Sitting of 16 July 1997

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

Rural Policies
Motion made, and Question proposed, That this House do now adjourn.—[Mr. Betts.]
9.34 am
Mr. Richard Spring: I am most grateful to you, Madam Speaker, for giving me the opportunity to introduce the debate. I am grateful also to the Under-Secretary of State for the Environment, Transport and the Regions, the hon. Member for Wallasey (Angela Eagle), for being in her place to reply on behalf of the Government. It shows the real concern that so many hon. Members have for the future of rural areas that so many are in the Chamber this morning.
On 9 February 1996, in a joint letter to The Times, the then Prime Minister, the Leader of the Opposition and the leader of the Liberal Democrats wrote as follows:
"On one subject we speak with a united voice—namely in advocating the protection of our countryside in its rich personality and character."
Regrettably, less than 18 months after that optimistic letter was written, that consensus is falling apart.
Only last week, more than 100,000 people came to Hyde park because they believe that the rural way of life is now at risk. They did not attack policemen, they did not burn cars and they did not shout abuse; they were restrained and good humoured. Nevertheless, their anxieties were genuine and heartfelt.
The chief executive of the British Field Sports Society explained:
"the countryside is waking up to the fact that this Government has an urban majority that doesn't understand or, indeed, represent rural interests. Countrymen can no longer afford to be complacent; they need to put their heads above the parapet and be counted. The urban majority must listen to the voice of the countryside before it is too late."
Over a period, some of those who sought a rural way of life have felt to some extent marginalised. The issue has now come forcefully to a head, however, with a new Government who are clearly bent on institutionalising urban-based political correctness. We have a Government who are dedicated to destroying country sports, which are an integral element of country life from both social and economic points of view.
The United Kingdom is one of the most urbanised countries in Europe, and that is especially true of England. There is hardly a place in this country that would not fall within city limits if it were in the United States. Hardly a farm is more than 30 miles from a major town or city.
308
For many, commuting has become a way of life. Increasing accessibility has fundamentally changed the relationship between town and country.
It is forecast that the number of households in England and Wales will increase by 4.4 million by the year 2010, and many of those people will wish to settle in the countryside. Pressures on space and services are causing considerable alarm among those already living in the countryside.
There is, however, considerable potential for redeveloping existing urban areas. It is up to the new Government to decide how to implement the Environment Act 1995 in relation to the so-called brown-field sites. I hope that the Minister will give some clear signs this morning, because many in the rural areas believe that there is unacceptable pressure for new developments on green-field sites.
In 1995, my right hon. Friend the Member for Suffolk, Coastal (Mr. Gummer), when Secretary of State for the Environment, published a comprehensive White Paper entitled, "Rural England—A Nation committed to a Living Countryside". I applaud him again for that initiative. The White Paper began by declaring the countryside to be a national asset. It went on to outline the ingredients for sustainable development, such as meeting the economic and social needs of people who live and work in rural areas, conserving the character of the countryside while accommodating necessary change, and improving the viability of existing villages and market towns.
Yet something has clearly gone wrong. Many rural dwellers have already lost confidence in the new Government's desire and ability to protect their interests. Sadly, I believe that their fears are justified. We know that 13 million people live in the countryside or in small towns. These 13 million share exactly the same hopes, aspirations and concerns as everyone else about housing, transport, law and order, jobs, schools, health and recreational activity. But there are essential differences, because of remoteness and small scale, planning and transport differences, and the desire of many to enjoy fully the recreational opportunities of country living.
Even in rural counties such as Suffolk, the bias in service provision is manifestly towards the urban parts of the county. My right hon. and hon. Friends will confirm exactly the same situation in Labour-controlled local government throughout the country.
The Government's precise view of the future of local government is unclear. May I directly tell the Minister that the prospect of yet another tier of administration in rural areas is deeply unwelcome? The mentality of urbanisation that exists in the Labour party threatens the proper administration of our country way of life.
Regional assemblies are bound to be based in towns and cities and take powers away from parish and local councils in rural areas. The previous Government sought to enhance the powers of parish councils. Now, my constituents are in a state of limbo about the Government's plans for the administration of country areas. They are fully entitled to some clarity.
Suffolk county council, for example, while for ever reciting the "lack of resources" mantra, has given, effectively, an open cheque book commitment to an expensive park and drive scheme in the city of Ipswich. Yet, disgracefully, I cannot even get a much-needed

309
footpath built in a rural village in my constituency, allegedly because there is no money. Similarly, lorries shatter the peace of rural villages because local authorities will not give urgent and sufficient priority to properly co-ordinated lorry management schemes, which are very much required.
Let us look at employment, which, as in the rest of the country, has been a considerable success story. One of the most disappointing features of the new Government is the way in which they are fundamentally failing to understand the increasingly fragmented nature of our economy. Apart from the agricultural sector, throughout the country there are thousands of people with offices in their homes, in rural cottages or converted barns, linked to their main offices or customers via the telephone, fax, Internet and e-mail. They may go to an office in a city only once or twice a week. Much of that activity is highly creative. It suits modern life styles. It is flexible. Some people may wish to work only part time.
We saw in the 1980s the massive job downsizing in large companies. Workplace fragmentation and the growth of outsourcing have flowered in this country. Now, bluntly, that is at risk. Having given away our employment rights when we signed up to the social chapter, we shall inevitably be at the receiving end of employment directives that will kill off this highly successful evolving process.
The European social and economic model is an employment disaster. The huge rural depopulation of France illustrates that clearly. The imposition of a minimum wage coupled with job-destroying directives will play havoc with the rural economy.
The Parliamentary Under-Secretary of State for the Environment, Transport and the Regions (Angela Eagle): Will the hon. Gentleman admit that the only places in Britain where there is a minimum wage are rural areas, because the Conservative Government failed to abolish the agricultural wages councils?
Mr. Spring: I am afraid that the hon. Lady entirely misses the point. There has been a diversity of economic activity and job creation away from the agriculture sector in rural areas precisely because there is not the sort of regulation that has destroyed employment in rural areas in countries such as France. I am astonished that she fails to understand that.
Mr. lan Bruce: It is always interesting when Ministers come to the Dispatch Box so badly briefed about the minimum wage. The agriculture wages council—
The Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mr. Elliot Morley): It is a board.
Mr. Bruce: The agriculture wages board, which is an exact model of what the Government want to bring in, has a minimum wage of £2.95. It would be nice to know from the Minister whether £2.95 will be the national minimum wage.
Mr. Spring: My hon. Friend is quite right. Perhaps the hon. Lady is not aware that there are many jobs other than farming that sustain the rural economy. Clearly, she is utterly ignorant of that fact.
310
Most businesses in rural areas employ fewer than 20 people. The most helpful thing that the Government could do to enable them to compete is to cut business rates, as we promised in our manifesto. Already, rate reliefs are available for village shops and post offices. They do not want to see a return to the local control of business rates by local authorities, some of which are instinctively anti-business. They do not want to be beholden to local authority officials whose ability to gold plate European health and safety legislation is legendary. Regrettably, the only policy that the Government have so far announced is the statutory right to interest, which was opposed by the overwhelming majority of small business organisations.
Rural areas need a balanced transport system. The imposition of new so-called green taxes in the latest Budget has had a particularly damaging effect on rural car users. It is to be hoped that the privatisation of our rail services will mean a more effective and balanced challenge to road hauliers. However, any sense of urgency so far is lamentably lacking. In my constituency, the A11 is a death trap and the Elveden crossroads truly life-threatening.
Valiant efforts have been made by interested parties, with considerable success, to resolve these problems co-operatively. I sought the help of the new Minister for Roads simply to bring this all together, only to be told that the whole roads programme was indefinitely under review. There appears to be nothing that is not under review. It is ludicrous that, after Labour waiting 18 years to get back into government, crucial decisions affecting our lives remain in suspended animation. People in rural areas have a right to know what transportation policies will be pursued.
On the subject of reviews, may I also tell the hon. Lady of the very real anxiety of many of my constituents following the announcement of the Secretary of State for Health that hospitals would close? In rural areas, there has been a dramatic improvement in the provision of primary health care through GP fundholding. Now we are, apparently, to have a fresh upheaval in the NHS with the creation of a new bureaucracy called locality commissioning groups.
I very much regret the closure of many smaller acute care hospitals over the years. Because we do not know what is happening, and there is a review, there is fear among GPs, nurses, doctors and patients that medium-sized acute care hospitals will close, too. In rural areas, that would be a catastrophe. Patients would have to travel miles to hospital or to receive visits from family and friends. It removes the essential linkage between local communities and their hospitals.
There is genuine concern that the West Suffolk hospital, in Bury St. Edmunds, which serves most of my constituents, will be closed, so let me spell it out clearly. If the Government decide that, to save money and further appease their urban supporters, they will concentrate acute care facilities in a very limited number of giant hospitals—if acute care health services are remorselessly centralised—there will be far more than 100,000 people protesting in the rural areas about the future of their health services.
Our farms are not theme parks to be trampled over at will by outsiders. There is a balance to be achieved. All hon. Members will applaud the efforts made by the

311
Country Landowners Association in its Access 2000 statement issued last May. Much voluntary progress has been made. I very much hope that the Government will work constructively with local authorities, landowners and countryside users for sustainable access. We must not create some statutory right to roam, and never again should we witness the horrific activities of so-called new age travellers, who had nil respect for the countryside, its inhabitants or its wildlife.
There are many other areas of rural life that I should like to touch on. I am sure that my hon. Friends will do so if they are fortunate enough to catch your eye, Madam Speaker. The 1995 White Paper brought together the rural aspects of all Government policies for the first time. May I therefore ask the Government to commit themselves to a similar integrated approach to rural policy so that the uncertainties that I have spelt out can be dealt with?
Last week, in Hyde park, we witnessed a defining moment. The catalyst was the private Member's Bill that seeks to ban country sports, particularly fox hunting. Marchers came to Hyde park from Scotland, Wales and Cornwall. The Bill makes a clear distinction, albeit a spurious one, between fishing and field sports. Somehow, it is entirely legitimate and not cruel to stick a barbed hook in a fish's mouth, play with it in the water, land it and watch it suffocate. At least, that is how some might interpret the situation.
No one disputes the fact that foxes are predators whose numbers must be controlled, but, under that private Member's Bill, it would be acceptable for vixens and their cubs to be gassed in their lairs, and for foxes to be snared only to die slowly and painfully and to be shot at with the risk of injury. All those practices may well happen, but allowing a fox to be killed instantly in the jaws of a foxhound would not be acceptable.
Mr. Morley: For the record, let me point out that gassing foxes is illegal in this country.
Mr. Spring: I appreciate that, but, although it is illegal, it is—regrettably—known to happen. The culling of foxes is a particular problem for farmers. If fox hunting were banned, we might just see an upsurge in such activity, which would be thoroughly undesirable.
The former executive director of the League Against Cruel Sports, Richard Course, observed:
"When I became fully and objectively appraised of all facts, and conversant with all related arguments, it was impossible to avoid the conclusion that the prosecution of the anti-hunt case would not advance "fox welfare" and consequently could not be justified."
I dwell on the subject because the importance of fox hunting is essentially twofold. As the New Scientist put it on 19 April 1997,
"Foxhunting has helped shape the British landscape. Areas where it is common often have more hedgerow and thicket which benefit other wildlife besides the fox. These would disappear if hunting were banned."
Fourteen thousand acres of woodland are owned or managed by hunts, and 95 per cent. of hunts undertake conservation work—the maintenance of bridleways, gates and so forth—while 1.4 million carcases are disposed of each year, either free of charge or at minimum cost. Hunting is an essential part of the traditional life of the countryside and has considerable economic significance.
312
There are 385 registered packs of hounds and 228,000 participants in registered packs and clubs. The 1997 update of the Cobham report estimated direct employment at 15,300 and direct expenditure at £176 million, with a turnover of £122 million involving 9,700 separate businesses. Five thousand pubs are patronised for hunt meets and other fixtures. The hunt is a broadly based social activity, often taking place in remote country areas: it is a way of bringing people together. Seventy per cent. of all woodland planting on English and Welsh farms is for sporting purposes.
Earlier, I tried to express the concern of rural dwellers about such matters as the rural economy, transport, health services, access and so-called green taxes. That concern, however, is merely a backdrop to the exploding sense of alienation from the urban-based, politically correct values that are clearly hallmarks of the present Government.
This is a matter of fundamental principle. No one can deny the right of anyone in our democracy to dislike fox hunting, to argue against it, to ignore it or even to find it repulsive. It is wholly different, however, when that right is translated into the punishment of those with whom such people disagree—their punishment as criminals.
How would the law be enforced when a farmer sought to cull foxes, and tried to flush them out with his dogs? Would that be a criminal activity? Where is the line to be drawn? Foxes are predators: they kill for the sheer pleasure of it. Savagely tearing the limbs off lambs and decapitating chickens, ornamental ducks or even swans has nothing to do with the need to eat. Yet we return to the same principle: should the state have the right to punish someone for his activities simply because the majority find them distasteful, and, in so doing, to have a severe impact on the economy of rural areas?
Last year, 3.3 million people went fishing and more than 700,000 shot game and wild fowl. Annual direct expenditure on country sports runs at £3.8 billion and has provided more than 60,000 full-time jobs. Indirect expenditure totals £2.4 billion and has provided 31,000 jobs. Government income runs at more than £600 million.
In our urbanised society, nature has become entirely removed from what we eat. It is a kind of carnal disembodiment. Butter and milk bear no relation to cows; eggs bear no relation to chickens; and chickens bear no relation to feathers. What is really repulsive is the way in which our new politically correct elite decides, in an inconsistent, illiberal and intolerant way, what is good for us all. Rural Britain is patronisingly viewed as some kind of Disney theme park.
When the sensitive luminaries of Islington, Hampstead and Highgate sit down to eat, the only thing that is wild about the poached salmon is the price. For them, a visit to the countryside all too often means a visit to a luxury health hydro, where they can "de-stress" after all the exhausting intellectual gymnastics of what they have decided is and is not currently politically correct.
Dr. Julian Lewis: My hon. Friend has set out a great many facts and figures for the record, and for the edification of Labour Members. Should we not also record the fact that fewer than half a dozen Labour Back Benchers have bothered to attend the debate?
Mr. Spring: I thank my hon. Friend for making that point, which is at the heart of the debate. Rural issues cannot be distinguished from the mainstream of British life; they are part of the nation. The contempt with which the Government are treating rural areas is, however, manifest in the number of Conservative Members who are present.
There is a serious point to be made, to which my hon. Friend has alluded. A substantial part of our population should be allowed to continue a way of life that is currently under threat. This is not only about hunting, but about all the activities that are linked with it: gymkhanas, horse trials and point-to-points. Those who despise the rural life will inevitably go after shooting as well. Not only would the whole rhythm of country life be affected by such moves, but trees, fences and hedgerows would soon be at risk.
Before the general election campaign, the Prime Minister declared his desire to lead one nation. He talked of the community and of social cohesion, and the electorate responded. Only weeks after the election, however, the uncertainties that had already stirred in rural Britain have been translated into real fear and anxiety. The Government's policies so far appear to be at worst hostile, and at best irrelevant, to the needs of rural Britain. I hope that the Prime Minister will not go down in history as the first Prime Minister to cause an irrevocable and damaging split between the rural and urban parts of our nation.
We have had a rocky start from this Government. I urge the Under-Secretary of State for the Environment, Transport and the Regions to listen carefully to the concerns of people living in the countryside in the years ahead. They are entitled to the same consideration as everyone else. They are entitled to a policy framework and services adjusted to their needs, and should not to be treated as second-class citizens.
9.59 am
Mr. David Hanson: I appreciate the opportunity to contribute to the debate. I congratulate the hon. Member for West Suffolk (Mr. Spring) on securing the debate, although I disagree with almost everything that he said. I represent a rural constituency and I won that seat from the Conservatives in 1992. My hon. Friends the Members for Forest of Dean (Mrs. Organ) and for Stroud (Mr. Drew) are present. They won seats from the Conservatives in the recent general election. Many Labour Members speak for rural areas. Conservative Members do not represent as much as a single tree or field in Scotland and Wales.
The Conservative party is not the only party which speaks for rural Britain. The Labour party achieved its highest-ever vote in rural areas on 1 May. We wiped out the Conservatives in rural Scotland and rural Wales. Many of my hon. Friends speak in the Chamber and run the country on behalf of rural Britain as a whole.
I hope that the debate will focus on positive points. In the spirit of cross-party co-operation, I say immediately that I welcomed much of what the previous Government did to recognise the needs of rural areas. I welcomed the proposals in the White Papers for rural Scotland, Wales and England. I welcomed the fact that "Rural England" was produced by the previous Government, and I recognise that the document "Working Countryside for
314
Wales" was important. However, the debate should be put in the context of the Conservative Government's performance on rural issues.
I should like to draw Conservative Members" attention to the Environment Select Committee's report on rural England, which highlighted problems that the Conservative Government had caused and which they had to face in the previous Parliament. Their documents proposed a certain strategy, but the Environment Select Committee's report highlighted rural poverty, the need to sustain market towns, the removal of large tracks of woodland and the need to develop key targets to achieve improvements in rural areas, which the previous Government failed to do.
Mr. Nicholas Soames: We all share the aim of removing rural poverty, as the hon. Gentleman calls it. Does he truly think that the introduction of a minimum wage will contribute to removing rural poverty? In an interview during the general election campaign with the distinguished journalist from The Sunday Times, A. A. Gill, the present Deputy Prime Minister, with welcome candour, said that the introduction of a minimum wage was likely to increase unemployment.
Mr. Hanson: I strongly support a minimum wage. During the general election campaign, many of the people who work in the rural parts of my constituency supported a minimum wage. Many of the farmers in my constituency, who are legion, lobbied me strongly when the Conservative Government tried to abolish the agricultural wages boards. Farmers and people in rural areas in my constituency recognise the need for an inclusive society in which everyone has a stake and in which people are part of the businesses in which they work.
One of the things I am most looking forward to in this Parliament is the establishment of a low pay commission, so that people in rural and urban areas can contribute to the decision on a reasonable level for the minimum wage. That will ensure an end to some elements of rural poverty in our communities.
We have had 18 years of Conservative government and 18 years of their stewardship of rural areas. The hon. Member for West Suffolk knows my constituency well and is a frequent visitor. He is aware that many rural areas have suffered dramatically under Conservative rule. Rural crime has risen. I could show the hon. Gentleman the former police stations in the rural areas of my constituency that were closed by the Conservatives. I could take him to see many of farmers and rural constituents who have suffered dramatically from rural crime. Dyfed Powys police have organised a conference next week at the Royal Welsh show to highlight the issue of rural crime. It is an important matter, and the Conservative party failed to deal with it during their stewardship of the rural community.
Mr. Keith Simpson: Do the Government intend to reopen those police stations in the hon. Gentleman's constituency?
Mr. Hanson: The Labour Government will put resources into policing to ensure that we reduce crime. There is a difference between removing police stations

