's Government will spare no effort to ensure that constructive approaches prevail.
In the meantime the structure of direct rule must remain in place. I therefore commend the order to the House. I beg to move.
Moved, That the draft order laid before the House on 17th June be approved [4th Report from the Joint Committee].—(Lord Dubs.)
8.11 p.m.
Lord Molyneaux of Killead: My Lords, I crave the indulgence of your Lordships' House to make my maiden speech. Although I have spent many years at the other end of the building, I realise that I have much to learn. But I am greatly consoled by the warm welcome that has been extended to me in past days and the willingness of many of your Lordships and the officers to improve my education, which, sadly, had been neglected in my earlier years. So much so that when I was first elected in 1970 an aspiring rival candidate said that he was well placed to succeed at an early stage because, to quote his words, "Molyneaux, with his very limited ability, will be only a short-term caretaker". I leave it to your Lordships to decide whether that assessment was correct or not.
It is a particular pleasure to follow the Minister. In the other place we co-operated on many issues although we were not always neighbours for the simple reason that while my party remained static on one Bench the
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same could not be said of the two main parties. General elections had the irritating habit of causing them to switch sides in the Chamber.
Later in the debate we are to hear from the noble Baroness, Lady Denton. So may I be permitted to pay a very sincere tribute to her outstanding services for all the people of Northern Ireland and to assure her that she has many, many friends in the Province.
In a week when the future of democracy in Hong Kong is the subject of much comment, it may be appropriate to focus on democracy within the United Kingdom itself, particularly in regard to Scotland, Wales and Northern Ireland. Your Lordships were addressing Scotland and Wales earlier today.
The order provides for the 22nd annual renewal of what I have always regarded as a flawed system based on the 1974 Act which was designed as a very temporary measure. Novel and dramatic initiatives have been launched at frequent intervals, but their dazzling launches have in a sense been their undoing. The present round began in 1987 with a modest objective to discover—I quote the words of the joint manifesto at that time—
"if there existed a willingness to find an alternative to and a replacement of the Anglo Irish agreement backed up by a reasonable, workable, administration acceptable to the four main parties in Northern Ireland, in line with the 1979 Conservative manifesto commiment to a regional administrative council".
The leader of the Democratic Unionist Party and I met senior civil servants within weeks of the 1987 election. We progressed to discussions with the then Secretary of State, Tom King, and later with the Secretary of State, Peter Brooke, who presided over many useful, informal meetings with the four party leaders. The noble Lord, Lord Alderdice, was in that bracket. Much useful work was achieved at that time by a small working party numbering about 10, again representing the four main parties in Northern Ireland.
All this continued under the noble Lord, Lord Mayhew, to whom I also pay a very sincere tribute for his patience and diligence throughout his term of office. When he became Secretary of State agreement was almost secured but unfortunately the advocates of summitry existing mainly in the news industry hijacked the whole operation and the solid achievements of years were destroyed.
At that point the British and Irish governments concluded that there was urgent need for a meeting of what is called the Anglo-Irish Conference arising from the earlier 1985 agreement, thus effectively terminating in about November 1992 five years of patient endeavour. Within a few weeks something very sinister emerged when it became known, first, to a very few of us and later to a wider public, that agents of the two governments were in contact with the IRA. I say "agents of the two governments" because it was never quite clear—and one cannot be certain—whether the two governments were kept informed of the extent of the content of those contacts. But the result of that revelation was disastrous to confidence throughout the entire Northern Ireland community.

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I explain this because at that point the democratic process was killed off and replaced by an utterly phoney so-called peace process. It is phoney because terrorists will never bring themselves to accept the principle of consent. They will never come to terms with my oft-repeated concept of what I term "the greater number", which I have amplified as consisting of Protestants, Roman Catholics, other faiths and those of no faith who, with varying degrees of enthusiasm, simply want to remain within the United Kingdom. One should add to that nationalists who admit that they are separatists but who have played their part in improving the lot of the people of Northern Ireland and will continue so to do. Those two blocks, amounting to over 80 per cent. of the population of Northern Ireland, are capable of, and willing to, sustain an administration provided it is not pitched at such a high level that the participants are asked on almost a daily basis, "Tell me, to which nation do you want to belong?" The response to that question will always be divisive.
But provided the elected representatives of all those great people (over 80 per cent.) to whom I have referred are not required to engage in a high-wire act mainly for the satisfaction of the news industry and provided they are enabled to redress social ills through sound administrative mechanism, they will acquire confidence and trust in each other and those are the essential building blocks for the future of Northern Ireland. There is no alternative.
When asked if I can see any solution I reply that I can. Allow our people to work together, remove the restrictions, forget about fancy initiatives and, most of all, do not wait for terrorists to lift their veto on that progress which, more than anything, will put them out of business. We are grateful for the clear exposition of the Minister today.
This coming weekend there is another prerequisite for a settled future in Northern Ireland; that is, the necessity calmly to consider the impact of current events on the long-term interests of Ulster and to give absolute priority to draining the lake of bitterness in which the terrorists have been permitted to swim for far too long.
8.21 p.m.
Lord Alderdice: My Lords, I have the honour of rising immediately after the maiden speech of the noble Lord, Lord Molyneaux. It is a considerable honour since it gives me the opportunity to express on my own behalf and on behalf of your Lordships' House congratulations to the noble Lord on an excellent and distinguished maiden speech. It was nothing other than I expected. The noble Lord has occupied a senior position in Northern Ireland politics for as long as I can remember. He has distinguished himself as a public servant in speeches such as the one that noble Lords have just heard—a speech brimming over with his long and deep experience of Northern Ireland politics, its vicissitudes and difficulties. But he is not only a speaker; he is a leader of great distinction. Northern Ireland as a whole, and the Ulster Unionist Party, still finds itself coming to terms with the fact that after at least a generation the
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noble Lord is no longer the leader of that party. That is not something that is easy either for that party or for Northern Ireland to understand and come to terms with.
I came to know the noble Lord during the talks in 1991 and 1992. I always found him courteous and a man of solid integrity. I also frequently found him to be a man of distinct humour. In the long, difficult and frequently discouraging talks that was something that I found extremely welcome. While in political terms he may well be regarded as a political opponent, nevertheless during those years and subsequently I have come to regard him very much as a friend. That cannot always be found in political life. Of course, in those talks we were leading political parties which were opposed to each other. However, a friendship grew up— it could hardly have been otherwise—because of his integrity, experience and fatherly attitude towards someone much younger. Even in the difficult circumstances of Northern Ireland political life the noble Lord, Lord Molyneaux, may have many opponents but I know of no one who regards himself as his enemy. The noble Lord is not one who makes enemies; he makes friends but he may also have opponents. When the noble Lord rises to speak on a matter of this kind he does so with singular experience. While this is his first comment on the order in this House, as a party leader he has risen to speak on it in the other place perhaps more times than anyone else. Therefore, we must listen to what he says with singular respect. It comes from long experience and great effort.
The noble Lord paints for us a difficult picture. He points out, quite rightly, that this was intended as an interim measure. I call to your Lordships' attention the words of my noble friend Lord Donaldson of Kingsbridge who was a Parliamentary Under-Secretary when this measure was introduced in 1974. He said that these temporary and interim arrangements were not in the view of the Government a satisfactory long-term solution. The following year when the measure was being renewed for the first time the view of the Government was that it could only be a temporary means of governing Northern Ireland. "Temporary" has become more permanent than many other permanent devices have turned out to be. One of the great misfortunes surrounding this and some other measures is that the removal of much responsibility from the people of Northern Ireland and their elected representatives has not meant that greater responsibility has been exercised.
In his comments the noble Lord referred to the worrying events that faced us over the next week or two. The Minister also made reference to them. There are those in Northern Ireland on both sides—those involved in leadership positions in the Orange Order and in residents groups—who have been making strenuous efforts to try to find a resolution of this difficult and fraught problem. But there are also those on both sides who continue to spoil for a fight and will continue to make any resolution impossible, defying all the efforts of those in leadership on both sides, the Secretary of State—who has been making great efforts—the Churches and all other people of goodwill who want to see something better for Northern Ireland than that

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which may arise. One can only hope and pray and do all that is possible to ensure that people draw back from the abyss that may well be before them in the coming weeks.
Of crucial importance is that over the next nine to 10 months a way is found of returning a measure of responsibility back to the Northern Ireland people and their elected representatives. It is not that this House and the other place or various governments of the day have not tried to be responsible but that when responsibility is removed from a community for too long it is more difficult for responsible people to make their voice heard and easier for those who are, frankly, irresponsible to find themselves in positions of leadership, albeit leading people astray. I appeal to the Government to be as good as their word so clearly expressed in this House and in the other place, particularly by the Prime Minister, and hope that all efforts will be made to return responsibility to the people of Northern Ireland in so far as that is appropriate and reasonable.
I make one final comment and request of the Government. Following the 1985 agreement one of the allowances, as it were, made to those involved in politics was that subsequent to meetings of the Anglo-Irish Conference party leaders would be briefed by the Secretary of State. As the talks in 1991 and 1992 progressed there were so many meetings with the Government and the Government of the Irish Republic that Anglo-Irish Conference meetings could hardly be fitted in. Therefore, it was not such a necessary matter. But as time has gone on that degree of accountability should not only be made available but be built upon. As Anglo-Irish Conference meetings return—which can be very important—I appeal to the Government that we are acquainted with what has happened and that beforehand the parties are invited to make their contribution not only in terms of their view of the current state of political life in Northern Ireland but in being able to put on to the agenda at those important inter-governmental meetings matters that may be considered by the governments and by the representatives. That is a particularly appropriate request since we are looking at the continuation of almost a quarter of a century of direct rule and to a government that has made it clear that they want to increase accountability. I look forward to the response of the Minister on this matter.
8.29 p.m.
Viscount Brookeborough: My Lords, I too should like to congratulate my noble friend Lord Molyneaux of Killead on his excellent maiden speech. I especially welcome him as a past leader of moderate unionism in Northern Ireland. I am sure that his wisdom will be of great benefit to your Lordships' House. My contribution in the wake of such speeches will be less than adequate, I am afraid.
This is my first opportunity to welcome the Minister personally to the Northern Ireland Office. I look forward very much to hearing what he has to say.
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I do not wish to dwell on terrorism and the events of the marching season, except to say that I wish the new Secretary of State and Ministers the very best in their endeavours to bring peace to our Province in that regard.
We all hope that future all-party talks will produce the basis for political stability and that Northern Ireland may soon be governed in a more democratic manner. At present agreement cannot come about without talks, and talks have been continually thrown off track by terrorism and civil disobedience. We must, however, endeavour to separate the day-to-day governing of the Province from the activities of the minority extremists. Such elements continue for the very reason that they are allowed to have undue influence on affairs. Their aim is to make the Province ungovernable, and the new Government must take another route out of this cul-de-sac.
Democratic government is like a pyramid of society and without a secure base the higher levels will perish. In the Province we have a base in the form of the newly elected councils. However, without the powers that they lost years ago those councils cannot give the support required to sustain any political settlement at a higher level. Most people believe that the councils are now responsible enough to have some of those powers reinstated and to carry out this function of support.
With a new Government in place and with these councils, there is now a window of opportunity that has not existed for some time. Now is the chance to build a basis of democratic accountability at a local level through these councils. It does not need Orders in Council or the agreement of the Government of the Republic to start this process. It requires only the determination of the Government and the Secretary of State to set it in motion.
It is clear to everyone that the inflated support for the extremes in the recent council and general elections came about as a result of the frustration of the electorate, as I said during the debate on Her Majesty's most gracious Speech. I am sure that the traditional constitutional parties would happily go along with that view. However, one individual, John Hume, leader of the SDLP, seems to be a spanner in the works. He, with the support of the Government of the Republic and Sinn Fein (with whom he is far too close) ensures a policy of "nothing is agreed until everything is agreed".
In the real world of politics in Northern Ireland, with the lack of compromise of the extreme elements, this policy has to be a dead-end failure and cannot go forward in such a way. John Hume is full of contradictions, not least in the manner in which he welcomed the Prime Minister's speech in Northern Ireland soon after he took office. He described it as the most comprehensive speech on the subject by a British Prime Minister and welcomed it. However, we know that John Hume, with the Government of the Republic and Sinn Fein, is against any internal settlement.
Another example of his seemingly forked tongue was in the connection with the Prime Minister's proposed statement on Northern Ireland on 19th June. The Irish Times headed its article on 20th June
"Hume may have urged delay of Blair North statement".

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It goes on to say:
"There was speculation at Westminster last night that Mr. Hume might have persuaded Mr. Blair to defer his statement … Mr. Hume could not be contacted about his meeting with Mr. Blair, but close observers had little doubt that he would have sought to persuade the Prime Minister against delivering a statement which was apparently 'very tough' and tantamount to pushing the talks process forward without Sinn Fein while not actually closing the door on the possibility of another ceasefire".
If that is true, it is the ultimate contradiction of his public statement about allowing Sinn Fein into talks.
Many people in the Province, not only those in the Unionist camp, believe that he often works against a settlement. There is a strongly held belief that he wished to see Gerry Adams, rather than his own SDLP candidate, Joe Hendron, win in West Belfast, which he did. John Hume may have been one of the original catalysts for the peace process but I personally wish that the rumour last winter that he was going to opt out of local politics and go to Europe had been correct.
In conclusion, I urge the Secretary of State and the Government to take the bold initiative of increasing democratic accountability at district council level as a first step, even while the main talks continue. I have no hesitation in supporting this renewal.
Lord McConnell: My Lords, I would like to commence by adding to the congratulations that have been offered to the noble Lord, Lord Molyneaux of Killead, on his very fine maiden speech. I have known him for many years and I am quite convinced that he will be a valuable addition to this House.
I also welcome the Minister on his appointment to the Northern Ireland Office. We wish him well and we will do our best to help him along in a difficult job.
I support what the noble Viscount, Lord Brookeborough, said about restoration of democracy to local government. At the moment local government is completely undemocratic. Powers that in the rest of the United Kingdom are carried out by local authorities are in Northern Ireland carried out by civil servants and quangos nominated by the Government. There has been another year of substandard administration which, although said to be temporary, has lasted for 25 years. It is time that government took the initiative and introduced democracy into local government. That measure would not be precluded by the talks going on at the moment. It is independent of the issue of the constitutional framework and is largely an administrative matter, but it would be a great advancement to have a little bit of democracy even in local government.
I deplore the continuing offering of enticements to the IRA/Sinn Fein. I had hoped that this Government would discontinue the kind of appeasement that was carried out by their predecessors for so many years without any success. There is now talk about a ceasefire for six months that has got to be permanent, lasting indefinitely into the future. It goes against common sense to say: "You can keep your arms in the meantime, during the period of the ceasefire". If the ceasefire is permanent and genuine why do they need to keep their arms if they are not going to use them in the future?
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At a recent trial a few days ago of six terrorists who plotted to blow up electricity power stations in the south east of England it was said that preparations for the plot began during the IRA's last ceasefire. That shows how genuine the ceasefire was and casts considerable doubt on any announcement of another ceasefire. It is difficult to see how in six week the Government can be satisfied that the ceasefire is genuine.
The future of Northern Ireland should be decided by genuinely law abiding people of all religions and political parties in Northern Ireland, without interference from the government of the Irish Republic. Recently, their Prime Minister made a speech which was anything but helpful. It would be better if the Ulster people were left to decide their future. Of course, it goes back to the notorious Anglo-Irish agreement. We cannot blame the present Government—it was introduced by the previous government—but it causes a great deal of dissent and ill will. The representatives of that government are bound by their constitution to seek territorial gain in the form of taking over Northern Ireland and incorporating it into the Irish Republic. That is contrary to the principles of the European Union, where one member country is not allowed to have ambitions over the territory of another. But that seems to be conveniently forgotten.
Finally, I wish to hear the Minister comment on the Grand Committee that has been established in another place. I understand that the mechanism has been set up and I shall be interested to know when it will get down to work and become effective.
8.42 p.m.
Lord Cooke of Islandreagh: My Lords, the House does not generally encourage successive speakers to congratulate a maiden speaker, but tonight we have had an exception, in that the noble Lord, Lord Molyneaux, has great experience of the affairs of Northern Ireland. I have no doubt that he will be a great asset to this House and I welcome him most heartily.
No doubt it will seem strange to people at home that I wish to speak in support of an extension of direct rule in Northern Ireland, but in the short term there is no alternative. During 23 years of direct rule under the Northern Ireland Act 1974 the citizens of Northern Ireland have become increasingly disenchanted with this form of democratic government. Northern Ireland is a democratic desert without equal in Europe and probably far beyond.
We are effectively being governed by a self-perpetuating Civil Service, responsible only to the Secretary of State. Members of our hospital and education boards and other quangos are selected by civil servants with a strong input and de facto power of veto by the government of the Republic of Ireland. Only 3 per cent. of public expenditure in Northern Ireland is under the democratic control of local authorities. This situation is not the fault of the Civil Service which, with some exceptions, is staffed by excellent, capable and responsible people. It is as a consequence of this Act and the Northern Ireland Constitution Act 1973 that a department of the Northern Ireland Civil Service is a legal entity and under direct rule it is under the direction and control of the Secretary of State.