315
and reducing rural crime cover, and examining that issue in the light of the damage done by the previous Government. We will put resources into policing to ensure that rural as well as urban areas are covered.
Mr. James Paice: Will the hon. Gentleman give way?
Mr. Hanson: In a moment. There is a limited amount of time, and many hon. Members want to speak.
With regard to transport, 33 million bus journeys per year were lost in Wales thanks to rural bus deregulation. On housing, we have had inappropriate planning policies, many planning appeals have been allowed and council house building has been prevented, thus reducing the number of affordable homes in rural areas. Great damage has been done on a range of issues as a direct result of the Conservative Government's policies.
Mr. Paice: Bearing in mind the fact that the Chancellor of the Exchequer has already confirmed expenditure policies for the current and the next financial year, will the hon. Gentleman tell us how much extra money will be spent on rural policing over and above that which the previous Government announced?
Mr. Hanson: The Chancellor has said that the target limits for the next two years are the same, but the priorities within them will be reviewed. A fundamental and comprehensive spending review is being undertaken, which will examine levels of spending and what has been done. We should also consider the key issue of crime prevention in rural areas to ensure that we reduce crime. The Government will improve on the previous Government's performance in many aspects of policy.
The hon. Member for Mid-Sussex (Mr. Soames), who has now left the Chamber, referred to wage levels. The Conservative Government launched an assault on the agricultural wages boards and tolerated rural low pay and rural poverty. I look forward to the establishment by the new Labour Government of a minimum wage and positive policies to tackle those issues.
The previous Government's record on education was appalling. The main concerns in my constituency during the previous Parliament were nursery vouchers and the potential for selection in schools, both of which had a dramatic effect on rural areas. If there is selection and if there is only one major school in a nearby town, many rural people will require additional transport to get their children to school. The rejection of the nursery voucher scheme in Wales was overwhelming in rural areas. The vast majority of petitions that I received from rural areas during the previous Parliament were about nursery voucher provision. The Conservative Government's education policies did great damage to my rural constituents.
People in rural areas are concerned about the removal of shops and pubs. The possible privatisation of the Post Office caused great fear in rural communities. The sell-off of woodlands and the destruction of hedgerows were part of a range of policies that the previous Government followed, and I hope that the Under-Secretary of State for the Environment, Transport and the Regions, my hon. Friend the Member for Wallasey (Angela Eagle), will address those problems.
316
There is also the farm crisis fiasco of BSE, which has cost billions of pounds of taxpayers' money and has destroyed many rural incomes and rural communities. It has put great pressure on the people whom some Conservative Members purport to represent.
One reason why there are 164 Conservative Members and 418 Labour Members is the previous Government's failure—[Interruption.]
Mr. Deputy Speaker (Mr. Michael J. Martin): Order. There is much shouting in the Chamber. Hon. Members should not try to shout down the hon. Gentleman because he expresses an opinion with which they do not agree.
Mr. Hanson: Many of my hon. Friends are out running the country, which is why they are not here at the moment.
The BSE crisis had a tremendous impact in rural areas. I should like to see some key policies put into practice in the countryside. We must look at economic prosperity to see how the Government can encourage small and medium-sized businesses to develop.
Mr. John Bercow: Will the hon. Gentleman give way?
Mr. Hanson: Time is pressing. I have given way a number of times and I must make progress so that other hon. Members may have an opportunity to speak.
I want economic renewal in rural areas. The hon. Member for West Suffolk spoke about information technology. I hope that the Government will extend information technology services and encourage them in many parts of rural Wales, especially in my area. The hon. Gentleman spoke about the important issue of developing rural communities and businesses. The Government should support a modern reappraisal of IT and put some effort and resources into it.
The Government should encourage environmentally sustainable businesses, help farmers to diversify, and encourage and develop tourism. They should use the proceeds of the windfall tax, which will shortly be on stream, to help young people in rural areas where there is high and persistent unemployment. Community projects would create employment opportunities for such young people.
The Government should concentrate on the protection and enhancement of the countryside environment and set national strategies for the protection of rural areas. That will entail considering hedgerows and the retention and planting of woodlands so that we can rebuild the rural community that was decimated by many of the Conservative Government's policies. There should be a Minister in each Department responsible for countryside matters, and the Government should help to provide low-cost housing by assisting housing associations and using some capital receipts to allow local authorities to build small developments of rented accommodation. That would allow many of my constituents to stay in the communities in which they were born and have grown up.
The current review of transport policy should enable bus services to be examined again so that they are improved in many of my rural communities. Many Conservative policies caused great damage, and there is

317
much that the new Government need to do. Their policies will help all the people of the United Kingdom and specifically many of my rural constituents.
The Government should consider using lottery funds to help rural areas. There is much that a people's lottery can do to refurbish village halls and to provide amenities in villages and playing fields. Rather than concentrating lottery money on the major towns and projects, spending should be diversified and put into local communities. That would encourage small organisations as well as the large, well-prepared, well-briefed organisations to have access to lottery money.
There is an opportunity for people in rural areas to work with the new Government. Many of us live and work in rural areas and speak for their inhabitants. The Government have an opportunity to do much good work that will undo some of the damage caused by the Conservative Government. We shall govern for all the people of this United Kingdom. All our people have a stake in it, and we speak for rural areas as strongly as do the fox hunters, the shooters and Conservative Members.
10.14 am
Mr. Alan Clark: The debate takes place in the immediate aftermath of the great countryside rally in Hyde park, which I attended. The countryside is under threat from a range of influences, which my hon. Friend the Member for West Suffolk (Mr. Spring) has described. Stupid bureaucrats, greedy speculators, rogue gangs and cultural and material vandalism have all placed the countryside that we all love and cherish under threat.
The rally seemed to polarise two important issues on the issue of fox hunting. One of those issues is the tension between town and country, which has been exacerbated, particularly by spiteful and malicious press coverage in, for example, The Mirror. It referred to people who live in the countryside as bumpkins, and the reports seemed to be written by a gang of reporters who have no feeling for the countryside or the cause of animal welfare, which they pretend to espouse. Presumably they went out and ate enormous plates of steak and chips after filing their reports.
The second issue that has been affected by the polarisation is animal welfare, which the single-minded obsession with fox hunting is threatening. My credentials in this field are well known and I hope that the House will allow me briefly to weary it with them. My maiden speech supported a Bill to abolish hare coursing, which was presented by the Secretary of State for the Environment, Transport and the Regions when he was in opposition, and I voted for his later Bill to protect wildlife.
When I was Minister for Trade, I drafted legislation on fur labelling which is currently being enacted by the European Union. I have participated in many such activities, including joining the picket line at Dover docks. That was probably not the best way to ingratiate oneself with the Conservative associations which I was assiduously courting at that time.
I do not hunt and I do not permit hunts to cross land that I own. Some types of hunting are cruel and sadistic. They include the practice of stopping up, which, for Labour Members who do not know about it, involves
318
blocking a fox's earth so that, at the end of the pursuit, the fox cannot go underground, digging him out when he does go underground, and cubbing. There should be a close season on that pastime. Stag hunting is another such pastime. The right way to get rid of a stag is with a Mannlicher .273 with a telescopic sight, not tearing it to pieces in water.
Those who favour a Bill on fox hunting must be prepared to make some concessions. There is a majority feeling on the topic that cannot be ignored. If Labour Members and the Government are prepared to make illegal—and they should be illegal—the practices that I have identified, they could allow the pursuit of a fox across the countryside. That practice is deeply rooted in the pageantry of our rural history, is seated in 300 to 400 years of practice and has not only a pictorial but a sporting element attaching to it. If they can sanitise it by taking out practices that are genuinely offensive, barbarous and cruel, they would be well advised to allow it to continue.
The whole question of animal welfare has become so polarised that matters that do require attention—laboratory experiments, brutalities in stockyards, factory farming and the horrendous industrialised exploitation of animals, which takes place daily—all need to be addressed urgently by the House. There is a danger that, if Labour Members get rid of fox hunting, they will feel that they can turn their attention to other things—that they have done their duty in the animal welfare sector and can move on. This is an important subject which requires careful attention and proper analysis. There is room for a compromise along the lines that I have suggested.
10.20 am
Mrs. Diana Organ: I thank the right hon. Member for Kensington and Chelsea (Mr. Clark) for his contribution, and agree that that issue is dear to many people in rural areas and needs full debate and full investigation. However, it is fascinating that, in a debate on rural policies, the hon. Member for West Suffolk (Mr. Spring) and the right hon. Member for Kensington and Chelsea talked almost exclusively about a minority blood sport. There has not been much comment on what is at the heart of rural issues.
One of the reasons why Labour won so many rural seats in the general election in May is that we addressed the real issues in rural areas. Conservative Members have talked about people coming to the rally from Scotland, Wales and Cornwall. Where is the Conservative representation in those areas? The idea that Conservative Members represent the countryside is nonsense. It is the Labour Government who represent people in rural areas, because we address the issues that concern them.
Mr. Spring: The hon. Lady entirely misses the point. The Labour party is in government. It is now responsible for rural areas. We should like some answers on policy issues, which, so far, it is pushing out of the way. That is the whole point of this exercise.
Mrs. Organ: The point of the exercise is to show that the past 18 years of Conservative Government have decimated rural services and rural transport, have hindered access to affordable housing and have put rural areas at a disadvantage compared to urban areas.

319
The biggest problem in rural areas is access to jobs, to advice and to housing. Because of the 1985 bus deregulation, the Conservatives cut off at the knees any opportunity for rural areas to be able to develop a good communication and transport infrastructure. The pursuit of the market principle which the Conservatives followed relentlessly for 18 years, with the threats on the Post Office, rail privatisation, bus deregulation, the development of out-of-town shopping and inappropriate housing development, is the reason why rural areas felt increasingly marginalised, looked to Labour and said, "Yes, you have the policies that address our concerns." Added to the chaos in the agriculture sector and the total mishandling of the bovine spongiform encephalopathy crisis, people lost all confidence in the Conservatives.
Problems in rural areas are often difficult to identify because people suffering social deprivation often live in small pockets, cheek by jowl with wealthy people. In my constituency, there are small pockets of deprivation in places such as Broadwell, Bream, Lydney and Cinderford, but they are cheek by jowl with affluent commuter areas such as Newent and Newnham. The problems are therefore difficult to identify.
The second problem is that, in many ways, rural areas deprivation problems are worse than those of urban deprivation because of the problem of access. That is biggest issue in rural areas. People need to get a job and to training. In the Forest of Dean constituency, there are three principal towns: Lydney, Cinderford and Coleford. People can take a bus only from Coleford to Cinderford. They cannot get one from Lydney to Cinderford, yet it is the centre of further education, skills and training. That means that people live in rural areas do not have access to the services that they require.
One thing that we must do in the transport review is to make bus services accountable to local communities so that they have a say in the frequency of service, the route and the setting of fares. The 1985 deregulation increased the poverty of rural areas almost incalculably.
The other issue is the release of capital receipts. The lack of affordable quality housing leads to distress and homelessness in rural areas. Capital receipts will allow local authorities to improve the housing stock and maintenance, and, more important, to build social housing in rural areas.
Mr. James Gray: Is the hon. Lady aware that most capital receipts have been raised in relatively pleasant rural areas and that the greatest social deprivation is likely to be found in cities? Therefore, most of our carefully preserved and raised capital receipts in rural areas will be spent elsewhere in England.
Mrs. Organ: That is not true. The hon. Gentleman should consider where the capital receipts are held. I absolutely refute that. The Labour Government have clearly said that we need to consider housing need and the best value that can be delivered, so we will move funds appropriately.
Local authorities in rural areas where there is housing need to hold capital receipts.
Mr. Nick St. Aubyn: Having sat on the Standing Committee that considered the Local Government Finance (Supplementary Credit Approvals)
320
Bill, which releases that money for housing spending, I believe that I am right in saying that, in the hon. Lady's constituency, the proposed formula will leave it worse off than it would have been if its authority had been left to spend its own capital receipts. I believe that I am right in saying that her constituency is one of those that will suffer under the system that the Government propose to introduce.
Mrs. Organ: Forest of Dean district council holds capital receipts of about £11.4 million, and we can deploy that money in all sort of projects, involving co-operatives, maintenance and grants to projects such as Anchor "Stay Put" to increase housing stock quality.
We need access not only to affordable social housing and transport, but to new technology—information technology. We do not want rural areas to become information poor. Labour's plans for putting ports and outlets through telecottages, schools, libraries, hospitals and colleges, and for access to cable and the super-highway, will enable rural areas to end their marginalisation and to be at the centre of the information revolution in Britain. That is important because such a revolution, through the training and the access that it offers, means that it will not matter whether you live in a small rural hamlet or in the centre of the metropolis. You will be equal with one another: you will shall have equal access to training and equal opportunity.
We must develop and sustain rural areas. In the past, it has been considered that large-scale private housing developments would be a way to provide sustainable economic growth to rural areas. I totally refute that. That is not the way forward. We are left in Gloucestershire with a vestige of Tory planning. There are plans to build estates of 1,000, 1,500 and 2,000 homes in areas of Gloucestershire such as Painswick, Sedbury and Tutshill. That is wholly inappropriate to those small villages. It is not the way forward and we are fighting to ensure that those plans do not go through.
Instead, we need to build on all the opportunities that the countryside offers. There is a strong arts and crafts heritage in the Forest of Dean. Indeed, in the British economy, the money deployed from culture is greater than that from manufacturing. There are many examples of rural areas being regenerated and revitalised through the growth of small-scale arts and crafts business that grow into large ones, such as Laura Ashley, Robert Walsh in Chipping Campden and Dartington in south Devon. Lottery money should be used to encourage the arts and crafts heritage in rural areas so that we can build sustainable small and medium-sized enterprises.
Mr. Michael Moore: Will the hon. Lady join me in supporting the work of the Rural Development Commission? Will she oppose any moves by her Government to abolish it?
Mrs. Organ: You are scaremongering.
Mr. Deputy Speaker: Order. Perhaps I could help the hon. Lady. On a number of occasions, she has used the term "you". She involves the Chair when she does so. I am reluctant to call her or order, but it might help her, so early in her career, to take note of such matters.
Mrs. Organ: I apologise, Mr. Deputy Speaker, for my lack of politeness to the Chair.