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We have a situation where Ministers are appointed to Northern Ireland departments, come over at great personal effort and work very hard. It has been generally assumed that each Minister is responsible for his or her department. However, as the Hayes review has pointed out, the title "Minister" is merely a courtesy title. The role of a Minister in Northern Ireland is not that of a Minister of the department concerned. It is more than a little odd that the duties and responsibilities of a Minister of the department in Northern Ireland is in no way related to that of a Minister in Great Britain.
Throughout the 23 years of direct rule it has been obvious that progress towards democracy should begin by transferring additional duties to local authorities. At present, their duties are almost derisory. The councils have been responsible for library boards and refuse collection but little else. Most local authorities have shown that elected councillors can and do work together for the common good, so why not give them more responsibility? Successive Secretaries of State have been requested to move in that direction and have been pleaded with, but without result. With each year that passes the absence of democratic input into the major departments has become more obvious. Decisions have become more arbitrary and less attention is seemingly paid to the interests and needs of those affected.
It is significant that all the speakers tonight have focused on the absence of local democracy and, so far as I am concerned, there has been no collusion in notes. As was pointed out by the noble Lord, Lord Molyneaux, this is the basic building block of a stable society. One of the difficulties is that we have not had a stable society and the fact that we have not had local democracy has been a contributory factor. There should be no delay and I hope that our new Government will give urgent attention to the matter. They should not consider having to wait until a grand solution may be reached.
Terrorism and civil unrest is uppermost in everyone's mind particularly at the present time. I need not go into the detail of what is to happen in the next few days, which is worrying people, because it has been spoken of already. The feeling everywhere is that we have had to put up with terrorism in Northern Ireland for far too long and that it must be resolved soon. The Prime Minister has understood that and has given Sinn Fein/IRA a last chance to reject violence and to enter talks. He has put a date on the start of the talks with or without Sinn Fein and he has put a date on the end of the talks. Those dates must be kept.
I wonder whether the Government are aware of the worries and fears of the pro-Union majority which, as was pointed out by the noble Lord, Lord Molyneaux, is about 80 per cent? There are fears about what could happen in the coming months. The reason for such fears is that recently Sinn Fein has gained one concession after another and the belief is that more attention is paid to the demands of terrorists than is paid to the rights of law abiding people. Everyone hopes that Sinn Fein will become a democratic party and that the IRA will reject violence for ever. But as yet, Sinn Fein shows no sign that it even understands what democracy is.
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It is generally thought, or people have been led to believe, that talks have only to commence and that once engaged in substantive talks agreement will be reached and all will be well. There is a need for a little realism. Unless Sinn Fein changes its spots entirely, there is no chance that agreement will be reached in all-party talks. Sinn Fein continues to say that its objective is unchanged and will remain unchanged. The first stage of that is to bring about a British withdrawal from Northern Ireland. If Sinn Fein engages in talks it will demand constitutional change, it will demand reorganisation of the RUC in a way which will allow it to control what it claims to be its areas. Unionists will not be able to agree, and the talks will end in deadlock.
The Government then intend to make proposals for a government of Northern Ireland which will be put to a referendum. Here lies the danger. Will the Government, when they are considering plans for the future of Northern Ireland next year, discover that, if Sinn Fein is not satisfied and return to the Armalites, they will be under pressure to perhaps fudge the issue? Will the Government try to split the difference between the opposing parties? Will they go down the route of the framework document and more to wrap it up in a way which they think will get Unionists to accept a referendum which will offer peace at a price or a resumption of violence?
This is not a hypothetical question. The batch of Northern Ireland graduates finishing university last week are making up their minds about their careers. They are asking their parents what is the future of Northern Ireland. If the parents who have spoken to me are typical, these young people want to stay in Northern Ireland but wonder if it makes sense to do so. Parents can do no more than say that they cannot see beyond the end of the talks, which they believe will end in disagreement. This is a tragic situation. I hope that the Government realise that we are time limited and that they will keep to the programme that they have set.
There have been encouraging signs. The Prime Minister's speech in Belfast on 16th May was excellent, straightforward and reassuring. The Secretary of State has spoken plainly and clearly. She has been doing her very best to see that the weekend programme will go well and without violence. The Minister of State's statement in this mornings News Letter was also positive and straightforward.
If the Government can move from statements of intent to achievement of their objectives in the next year of the Northern Ireland Act 1974, we shall have much to thank them for.
8.52 p.m.
Lord Holme of Cheltenham: My Lords, I thank the Minister for the clear and helpful way in which he presented this order and I welcome him from these Benches. He probably realises that he has joined a rather special club. It is an unusual club; it is exclusive, not very numerous and it meets at rather curious times. It has rather ascetic habits—it always meets in the dinner hour—but it makes up in quality what it lacks in quantity.

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That has been very evident this evening, especially in the maiden speech of the noble Lord, Lord Molyneaux. Among his wise words one of the wisest was his tribute to the noble Baroness, Lady Denton. What she managed to achieve in her time working with the former Secretary of State, the noble Lord, Lord Mayhew, was remarkable in moving Northern Ireland from an economy which was over corporatist, over stateist and over dependent on public funds towards a more robust economy, driven by private enterprise and inward investment. She made a major contribution in that respect and, if it is not impertinent from these Benches, I suggest that the Government should try and find some way of making use of her experience in the future.
Just as I think the economy of Northern Ireland needs to move on from paternalism and dependence, so, as many Lords have said, does the politics of Northern Ireland need to move on from the bizarre way in which the Province is governed. We meet at strange times in this House to discuss orders which, for the most part, deal with matters that should be decided in Northern Ireland by the people of Northern Ireland and their elected representatives. This is not healthy for Northern Ireland society. It produces dependence. If people do not grapple with decisions; if they do not have to deal with the bread and butter of politics but are confined to the pulpit of rhetoric, it produces what my noble friend Lord Alderdice referred to as irresponsibility.
In that respect I welcome the remarks of the noble Viscount, Lord Brookeborough, and other noble Lords who referred to the need to start to give back to local government in Northern Ireland some of the powers that local government exercises in other parts of the United Kingdom. But I would make two caveats. The first is that that should not be used as a pretext for doing nothing else. It should not be made a step which is precedent to doing all the other things that need to be done to transform politics in Northern Ireland. The second caveat is that, given the bumpy history of local government in Northern Ireland, that would happen best in a context where rights and mutual reciprocity between the two major communities were better established. But, with those two caveats, I agree wholeheartedly with the need to strengthen local government in Northern Ireland.
As to the current situation—which the Minister will accept is not a happy one—it is right to pay tribute to both the Prime Minister and the Secretary of State for their remarkable efforts since the new Government assumed office in trying to bring about progress, both in the talks and on the question of marches.
Much emphasis has been put on this last-ditch attempt to get Sinn Fein into the talks. The Government could hardly have made the conditions for Sinn Fein's participation clearer. They certainly could not make them any more generous. There is no latitude there; they have gone as far as any government can or should go in terms of trying to persuade Sinn Fein to participate. I hope that is clear and I would welcome the Minister's reassurance when he replies that there can be no teasing out by Sinn Fein of further negotiations, even if it come
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sunder the guise of clarification. Sinn Fein has to make up its mind. I am not optimistic that it will make up its mind.
If it does not it is extremely important that the Government's initiative places extra responsibilities upon the constitutional parties—particularly upon the SDLP and the Ulster Unionist Party—to prove that talks between peaceful constitutional parties can be constructive and can make progress. That duty will be much heavier upon them if the terrorists do not give up their ways of violence and come to the table.
As to the marches and the marching season, the Secretary of State has been tireless but clearly now the situation is not promising. I suspect that the attitude of the Garvaghy Road residents has not been helped by the reported words of the new Taoiseach. I hope that he was misquoted, as he said he was, because this is a time when it is extremely important that the two Governments hold together. I hope that proves to be the case over the coming months.
I have one final word on a subject which the Minister's predecessor the noble Baroness, Lady Denton, heard from me on several occasions, the question of integrated education. Integrated education has a particularly important part to play in the political process in Northern Ireland. Will the Minister assure me in his reply that the Government are committed to doing all they can to promote and finance integrated education in the Province?
I was slightly disconcerted by the words of his colleague in another place, Mr. Worthington, the other day who seemed to imply a rather lukewarm support, where enthusiasm and commitment from the Government would be appropriate and help to advance the progress in the Province for which we all devoutly hope.
8.59 p.m.
Baroness Denton of Wakefield: My Lords, it gives me enormous pleasure to be able to put on record my welcome to your Lordships' House for the noble Lord, Lord Molyneaux. The noble Lord said that he had much to learn. However, I believe that his speech tonight showed that this House has much to learn from him. I thank the noble Lord for his kind remarks; indeed, I value greatly the hands of friendship that were offered to me during my three-and-a-half years in Northern Ireland. I thank, too, the noble Lord, Lord Holme, for his kindness. Nothing gave me greater pleasure than leaving Northern Ireland with more people in work than ever before. That justified every ounce of jet lag that seemed to dominate my life in those years.
However, I must apologise in advance to the noble Lord for the further confusion that we will cause him when we return to the Benches opposite. It is a somewhat unusual situation to stand at this Dispatch Box with one's former Secretary of State sitting behind. Indeed, we all look forward very much to hearing the maiden speech of my noble friend Lord Mayhew in due course. One of the most pleasurable aspects about tonight's debate is the fact that there were more speeches from Members of this House whose homes are