321
It is important to develop sustainable small and medium-sized businesses, using all the rich opportunities of the countryside such as leisure, tourism, culture and the arts. We need sustainable economic growth. We must deal with the real needs of the countryside.
Mr. Bercow: I have been listening closely to the hon. Lady's thoughtful speech. She criticised my hon. Friends for what she thought was an excessive preoccupation with country sports. I hope that she will forgive me for saying that she seems studiously to be avoiding any reference to that subject. Does she propose to vote for a ban on fox hunting? If so, did she inform her electorate of that before the election?
Mrs. Organ: I have avoided the subject because it is a minority activity. The real issue is policies in rural areas. The Government will deliver policies on transport, housing and economic development that will deal with all the needs of rural areas.
10.32 am
Mr. Andrew George: I have had the great pleasure and privilege of being born and brought up in my constituency. Therefore, I speak from some experience of life in rural areas and the impact of Government policies on that, rather than from—as is all too often the case—the perspective of people who have moved there latterly from better-off backgrounds and suburban environments, and have a rather idyllic and out-of-touch view of what living in rural areas is all about.
I was surprised that the hon. Member for West Suffolk (Mr. Spring) should imply that all the ills facing the countryside are due entirely to the policies implemented by the Labour Government over the past two months, rather than those implemented by the Conservative Government over the past 18 years.
I remember going to the Lizard area when the Cury hunt was out. The whole community came together and my mates and I chased around on our pushbikes to see what was happening, although I do not remember the hunt ever catching a fox. I do not think that whatever happens to that leisure pursuit will have a significant impact on the economies of rural areas. I agree with the hon. Member for Forest of Dean (Mrs. Organ) that there are far more pressing issues facing rural areas.
Conservative Members talk about leisure pursuits, but there should have been more support from the previous Government to improve facilities in rural areas. For example, they should have recognised—in the teeth of prejudice—the need for improved skateboarding facilities. Too often, we think about the leisure needs of the privileged, but the less well-off also have leisure needs. Providing those facilities would contribute considerably to the economies of rural area—
Mr. Alan Clark: Skateboarding!
Mr. George: The right hon. Gentleman represents the rural area of Kensington and Chelsea. He appears to be opposed to skateboarding in rural areas. It is an important issue. We want to tackle crime in rural areas,
322
and providing leisure facilities for young people is important to that. Indeed, it is far more important than the wholly unimportant issue of fox hunting.
Several hon. Members rose—
Mr. George: I will not give way. There have been many interventions from Conservative Members, and the Minister is waiting to reply to the debate.
Cornwall is an example of how the previous Government affected the economy of a rural area. Over the past 18 years, it has been at the bottom of the earnings league. It has one of the highest levels of unemployment among rural areas. As the hon. Member for Forest of Dean accurately and rightly pointed out, the environment has been under great threat from the let-rip attitude of previous Tory environment Ministers, who have allowed rural areas to be over-developed with speculative housing and out-of-town supermarkets, despite the strong objections of local authorities.
Mr. Geoffrey Clifton-Brown: The Conservative Government's White Paper predicated that 4.4 million more houses would be needed by the year 2016. Where does the hon. Gentleman think those houses will be built? Does he want to deny people who want to move out of the cities the opportunity to live in rural areas? That would be the consequence of no further development in rural areas.
Mr. George: The fundamental flaw in the Conservative Government's policy was that they based their estimates of future population growth on past levels. That is spurious and I object strongly to that approach to planning needs.
Cornwall is a good example of population growth. It has grown faster than anywhere other than the county of Buckinghamshire, which has the new town of Milton Keynes. That growth has not been integrated with economic policies; instead, there has been a massive increase in unemployment. Growth and economic policies have not gone hand in hand. If the hon. Member for Cotswold (Mr. Clifton-Brown) is concerned about accommodating people in rural areas, what about the local people who have made homeless by Tory policies?
Mr. David Heath: I share my hon. Friend's analysis of the behaviour of a Tory Government run by a suburban party.
It is very difficult for me to listen to the comments of some Members because, tomorrow, we will discuss capping provisions that will have disastrous effects on rural services in my own county of Somerset. I hope that some of the hon. Members who have spoken so eloquently on rural services in today's debate will support the counties of Somerset and Oxfordshire in tomorrow's debate on the issue.
On the matter of planning and housebuilding—
Mr. Deputy Speaker: Order. The hon. Gentleman's intervention is far too long.
Mr. George: I am sure that the matter mentioned by my hon. Friend the Member for Somerton and Frome (Mr. Heath) will be debated fully tomorrow. Because of

323
my deep experience of the pains and pleasures of living in rural areas, I have a great deal to say—as I am sure that hon. Members will appreciate—on the matters that we are debating. However, I am aware also that I must leave time for the Minister's reply.
The past 18 years of Tory Government policy have led to an increase in homelessness in rural areas. The housing market is often called an open housing market, but it is a private housing market. In Cornwall, we have one of the nation's biggest mismatches between earnings levels and house prices. Opportunities for local people to get on to the first rung of the housing ladder are very few and far between, and those trying to obtain a council house in a remote rural area cannot get one.
In the private rented sector, the tourist industry has taken precedence. Rural areas therefore face enormous pressures, making it incredibly difficult for local people to find accommodation.
Building speculative, executive homes in rural areas does not answer the housing needs of local people. Those needs were also not met by the Tory Government's legislation, which allowed council tax reductions of 50 per cent. for second-home owners in rural areas. Such measures simply further encouraged the iniquitous trend towards second-home ownership, which—hand in hand with homelessness and a shortage of affordable housing—has greatly increased in many of the villages in my constituency.
Although many rural issues must be addressed, I specifically ask the Minister to tell us whether an integrated rural policy will be developed involving all Departments, including the Department of the Environment, Transport and the Regions, the Department of Trade and Industry, the Department of Health—because many cottage hospitals are under threat—and the Ministry of Agriculture, Fisheries and Food.
We must also recognise the important role of the Rural Development Commission and the Countryside Commission. It was rather rich for my hon. Friend the Member for Tweeddale, Ettrick and Lauderdale (Mr. Moore) to question the Government's commitment to the Rural Development Commission. They have withdrawn funds from the commission and spent some of its core budget on the frivolous activities of rural challenge. I hope that the Minister will address the issue of integrated policies.
10.42 am
Mr. Tim Yeo: I congratulate my hon. Friend the Member for West Suffolk (Mr. Spring) on securing this debate. Judging by the level of interest shown by hon. Members, especially Opposition Members, we could use a full day's debate on the subject every week for some time to come. I pay tribute to him on his speech, in which he made many important points. He is a resolute champion of rural interests in Suffolk.
My right hon. Friend the Member for Kensington and Chelsea (Mr. Clark) expressed views for which he is well known. I have no doubt that other hon. Friends, if they could have spoken in the debate, would have dealt in some detail with the points that he raised. I hope that they will have an opportunity to do so in a future debate.
I regret to say that I felt that the speeches by Labour Members demonstrated the nature of the problem. There may be many Labour Members in this Parliament,
324
but there are very few with an understanding of the countryside. Judging by the attendance for today's debate, very few Labour Members have even an interest in the countryside.
Among the very important points raised by my hon. Friend the Member for West Suffolk were the irrelevance of an additional tier of government for rural areas; the bias of many county councils—certainly it is true of Suffolk county council—against rural areas and in favour of urban areas, where Labour party support has traditionally been concentrated; neglect of—
Mr. Andrew Love: Will the hon. Gentleman give way?
Mr. Yeo: No. I am sorry, but I do not have time to give way.
Other points raised by my hon. Friend the Member for West Suffolk were the neglect of important rural assets, such as footpaths, and the impact of the minimum wage on the rural economy. I note that the hon. Member for Delyn (Mr. Hanson) did not say at what level the minimum wage which he so enthusiastically supported should be set.
On field sports, I reiterate my robust opposition to any legislation that aims to outlaw traditional country sports. In that context, will the Minister be able to tell us whether the fact that so many Labour Members support such legislation is connected to the £1 million donation to the Labour party from the International Fund for Animal Welfare? In the previous Parliament, in early-day motion 726, that organisation was described by Sir David Steel as
"a private company … which is simply an animal rights lobbying organisation fleecing money from the public and enriching its operators".
Will the hon. Lady tell us whether the Labour party solicited that donation? In view of the Labour party's proclaimed commitment to opening up details about party funding, will she tell us—I am sure that she will not wish to dodge the question—whether the International Fund for Animal Welfare approached Labour, if Labour did not approach the fund?
Given the size of the donation, one must assume that the Labour party made detailed inquiries about the nature of the fund's activities. Will the Minister therefore tell us on what basis the Labour party judged that fund to be a suitable organisation from which to accept money? What discussions were held between Labour and the fund on the issue of field sports? If she cannot answer those questions in her reply, will she write to me and place a copy of her reply in the Library?
My hon. Friend the Member for West Suffolk mentioned the White Paper on rural England, which was published—to widespread acclaim—in 1995. A progress report, "Rural England 1996", assessed the achievements of the 12 months following publication of the White Paper. At the conclusion of "Rural England 1996", there was a commitment to making subsequent progress reports in 1997 and thereafter. Will the Minister confirm that the Government intend to honour that commitment? Will she confirm also that future progress reports will contain the same helpful check list, listing every individual commitment, which was originally made in the 1995 White Paper and occupied the last four pages of "Rural England 1996"?

325
My hon. Friend the Member for West Suffolk also mentioned access—a crucial issue for many people living in the countryside. Will the Minister now tell the House what is meant by the Labour party's manifesto commitment, which refers to
"greater freedom for people to explore our open countryside"
but adds:
" We will not, however, permit any abuse of a right to greater access"?
Does that commitment mean that there will be legislation to introduce a statutory right to roam? If it does not mean that, what does it mean?
Does the Minister understand that the uncertainty—indeed, the threat—about the Government's intentions does nothing to encourage further progress on voluntary agreements with landowners, which have secured such an enormous increase in the amount of open countryside to which the public now enjoy access?
My final comments deal with the all-important matter of resources. In the 2 July Budget, the Chancellor of the Exchequer announced his smash-and-grab raid on pension funds by abolishing the advance corporation tax credit. Even now, two weeks later, the full impact of that smash-and-grab raid has not yet been fully understood. The consequences of the Chancellor's raid are devastating for rural areas and for the local authorities that are responsible for those areas. Norfolk county council, for example, now faces an annual shortfall of £5 million a year in its pension fund, which is more than 1 per cent. of its total budget. In Lincolnshire, the equivalent figure is £2.45 million; and, in Somerset, it is £2.1 million a year.
The shortfalls have already started to accumulate—the change was made effective two weeks ago—and they need to be made good very urgently. If local authorities are to act responsibly in the interests of their employees and future pensioners, they cannot allow their pension funds to fall into substantial deficit. Therefore, local authorities' contributions to those pensions funds must rise.
There are three options to meet the cost of those higher contributions. The first is that services can be cut; the second is that council tax can sharply rise; and the third is that the Government will raise the revenue support grant. There are no other options. Will the hon. Lady tell the House today which of the choices the Government propose to adopt? If she cannot tell us, will she at least say when she thinks the Government will announce which option they have chosen?
To put a little flesh on the argument, in Norfolk more than 200 teachers may now face the sack, making a total mockery of the Government's election promises about class sizes. As the hon. Member for Putney (Mr. Colman) warned the Chancellor before the Budget, no increase of the sort required by the abolition of ACT could be afforded by local authorities without their having to make further cuts in services to their local residents. Millions of anxious people in the countryside will be hanging on the Minister's words this morning. They are wondering whether the Chancellor's smash-and-grab raid will cut services in their areas. Their uncertainty and anxiety should be ended at the earliest possible date.
I greatly regret that there is no time to pursue the other important issues raised in the debate. The Minister may not be able to respond to all the points raised by me and
326
my colleagues, but I hope that she will deal with as many as she can. In passing, I remind her that I am still waiting for a letter from her on related issues that I raised in a debate on 10 June.
The importance of rural issues has been reflected in today's attendance and in the quality of the speeches, especially those of my colleagues. In the afterglow of their election victory, the Government may think that a majority derived from urban constituencies gives them the right to ride arrogantly and contemptuously over country dwellers and their concerns, but last week more than 100,000 people issued a powerful warning to the Government in Hyde park. This week, my hon. Friends have repeated that warning to the House. The Government ignore that warning at their peril. The Minister now has a chance to show that the Government will at least start governing in the interests of all the people in this country, including those who enjoy and live and work in the countryside.
10.51 am
The Parliamentary Under-Secretary of State for the Environment, Transport and the Regions (Angela Eagle): I congratulate the hon. Member for West Suffolk (Mr. Spring) on his success in securing this debate, but he and some of his colleagues have missed the opportunity to deal with some of the real issues facing people who live in rural areas.
It is interesting to find that, in the general election, the hon. Member for West Suffolk suffered a 13 per cent. swing to Labour in his rural area. His majority is now only 1,800. When people had the chance to express their views about the previous Government's 18 years in office, there was a huge swing against the hon. Gentleman and the Conservatives—that is the real view of the people of rural Britain, not that expressed by the people in Hyde park last week.
Mr. Clifton-Brown: Will the hon. Lady give way?
Angela Eagle: No, I have fewer than 10 minutes. Plenty of Conservative Members—well, all 11 who managed to stay for the entire debate, which is not a startling turnout—have had the opportunity to speak.
The hon. Member for South Dorset (Mr. Bruce), who accused me of not being briefed, left the Chamber for some of the debate and then returned, misquoted the levels of the minimum wage recently agreed by the agricultural wages board. For his information, they now stand at £4.20 an hour for ordinary labourers and £3.06 an hour for casual workers.
Mr. lan Bruce rose—
Angela Eagle: No, I am not giving way.
Mr. Bruce: On a point of order, Mr. Deputy Speaker.
Mr. Deputy Speaker: Is it really a point of order?
Mr. Bruce: It is indeed, Mr. Deputy Speaker. I want to ask your advice on how I should proceed. I left the

327
Chamber to check the figures, and I find that I did mislead the House. The minimum wage for an 18-year-old is £2.60 an hour, not £2.95, and for a 16-year-old it is £1.84.
Mr. Deputy Speaker: That is not a point of order.
Angela Eagle: Out of interest, the hon. Gentleman's majority is now 77. There was a 15 per cent. swing against him, which again shows the views of rural voters on the previous Government's 18 years in office.
Conservative Members have presented a caricature of the urban-rural debate. I understand that people have very powerful feelings about fox hunting and some issues which may be coming before the House in private Members' Bills, but this debate should rightly have been about the issues raised by, for example, my hon. Friend the Member for Delyn (Mr. Hanson) in his excellent contribution, my hon. Friend the Member for Forest of Dean (Mrs. Organ) and, indeed, the hon. Member for St. Ives (Mr. George).
They spoke about the problems that rural people face every day—the problems of transport, access to schools, hospitals and housing, especially for young people who face having to leave the places in which they were born because they cannot afford to live there. They are the issues that affect the everyday lives of people in our rural communities. It is a great pity that Conservative Members could not spend very much time even thinking about them because they were so obsessed with issues such as hunting, which the House will be debating.
Conservative Members made great play of last week's Hyde park rally. We were all privileged to hear the speech of the right hon. Member for Henley (Mr. Heseltine), who told the rally that what he sees as the threat to hunting is a
"vicious onslaught on a treasured tradition of rural life."
Where were Conservative Members—in fact, where were the members of the public who were in Hyde park last week?—when the right hon. Gentleman decimated the coal industry and destroyed 55,000 jobs in rural areas? The Conservative Members were in the Lobbies voting for it, so we shall take no lectures on hypocrisy from them.
In the time left to me, I should like to ask Conservative Members to take this opportunity to condemn—[Interruption.]
Mr. Deputy Speaker: Order. There is a great deal of noise from Opposition Members, which is unfair when a Minister is replying to the debate.
Angela Eagle: Will Conservative Members take this opportunity to condemn the threats received by my hon. Friend the Member for Worcester (Mr. Foster)? A snare was recently sent to him in the post. He received a letter saying that the writer
"would like to throw your entrails to the dogs."
Another said:
"You will not live to see the end of your Bill".
A third said:
"You and your family ought to find bolt holes"—
[Laughter.] Death threats may be funny to Conservative Members, but they do not reflect well on the people who send them. I would expect the party of law and order—it still prides itself on that title despite its record in office—to condemn such assaults on free speech.
328
Will Conservative Members also condemn some speakers at the Hyde park rally who threatened to burn forests and poison water supplies and who stated that that rally would be the last peaceful one? These are not the activities of people to whom we should listen seriously. Conservatives Members need to realise that the majority of people in the countryside are anti-hunting. We must also remember that hunting is not a town-country issue—it is a moral issue, which is why there will be a free vote for Labour Members, should the Bill be debated.
In the very limited time I have left, I shall point out that the Government believe in opportunity, fairness and prosperity for all. That applies equally to urban and rural areas.
Mr. Owen Paterson: Will the hon. Lady give way?
Angela Eagle: No. I have only two minutes left—be real.
In our manifesto, we gave a number of pledges on rural matters. We pledged to recognise the special needs of rural areas and communities, not to allow public and transport services in rural areas to deteriorate, to give greater protection to wildlife, and to give greater freedom to people to explore the open countryside. It has already been said from the Dispatch Box that the principle of access is not negotiable, but we are aiming for an extremely wide-ranging consultation with all the parties involved on the question of access to the countryside. The consultation paper will be issued before the end of the year. We want to hear everybody's views so that we can come up with workable legislation that will be supported as widely as possible.
The Conservatives brought us BSE, transport deregulation and the poll tax, which decimated the incomes of many rural people. They have no representation in Scotland and Wales. Their concern about fox hunting and many issues that people in rural Britain feel are irrelevant sits pretty ill. If they want to get back on to the Government Benches within a reasonable time, they must modernise. They need to realise that they have to represent the real interests, views and life styles of all people in Britain if they are to have a chance of regaining the trust of the electorate.
Mr. lan Bruce: On a point of order, Mr. Deputy Speaker. I appreciate that the Minister had a limited amount of time, but two pieces of information were given to the House during the exchanges. The first is about the minimum wage. The Library has just given me the figure, which is £1.84 for 16-year-olds. The hon. Lady—
Mr. Deputy Speaker: Order. The hon. Gentleman has already commented about that. It is not a matter for the Chair. Any facts and figures given by hon. Members are given in good faith. It is not a matter for the Chair, and the hon. Gentleman cannot put the record straight on a point of order.