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in Northern Ireland than any others. That is both important and to be praised. Indeed, I hope that it will continue.
It gave me no pleasure to bring forward this order to your Lordships' House in 1995 and 1996. Twenty-three years is a long time for temporary powers, as many other speakers have said. However, I was pleased to hear recently reports of the Minister's speech to local government chief executives in which he said that the Government will be trying to ensure that locally elected representatives are more involved in strategy, planning and participation activities in Northern Ireland. It is difficult, if not impossible, to ask people to be responsible without giving them responsibility.
This is a difficult time in Northern Ireland; indeed, there can be no underestimating that fact. Every remark made now brings a retort and probably a consequence. I shall, therefore, restrict myself to wishing all those involved in trying to ensure a weekend without violence the success that they deserve. In particular, I should like to praise the energy and outstanding efforts made by the Secretary of State in that area and to offer the Government our full support from these Benches for the order.
9.2 p.m.
Lord Dubs: My Lords, I should like to thank all Members of the House for their contributions to the debate and indeed for the support that many speakers gave to the task facing the Government and the statements that we have made. I should like, first, to pay a particular compliment to the noble Lord, Lord Molyneaux, on his maiden speech. The noble Lord and I were in the other place together, although he was there a lot longer than I was. We got to know each other well and I have an enormous respect for his qualities of leadership, for his party and for his enormous knowledge of Northern Ireland, together with the great contribution that he has made to United Kingdom politics as regards Northern Ireland and other issues over many years. It is an enormous pleasure for me to see him in this House. I know that the noble Lord will add significantly to the understanding and knowledge of Northern Ireland held in this House. I genuinely look forward to the many contributions that I expect he will make to debates on Northern Ireland and other issues in the years to come.
Many specific points were made this evening. I shall do my best to deal with as many of them as I possibly can in the time available to me. I shall begin with the speech made by the noble Lord, Lord Alderdice. He made a particular suggestion which I believe to be of interest. I shall draw that suggestion to the attention of my right honourable friend the Secretary of State. I refer to the noble Lord's suggestion about briefings in the context of the intergovernmental conference. I cannot foresee any particular difficulty about resuming the practice which occurred in the past of briefing Northern Ireland party leaders on such meetings. However, we must consider the practicalities of discussing the agenda
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in advance. Nevertheless, I thank the noble Lord for his suggestions. We shall see what we can do to take that particular one further.
The noble Viscount, Lord Brookeborough, offered me his best wishes for which I am grateful. Like other speakers, he referred to the powers of district councils, to which I shall refer later. However, I should like to take issue with the noble Viscount about some of the remarks he made about John Hume. I have known John Hume for some years and I believe that he has a clear commitment to a peaceful and democratic settlement for Northern Ireland. I believe that that is well known to this House. It is also known how hard he works to that objective and I believe that he deserves our full respect in those efforts.
The noble Lord, Lord McConnell, also offered me his support, for which I am grateful. He, too, referred to district councils and, as I said, I shall return to them later. The noble Lord also implied that some enticements were being offered to IRA-Sinn Fein. I would say emphatically that that is not the case. The Government have made their position absolutely clear from the Prime Minister and the Secretary of State onwards. It is a clear commitment: everything is above board. The Prime Minister made it clear that there were initially to be talks between officials and Sinn Fein about the peace process. Those talks have now stopped and I can assure the noble Lord that everything we are doing is open for him and other people to see. Indeed, we are doing nothing in any way behind people's backs and I do not believe that any enticements are being offered to Sinn Fein. We want a fully accountable talks process but only one with parties which are wholly committed to a peaceful and democratic approach. Sinn Fein cannot join the talks without an unequivocal restoration of the IRA ceasefire. That is clear; that is known; and there can be no ambiguity or misunderstanding about it.
The noble Lord, Lord McConnell, also talked about Articles 2 and 3 of the Constitution of the Republic of Ireland. The Irish Government have agreed to put this matter to a referendum in their country in the context of a final settlement in Northern Ireland. The Prime Minister has of course pointed to the benefits which would flow from earlier movement on that issue. That is where the matter stands and again the Government's position is quite clear.
The noble Lord, Lord Cooke, referred to the responsibility of Ministers, and particularly junior Ministers. He suggested that their position was somewhat different from those representing departments for Great Britain. I do not think the noble Lord was right in suggesting that the role of a Minister in the Northern Ireland Office is any different from that of a Minister in a Great Britain department. The fact that powers are given to Secretaries of State in Great Britain and to the departments in Northern Ireland is, I believe, quite irrelevant as the Northern Ireland departments operate under the direction and control of the Secretary of State. In both cases junior ministers have no separate statutory existence but operate with full delegated authority from the relevant Secretary of State.

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The noble Lord, Lord Holme, asked about integrated education and the Government's position on that. Let me say that the Government remain committed to integrated education and will continue to support and facilitate the future development of this sector in partnership with all interested parties. The integrated sector is small in Northern Ireland and of course there have been some disappointments on the path to achieving more integration in schools. Clearly any further expansion of the integrated sector must take into account both demands made by parents for integrated education for their children and the limits imposed by what can be afforded. There is a balance to be struck here, and my noble friend the Minister for education for Northern Ireland will be seeking, in consultation with the Northern Ireland Council for Integrated Education and other interested bodies, how best to achieve this. I think that is about as far as I can probably take it on this occasion, but the commitment on the part of the Government is there, as I have stated it.
The noble Lord, Lord Holme, also mentioned teasing out developments in connection with Sinn Fein. The position is quite clear and the Government have made clear to everybody where we stand regarding the entry of Sinn Fein into the talks. It knows what it has to do and it is up to Sinn Fein to respond if it will, but there is no more discussion or negotiation on offer to it. It has been told what the position is and we await its response. I hope that the response will be positive and that there will be a ceasefire, but we must wait on developments.
Many of your Lordships asked about local government and the powers relating to district councils. I have sympathy with the views that have been expressed by noble Lords, but I am sure it will be appreciated that there are difficulties. We have already moved some way. The noble Baroness, Lady Denton, referred to a speech I made recently to the Society of Local Authority Chief Executives Conference in Belfast on 17th June. I talked there about establishing a framework for helping to develop the existing role of district councils in Northern Ireland. Some of the announcements that I made will need to be worked upon in the coming months.
To summarise some of those matters, I mentioned that the Government were considering how to give councils a power of general competence to allow them to do what they consider appropriate in the interests of districts and their people. That was in our manifesto and we want to give effect to it, but we are considering the details. I should like to strengthen the consultative role of district councils, for example, by the establishment of a planning advisory body to give councillors a role in advising the department on strategic planning policy.
I should like to look at proposals to improve consultation with councils on individual planning applications. There are to be regular ministerial visits to councils to hear their views, and I have committed myself to visiting every one of the district councils in Northern Ireland in the near future. These and other approaches will be there to help to give those who are elected to district councils a more important role and a feeling that they have more oversight of what is happening in their areas and more chance to influence
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it. I appreciate that that may not go as far as some of your Lordships might like, but let me remind the House of this: going further can be achieved only through the medium of political talks. I believe that is the right way forward. Otherwise we might be seen to be pre-empting the talks process by making other decisions. That would not be a proper way of giving the process the right authority to move forward.
We have had a good discussion and a good debate. Of course Northern Ireland is poised particularly for this coming weekend; and we can only hope that sense will prevail. I am grateful to noble Lords who have paid tribute to the enormous efforts my noble friend the Secretary of State has made in seeking to bring the parties together and to get agreement as regards the marches that are to take place. We can only hope that her efforts will be successful in the event. But we all know how critical this coming weekend will be for the people of Northern Ireland.
In conclusion, I believe that if we can establish peace in Northern Ireland, Northern Ireland stands on the brink of enormous economic success. I believe that Northern Ireland would take off economically and show economic growth as fast as any other part of the European Union. There is an awful lot at stake. I believe that the majority of the people of Northern Ireland fully understand that and are desperately anxious for peace.
I again thank noble Lords who contributed to the debate for their comments. I believe that I have dealt with all the points of detail. I understand the reservations about the measure. The structure of direct rule must remain in place. I therefore commend the order to the House.
On Question, Motion agreed to.

Referendums (Scotland and Wales) Bill
9.15 p.m.
House again in Committee on Clause 2.
Lord Crickhowell Lord Crickhowell moved Amendment No. 29:
Page 2, line 6, at end insert ("as set out in a White Paper to he published and debated by each House of Parliament not less than six weeks before such a referendum").
The noble Lord said: The amendment covers two important points. We have dealt with one in some detail and touched on the other. The Bill refers to the establishment of a totally undefined Welsh assembly. An assembly might do almost anything, or nothing. Nothing in the Bill states what the powers and responsibilities, the limitations, of the assembly might be. Everyone—Ministers as much as those on this side of the Chamber—acknowledges, that the White Paper will be of fundamental importance. The contents of the White Paper will guide the electorate. The electorate will be asked its opinion about the contents of the White Paper. Without the detail contained in the White Paper, it is not in a position to express an opinion.
On 1st March 1979 we debated the contents of a Bill which had already passed through Parliament in which the responsibilities of the proposed assembly were not

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only set out in legislation but in legislation which had been the subject of almost endless debate and examination. Everyone knew exactly and precisely what they were being asked to vote about.
What worries me is that the present Bill gives no real indication of what the electorate is being asked to vote about. I fear also as to what will happen subsequently. If we simply have a vote which refers to an assembly without reference to the crucial White Paper, there is nothing to stop the Government subsequently coming forward with a set of wholly different proposals, saying that Parliament must support them because the Welsh people have expressed a wish to have an assembly. The fact that the assembly may bear no resemblance to the White Paper is not a matter to which we could respond. First, there must be reference to the White Paper in the Bill if we are to impose any limitation and discipline. Secondly, we must have adequate time in Parliament to debate the White Paper, and then to discuss it and present it to the people.
I tried to refresh my rapidly failing memory about some of the debates that took place last time. I dug up Hansard and was interested to see (for those who think that we are taking excessive time on proceedings this time) that we spent more than three hours debating a Bill put forward by Mr. Geraint Howells (as he then was) on the timing of the referendum, and the amount of time there would be for debate before the referendum was held. It cannot be said that that was a filibuster by the Conservatives, because Mr. Wyn Roberts, as he then was, and I were criticised for not taking part at all in the debate, which was held between the Labour Party, the Liberals and Plaid Cymru.
A major speech in the debate was made by Mr. Gwynfor Evans, who was then the Member for Carmarthen. The bulk of his speech was devoted to the need to have adequate time for the referendum to be held. He argued that people do not easily grasp these constitutional issues, which are very complicated. He said that if an appeal is to be made to reason, time must be given for people to understand it, and the arguments must be set out clearly and often. The Bill should therefore give enough time. He suggested that the amendment under debate did give enough time; although it would not extend the length of time interminably, it would provide enough time for people to understand the arguments and for those arguments to be set out and debated not only in the press but in all the media. The noble Lord, Lord Elis-Thomas, in an earlier guise, took part in that debate and supported the general argument advanced by Mr. Gwynfor Evans.
So I hope that there is agreement in all parts of the Committee that there must be adequate time to debate the issue in Parliament and to present it to the electorate. This amendment merely seeks to ensure that there will be adequate time, and that sufficient detail will be contained to enable the electorate to take an informed decision. I beg to move.
Lord Lucas: In lending support to my noble friend's amendment, I am not in the strong position I should like to he in, since I find myself facing the wrong
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Lord Williams. At about this same time last year, I had the great pleasure of helping to take through two housing Bills. Opposite me was the noble Lord, Lord Williams of Elvel. When we came to amendments such as this, proposed by him or his colleagues and full of evident good sense, I might have been under some restriction from my briefing but one way and another we contrived over the period of the Bills' passage to reach agreement. I believe that on both Bills over 100 amendments that were accepted by the Government were either directly proposed by the noble Lord, Lord Williams, or were attributable to amendments that had been proposed by him.
I hope that some of the cousinly virtues of the noble Lord, Lord Williams of Elvel, will rub off on the noble Lord, Lord Williams of Mostyn, and that he will feel able to look favourably on this amendment. I understand that it bears a great resemblance to one that we discussed only a couple of days ago. It may be that the noble Lord is not able to move a great way on this occasion.
Surely the two propositions embodied in this amendment work very much together. If the White Paper is to be taken seriously—if we are to be asked when we come to the Bill to pay attention to the contents of the White Paper, to treat it with great seriousness, to be extremely judicious in proposing any moves away from the principles set out in the White Paper; if we are to accord it approval in a referendum, to accord it that degree of importance—then the Welsh people must be given a decent length of time in which to examine it. The period proposed is six weeks, and four of those weeks are likely to be in August. How can anyone argue that that period should be any shorter?
Lord Mackie of Benshie: I have listened ad nauseam to this argument. The fact is that in Scotland the debate has been going on for years. And we have heard evidence that the debate has been going on in Wales. The noble Lord, Lord Crickhowell, said that it was fierce and savage in the last referendum. He was, of course, satisfied with the outcome.
General elections are normally held over a period of three weeks. In this case the White Paper should be presented quite soon. It is nonsense to talk of a period of six weeks. The issue has been debated in Scotland. It is known that the constitutional convention has already announced that papers are available. There is no question: the sooner we have the White Paper and the debate, the better. To try to lay down a period of six weeks is surely excessive.
Lord Tebbit: I hope that I shall be forgiven, as an Englishman through and through, for intruding into these matters which are often portrayed as being of concern only to the Welsh and Scots. However, anything which affects the constitution of this kingdom is of interest to all its citizens. I take the view that I have some feelings, particularly towards Wales, having spent some of my childhood there and having taken an interest in its affairs for many years.
I have to ask, not least of the noble Lord, Lord Mackie: what on earth is the haste? Why must these matters be decided in such a helter-skelter fashion?