Coal Areas (Housing)
11 am
Mr. Joe Ashton: I thank Madam Speaker for making time available for a debate on this important national problem.
After the miners' strike of 1984–85, the previous Government instructed British Coal to sell its stock of houses. At that time, it owned 165,000 or 170,000 houses of different types that had been built at various times in colliery areas. In 1984, parts of some of the older villages were put up for auction to any speculator who would buy them.
The houses were first offered to the miners. Many of them purchased their homes, even though the pit was closing. However, many elderly miners did not want to buy their houses, because they were 50 or 60 and not in the best of health, so they carried on renting. The houses were sold en bloc in many areas throughout the country—south Wales, Yorkshire, Nottinghamshire, Derbyshire, Durham and Scotland. The speculators moved in and snapped up the houses, often for as little as £3,000 or even £1,500 each.
I am particularly concerned about the village of Warsop Vale, on the boundary of Nottinghamshire and Derbyshire, abutting on to the constituency of my hon. Friend the Member for Bolsover (Mr. Skinner). A landlord called Dennis Rye bought many houses in Derbyshire and Nottinghamshire. The area has had nothing but problems since.
The houses in Warsop Vale were built around the turn of the century—probably at about the time of D. H. Lawrence. A D. H. Lawrence film could be made there, with the back ginnels and the back yards. They were decent terraced houses. With improvement grants from the council, bathrooms had been added to the backs of the houses. It was a happy village. There are people of 75 who were born in the village, worked all their life at the pit, married someone from the village and still live there. It was a good community with thriving pubs and shops.
The past 12 or 13 years have been disastrous. The private tenants moved in by the landlords as the pensioners died were often transient residents. Many had been evicted or had left their wives and run off with someone else. The private landlords advertised in the papers for them. The tenants had no feeling for the community, often staying for just a few weeks. Their weekly rent for a small terraced house was sometimes up to £55 or £60, paid by housing benefit. We protested strongly about that, but the Government of the time were in favour of a free market for rented houses and were happy to pay £50 or £60 housing benefit for each house. The area became like a transit camp, and the problem grew and grew.
When the previous Government restricted the rents to more or less what the council would have charged—about £20 or £25 per property—the private landlords decided that the houses were not worth letting. It was easier to let them stand empty and try to make the council take the blame or get a lump sum from the council for the empty houses.
The houses were soon vandalised. Kids threw bricks through the windows and organised gangs moved in to strip them of anything with a second-hand value—radiators,
330
taps or doors. Anything that could be unscrewed was taken. Kids in the neighbourhood, who had no jobs and no future at the pit, as their fathers had had, set fire to parts of the houses. Some houses became infested with vermin. Warsop Vale and many other villages now look like a war zone. Places have been shelled and set on fire and look like houses after the blitz. I lived through the blitz as a little boy and remember seeing some houses inhabited and others left derelict for a long time.
The miners who bought their houses cannot sell them. They have modernised the houses and made them into what we in our neck of the woods call little palaces. Many have double glazing, new doors and central heating. They are unsaleable because of the empty houses next door that have been set on fire, have rats or are vandalised. The whole place is in a terrible state. European grants have been given to some villages to renew the pavements and the lighting, but there has been nothing for the housing.
It is impossible to attract new industry. Anybody thinking of setting up a new factory looks at the housing and the wreckage and moves elsewhere. There are so many empty sites available in pit areas that people can take their pick. There may be subsidence problems in the area because of the old pits. People whose families have lived next to a colliery for 100 years, with heavy lorries going back and forth, klaxons sounding at night, night shifts and dust from the spoil heaps now have to put up with the houses turning into slums.
In addition, the Fitzherbert estate now wants to move in and quarry for thousands of tonnes of limestone, as do Tarmac, Redland and any other company that knows that it can enhance the value of the old pit site by £1 million simply by getting planning permission for limestone extraction.
We are talking about people who have suffered all their lives. They have no hopes unless the new Government take action. I have been going to the village for many years saying that we need a new Government and new policies.
Mr. Bill O'Brien: Does my hon. Friend agree that, because of the rundown of the villages, amenities such as thriving shops, pubs and telephone kiosks to which he referred have been lost? The old people who made the village no longer have those back-up amenities. That is a further problem for them, adding to my hon. Friend's argument that something should be done for such communities.
Mr. Ashton: My hon. Friend is right. The pub in Warsop Vale has shut. The post office shut and reopened as part of a grocer's shop. Bus services are poor. Elderly people are trapped in their houses, unable to get to a supermarket. It is like a backwater of Kentucky.
Five years later, British Coal again tried to auction off the houses, and there was uproar. My hon. Friends the Members for Mansfield (Mr. Meale), for Normanton (Mr. O'Brien), for Rother Valley (Mr. Barron), for Bolsover, others who want to speak in today's debate and even some Tories, protested strongly at the inhumane attitude of auctioning off people's lives. The Government agreed and told British Coal to sell houses to housing associations.
Later types of houses, made from concrete slabs, which were built in 1947 because miners were coming down from Durham and Scotland, are now in the hands of

331
housing associations, but they have problems. Many of them need repairs. The iron bar that runs through the concrete slab is often rusted or rotten. Some miners bought such houses, but now find that they are stuck with them because building societies say that they do not have a long life and they will not provide mortgages on them. The housing stock is not very good at all, although I must say that the housing associations that took over the houses have been excellent landlords, and the scheme has worked in that respect.
The landlords who bought the houses for about £1,500 each have made enormous profits. They have managed to take in rents of £50 or £60 a week for 10 or 12 years, while spending negligible amounts on the houses. Now that they realise that they cannot get such rents, they want to sell the houses to the local council for about £17,000 each.
So, along with one or two other private landlords, Mr. Dennis Rye in Warsop Vale, who bought 80 houses, 20 of which have been vandalised and are standing empty, wants to take about £1 million out of the small village of 280 houses. The modernised houses with two or three bedrooms, an attic and a bathroom, which have had grants spent on them and on which many people have spent a lot of money, still sell for only £21,000 each. In London, the same houses would go for £80,000 or £100,000.
The local owner-occupiers and decent tenants have been very angry for many years. Reports have been produced and there have been meetings, but we have got nowhere. Numerous surveys on housing conditions have been conducted by various officers of district and county councils, but everybody blames each other. We need Government action to get something done.
I understand that the Housing Corporation in the east midlands has a surplus of £3 million, so there is cash available if it is a question of housing associations buying the houses. Three or four weeks ago, my hon. Friend the Member for Mansfield and I clashed with the housing associations at a meeting. It seems that they admit that they have the cash but are interested in spending it only on the houses they already own, and are not keen on using it to purchase houses from private landlords and improve such houses. They accept that the Housing Corporation in the east midlands is sitting on the money, but put up strong resistance and display a marked reluctance to taking over houses from private landlords.
The Government have announced that there will be extra cash from the receipts of the sale of council houses, which is very welcome. The announcement was received with acclaim. Obviously, the scheme will be phased in. Local councils have reacted by saying that the money must go on modernising council houses and that they would prefer to spend the cash on their own council houses rather than private rented houses, which nobody wants to touch with a barge pole due to the amount that needs to be spent on them.
There is a problem with the old compulsory purchase powers. When Roy Hattersley was chairman of housing and I was deputy housing chairman on Sheffield city council in the 1960s, the council compulsorily purchased thousands of houses at a time. All that the landlord got was the value of the site. The regulation was simply applied to houses that were unfit for human habitation. I know as well as anybody that they were unfit because I lived in one.
332
Such houses had lavatories that did not work, they were infested with rats and they were next to belching chimneys and drop hammers. We grew up in such conditions. It was accepted that such houses were unfit for human habitation, compulsory purchase orders were made and the scheme worked—the council built council houses and people were rehoused.
The Housing Act 1985 took away such powers from local councils. Compulsory purchase orders were allowed in certain circumstances, but councils had to pay the market price—whatever it was—and the price had to be agreed with the landlord. Owners are not against selling the houses—they would not mind at all selling them—but they want £17,000 for a house for which they paid £3,000 12 years ago and for which they have charged a rent of £3,000 a year—perhaps they have taken £30,000 in rent in total. That does not add up, and it cannot go on.
In its election manifesto, the Labour party gave an undertaking that council receipts from the sale of council houses which are received but not spent by councils will be invested in building new houses and rehabilitating old ones, and that the scheme will be phased in to match the capacity of the building industry. It quite rightly said that the cash from capital receipts can not only be spent on council houses but can be used for the provision of new social housing in partnership with registered social landlords, for private-sector renovation, for improving energy efficiency and for raising the quality of a neighbourhood by, for example, encouraging or promoting mixed development.
The problem is that there are loopholes in the system. Even if councils had the cash to spend, private landlords would blatantly exploit the loopholes in the legislation. In 1996, the Government introduced the Housing (Fitness Enforcement Procedures) Order. Sections 86/189 and 86/190 should help councils to grab hold of negligent landlords, but there are too many loopholes.
The legal loopholes include landlords being allowed 28 days to start repairs; so they start, and then they stop. The council takes the landlord to court, so he starts again, and then he stops again. Then he does just enough repairs to take the matter outside the law, which covers "substantial disrepair", and says that he has taken the safety measures and does not need to do anything else. The procedures include vague clauses such as the council has to be "minded to take action"—whatever that might mean—and "give fair warning" that it is thinking about taking such action. If the landlord does not do something, the council thinks about it a bit more.
The maximum fine is £2,500. Private landlords laugh at that. It is an offence if somebody intentionally fails to comply with the council order, but it is very difficult to prove such intention in court. Did the person deliberately not comply, not understand the order or employ contractors who went off moonlighting, or could the contractor not find his tools? Usually, the contractors are part of the landlord's business, anyway. The system is full of loopholes, and is not working.
We have a new Government commitment to license landlords of houses in multiple occupancy, which is very good. Such landlords should have to apply for a licence to run houses. There are already thousands of problems with students who are being ripped off and who have to take out massive student loans to pay £40 a week for one

333
room to somebody they do not know or cannot find and who is not implementing any safety measures such as providing fire escapes.
I hope that my hon. Friend the Minister will consider licensing not only houses in multiple occupancy but any dwelling or property where a landlord deliberately keeps it empty or uninhabitable in order to try to put pressure on the council, do a deal, or simply because the property is going up in value. Any house that is boarded up—even if the landlord cannot be bothered to board it up and squatters are allowed in—should be licensed. The existence of such houses is unfair on tenants who live next door, have mortgages and have spent money on their house, but cannot sell it because it looks straight across at a slum with smashed windows where kids run in and out.
It is estimated that 20 per cent. of private rented property is unfit or uninhabitable.
We should introduce new offences. It should be a separate offence for a landlord deliberately to refuse to maintain a house in fit condition for habitation. We should say that no landlord is entitled to receive housing benefit if he refuses to carry out repairs. We should also prohibit landlords from increasing rents if they refuse to do repairs and we should refuse certificates and licences to such landlords.
We should also pass legislation so that tenants of landlords who refuse to do repairs have the right of compulsory purchase of their rooms, perhaps as a co-operative. If the council has not got the money, the tenants could get together and buy their houses at a price agreed with the independent valuer. If that does not work, perhaps because the tenants are elderly, they should have the right to vote for a housing association to take over from the landlord at an agreed price. Such measures would go a long way towards deterring such behaviour by landlords. We should have a licensing system, and we should strengthen laws that compel decent behaviour from landlords.
Only 10 per cent. of chief environmental officers currently think that the previous Government's Housing Grants, Construction and Regeneration Act 1996 has worked. Only 1 per cent. of them believe that it has improved standards. The Act is deregulation gone mad. The previous Government took away all the regulations and let the landlords do what they wanted.
I do not wish to detain the House much longer, but I wish to put on record the recommendations of the legal experts of Mansfield district council, who have a good approach to the problem. I am sure that the Coalfield Communities Association, which has about 80 members among towns, villages and district councils who share the same problems, agree with the legal experts' opinions.
The experts suggest that the Government should abolish the order made under section 86 of the Housing Grants, Construction and Regeneration Act 1996, which is known as the Housing (Fitness Enforcement Procedures) Order 1996; abolish the requirement restricting local housing authorities from specifying the commencement of work earlier than 28 days from the date of service of section 189 and 190 notices; abolish the provision whereby section 189 and 190 notices are suspended on appeal; introduce a fast-track appeals procedure for Housing Act action; change the level of fines that can be awarded on
334
successful prosecutions for failure to comply with sections 189 and 190 to a minimum of £1,000 and an unlimited maximum; change the mens rea of section 198A offences from "intentional" to "without reasonable excuse"; introduce a new provision whereby people commit a summary offence if they fail to maintain their dwelling in a condition fit for human habitation without reasonable excuse; introduce a new power to allow local housing authorities to make control orders on properties that are not houses in multiple occupation; introduce a licensing scheme for all private lettings; introduce a provision under which landlords are not entitled to increase rents unless a certificate from the local housing authority states that the property is fit; introduce legislation to enable aggrieved private tenants to purchase compulsorily their houses collectively or to vote to transfer to a registered social landlord who would buy at the district valuer's valuation; simplify and accelerate compulsory purchase powers; and, finally, introduce legislation whereby housing benefit is payable only to approved landlords.
I am sorry that I have not had the chance to notify the Minister of those points, but the council's legal experts delivered their opinion to me only yesterday. I thank him for giving his time to listen to the debate and I know that many of my hon. Friends wish to speak. I am certain that the Government, if they go about it the right way, can solve the problem.
11.23 am
Mr. Dennis Skinner: I thank my hon. Friend the Member for Bassetlaw (Mr. Ashton) for initiating the debate today. The problems he has described are mirrored in all the coalfield areas, as exemplified by the fact that several of my colleagues are here today to speak on the issue. My hon. Friend gave a list of suggestions by Mansfield district council. Its environment department is certainly at the sharp end of dealing with the landlords who cause problems.
One particular landlord in my area has already been mentioned—Dennis Rye. He has got houses all over the place, including Yorkshire, and I reckon that he has houses in 12 or 15 constituencies. He has spread his net far and wide. In the Pleasley area of Bolsover, which is not very far from Mansfield, Dennis Rye owns some 70 houses. In 1987, he decided to apply for grants, and Bolsover district council agreed to give him grants to improve the houses. Dennis Rye then decided that he wanted grants to make the properties into flats to make more money. The council said that he could have the money, but he appealed against that decision. That dragged out the procedure.
Some years later, Dennis Rye said that the properties should be demolished. So the Bolsover district council, as the Mansfield district council would have done, said that it would put in an order to demolish the houses, which were unsightly and like a bomb site, as my hon. Friend the Member for Bassetlaw described. What did Dennis Rye do? He appealed against the demolition order. The case went to court again and was dragged out further.
Such cases usually go to magistrates courts, but sometimes to the county courts. Sadly, all the magistrates courts work separately, but many deal with the same small number of landlords. Although my hon. Friends and I are aware of the landlords' efforts in all the different areas, the magistrates, for some reason, are not aware that they are being taken for a ride.

335
In the 1990s, after Dennis Rye had appealed against the demolition of the properties in Pleasley, the Bolsover district council decided to serve repair notices. We all know the problem with those. The landlord gets a builder to knock a nail in a skirting board and that is enough for the magistrates to say that the landlord has made a start on repairs, even though people are still living in terrible conditions.
The process is dragged out even more. Bolsover district council currently has three outstanding actions against Dennis Rye, but the environmental health department knows that the chances of solving the problems are remote, as it told me yesterday, unless the law is changed in the way suggested by my hon. Friend the Member for Bassetlaw.
We all know that the examples in Warsop Vale and in New terrace in Pleasley that I have mentioned are not isolated instances. As my hon. Friend said, many houses were sold off in job lots to landlords in London. I have evidence that, in some cases, groups of houses were sold three times in a month, with each successive purchaser making money from the ribs of miners and their families living in those properties. Eventually, the ownership of the properties ended up in tax havens.
Many landlords have agents in the coalfields. There is an agent in Creswell, a wonderful model village that was built at the turn of the century. Some 200 houses were built in a circle and, at the time, were an example of state-of-the-art building. For many years, while the pit was open, the village had a vetting procedure. The local National Union of Mineworkers and the residents ensured that anybody who took over an empty house was vetted. There was nothing wrong with that, and it gave an element of democracy, but it went when the pit shut.
The Tories—who are not here now, although they were in the Chamber for the previous debate about fox hunting—should understand that this debate is also about rural life. Each of those areas is a village. We are talking not about towns, but about tiny little communities. The Tory Government smashed them as they closed pit after pit. They may not have realised, although I am sure they did, that they took away the mantle of security that existed for the people who lived in those villages.
The net result is that there are no more vetting procedures in Creswell model village, with the result that the houses have been taken over by Villagate Properties, which is based at Westerham, Kent. When repairs are needed, I have to write to someone in Kent, after trying the agent first.
People are coming in from all over the place. My hon. Friend referred to the transient population. About a month ago, some paedophiles finished up living in Creswell model village. I will not go through the details, but they do not live there any more. Action was taken. Least said, soonest mended, but court cases will follow.
I want to stress to the House that the people of Creswell regarded that episode as an insult to them. They had worked hard—the miners at the pit—and now they see all those people coming in and upsetting their community.
I am not saying that everything can be done in next to no time. We have five years, but we do not want to wait for five years; we want to start now. We have a Minister who knows a little about housing. As we know only too well on both sides of the House, not every hon. Member
336
who reaches the Front Bench is well equipped to do the job immediately, but the Minister understands the subject and should be able to make a flying start.
My hon. Friend the Member for Bassetlaw presented a good number of proposals. Every village in the mining communities is affected. I could go on to speak about Langwith, Shirebrook and many others. They follow a similar pattern. People have been deserted by the previous Government. Their jobs have been taken away, and now they are having to put up with living in communities that are falling apart, with desolation and dereliction all around them, as at New Terrace, Pleasley.
My hon. Friend suggested the action that could be taken, and I agree with much of what he said, bearing in mind that local authorities are spending thousands of pounds going to court. Environmental teams in local authorities should be given the power to work together. They know the landlords who are causing all the trouble. Each local authority is litigating separately, but those who want to do so should be able to take joint action against rogue landlords such as Dennis Rye.
My hon. Friend referred to various housing Acts. Local authorities have the power to take a landlord to court to enforce the repair of properties and maintenance of sites, and the need to clear up the dereliction should be part of the argument for the local authority to exercise those powers.
I agree with my hon. Friend the Member for Bassetlaw about fast-track litigation, although that is a matter for another Government Department. I hope that my hon. Friend the Minister will consider that. My hon. Friend also dealt with the licensing of landlords.
For a local authority to enforce a compulsory purchase order, as I understand it, it must be based on housing gain. A local authority should be able to obtain a compulsory purchase order on the grounds that the property is unsightly and a mess—that would deal with Rye, both in Warsop Vale and in New Terrace, Pleasley—or if they can prove that there is constant litigation and that the landlords are using the courts to drag the process out.
I conclude on a more general point, which my hon. Friend may not support immediately. Many of the problems have occurred not just in mining communities, but on a wider scale, because one of the first acts of the Tory Government after their 1979 victory was to introduce the right to buy, which everyone talks about. However, another factor that caused mayhem for many people in our communities was short hold tenancies—the power of landlords to grant three-month or six-month tenancies and then kick people out. That shifted housing powers away from tenants—not that they ever had much power—to landlords. I hope that in the next five years our Government will review short hold tenancies and return to the system of intervention and control.
11.35 am
Mr. Kevin Barron: I congratulate my hon. Friend the Member for Bassetlaw (Mr. Ashton) on securing this opportunity to debate such an important subject.
Like my hon. Friend, I have in my constituency a large number of properties that were once owned and managed by the former National Coal Board, and as in Bassetlaw, the decision to sell off those properties in the Rother

337
Valley, and the clumsy and disjointed way in which the sell-off was handled, has had serious and damaging consequences for several of the villages in my constituency.
The Rother Valley has three estates consisting of former NCB homes—at Aston, Kiveton Park and Maltby. The houses on the estates were constructed using pre-reinforced concrete. They were built in factories and assembled on site. In the 1950s, at the age of eight, I moved into one of those houses, when I moved from North to South Yorkshire.
Because of their flawed design, the houses on those estates have been classified as defective under the terms of the Housing Defects Act 1984. I understand that those provisions are contained in more recent housing legislation. The steel in the houses is corroded because the concrete has let water in. The steel has expanded, rusted and forced the concrete up on the outside. Consequently, no one will loan money against such a house.
The properties were sold off in lots at auction. Various parts of the estates were bought up cheaply by organisations and individuals who had little or no interest in maintaining the estate as a whole. Some properties were sold by the NCB to sitting tenants in the 1970s and 1980s, and were bought back by the local authority under the 1984 Act.
I shall describe the situation at one estate, Kiveton Park, in my constituency. Florence Unity Biby Richardson and Clive Richardson of Wimbledon own 20 of the houses. Great Parndon Investments of Harlow in Essex owns 14 houses. Michael Windle from Skipton owns 40 houses. He also owns houses on the Maltby estate. Paul Wright of Worksop owns 18 properties at Kiveton Park. DetaRock Properties owns four houses, Globe Properties owns one, and Rotherham borough council, having bought back houses from sitting tenants under the 1984 Act, owns 43.
One of the houses on the estate has a great history, as my case work revealed. The landlord proved to be so bad and difficult to deal with that the London solicitors who were acting as his agents eventually gave up on him. They cancelled their agreement with him and refused to deal with inquiries about the property's state of disrepair. I was told by the firm of solicitors to contact the landlord direct—he lived in Baghdad. He, like many other people, had bought the property at an auction in the Connaught rooms. He had seen photographs of the houses, which looked like decent, three-bedroomed semi-detached houses. No one had told him of the concrete construction that had been classified as defective. He thought that he could spend a few thousand pounds and make a profit.
The fragmentation of the ownership of what are called locally the "White City" estates was only the beginning of the present problems. Although some money is available to make the necessary repairs and correct the building faults of some of the houses, that money is too slow in coming through. When it arrives, the piecemeal way in which it has to be used can itself be a contributory factor in the decay of the estates. I shall return to that thought at the end of my speech.
The Housing Defects Act 1984 allows local authorities to buy such properties from their owners, but it does not fully cater for the circumstances on the former NCB
338
estates. Rotherham borough council was reluctant to buy the residents out, because it had never previously owned the stock and did not consider itself responsible for the situation. The Act made the council responsible, but it showed great reluctance, and I had a public falling out with it about how quickly it should respond and buy the properties back.
While the wrangling about the status of the houses continued, many of them fell into disrepair, and even dereliction, as they became empty. Many hon. Members will know that, when a property becomes empty, that can be the beginning of a steep downward cycle in its useful life. Properties that are empty for any length of time tend to fall into serious disrepair.
With the former Coal Board houses, disrepair can be brought about even more quickly by the new absentee landlords who refuse to take their obligations seriously. Last month, I received from an environmental health officer at my local council a letter that highlights one of the problems:
"As houses become empty they are vandalised and frequently set on fire … Since March, I have served a stream of Statutory Notices on two landlords to make such houses secure. Most recently, two properties on one road have been boarded or bricked up following such action. One by the Council in default."
My local council has thousands of pounds outstanding because it has had to take action to protect the interests of the people who live on the estates, especially in terms of the safety of young children. It has spent thousands of pounds because we cannot get the landlords to act responsibly.
Empty and derelict properties also become targets for theft, especially on the estates, where metal fixtures and fittings are sold for scrap. The latest craze on one of the estates is the removing of drainage covers, despite the fact that they are heavier than some of the inside fittings. Of course, the open manholes then become a health and safety hazard. They get filled with rubble, which blocks the drains and causes further environmental health problems.
In some cases, the problems of the estates are becoming so bad that even the infrastructure is failing. A letter from Yorkshire Electricity, which was forwarded to me, says that the company noted concerns about the state of the supply cables, but:
"There will be a need to take an overview of the best approach to resolving this problem since there are so many interested parties on the White City Estate".
That was a reference to the estate on which I was brought up. A couple of years ago I took Jeremy Walker, who works in the Government regional office in Leeds, to see that estate, and showed him the house that I moved into at the age of eight. It was derelict and had been vandalised. People had been in and stolen all the copper, including the main means of stopping off the water. Water was jetting up into the kitchen ceiling, and somebody had thrown an old mattress down to try to stop the flow. The house next door had been burnt out completely, right up through the roof tiles.
My constituents have had to live with those conditions for years. We have had a decade of such problems on the estates, and they are not nice places to live now; they are certainly not like the place that I moved to in 1955 with the rest of my family.
In some cases, fire damage in empty houses means that the only suitable course of action is demolition. However, because of the way in which the bundles of houses were

339
sold, it is never certain that a single landlord will own adjacent houses that may also need to be demolished. An argument is taking place now about one house that needs to be demolished but is attached to another. The landlord refuses to do anything about the situation, so we cannot demolish a property that is causing a hazard on the estate.
On two of the estates a scheme is in place to reinstate properties, and the work is being done by a local housing association. I congratulate the housing association, which is doing some magnificent work, especially in view of the circumstances on the estates. In some parts of the estate, schemes have been agreed to new build by both demolition and reinstatement of homes under the Housing Defects Act.
The greatest problem is that money for the schemes trickles out too slowly to cope with the scale of the problem. A scheme gets going in an area, but the following year it has to stop, because we cannot get the funding from the Housing Corporation to the housing association. My local council, which owns houses on the estates, is giving them gratis to the housing association so that the process of regeneration can take place. None the less, the problem is still difficult.
Perhaps the most important factor is the botched manner in which the former Coal Board properties were sold by the Conservative Government. It means that no one organisation has control of the process of regeneration, and no proper sanctions exist to make the various parties work together.
The lack of co-ordination leads to fire-gutted houses, open to vandalism, being left standing in otherwise tidy streets. It leaves boarded up houses next to well-maintained ones, and means that properties in need of repair are de-prioritised as resources are reallocated to secure properties that, although they are beyond repair, cannot be demolished. That is not right; nor is it a sound use of public money.
While all that is taking place, tenants' associations have been working closely with housing associations and builders estates to improve their own environment. I pay tribute to the tenants on the estates, who have got together and set up tenants' organisations, which are now arguing with the authorities to get things done. Without them, I do not know what would be happening on those estates now.
Mr. Allan Rogers: We have the same sort of problems in the Rhondda valley, especially associated with such estates, and with unemployment. One of the direct results and hidden charges is the relationship between the scenes of vandalism that my hon. Friend is describing, and general criminality. Unfortunately, it seems that, on some of the estates, the aura and ambience of criminality will not be overcome in this generation. A long-term effect on the community has been created.
Mr. Barron: Yes, I am sure that that is right—but today I shall not go into the wider issues, beyond the economics of the estates to their social problems, which are there for all to see.
Will the Minister have the time to come to the Rother valley and see for himself what action is required to speed up reinstatement and regeneration of the former Coal Board houses? I believe that action must have two main elements.
340
First, the sloppy handling of the sale of the houses must be rectified. There must be some mechanism to require the various owners to work together better. I do not know whether that should be through some form of compulsory purchase, but it must be done. Public money is being spent in a "patchwork quilt" way because of the ownership of the houses, and that is not good public investment for the future. None of us would choose to invest the money that we, as taxpayers, are investing in the estates in that particular way, but at the moment we have no choice because of the major problems caused by multi-ownership.
Secondly, we need to tackle the skewed system of resourcing repairs and renovations. That means putting in place a better and more coherent system for releasing money to reinstate properties. More money, in bigger blocks and more regularly paid, is needed if the estates are to recover their former prestige.
There is no doubt that the work now being done is improving the estates. The problems are slowly being solved. However, that work throws up questions about how landlords, who are not eligible for current grants, can fit in with the regeneration schemes. Some of them sit and do nothing. All they want is the rent from the properties, yet we as taxpayers may be spending money through housing associations on the house next door, to reinstate it and give it a 30-year life against which money can be borrowed. That is not common sense. If the Minister visits my constituency, I hope that he will address that issue.
Once again, I congratulate my hon. Friend the Member for Bassetlaw for bringing this important matter before the House. I hope that my hon. Friend the Minister will be positive and get out of the ways of the previous Government—ways that caused many of the problems on the estates.
11.49 am
Mr. Paddy Tipping: I am grateful to my hon. Friend the Member for Bassetlaw (Mr. Ashton) for making this debate possible. I am pleased to follow my hon. Friends from coalfield communities who have spoken graphically of the pain and anger in those communities in Nottinghamshire and throughout the country.
There is no doubt that we have had 18 wasted years. Coalfield communities feel strongly that the previous Government buried the coal industry and tried to walk away. My hon. Friend the Minister should be aware that there are high aspirations for what the new Government can achieve for those communities.
People in coalfield communities are characterised by a continual desire for improvement: they always want better for their children than they have had for themselves. They want their children to have better jobs and education, and they are crying out for new investment, new hope and a new future under Labour. It is clear that new investment in housing can bring new hope.
I want to confine my remarks to the fairly narrow subject of housing associations. My hon. Friend the Member for Bassetlaw and others spoke of houses that have fallen into private ownership. My hon. Friend made the strong case that housing associations may have a role in acquiring those houses and renovating them. However, at present those housing associations that own ex-British Coal houses have a liability. I want them, as social landlords, to discharge that liability.

341
We live in a crazy world in which money from the public purse is given, through legal aid, to tenants of housing association houses to sue their landlords. It is absolutely right for us to work with housing associations and put pressure on them to do up their ex-National Coal Board houses.
In the east midlands, 1,800 houses passed to housing associations in 1984, split three ways between Leicester housing association, Nottingham community housing and East Midlands housing association. It was envisaged that they would renovate those houses, but their efforts were stymied because they were denied grant by what I consider a vindictive attitude on the part of a former Secretary of State, Nicholas Ridley. They were told that they had to fund the renovation by the sale of some of their housing stock, which has proved impossible as the housing industry has declined.
Who wants to buy a derelict house in Bilsthorpe or Calverton, say, for £15,000, £20,000 or £21,000? The associations have not been able to achieve those sales to fund the renovation of the remaining stock. We must move towards renovation and lifting the moratorium on grant for housing associations.
In the Newark and Sherwood district council area alone, 320 housing association houses in such places as Bilsthorpe, Calverton and Rainworth need repair and renovation; in the current year, only 23 are being improved. That is a good benchmark of what has happened up to now. In Newark and Sherwood alone, it will take another 16 years to put all the housing association houses back into good repair.
My hon. Friend the Minister should reconsider the moratorium. I know that he is aware of correspondence from Leicester housing association. Let me reassure him that I am not asking for extra money or for new money. I am concerned about the way in which the Housing Corporation spends its money. I know that its east midlands regional office has £2.4 million of unallocated funds for the current year. Why cannot some of that be applied to regenerating housing association properties? That would lever in more funds, and double the amount up to perhaps £5 million.
The situation in the east midlands is not unique; it is repeated throughout the country. We should examine the reserves held at regional offices. More important, let us have fairness, not favours, for coalfield communities. Housing associations want to be able to bid for housing grant. They do not understand why they should be precluded from doing that by a vindictive action of some years ago.
My hon. Friend the Minister is well versed in housing matters, and enthusiastic about energy and conservation issues. The kind of housing of which we are speaking has a national home energy rating of only 3.6; when the houses are refurbished, their energy rating rises to 9. Condensing boilers, new windows and loft and wall-cavity insulation can make them energy-efficient. We should be doing that. People should not have to live in damp and cold houses.
Coalfield communities in Nottinghamshire and throughout the country have high expectations in general, and even higher expectations of the new Labour
342
Government. They want new investment in housing, new hope for their families and a better future for their children. They want the blight of poor and derelict housing to be cleared up.
I ask my hon. Friend the Minister to give people some hope by saying today that he will take steps to investigate the moratorium on grant for housing associations and introduce some fairness for the first time in 18 years, so that they can aspire to a better future for their children and their communities.
11.57 am
Mr. Michael Clapham: I congratulate my hon. Friend the Member for Bassetlaw (Mr. Ashton) on securing this debate, which is important because it gives the House the opportunity to focus on housing in coalfield communities. My hon. Friend referred to the vast number of British Coal houses—the scale is not always appreciated—that were sold off in the 1980s: the figure is between 70,000 and 80,000.
Some dwellings are still being sold off. In the most recent batch, which went along with British Coal's land sales, about 800 houses were sold. Many of them were in terrible disrepair, which is why many tenants did not want to exercise their right to buy. My hon. Friend the Member for Bassetlaw touched on another important reason why those houses were not bought by the tenants: many of those who lived in the houses were former miners, some of whom had been disabled in the colliery and could not work; many were retired; and many were miners' widows.
British Coal put the houses on market and, as my hon. Friend the Member for Rother Valley (Mr. Barron) pointed out, many were bought up by middle eastern business men and have changed hands time and time again, so the tenants cannot always trace the current owner.
The local authorities could not buy because they did not have the money to purchase the housing stock. At the time it was passed on to the market, there was an assault on mining communities. In the 1980s, the Government had a mentality of revenge and sold off houses without giving miners and former miners an opportunity to voice their thoughts on what ought to happen to the housing stock.
Whole villages have been sold off. Two villages in my constituency had a great deal of Coal Board housing—Dodworth on the west side of the constituency and Elsecar on the east. The contrast_between the two villages is clear. At Dodworth, many people were in a position to buy their houses—they were still working in the collieries. In general, the miners bought their houses.
As my hon. Friend the Member for Sherwood (Mr. Tipping) pointed out, miners were able to express their aspirations—I would say their "individuality", which is rather different from Opposition Members, who would say "individualism". Miners were able to express their individuality in their houses. Anyone who travels through Dodworth on the main Manchester road will see that the housing stock is in good repair and is a great credit to the village.
At Elsecar on the eastern side of the constituency, the former Coal Board housing stock is in disrepair. Recently, the local press has referred to an estate there being like