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If we are to have an assembly in Wales or a parliament in Scotland, is it of any great import whether the assembly or parliament is established this October, next October or the October after? Surely these issues can be given mature consideration.
The noble Lord says that all these matters were decided at the time of the general election. It is difficult to pick out from a general election campaign just which items in a party's manifesto carried it through to victory. I suspect that the concept of devolution is more popular—for many reasons, which we all understand— in Scotland than it is in Wales. The noble Lord, Lord Thomas, said that one of the problems about the Welsh issue is that Welsh people prefer to read newspapers which are published in London and prefer to watch television programmes which are produced in England rather than read newspapers and watch programmes produced in Wales. Maybe that tells us something about all the issues. I would not want to argue the point too strongly. I just put it to the noble Lord so that he may take it into consideration.
What is clear is that the tactics being pursued by the Government show that they have learnt something from past experience. Of course, the experience of the last time the issues were put before the electorates of Wales and Scotland is that the more people knew about the details of the proposals, the less attractive they became. Of course, it is enormously attractive to say in general terms that the people of Scotland or Wales should have more say over their own affairs. Sometimes it is quite attractive to the people of England to take that view. I have been cursed for much of my life to have been ruled by Labour governments which have been imposed not by the people of England but by the people of Scotland and Wales. So I can understand that view. But I believe that in a united kingdom we take the rough with the smooth. Fortunately, for the past 18 years we have had more smooth than rough and maybe that is about to change now.
However, why is there this unseemly rush? Why is it that when we say to the Government, "When is the White Paper going to be published?", they regard it as though we are asking them for the key to the codes which allow the firing of Trident missiles? It is something which has to be hugged, in the interests of national security, close to their chests. If we say to them, "What is a reasonable time for this debate to take place, for these campaigns to be organised and these issues to be discussed?", they say, "reasonable". You ask, "Six weeks, eight weeks?". Their reply, essentially, is, "That is difficult to say. Enough is enough." I can understand that. When I was a Minister I often thought about debates—enough is enough. I ask the Government to think back just a little to the time when they were in opposition and indeed to think forward a little to the time when they will next be in opposition. They are making some rods for their own back.
It seems to me that it would be very easy to present the issues to the people of Scotland and of Wales—we are discussing the Welsh case at this point—in very easy terms. Have more control over your affairs; this is a cost-free option; the proposition has nothing but an upside; there is no downside. It sounds very glib and
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very easy. The White Paper may be very glib and very easy. But it is essential that we give time out in the country—for there will not be any time given before the referendum in Parliament—for these issues to be discussed in detail. Precisely what are the proposals? How will they affect Wales? How will they affect the United Kingdom? A Welshman is not only a citizen of Wales; he is a citizen of this kingdom. Why is there such unseemly haste? Why cannot we be assured tonight that there will be an adequate time for these matters to be decided?
After all, if the Government's case is good, it can only get better with discussion. It seems to me that whenever one encounters the slick salesman of a shoddy insurance policy or a second-hand car that is bent, the one thing he will say to his prospective customer is, "You must make a decision quickly. Do not give yourself time for adequate thought. Sign up now." That is the proposition which is put to us by Her Majesty's Government this evening.
It seems to me that it is not only in the interests of those to whom the proposition is being sold but in the best interests of those who are selling the proposition that there should be adequate time for it to be discussed and debated. I suspect that in the speeches of Labour candidates during the general election campaign in both Scotland and Wales there was more time given to the issue of sleaze or health service funding than there ever was to the question of devolution. The Government should now have the decency, the honour and the courage to admit that adequate time should be given to debates on these matters in the country at large. They should accept with good grace the amendment proposed by my noble friend Lord Crickhowell.
9.30 p.m.
Lord Simon of Glaisdale: I intervene to say only that it is utterly unreal to treat three or four weeks in August as though they were the same as three or four weeks in October. Three weeks in the holiday period when we are considering a major issue of constitutional import is not the same as three weeks outside the holiday period. I am, on balance, a supporter of devolution but I respectfully pray Ministers not to ask us to live in Cloud-cuckoo-land, as though time in August were exactly the same as time in October.
Viscount St. Davids: I believe this amendment to be unnecessary. The Government's stated objective is to bring about devolution in Wales. They have proved that by their pre-election rhetoric, by their election manifesto and by the high priority they have given the matter in their first year of Parliament.
The Government know full well that at the moment it is touch and go in Wales if they wish to achieve a "yes" vote in the referendum. They know that if they do not give sufficient time for the matter to be debated they will not carry the day. We do not need to put time limits on them; they have done that themselves.
Lady Saltoun of Abernethy: I agree with my noble and learned friend Lord Simon of Glaisdale and the noble Lord, Lord Tebbit. More time is needed. This

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referendum concerns something infinitely more important than a general election. A general election is merely about what the Government will be for the next five years. The referendum is about what is proposed will be the form of government—a constitutional change—which it is hoped will endure for a great deal longer than five years. To cut short the time—in a holiday period at that—that people will have to consider how they will vote is simply not good enough.
Lord Sanderson of Bowden: I had not intended to intervene, but listening to what the noble Lord, Lord Mackie of Benshie, said—I agree with him on many matters—I felt that he was a little bit at sea on this matter. Of course the subject of devolution in Scotland has been debated ad nauseam over the years. But we are dealing with a new form of referendum—a referendum that is coming before the Bill which is going to implement whatever the government of the day wish to take place.
It is only right, if we are to have a pre-Bill referendum, that time should be given so that people understand exactly what is happening. I am sure that, if we have a "yes" vote, the debate will go on during the whole of next year and at the end of that time people's minds may well have changed—I hope for the better.
Lord Mackie of Benshie: The noble Lord referred to me, so perhaps I may respond. I enjoyed the debate; it was not ad nauseam to me.
Lord Williams of Mostyn: The preamble to the propositions, as is seen in the schedule to be printed at the top of the ballot papers, makes clear reference to the Government's proposals. The proposals that the Government rely upon and offer will be set out in the White Papers. To that extent the amendment is not required.
I come to something which may be more at the heart of the noble Lord's amendment. The purpose, as he indicated and as was underlined by the noble Lord, Lord Tebbit, is to provide sufficient time for the people in Wales adequately to examine the proposals contained. I do not believe that the Government are being unduly hasty; they are delivering on an election promise.
There is nothing between us that it is appropriate that there should be sufficient time for consultation, for argument, for public discussion. We have said several times that we intend to ensure that there is ample time for informed reflection on the part of those who will vote on the proposals. The Lord Privy Seal told your Lordships a long time ago that there would be a debate on the White Papers in this Chamber before the Recess. repeat that.
I tried to make clear at Second Reading that there would be sufficient time for debate and for reflection. I am not in a position to give an absolute guarantee on the exact period that there will he between publication of the White Papers and the referendums. I do not intend to promise what I cannot deliver. However, I wish to go as far as I can tonight and, in the hope that the Committee will find it acceptable, I do it in this way.
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I very much hope that there will be a period of about six weeks between publication of the White Papers and the referendums. It may be a little more than that; it may be a little less. I hope the Committee will accept my assurance that our intentions are clear—to ensure adequate time for debate. There is a range of views, as we heard on an earlier occasion, on what length of time would be adequate. My own view, which I repeat— I hope in a spirit of attempting to be helpful; after all, it is getting late—is that about six weeks would be adequate. That is what we are looking at.
My noble friend Lord Sewel has given an undertaking several times—on different occasions, on different amendments—that we will come back at Report stage with specific dates for the publication of the White Papers and the referendums. The period between those dates at that time—the subject of the undertaking my noble friend gave—will be absolutely clear. If at that time noble Lords are still unhappy about the period, they can of course revert to this point. I hope your Lordships would think that a proper way—perhaps the better way—to proceed in our present circumstances.
Lord Mackay of Ardbrecknish: Before the noble Lord sits down and my noble friend answers, I rather assume that his welcome statement and assurance covers Scotland as well. I have made that assumption. The amendment refers only to Wales. I should be grateful if the noble Lord could clarify that.
Lord Williams of Mostyn: That is so. I am obliged to the noble Lord for his question. I have tried to respond, I hope in a spirit which meets his earlier observation and indeed the observations made by the noble Lord, Lord Gray. I hope I have been helpful.
Lord Tebbit: The noble Lord said that in his view a period of six weeks would be adequate. Can I tempt him to say whether a period of less than six weeks would be inadequate?
Lord Williams of Mostyn: In the next two or three years, possibly, fox hunting will be outlawed. This fox is not going to get into that hound's jaws.
Lord Crickhowell: I am grateful to the noble Lord, Lord Williams, for giving what I think was a helpful reply. Clearly, we shall have to wait to see what happens later when the White Papers appear and we hear what is said on Report. At that stage we shall need to consider again rather carefully the important point made by the noble and learned Lord, Lord Simon of Glaisdale.
My noble friend who intervened so enthusiastically for this legislation should know better than most. because he lives in Pembrokeshire, that a campaign fought in that constituency in August almost entirely addresses the people of England and not the local people. I used to find the greatest possible difficulty with summer elections because everyone I enthusiastically approached and solicited a vote from turned out to be a visitor from England. All my constituents were much too busy running the B&Bs and the other entertainments for the visitors to think about

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the campaign. I shall certainly withdraw the amendment but we shall need to ensure that we are not landed with the whole of the campaign in August. Having said that, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 30 to 40 not moved.]
Clause 2, as amended, agreed to.
[Amendments Nos. 41 and 42 not moved.]
9.45 p.m.
Lord Crickhowell Lord Crickhowell moved Amendment No. 42A:
After Clause 2, insert the following new clause—

UNDUE INFLUENCE
(" .—(1) A person shall be guilty of a corrupt practice if he is guilty of undue influence.
(2) A person shall be guilty of undue influence—

(a) if he directly or indirectly, by himself or by other persons on his behalf, makes use of or threatens to make use of any temporal or spiritual injury, damage, harm or loss upon or against any person in order to compel any person to vote or refrain from voting, or to campaign or refrain from campaigning in the referendums;

(b) if by any duress or contrivance or threat of loss or rights or privileges, or by any attempt by duress, contrivance or threat he prevents the carrying on of the normal and legitimate activities of any person in order to induce or prevail upon an elector to vote or refrain from voting, or any person to campaign or refrain from campaigning in the referendums.").

The noble Lord said: Those who are familiar with the Representation of the People Act 1983 will instantly recognise that I have borrowed a good deal of this amendment from that legislation. I am prompted to do so by the extraordinary things which have been happening in another place and the vigorous argument that has been going on both in another place and outside, between the right honourable Ron Davies, the Secretary of State, and Mr. Llew Smith and his special adviser.
Like the noble Lord, Lord Elis-Thomas, I rely of course on the Western Mail for a great deal of the information that I have on such matters. I am sure that when that newspaper puts words in quotation marks it does so with due care and attention. On 24th June it reported that Mr. Smith had told the Western Mail, speaking about the Welsh Secretary,
"He said to me if you campaign against a Welsh Assembly you will be kicked out of the Parliamentary Labour Party and if any other party member should follow your lead, they will be expelled from the party too".
He also said that after the Labour victory on 1st May Mr. Davies's special adviser, Huw Roberts, had phoned him with the same story. He said that if he behaved in that way he would be disciplined.
Later, after the parliamentary Whitsun Recess, Mr. Smith said that his constituency's local council, Blaenau Gwent, had been told on the phone by Mr. Roberts that if Mr. Smith campaigned against an assembly and was the subject of disciplinary action, it would be difficult for Ministers to meet the council with him in attendance.
These assertions were immediately denied by the Secretary of State. Both these people are Members of another House and therefore by definition are
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honourable Members. I do not wish to get involved in any examination of their probity and honesty except to say that clearly there was a pretty profound disagreement between them, which has been reported day after day in the press and has been referred to both in Parliament and in the Welsh Grand Committee.
On 25th June we were informed that Mr. Smith, described by the Western Mail as,
"Labour's arch anti-devolutionist in Wales",
said that Mr. Roberts, who is the special adviser, had contacted his local council saying that the Welsh Office's relationship with the authority might be adversely affected if Mr. Smith actively campaigned against a Welsh assembly. That is a claim vehemently denied by Mr. Davies.
The Secretary of State said that there is no question of threats. He said that if people hold strongly individual views then they had to be free to express them. He then went on to say,
"It is one thing to be tolerant of strongly held personal views, it is quite another matter if individuals wish to flout the election manifesto on which they were elected, to show disloyalty to the Government which they were elected to support, and to campaign publicly against the Labour Party, allying themselves with the Conservative Party in a public referendum. He said that if Labour members failed to toe the party line, then the PLP would have to look at what action was available to it".
I suppose that that is not a threat or, if it is, it is the kind of threat that the Mafia is inclined to deliver to people as they gently sidle up alongside them and say, "We are not going to do anything to you—well, not unless…". Clearly, Mr. Smith continued to think that it was a threat because the argument went on. We were then told by Mr. Roberts, who was the individual who had telephoned the local authority,
"I simply said to Mr. Assinder"—
who is the representative of the local authority—
"that if Llew insisted on making himself effectively the Opposition it would be best for the council to meet Ron (Davies) without him".
I suppose that that is not a threat either, but it is a pretty disreputable tactic.
The saga carries on. The matter was reported on 27th June and subsequently. Then we were suddenly told that the Prime Minister had said that there would be no question of expulsion and that people would be allowed to campaign. We also had a very welcome Statement from the Speaker of the House of Commons who in the great tradition of Speakers of the House of Commons had something very important to say about the principle that freedom of speech was one of the most cherished parliamentary privileges of a democracy and she was determined to defend it.
One of the difficulties is that, while the Speaker is in a position to control what happens in another place it is uncertain whether she can control the growing army of special advisers who appear to act as Ministers' messengers in a most remarkable way. During my time at the Welsh Office I had one special adviser. He did a certain amount of valuable research for me. It never occurred to me to send him out to local authorities to