343
Beirut, as it is so bad. There is vandalism and houses have been burnt down and demolished, yet we cannot trace the landlords to clean up the rubbish. Consequently, the rest of the village sees the area as a dumping ground. That has blighted the estate. People who purchased their homes on the Elsecar estate and spent money to make them look decent cannot sell their properties. As I said, some of the landlords cannot be traced, yet mountains of rubbish need to be cleared away.
My hon. Friend the Member for Bassetlaw pointed out what needs to be done. He took advice from housing experts in Mansfield. I urge my hon. Friend the Minister to consider relicensing and compulsory purchase so that local authorities can tackle the problem and restore the dignity of those estates and people can live there in decency.
12.2 pm
Mr. Allan Rogers: I wish to introduce a Welsh dimension into the debate, although the Minister is not responsible for housing in Wales, to emphasise that this is a countrywide problem. Fortunately, I live in what might well be the oldest mining community in Great Britain. As a result, there is an enormously high level of owner-occupancy. People bought their houses from the Coal Board many years ago. The houses are terraced and 78 or 80 per cent. are owner-occupied, so the problem of large, rundown housing estates with communal poverty is not quite as acute as elsewhere. There are, however, ex-Coal Board estates throughout the south Wales valleys that are suffering such problems.
In the owner-occupied areas, there is a lack of grants for repair, and some of the housing stock dates back well over 100 years. The houses are little palaces. People have taken enormous pride in building up their homes over many years.
On the newer Coal Board and municipal housing estates, we have the problem that has been so graphically outlined by hon. Members from Nottinghamshire and Yorkshire—the fabric of individual houses is deteriorating. As a result of that and the lack of occupancy, there is general deterioration on the estates. As I said in an intervention on my hon. Friend the Member for Rother Valley (Mr. Barron), that breeds criminality. The kids have nothing to do and are exploited by the drug pushers, who use the empty and vandalised houses almost as resting places in between the times when they peddle their obnoxious trade. It is not just a housing problem, but an enormous social problem. It is not merely neglect of houses, but neglect of people and communities.
Hon. Members representing mining communities throughout Great Britain have seen the great rundown in our communities in the past 10 years as a result of the previous Government's vindictive actions against the coal industry. We represent areas of enormous pride. We do not come to this place with begging bowls, asking for action to be taken. With the present Labour Government, we are certainly not begging but demanding that action be taken. That is why our communities have stayed faithful to the Labour party for so many years. It is not as though we are on the edge and might be able to sway the balance—not that this Government need that in electoral terms. We have a right to a return from this Government for our communities and the Government will neglect our communities at their peril.
344
Our communities are proud, and they are not, in general, poverty-stricken. They have produced many leaders. The south Wales valley communities have probably turned out more musicians, poets and writers—I apologise to my English friends for being arrogant. In the Rhondda valley alone, we have six or seven brass bands, four or five of which are of championship standard. Some have won the European championship. We have musicians who are renowned all over the world. Leaders and conductors of symphony orchestras have come from the Rhondda valley and its schools, as have poets and actors.
Throughout south Wales, great names in British cultural life have contributed, through either the Welsh medium or the English language. We are proud communities. All we are asking is that some effort be focused back on to the problems that have been created, particularly in the past 10 years.
The Coal Board and the coal owners before it got their pound of flesh out of our communities. For years, we talked about the masters who lived in London. We want some return. I tell the Minister, and through him his colleagues in the Welsh Office who are responsible for housing: we now require them to do something for our communities. For many years, they have contributed to the wealth of Great Britain. Now, our youngsters—our new generations—require a return.
12.7 pm
Mr. Christopher Chope: I congratulate the hon. Member for Bassetlaw (Mr. Ashton) on raising this important subject. This debate is a supreme example of how difficult it can be to translate the good intentions of politicians into practical solutions. Indeed, it is almost a case study on the diminishing returns of good intentions.
This is indeed a debate about rural communities and the quality of life of those who live in villages built around coal mines that have closed down. When I was a Housing Minister, in the late 1980s, I had the privilege of visiting Mansfield and Bolsover. I still have on my wall a presentation that I received from Bolsover district council showing the Creswell crags.
I am reminded of that visit because I had high hopes following it. I had seen the extent of the dereliction and disrepair that were the inheritance of the nationalised Coal Board. I saw the high hopes of people in those rural communities, who were exercising their right to buy and hoping that housing associations and new landlords would reinvigorate the housing in those areas. It is therefore distressing to hear about the sheer magnitude of the waste of valuable housing resources that the debate has highlighted and of the human misery generated among responsible householders who are locked into a deteriorating environment.
The debate takes me back about 19 years when I was the chairman of a housing committee in a borough that inherited 1,066 empty, vandalised and squatted houses from an old Labour council, which had believed in public housing and despised private investment in housing. That council wanted more and more control and regulation. Those public sector solutions were manifestly unsuccessful in the London borough of Wandsworth in the 1970s. My experience makes me extremely sceptical about some of the solutions that are being canvassed by Labour Members. We hear about more compulsory

345
purchase powers, more penalties for private landlords and more local authority ownership. Such policies are no more likely to be successful in future than in the past.
It was interesting to hear the hon. Member for Bolsover (Mr. Skinner) praising the idea of vetting procedures. There was cross-party political consensus for many decades that we should move away from such procedures. I have in mind the old housing associations that used to have vetting procedures. Council tenants in Wandsworth and Southampton used to tell me that, when they first became tenants, they had been vetted and approved. They had demonstrated how responsible they were, only to find that people moving into the house next door were quite the reverse. I am delighted to hear that there is a move back to vetting procedures. They are, of course, entirely at odds with much that is contained in the Housing (Homeless Persons) Act 1977.
I was interested also in the comments about housing benefit. If the benefit were paid at a higher level, it is clear from what the hon. Member for Bassetlaw said that at least houses would be occupied—perhaps they would not be occupied by ideal tenants, but they would be in use. As soon as housing benefit was reduced, landlords said, "It is not worth our while bringing these houses into use." Houses have become empty and derelict as a consequence of vandalism. The message is that, if we try to buck the market, we end up in the counter-productive situation of housing stock not being used when we know that there is a crying need among many people for housing.
This is an important debate, and I look forward to hearing how the Government think they will solve the problems that have been highlighted.
12.11 pm
The Minister for London and Construction (Mr. Nick Raynsford): I congratulate my hon. Friend the Member for Bassetlaw (Mr. Ashton) on securing the debate, thereby giving us the opportunity to debate a subject of real concern to many people living in former mining areas and in some continuing mining areas. The economic and social problems of such areas are of great concern to the Government. We recognise especially the specific problems that are associated with some of the housing that was previously owned by the National Coal Board.
We have heard a series of disturbing stories setting out a catalogue of neglect and mismanagement. Examples have been presented of communities exploited by unprincipled absentee landlords. That is serious cause for concern, and we are determined to ensure that more effective action is taken to tackle and resolve these problems.
As my hon. Friend the Member for Bassetlaw explained, in the 1980s the Coal Board, under pressure from the former Conservative Government, began a programme of disposal of its homes, which at the time consisted of about 80,000 units. Within the North Nottinghamshire coalfield, about 1,800 were purchased by a consortium of housing associations; others were purchased by local authorities. Mansfield district council holds about 490 former NCB properties. Other properties were purchased by their former tenants, while some were purchased by private landlords, often buying in job lots at auction.
346
Warsop Vale, the area about which my hon. Friend the Member for Bassetlaw spoke at some length, was built at the turn of the century for workers at the nearby Warsop pit. Of the 200-plus houses in the village, 88 were purchased by Ashfield Nominees Ltd., a company under the Dennis Rye organisation. About 30 others are in the ownership of smaller private landlords. More than half the houses in the village are owned by private landlords. The remainder were purchased by former NCB tenants, who purchased their own homes.
The Government are extremely concerned about the problems of disrepair in the nation's housing stock. In the wider context, we are encouraging local authorities to make every effort to ensure that owners of unfit properties take remedial action without resorting to enforcement powers. Renovation grants and home repair assistance are available at the discretion of local authorities to help home owners on low incomes to improve their properties. However, owners have a responsibility to maintain their own properties, and local authorities are under a statutory duty to enforce the housing fitness standard. We are reviewing the housing fitness standard and enforcement procedures and we shall publish a consultation paper in the autumn.
Authorities have a range of enforcement options at their disposal. Where a local authorities identifies a property as unfit against the requirements of the standard, it must come to a decision and take one of the enforcement options as the
"most satisfactory course of action"
for dealing with the property.
These options are, first, to serve a repair notice specifying the repairs required to make the property fit; secondly, to make a closing order prohibiting residential use of the property; thirdly, to make a demolition order or to declare the area in which premises are situated to be a clearance area; and, finally, to serve or renew a deferred action notice. Such a notice specifies the repairs that are required to make the property fit, but shows that no immediate enforcement action will be taken. In reaching a decision about which of these options is the most satisfactory course of action, a local authority is required to have regard to the statutory code of guidance for dealing with unfit premises set out in circular 17/96.
My hon. Friend the Member for Bassetlaw raised several important technical issues suggested by Mansfield district council that affect its ability to operate the procedures that I have been describing. I hope that my hon. Friend will appreciate that, on technical issues of this nature—I received notice only today—it is not possible for me to give him an immediate response. I shall carefully consider all the points that he raised, and I shall write to him.
Some of the properties in the area of which my hon. Friend spoke are now owned by housing associations. About 10 years ago, a consortium of associations bought about 1,700 tenanted properties from British Coal with a mixture of housing association grant and private finance. In the late 1980s, a policy was drawn up to the effect that housing association grant should not be made available for the acquisition, improvement or repair of tenanted stock transferred from public sector landlords to housing associations. The previous Administration refused to review that policy, which therefore made it impossible

347
for social housing grant to be made available to housing associations to carry out works to former Coal Board property passed to them.
I have asked officials in the Department of the Environment, Transport and the Regions to conduct a review of the application of social housing grant for the improvement of such properties owned by housing associations. We need to consider the extent to which acquisition costs could reasonably have been expected to reflect the need for future work to the stock. That is why we need some consideration of these issues before reaching a decision. We are reviewing the application of policy and I expect to be able to make some announcement before too long on whether there will be a variation of the previous policy.
I recognise that the problems that concern my hon. Friend the Member for Bassetlaw are predominantly those that relate to properties that are owned by private landlords. In principle, we value a revived private rented sector. It has important and positive role to play in meeting part of the country's housing needs. All too often, it is the sector with the greatest problems of disrepair.
I welcome the fact that many local authorities have established regular liaison forums with the private landlords in their area. These are proving valuable both to landlords and to the local housing authorities, whose job it is to ensure that local housing needs as a whole are met. That sort of co-operative arrangement with decent landlords is to be applauded. It will not work, however, where landlords are unwilling positively to participate in tackling the problems of their area. The Government will have no truck with any exploitative slum landlord who is not interested in providing reasonable quality housing at a reasonable rent.
To deal with these problems, we are committed to introducing a compulsory licensing system for houses in multiple occupation, as the worst conditions in the private rented sector are generally found in such properties. We are drawing up a framework for a licensing scheme so that we can be ready at the earliest legislative opportunity. We expect to issue a consultation paper later this year.
My hon. Friend suggested that the consultation paper should be extended to cover empty properties, such as the derelict homes in Warsop Vale that he described. The Government are not convinced that that would be the most appropriate response, because the licensing of houses in multiple occupation is designed to cope with a situation where a significant number of tenants share the same property and where, as a result, there are particular problems of squalor, and, sometimes, danger because of fire and other hazards.
The issues are very different for empty properties. The licensing framework which we are approaching would not be appropriate for those different circumstances. That does not mean that we are indifferent to the issue of empty properties; indeed, we are extremely concerned about it. I shall say a little more later about our response to empty properties.
I am sympathetic towards the particular problems faced by tenants in Warsop Vale and many other areas. During 1996, Warsop Vale residents association commissioned a survey of properties in the area that were owned by private landlords. The survey, entitled "Stop the Rot", revealed that the wall, floor and roof structures were in generally good condition, but that 36 of the 39 properties
348
surveyed were unfit for human habitation. Of the 23 full internal surveys carried out, 22 of the properties were found to have conditions prejudicial to health and a cause of public nuisance. That was due to a wide range of design issues, disrepair and dampness, creating hazards or conditions prejudicial to health. However, the surveyors noted that, with moderate investment, the properties could provide good-quality housing for many years to come.
I am pleased to know that Mansfield district council has responded robustly to the report. Between January 1994 and June 1997, the council served 30 notices requiring specific repairs to be carried out to make properties fit. Of those notices, 29 were related to properties owned by one landlord.
However, since the publication of the "Stop the Rot" report, Mansfield district council has stepped up its activity and introduced a policy of inspecting six properties each week at Warsop Vale alone. In the past month, it has inspected 19 properties and served eight "minded to" notices, showing its intention to pursue enforcement action. The council is prepared to fund the costs of the repairs and reclaim them from the landlord through the legal system, and informs my officials that it is confident that it can complete the works within the next two financial years. We are keen that it should continue to pursue this vigorous action to tackle the problems.
The problem of empty properties was also raised. I should say straight away that the Government are determined to bring empty properties that are needlessly neglected back into use by promoting good practice by local authorities and tackling underfunding through the phased release of local authority capital receipts. Local authorities have a key role to play in bringing privately owned empty properties back into effective use in their areas. They are best placed to know where those properties are and who owns them.
Local authorities can deploy a wide range of approaches to get empty properties back into use—from advice to landlords who are simply unaware of procedures and the terms under which they might let, to grants or fitness enforcement procedures, to which I have referred. Solutions may require a corporate approach by local authorities, working in partnership with housing associations, private owners, property professionals and other public and voluntary bodies.
I welcome the fact that local authorities in the east midlands region, with the encouragement of the government office, recently set up an empty homes forum to tackle vacancy rates in the region. I hope that it will provide a sharper focus for tackling the particular problems to which my hon. Friend the Member for Bassetlaw referred.
Another approach to the problems of the properties in Warsop Vale might be for a housing association to buy them from the landlord by agreement, provided that the landlord is prepared to sell at a reasonable price. My hon. Friend suggested that the Housing Corporation has a surplus—I think £3 million was quoted—which could be used for that purpose. That is not correct. The east midlands and eastern regions of the Housing Corporation have between them a reserve, not a surplus, of £3.5 million, but it has been allocated for needs-related expenditure and will be allocated during the year to a number of projects for housing investment. In any event, my understanding is that the landlord is unlikely to be willing to sell on reasonable terms.

349
That brings us to the issue of compulsory purchase. Local authorities have powers to acquire houses and land, either by agreement or by compulsion, for a variety of reasons. Those include the subsequent transfer of the property to a third party, such as a housing association that intends to provide housing accommodation on that land. In theory, that would enable the council to acquire the buildings and set in motion procedures for their improvement.
Let us not forget in this consideration of a particularly hard case that compulsory purchase is a draconian power, and should be used only as a last resort. Moreover, it is not always the most cost-effective means of solving a problem. It must be for the local authority to decide the most appropriate way of tackling the problem. We do not propose to dictate to local authorities; it is for them to decide the most appropriate solution. However, where other options fail, where properties are left needlessly empty and local authorities believe that compulsory purchase is appropriate, the Government will not stand in the way.
My hon. Friend discussed the issue of valuation and suggested that site value might be a more appropriate basis on which to base compensation. I should explain that the Land Compensation Act 1961 provides that owners of land expropriated by compulsion should receive its open-market value—the amount that the owner would have received had the transaction occurred between a willing seller and a willing buyer in an open market. That is a fair basis for compensation, and it is used worldwide.
It would be wrong to expropriate property without any compensation—compulsory purchase order procedures do not provide for that—but we should bear it in mind that, in the instances that we have been considering, open-market values could be very low indeed, possibly even lower than the site value, where the property is derelict and where costs are associated with clearing the property if it cannot be used. It is not necessarily an advantage to value properties for compulsory purchase on a site valuation basis. The open-market valuation for derelict properties may be very low indeed.
The problem with many of the options that I have described is the resources available to local authorities to be able to carry out necessary works. We recognise that, under the previous Government, resources provided for housing were cut savagely year on year. The Government
350
are committed to redressing the chronic under-investment in housing. That is why, immediately after the election, we made a capital receipts initiative one of our priority actions. Under the initiative, we are providing local authorities in England with an extra £174 million this year and an extra £610 million next year.
These resources will be directed at housing and associated regeneration needs, and will be available for both public and private sector housing. I should stress, however, that in the first instance it will be for individual authorities to determine where the local needs and priorities lie and to direct resources accordingly. We do not propose to impose a rigid central diktat on the application of the resources, but we expect authorities to apply them efficiently, economically and effectively. We have consulted on this matter.
A consultation paper has been issued. We will listen to the responses. If local authorities in the areas that we have considered this morning believe that it would be appropriate for those resources to be used to help to bring back into use properties that are neglected and to raise the standards of derelict and sub-standard properties, it is my view that that would be an appropriate use of the capital receipts released.
A number of my hon. Friends spoke in the debate. I do not have time to refer in detail to all the comments. My hon. Friend the Member for Bolsover (Mr. Skinner) highlighted problems relating to Pleasley and Creswell, in his area. Those are similar to the problems of which we heard from my hon. Friend the Member for Bassetlaw.
We shall take a detailed look at the problems raised by my hon. Friend the Member for Bolsover, relating to weaknesses in the current procedures under which local authorities wishing to enforce the law are frustrated by delays caused by landlords. As part of our review of the fitness standard and the enforcement procedures, we will consider the points raised by my hon. Friend.
My hon. Friend the Member for Rother Valley (Mr. Barron) highlighted problems in properties on estates in Aston, Kiveton Park and Maltby that were sold by auction and acquired by owners with addresses as far away as Wimbledon and even Baghdad. He revealed a deplorable catalogue of neglect and dereliction. We are keen to see action in his area, as elsewhere, along the lines that I have outlined.
Mr. Deputy Speaker (Mr. Michael Lord): Order. We must move to the next debate.

Manchester Airport (Second Runway)
12.30 pm
Mr. Martin Bell: I am grateful for the opportunity to talk about an issue that is very important to many of my constituents. I promise to be brief, both because I believe in brevity and to allow other hon. Members—including some with a long involvement in the issue—to have their say.
This is not a routine debate and its subject is not a routine issue. I represent many dismayed people who feel that their land and their homes are being taken from them against their will without sufficient reason. The hour is late; the official inquiry went against them and the heavy equipment will be moving on to the site any day now to begin the work of construction and, it must be said, destruction.
We are the small platoons up against the big battalions. Only one statutory body is left standing in the field and fighting in the last ditch: Mobberley parish council. The council has gone to the European Commission with a complaint that deserves—and, indeed, is receiving—a hearing: that the funding of Manchester airport with public money infringes the treaty of Rome by distorting competition within the European Community. Government money is luring airlines to Manchester that would not otherwise fly there.
Mr. Graham Stringer: Does the hon. Gentleman accept that, although Manchester airport is in the public sector, no public subsidy has been provided by the town authorities that own it? They have lent the airport money borrowed from the public works loan board—which could have been borrowed from any other source on commercial grounds. The parish council's case is that a subsidy has been provided, but it has not.
Mr. Bell: The European Commission is now reviewing the position and will make a decision.
In its complaint, the parish council cites an agreement between Manchester airport and Continental Airlines to offer slots for five years in return for landing fees at less than the market rate and a roughly similar agreement with American Airlines. There is a pattern of development that is promoting Manchester as the Heathrow of the north. While that may seem a laudable municipal ambition, it carries certain consequences, one of which is Manchester's probable expansion at the expense of other airports. Another is that 1,000 acres of Cheshire countryside will be sacrificed. That is not the march of progress; it is the march of conflict.
A further consequence is that the travelling public—who could travel more conveniently, especially on charter flights from other regional airports such as Liverpool and Leeds-Bradford—will take the long journey to Manchester, putting a further strain on a road system that is already close to gridlock for much of the time.
The figure of 50,000 new jobs was originally conjured out of a hat. On cross-examination, that figure fell to about 8,000. Many of those jobs would be created by the continuing expansion of the airport within its existing boundaries and the concentration of traffic in Manchester will clearly be to the disadvantage of Liverpool. The planners talk of disbenefit to Liverpool. That means damage and the possible loss of jobs.
Mr. Stringer: Does the hon. Gentleman accept that the growth of Manchester airport that was projected at
352
the planning inquiry—it was forecast that 30,000 people would use it in 2005—will create more jobs in Liverpool and the Merseyside area than any proposed immediate expansion of Liverpool airport?
Mr. Bell: I am coming on to the projections of passenger growth—and I think that the hon. Gentleman means 30 million people, not 30,000.
Refusing permission for the expansion of Liverpool airport, the Deputy Prime Minister said that this was by no means the end of the story. He added that he intended to take a close look at the role of regional airports in contributing to regional development—but the time to do that, surely, is before the Bollin valley has been concreted over, not after.
Much of the debate—this will be familiar to the House—depends on forecasts of future traffic. The figures in those forecasts have not been rising so fast lately. A more plausible figure for the year 2005 at Manchester airport is 20 million. Today Gatwick airport handles more than 20 million passengers a year on one runway, and it expects to be able to handle 35 million on one runway by 2012. Gatwick is a model example of what can be done with one runway. If Gatwick can do it, why cannot Manchester?
The argument is not about process and procedure, although we may well wonder about the fairness of a system that allows one side to outspend the other in the planning period by a factor of more than 10 to one. The argument is about the best way in which we should now proceed. The inspector accepted that the second runway was an inappropriate development of green-belt land and would be harmful to it and that such development could be approved only in exceptional circumstances, which he set out.
I submit that we now have a new special circumstance: the election of a new Government who are committed to an integrated transport policy. The Deputy Prime Minister emphasised that again on Monday, when he said:
"Integration is a serious matter—not a buzz word. It is about how we can use existing capacity better than we do at present. It is about putting things together so that the whole is better than the sum of the parts".
The second runway at Manchester has nothing to do with an integrated transport policy. I argue that it has more to do with a disintegrated transport policy. Manchester may well prosper at the expense of other airports. Its development was not considered with that of Liverpool, or that of the region's road and rail system; it was considered separately. If we are to have an integrated transport policy, let us have one, and let us consider—even at this late stage—whether the loss of the Cheshire countryside is in any way justifiable.
The Minister may consider that hands are tied by the last Government's decision and the result of the public inquiry, but there is the option of switching charter flights, above a certain limit, from Manchester to other regional airports, particularly Liverpool. That would relieve congestion at Manchester during the rush hours and help the development of other airports. Exactly that kind of action was taken in the early 1980s, when charter flights were redirected from Heathrow to Gatwick, and it started the regeneration of Gatwick. If such action could be taken then in the south of England, it can be taken now in the north.

353
Even in the present circumstances, the suggestion that Manchester's traffic growth exceeds its capacity is hard to square with common observation. I have received a letter from one of my constituents, a British Airways captain who flies out of Manchester and sees it more closely than most people, who states:
"My daily experience of airport operations makes it abundantly clear that the airport's existing runway is under-utilised. For extended periods, there are few, if any, aircraft movements."
The case for a second runway is not convincing. Those who walk the local fields and footpaths, as I did last weekend, between fences of a size and complexity that I have not seen since the end of the cold war, will wonder how convincing that case can be. In fact, there is no sufficient case, but there is every case for a pause and a review of airport and road and rail policies. Those policies hang together, or they fail together.
It would be useful at this point to pre-empt and answer the charge of NIMBYism. That unappealing acronym now has a different meaning: "not in Manchester's back yard". This is not a case against Manchester; it is a case for Manchester. Manchester must breathe, and the Cheshire green belt is one of its lungs. The development of the second runway will damage its lungs, and that damage cannot be made good.
Let us also counter the arguments that can and will be advanced about the necessary action of mitigation and damage limitation. Bats and badgers will be rehoused, hedges will be planted and ancient woodland will be replanted. We are promised the greatest migration of forestry since Birnam wood came to Dunsinane. This is about people, however. It is also about woodlands: ancient woodlands cannot be transplanted, but they can be destroyed.
The victims, however, will be people, such as those whose homes will be taken from them. There are two people observing this debate whose 17th-century farmhouse with its landscaped garden will go under the end of the runway. People have security guards living in their outbuildings, but no compensation has yet been agreed. The victims will be the people whose farms, footpaths and fields will be taken from them and the people who live beyond the perimeter of the new runway and who are unable to sell their homes, so they are, in effect, prisoners of their own property. Altogether a quarter of a million people will be affected by the noise and the extra risk factor associated with the second runway.
Those figures are not small. Behind these large issues lies the even larger issue of what kind of people we are. Are we the kind of people who will promote one airport at the expense of others? Are we the kind of people who will concrete over our inheritance? Or are we the kind of people who will pause to think, even at this late hour, and save what needs to be saved?
I have seen too much destruction in my previous life to condone it in this one. I have seen too much indifference to be indifferent now. I believe that we should pause, reflect and start anew.
12.40 pm
Mr. Paul Goggins: I am grateful for the opportunity to speak in this brief debate, and I thank the hon. Member for Tatton (Mr. Bell) for his
354
approach to it and for allowing time for other hon. Members to contribute. I congratulate him on the result on 1 May. Although we disagree on this issue, I acknowledge that he represents his constituents with honesty and integrity.
Half of runway two will be in my constituency, in addition to the two terminals and the 280 businesses that currently constitute the commercial community of Manchester international airport. The hon. Member for Tatton expressed his view and the views of a number of his constituents, but there is another view on runway two, which was endorsed by the inspector after a public inquiry that lasted more than 100 days and took evidence from 180 witnesses. That view is backed by the whole of the region's business community and, according to a recent MORI opinion poll, supported by 80 per cent. of local residents. I also support the view that the decision to go ahead with runway two is the most important strategic decision that has been made in the north-west region for decades, and that the extra capacity that will flow from that decision will unlock the region's economic potential and make the north-west a focal point in the global economy.
I must dispute some of the figures that the hon. Member for Tatton gave. The current and projected rate of growth in air passenger travel will result in 30 million passengers passing through Manchester airport by 2005, not 20 million as he stated. That is double the current rate. With those additional passengers will come 15,000 new airport jobs and as many as 35,000 further jobs elsewhere in the region. Those figures were not plucked out of a hat, as the hon. Gentleman said, but are well researched and well founded projections.
Some 2,000 of my constituents who live barely a mile from Manchester airport are out of work. Some of the young people in Wythenshawe, whom I represent, are third generation unemployed. They have given up hope of ever finding a job. The hon. Gentleman described the people of Tatton as concerned and dismayed. I ask them to put themselves in the place of those unemployed people and to imagine what it is like. Runway two may be their only chance of ever finding employment.
The least well known aspect of the £172 million investment, of which runway two is a part, is the environmental mitigation package, which the hon. Gentleman acknowledged. The eco-warriors labelled it as window dressing, but it will mean more ponds, new hedgerows and new grasslands and woodlands. Manchester airport has a 15-year management plan, so those 850 acres of countryside will be protected.
No one wants unwarranted destruction of the environment, but sustainable development requires social cohesion and economic progress as well as environmental protection. I believe that the plans for runway two have all three elements.
12.44 pm
Mr. Graham Stringer: I welcome this opportunity to put arguments in favour of the second runway and the development of Manchester airport, in addition to those put by my hon. Friend the Member for Wythenshawe and Sale, East (Mr. Goggins).

355
The essence of the case made by the hon. Member for Tatton (Mr. Bell) was that the extra traffic could be diverted to Liverpool airport and that the people of Merseyside would welcome that. He misunderstands European law and the freedom of airlines to travel where they want. Neither United Kingdom nor European law provides a power to tell airlines to land at Liverpool when they want to land at Manchester. If there were such a law, I hope that the hon. Member for Tatton would oppose it. Why should people who want to fly from Manchester have to go to Liverpool or anywhere else?
Airlines use airports because of the facilities that they offer. They can benefit from being able to transfer passengers to other airlines. In cities around the world, such as Glasgow, Toronto and Washington, attempts to run two airports separately have failed, and they have had to be amalgamated.
It was often said during the inquiry that Liverpool airport could be used instead of a second runway. If passengers were changing planes, even if a new route were built, would they want to arrive at Manchester and then take the train to Liverpool? I suspect that they would not welcome that.
I wish Liverpool well. I welcome the Deputy Prime Minister's statement on Monday that Liverpool and Manchester airports should work together for the benefit of the whole region, but it should not be done by some dictatorial distribution of traffic, which I believe would be unlawful.
The opponents of the second runway often use contradictory arguments. I am afraid that the hon. Member for Tatton falls into the category of people who say that demand is insufficient to justify the expansion of the airport. Other people argue that demand will grow too much, that the airport is not used efficiently enough, or that it is too efficient.
It has been argued that Gatwick can manage 35 million passengers on one runway. The aircraft that use Gatwick are larger. Jumbo jets use Gatwick in a way and in a mix that is not possible at Manchester. If Manchester could accommodate as many large aircraft, it could manage with one runway. Flights from Manchester are mainly short-haul to other parts of Europe and the United Kingdom, so jumbo jets do not fly from Manchester to Schiphol or Glasgow. Smaller aircraft require a greater number of movements and have fewer passengers.
An opinion poll carried out four years ago in every constituency in the north-west of England, including Tatton, showed majority support for the second runway because of the benefit for jobs. An opinion poll carried out in January showed majority support in every constituency except Tatton, where there was a small majority against it. People in the north-west know that the second runway would produce more jobs than any other investment in the whole of the north of England.
12.48 pm
Mr. Robert Sheldon: I have only 60 seconds. I listened carefully to the speech of my hon. Friend the Member for Tatton (Mr. Bell). I call him my hon. Friend because he should have hon. Friends on both sides of the House, given the way in which he entered Parliament. He is ably looking after his constituents, and I understand that well. My home, where I have lived nearly all my life, is probably nearer to Manchester airport
356
than the homes of many of my hon. Friend's constituents. I understand the problems, but it is important to have an international airport north of London, and Manchester has such an airport. It is the only such airport outside the south of England, and it is more important to the whole of the north of England and even to Scotland than some of the others that have been mentioned, which are feeder links to London. However, Manchester airport stands on its own. To reverse the move to the south, Manchester should have its second runway.
12.50 pm
The Parliamentary Under-Secretary of State for Transport (Ms Glenda Jackson): I congratulate the hon. Member for Tatton (Mr. Bell) on raising an issue that is important not only for his constituents but for all those who live and work in the north-west. I thank him for his generosity in allowing time for contributions by my hon. Friends the Members for Wythenshawe and Sale, East (Mr. Goggins) and for Manchester, Blackley (Mr. Stringer) and by my right hon. Friend the Member for Ashton-under-Lyne (Mr. Sheldon). They underlined my point that the issue is of great importance to the whole of the north-west.
Manchester airport is already the 18th busiest in the world, and handles more international passengers than Chicago's O'Hare airport. The proposal to build a second runway inevitably involved a wide range of aviation, economic, environmental and other issues and it became one of the biggest planning issues of the past decade. The Secretary of State at the time decided to call in the proposal because of its regional and national importance. A nine-month public inquiry was held from June 1994 to March 1995, at which parties that supported and those who opposed the runway gave evidence. Some 15,000 written representations were also taken into account. The inspector reported in August 1996 and recommended that planning permission should be granted. The then Secretary of State announced the granting of such permission in January this year.
Since the decision, opposition to the new runway has continued, and the Government have received numerous requests to revoke or review the decision. We have taken those requests seriously and examined the issues carefully. As a Cheshire girl, I would never have considered accusing the hon. Member for Tatton or any of his constituents of NIMBYism. We have concluded that it would be wrong to reopen the decision.
I am grateful for this opportunity to comment on some of the issues that were raised by the planning application, but I shall first give a brief outline of the policy background. We are committed to bringing together transport and environmental decision-making. My right hon. Friend the Secretary of State announced in the House on 5 June that we had launched a fundamental review of transport policy to provide an integrated transport system that meets the environmental and transport needs of all regions for today and the future. The review will look at short and long-term actions that are necessary to deliver an integrated transport system, and we aim to publish a White Paper in the spring. Its publication will mark the initial analytical goal setting and consultation phase in the development of that policy.