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convey messages about what the Secretary of State might do or think or what he might inflict upon them if they did not toe the line.
This is a very important matter. In the past year or so there has been a great deal of debate, as my noble friend Lord Tebbit has reminded the Committee, about sleaze. I am the first to condemn in the strongest possible terms any form of financial corruption or sleaze in parliamentary life. However, I believe that if there is a worse offence than financial corruption and sleaze it is political corruption and sleaze. It is quite clear that here pressure has been applied in the past. We are running into a referendum campaign at a time when threats have been uttered, and there is still a possibility that similar threats will inhibit public debate.
I believe that there is now agreement on all sides of the House that open and free debate on these issues is absolutely vital if there is to be a proper referendum and decision by the electorate. It means that we must have an assurance about the way in which that election is conducted. The Representation of the People Act was not passed essentially to deal with referendums. It deals in very precise detail with the situation of parliamentary candidates but does not cover in anything like the same detail the holding and proper conduct of referendums. I do not believe that that situation can be allowed to continue.
I repeat that we are dealing with two individuals who are honourable Members of an honourable House. However, we are entering a campaign in which many others will be involved—some will be special advisers, but there will be others who will be campaigning—who will not be subject to the constraints imposed in a parliamentary election by the Representation of the People Act. I put it to noble Lords that a measure of protection needs to be introduced. I am not a lawyer. It may well be that my attempt to amend a particular provision in the Representation of the People Act, which was drafted for another purpose, has imperfections.
I hope that the noble Lord opposite, who is a distinguished lawyer, will not say in reply that this is simply imperfect drafting, because I can think of no one better qualified to redraft it so that it does what I want it to do. Therefore, if the noble Lord has any doubts about the drafting, I hope that he will redraft it to provide the simple protection that I seek for an uninhibited debate in which no one on either side of the argument feels that they are under threat from any quarter. I beg to move.
Lord Mackay of Drumadoon: I should like to offer a few words of support to the amendment moved by my noble friend. In the draft orders reference is made to Section 115 of the Representation of the People Act. Under that provision it is an offence to threaten to withdraw the whip from an MP who has voted in a referendum contrary to the policy of his own party or to threaten to withdraw party membership from any individual who voted in a way that was contrary to the policy of the party, because that would amount to a threat to inflict some form of temporal injury, damage, harm or loss upon any such MP or individual.
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My noble friend's amendment takes the matter one stage further, to the issue of campaigning. Without repeating my noble friend's comments, clearly in Wales there is a difference of view between different members of the Labour Party about the approach to be adopted to the referendum. In Scotland, within individual parties there is also a difference of view as to the approach that should be taken. As the noble Lord said, I know more about that because we have been happy to discuss it in public, unlike the private communings which seem to be a speciality of the party that is now in power.
As the noble Lord, Lord Sewel, will be aware, at the conference held by the Scottish Conservative Unionist Party recently, it was recognised that some members may take a contrary view to that of the majority of the party. While the party committed itself to offering support to a broad based referendum campaign against the Government's proposals, it recognised the right of individual members of the party to campaign to a different effect; and I fully expect that they will do so.
I will not venture to investigate whether members of the Scottish Liberal Democratic Party may take different views lest I join the increasing number of noble Lords meriting some form of rebuke from the noble Lord, Lord Mackie. It is well recognised that the Scottish National Party has conducted a serious debate within the party as to whether to support the Government's proposals. The Member for Linlithgow, formerly West Lothian, has demonstrated that there is not unanimity of view in the Scottish Labour Party.
I seriously suggest that, if all parties recognised that there is a room for difference of view within their own party on the issues in the referendum, we would have a healthier debate about the merits or otherwise of the Government's proposal than if we impose some form of party discipline. If party discipline is imposed on individual party members, whether or not they are members of Parliament, and they are precluded from campaigning contrary to the policy of the individual party, members of the press will spend hours, and acres of newspaper print, seeking to expose such rifts within parties. They will try to identify the dissidents and to get them to say something contrary to the party line, and they will then go to the party managers asking what they are going to do about the situation.
If, on the other hand, it is recognised that there should be freedom of speech within parties about important issues to be encapsulated in the White Paper, the debate will be healthier and the people will be better informed. Furthermore, if the Government obtain the votes that they seek in the referendums they may be able to claim that they offer greater legitimacy to the proposals than if the campaign were in some way inhibited. There may be some technical imperfections in the amendment tabled by my noble friend. I do not concede that that is necessarily so, but the spirit of what he is about is commendable and for that reason I support his amendment.
10 p.m.
Earl Russell: I wonder whether the Minister can help me in his reply. The wording of the amendment is general. If it were to be carried, would its effect be to free members of the Shadow Cabinet to campaign in favour of devolution without fear of dismissal?
Lord Williams of Mostyn: I certainly shall help the noble Earl, but in a moment or two if I may. Perhaps I may remind the noble Lord, Lord Crickhowell, of the replies given by my right honourable friend the Prime Minister in another place on 25th June and again yesterday. He said that no one had been threatened with expulsion from the Labour Party simply for expressing an opinion. Neither had the Government suggested to any council that relations with them would be damaged if their local Member of Parliament campaigned against a Yes vote. Everyone in the House and in another place was free to speak his mind on policy matters. There was no question of any undue influence being exerted on any Member of Parliament.
As I read the law, the noble and learned Lord, Lord Mackay of Drumadoon, correctly referred to the draft orders in council which have been made available to your Lordships and which apply Sections 113 to 115 of the Representation of the People Act 1983. That deals with bribery, treating and undue influence on persons to persuade them to vote or refrain from voting. Therefore, the amendment is not necessary because this is a referendum as opposed to a general or other kind of election. However, it attempts to widen the law to bring about undue influence to cause a person to campaign or to refrain from campaigning.
I have just read the amendment, which states:
"A person shall be guilty of a corrupt practice if he is guilty of undue influence".
"Undue influence" is thereafter defined. However, most criminal offences that I know of carry penalties, although the noble Lord the Lord Advocate may have a different experience. What is the penalty here? Is it the mark of Cain or the brand of Tebbit? I do not know. In answer to the noble Earl's question, it seems to me that the amendment is so widely drawn that it would cover any dissent of any kind. I am intrigued to see that,
"Any duress or contrivance or threat of loss or rights or privileges",
to induce someone to campaign or not to campaign will be an offence. Any spiritual injury will be an offence.
I must not tease unduly, but the noble Lord, Lord Crickhowell, asked for my advice and assistance in redrafting the amendment. It is well known that any member of the Bar who gives free legal advice is automatically disbarred and therefore I must not fall into that trap! I recognise that there is a serious purpose behind the amendment. I do not dismiss that serious purpose but simply suggest as gently as I can that this is not the way to bring it about. It is not necessary. In fact, if it were to be extended to general elections, a number of names offer themselves who might at various times have been subject to pressure one way or another, possibly even on European matters.
Lord Tebbit: The noble Lord tempts me. Not only have I been subject to pressure I have exercised
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pressure—but not undue pressure, of course. I was intrigued as the Minister quoted the words of the Prime Minister about the immunity of Labour Members of Parliament in the other place from pressure in relation to which way they vote. But he said nothing about immunity from pressure in relation to which way they might campaign. Will the Minister give an assurance about the mind, the mood, and even the guarantees that the Prime Minister has offered in that respect? After all, the vote is only one vote but the influence of a Member of Parliament when he is campaigning may be worth far more.
Lord Williams of Mostyn: I did say that there is no question of any undue influence being exerted on any Member of Parliament. Any Member of this House or the other place is free to speak his mind on policy matters. I cannot make it plainer than that. I must say that I was very surprised, disappointed—almost shocked—to hear what the noble Lord, Lord Tebbit, said about his past convictions.
Lord Crickhowell: I noted carefully what the Minister said and his quotation of the Prime Minister, who said that there was nothing improper happening at all. I also noted that Mr. Llew Smith insisted that he was not withdrawing his accusations but that, in view of the assurances that he had been given that he was not going to be thrown out of the party he was not going to press them for the time being. So there is a nice stand-off here and long may it continue.
The Minister quoted a number of phrases from my amendment and criticised some of them. I was amused because almost all of the ones that he criticised were the ones that I had not amended at all but were lifted straight out of the Representation of the People Act which already imposes criminal offences. One would have to look further, if the amendment is passed, into what the penalties should be. I have not taken it that far.
We will have to wait over the coming weeks and see whether there is a relaxation; whether Members of another place, those who represent them in the country and the individual members of political parties do feel free and appear free to campaign openly and join in campaigns.
In view of what the Minister said, I intend for the time being to await events and watch very carefully what happens next. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 3 [Referendums supplementary]
Lord Mackay of Ardbrecknish Lord Mackay of Ardbrecknish moved Amendment No. 43:
Page 2, line 27, leave out subsection (1) and insert—
("(1) The referendums shall be conducted according to the provisions set out in Schedule (Conduct of referendum in Scotland) and Schedule (Conduct of referendum in Wales).").
The noble Lord said: This amendment would have been the subject of a long speech if it had been moved earlier in the day, but I can now be extremely brief. The subject of these two schedules is the two draft orders which accompany the Bill. They are considerable and they advance my argument that we should be dealing with a

403
referendums Act if we are to have a number of referendums and not with a piecemeal adaptation of the Representation of the People Act. Although I put my argument in that shorthand way, it in no way diminishes the strength of my feeling that we ought to be doing this properly. However, we are not doing it properly; we are doing it this way.
My second reason—again in shorthand—is that, having listened to the noble Earl, Lord Russell, on a number of occasions talk about the superiority of primary legislation over secondary legislation, when the draft orders are already available we should at least consider putting them into primary legislation.
The third and perhaps most important reason is that if we do not act in that way the House will have to sit well into August. That would be very unkind on those Labour Members of the other place who have school children in Scotland who go back to school quite early in August. I am thinking about them in a way that the Government do not.
The way to overcome the problem, to be tidy and to show that the Opposition do not wish to hinder the passage of the Bill is to incorporate these two draft orders into the schedules in the way I have suggested. I beg to move.
Lord Sewel: I have listened to the remarks made by the noble Lord, Lord Mackay, and have reflected long and hard upon the wisdom of his case. The noble Lord is concerned about groups of people—that is, those who perhaps have angling holidays at a particular time of the year. I, too, wish also to protect their interests. At this stage of the proceedings and in the spirit of concord and co-operation which has marked our debates today, perhaps I may confirm that the Government are certainly prepared to accept the amendment in principle. I give the Committee an undertaking that I will bring forward suitable amendments on Report because there are some technical difficulties involved.
Lord Mackay of Ardbrecknish: I am extremely grateful to the Minister for that response. Of course, I appreciate that there will be some technical difficulties; indeed, there were one or two gaps in the draft order which I am afraid I completed in a rather arbitrary fashion.
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Therefore I can appreciate that the Government may want to fill them in a more serious way or with an eye to the dates of the referendums which they know and I do not. I should tell the Minister that I do not actually have any fishing engagements during the first week of August. However, if anyone wants to ask me, I am always free. In this very satisfying way of concluding today's sitting of the Committee, I should add that I am most grateful to the Minister. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
The Earl of Balfour The Earl of Balfour moved Amendment No. 44:
Page 2, line 32, leave out subsection (2).
The noble Earl said: I tabled the amendment to give me the opportunity to ask a certain question. The voters' roll is made up in Scotland in October of each year. I have no doubt that the voters' roll will have been brought up to date to some extent for the election in May. However, from what I can gather, the Government's referendum will take place before the voters' roll will be adjusted. I have in mind in particular the last few words contained in Clause 3(2), namely,
"alterations made after a specified date in a register of electors to be disregarded".
I am concerned about those words and can only hope that not too many people will be disregarded because of that sort of fault. I beg to move.
Lord Williams of Mostyn: The noble Earl has raised a point of some interest. As I know that he has difficulties which may prevent him from being here on Monday next, perhaps the better course would be for me to write to him directly in an effort to set his mind at rest.
The Earl of Balfour: I am much obliged to the Minister and beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Baroness Gould of Potternewton: I beg to move that the House do now resume.
Moved accordingly, and, on Question, Motion agreed to.
House resumed.
House adjourned at thirteen minutes past ten o'clock.

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