357
The hon. Member for Tatton spoke about possible investigation by the European Commission. There is no official investigation by the Commission. The current position is that it has asked the United Kingdom for comments on a dossier of papers that was provided to it. My Department is considering the dossier and will reply shortly. It will then be for the Commission to decide whether to take the matter further.
The accusation of state subsidy to British Airways relates to new facilities that are currently being constructed in terminal 1. The airport company agreed with BA and the other users of terminal 1 to redevelop the terminal following the opening of the first phase of the new terminal 2. The planning of that redevelopment has concentrated on increasing capacity, providing better facilities for passengers transferring between domestic and international flights and increasing the amount of retail space.
The first element of the redevelopment was a hub facility for Lufthansa and its partners. It opened last summer. Elements of the retail development are opening this summer. The final element is a new pier and associated facilities attached to the domestic part of the terminal which, in combination, will enable British Airways to combine its domestic and international operations in one part of the terminal. British Airways will not have exclusive use of those facilities. The airport company's arrangements with BA are consistent with the principles of the arrangements with other airlines for customisation of airport facilities. Airport charges will remain the same for BA as for all other users of the airport, as was explained to the Monopolies and Mergers Commission as part of the economics of the airport's charges.
Manchester airport has experienced sustained long-term growth in demand. It has retained its position as the UK's third busiest airport and has increased its market share over the years from 8 per cent. of all UK airport traffic in 1983 to 11 per cent. in 1993. It expects demand to grow from 12.9 million passengers in 1993 to 29.4 million in 2005, if the second runway goes ahead.
Even if the airport were restricted to one runway, demand is still expected to grow to 22.8 million passengers by 2005. However, the constraint of having only one runway would mean that there would be more pressure to find slots in off-peak times and more inconvenience to passengers. The inquiry discussed whether there could be other ways to meet the demand and decided that there was no other clear solution. The inspector recommended that there was no guarantee that demand could be diverted from Manchester airport, if it were restricted to one runway, to other northern airports.
The hon. Member for Tatton spoke about the issue that was raised by some objectors—the possibility of expanding Liverpool airport as an alternative to building a second runway at Manchester. A separate planning inquiry was held into proposals to expand Liverpool airport, as each of the Manchester and Liverpool proposals raised its own aviation, economic and environmental issues. My right hon. Friend the Secretary of State for the Environment, Transport and
358
the Regions recently announced that planning permission had been refused for the proposed expansion of Liverpool airport.
There is nothing that I can add to that decision other than to reiterate that those proposals would have caused more environmental harm than was justified by the need. We hope that Manchester and Liverpool airports will develop in a co-operative and complementary way. That is clearly a matter for the Manchester airport management to discuss with Liverpool airport's new owners.
The hon. Member for Tatton referred to the destruction that he has seen, and said that the central issue of the debate relates to people. As my hon. Friend the Member for Wythenshawe and Sale, East said, we have seen the destruction not only of the environment but of people brought about by economic decay. That is why the runway is so important to the whole of the north-west. The airport management has calculated that its planned expansion will lead to the creation of an extra 50,000 jobs by 2005, either directly or indirectly, compared with 1993. Some 18,000 of those jobs will be attributable to the second runway rather than to some other aspect of airport expansion. We are aware that objectors have queried those forecasts, and we do not necessarily subscribe to any one set of forecasts, but we agree with the inspector's conclusion that the only real dispute is over the scale of the impact.
We are confident that the growth of Manchester airport can be achieved in line with the principles of sustainable development. The public inquiry concluded that airport expansion should not lead to extra urbanisation as there should be sufficient capacity in the conurbation to accommodate the new jobs and the extra work force. We are pleased to see that the airport authorities have entered into a commitment to increase the proportion of passengers using public transport, hopefully to 25 per cent. We have given a grant to the airport for a new rail siding so that construction material can be brought to the site without disturbing the local community.
The second runway is in the green belt and is not the sort of development that would normally be appreciated in such a belt. I have two comments about that. First, national green belt policy allows exceptions in special circumstances and the previous Secretary of State considered that the need for the runway and the economic benefit that it would bring constituted special circumstances in this case. Secondly, the decision does not represent a general relaxation of green belt policy.
The benefits that the second runway will bring to the north-west must be weighed against local environmental impacts—the hon. Member for Tatton made several points on the issue—principally on the local ecology and landscape. A development of this type and scale will inevitably have some impact on the area, and that should be taken into account in any planning decision.
The airport management has drawn up an impressive environmental mitigation package that won the endorsement of English Nature, the statutory advisers on ecological issues, and that persuaded Cheshire county council to drop its objections to the planning application.

359
The package includes the replacement of ponds and hedgerows and improved management of the ponds and hedgerows that will remain in place—
Mr. Deputy Speaker (Sir Alan Haselhurst): Order. I hope that hon. Members will have noted the difficulty in half-hour Adjournment debates secured by one Member: interventions may prevent a full reply from the Minister.

Measles Vaccines
1 pm
Mr. Llew Smith: Jonathan Swift once said:
"Falsehood flies, and Truth comes limping after it; so that when Men come to be undeceived, it is too late, the Jest is over, and the Tale has had its Effect".
How true that was and will be, as evidence is increasingly uncovered highlighting the potential implications of the rising incidence of autism and Crohn's disease in children, and the uptake of the mumps, measles and rubella and the measles and rubella vaccines. Indeed, the evidence shows that it is the cocktail of vaccinations that is likely to be the cause of the unexpected problem.
In the past two years, I have tabled dozens of questions and was granted an Adjournment debate on problems relating to measles and rubella vaccinations—problems ranging from lack of adequate information to parents and the possible side effects of the vaccinations to the damage itself. Over that period, I have become increasingly critical of the procedures and the side effects on some children from those vaccinations, but even my cynicism was stretched to breaking point when I read that in the latter part of the 1950s in the United States, and in the United Kingdom in the early 1960s, Down's syndrome children were used as guinea pigs in tests involving live measles vaccines. At that time, those living in the institutions concerned were described as "sub-normal".
Those tests were recently brought to the public's attention as a result of an article in The Sunday Telegraph by Victoria Macdonald, highlighting much of the research by solicitor Richard Barr and consultant Dr. Andrew Wakefield. In the past couple of weeks, articles in the Irish Independent also raised the issue. Their author, Brian McDonald, reported:
"Children, some of whom were either mentally or physically handicapped, were used in drug trials carried out in Irish orphanages over twenty years ago."
Some people, while deploring what happened in the 1950s and 1960s, may attempt to justify it on the basis that at that time we knew no better, but that is not a satisfactory explanation. For instance, Dr. Richard Nicholson, editor of the Bulletin of Medical Ethics, stated:
"People try to say that you cannot apply the same ethical standards today as you could in 1960. You have to do the research with the proper safeguards in place and the safeguards were there in 1960, but it was largely ignored by the doctors."
Dr. Wakefield of the Royal Free hospital stated:
"this is both a practical and ethical issue. You cannot extrapolate from brain damaged children to normal infants."
The response by Jackie Fletcher, who set up the national organisation JABS—Justice Awareness and Basic Support—when her child was severely brain-damaged after one of these vaccinations, said:
"The more I go into this, the more horrific it becomes".
We should be horrified, because, as Victoria Macdonald stated in her article:
"babies and young children with Down's Syndrome were used as guinea pigs by British doctors in 1960 to test an experimental vaccine for measles … children who were living in institutions for the "severely subnormal" (as they were then described) were

361
subjected to the experiments because the doctor said it was "useful" having them in hospital where they could watch over them for adverse reactions."
She went on to state:
"one of the children died seven days after being vaccinated from a common side effect of measles, but the doctors described it as coincidental in their reports."
From an ethical point of view, tests such as those carried out in the UK in 1960 on Down's syndrome children—some of the most vulnerable people in our community—should never have taken place, because those children did not have the ability to say no. Because of their mental condition, they were passive recipients of the tests or anything else one wished to inflict on them. If we are to be worthy of the description "civilized", we can never condone those acts; otherwise, we debase our humanity. We hear of other instances, where people with severe learning difficulties have been taken advantage of; we have rightly condemned those acts and must continue to condemn them, but we must also ensure that we learn from our mistakes.
On the practical side, Dr. Wakefield argues that there are several factors which make that population
"entirely inappropriate for studies designed to detect adverse neurological events to measles vaccine."
He states:
"The susceptibility of the damaged brain to acute and delayed adverse events to measles or measles vaccine is unknown, although this may be altered when compared with the normal brain."
It was inappropriate and potentially hazardous, therefore, to extrapolate from that series of studies that the vaccines would be safe for the general population. The period of observation was limited to three weeks maximum in any one study, which is far too short a time either to detect or to exclude all adverse effects on the central nervous system.
The question we have to ask is what lessons have we have learnt from the mistakes of the early trials. The inadequacy of the three-week safety trials, particularly in relation to children with Crohn's disease, is highlighted by Dr. Wakefield, who states that there may be a diagnostic delay of up to two years. Indeed, he goes on to say that there
"have been no prospective studies of measles vaccine safety beyond the initial 3–4 weeks follow up period … Beyond this time, safety was assumed. It is notable that trial cohorts from 1964 continue to be monitored for vaccine efficacy 31 years later. It is also notable that in 1995 it was possible to use the same trial cohort to examine a possible link between measles vaccines and inflammatory bowel disease."
Those points were also made by Thompson writing in The Lancet in 1995.
Mr. Don Touhig: As my hon. Friend knows, I have some knowledge of the problem of Crohn's disease, as my eldest daughter has been a sufferer for the past 10 or 11 years. Will my hon. Friend comment on the case of David Lawrence, a young constituent of mine who had a measles vaccination in 1994 and became very ill with a serious virus about 10 days later? Over the past two years, he has gone from being a healthy, fit young lad to a weak and sickly young lad. Three weeks ago, he
362
was diagnosed as having Crohn's disease. His family are convinced that all his medical problems stem from that vaccination.
Mr. Smith: Solicitors and consultants involved with this work have received hundreds of similar complaints about children who have ended up with either Crohn's disease or autism. What saddens me is the response of the medical profession, which more often than not implies that there is no relationship between the vaccination and autism or Crohn's disease. People in the profession often say, "These are merely scare stories," but the example that my hon. Friend has given is repeated in my constituency. Within an hour of the measles vaccination, a young girl became seriously ill, and a couple of years later she is having treatment for autism and Crohn's disease. There are not just one or two cases: there are hundreds of cases.
Vaccine experts state:
"standard dose "further attenuated" measles vaccines are among the safest vaccines in use today".
Although the implication of that statement is that live measles vaccines are safe, it is of course relative and meaningless if safety trials of other vaccines were as inadequate as those conducted on measles vaccines.
No one denies the benefits of vaccinations, but what about the risks? Vaccines should be safe. The children are not ill; they do not have any disease when they are vaccinated. Vaccines are given as a preventive measure. The only acceptable side effects of a vaccine are those which produce no long-term damage. More than 800 families have now contacted solicitors or support groups in the belief that their children have been seriously damaged by vaccines in the same way as the child referred to by my hon. Friend.
It is worth noting that Crohn's disease among children was unheard of 15 to 20 years ago. What safeguards were in place to monitor the risks of two-dose vaccine schedules, which had been highlighted as of particular concern to international measles virus experts in the early 1990s? There was none—safety was assumed on the basis that certain Scandinavian countries, such as Sweden, had been administering two doses of measles vaccine for some years. But had Sweden or any other Scandinavian country ever conducted any safety trials of two-dose measles or measles, mumps and rubella vaccines? No, they had not.
We cannot make assumptions about the safety of the administration of, or exposure to, live biological agents. How many times in recent years have we been reminded of that fact, whether it be in relation to the Gulf war, BSE or E. coil? The chief medical officer, Sir Kenneth Calman, claimed in the Daily Telegraph on 5 December 1996 that Britons were dangerously blasé about disease. Unfortunately, the assumptions made by his Department about the safety of a second dose of measles vaccine show that the Department was equally blasé.
The Department of Health claimed that the procedure was safe because it had been given to millions of children world wide. That is not a qualification of safety. Thalidomide was given to thousands of women, but that did not make it safe. Dr. David Salisbury, principal medical officer for vaccines, had ample warning of potential problems as early as 1992. Indeed, these points have been made on many occasions to officials at the Department of Health. Unfortunately, I suspect that those who were advising the previous Government are now advising the Labour Government.

363
We should contrast the Government's policy on reviewing the possible negative health effects of the MMR vaccination campaign on some children with the rapid way in which Ministers have rightly intervened to support the alleged victims of Gulf war syndrome.
The previous Government tried to deny and then to avoid all responsibility for Gulf war syndrome. Yet when it comes to initiating a widespread review or reassessment of the MMR-MR vaccination campaign, Labour Ministers are sticking to the same policy reassurances as their Conservative predecessors. For example, in 1995 Tom Sackville, the then Conservative Minister, said in a written answer to me:
"There is already a well-established satisfactory system in place for monitoring adverse reactions to all medicines, including vaccines.—[Official Report, 6 November 1996; Vol. 265, c. 610.]
More recently—on 22 May—in a written question I asked the Secretary of State for Health whether he would
"establish a review of (a) the effectiveness of and (b) side effects arising from the most recent national MMR vaccination campaign."
The Minister for Public Health replied:
"The effectiveness of, and side effects arising from, the 1994 measles/rubella (MR) school-based immunisation campaign have been carefully reviewed … The campaign was very successful."—[Official Report, 22 May 1997; Vol. 294, c. 174.]
Essentially, her reply was the same as that given by the Conservative Minister.
I want to restate the need for an independent commission to study the possible links between MMR and MR and Crohn's disease and autism in children. I have been advised that work done in America by Dr. Hugh Fudenberg and Dr. Gupta, and in the United Kingdom by Paul Shattock of the University of Sunderland, demonstrates the link between vaccine damage and autism. I urge my hon. Friend the Minister to investigate that further.
What concerns me and others is Government inactivity over more than 300 cases in which parents claim that their children have been injured by one or other of the vaccines. In particular, there seems to be an extraordinarily high incidence of autism among the children concerned and a surprising number of cases of what appears to be Crohn's disease.
Autism has been dismissed as a side effect by Elizabeth Miller of the Public Health Laboratory in a memorandum to health professionals. She argues that it is simply a coincidence because most autism is diagnosed at about 18 to 30 months, which happens to coincide with the time of vaccination. What Dr. Miller does not explain in that rather simple answer is why the vaccinated children develop other symptoms at the same time as becoming autistic. Many of them develop a raging thirst; many acquire bizarre eating habits; sleep patterns are disrupted and children lose their temperature control. A characteristic common to many of the late-onset autism cases is that speech which had been previously acquired is lost. In other words, the children do not simply fail to develop—they lose what they already had.
That all tends to point to an encephalitic event, and even the Government's chief medical officer concedes that there is a possibility that the vaccine causes autism. In a memorandum to directors of public health on 7 February, he states:
"It is therefore unlikely that MMR vaccine plays a part in the development of autism in children who do not have significant neurological manifestations after immunisation."
364
The inference is that he concedes that the MMR vaccine does play a part if there is a significant neurological manifestation.
Crohn's disease and autism are not the only side effects reported in respect of the MMR vaccine. My attention has been brought to 122 cases in which epilepsy developed after vaccination, and numerous other cases of problems with the immune system.
Finally, nothing can be done about the decision to use Down's syndrome children as guinea pigs for live measles vaccinations in 1960. We now know that the vaccines were not innocuous. We need to be rigorous in the design of safety standards. We need an independent investigation into the links between MMR and MR and Crohn's disease and autism in children. Until then, we should consider suspending the multi-dose MMR vaccines in favour of single-dose vaccines. We should also suspend the revaccination programmes because no safety trials have been conducted on them.
1.17 pm
The Minister for Public Health (Ms Tessa Jowell): I thank my hon. Friend the Member for Blaenau Gwent (Mr. Smith) for raising this important issue. I pay tribute to his relentless pursuit of information and inquiry.
I was very concerned when I heard about the use of the measles vaccine on children in residential care in the United Kingdom in 1961—the issue that has prompted this debate. I have uncovered as much of the story as possible and will set out the facts available to me. It is important that hon. Members should recall the context and the extent and seriousness of measles at the time.
In the 1950s, measles in the UK had settled into a cycle of large epidemics every other year. The annual notifications ranged from a minimum of 150,000 to a maximum of 700,000 cases, with up to 300 deaths a year. Measles was a killer both in this country and around the world. Against that background of serious disease, work was progressing internationally to produce safe and effective vaccines. During the 1950s, candidate vaccines had been developed and by 1960 many had already undergone clinical trials in the United States. The results of those trials were reviewed and evaluated in the New England Journal of Medicine on 28 July 1960.
Mr. Llew Smith: Does my hon. Friend accept that the trials conducted in the United States involved about 170 to 180 children, the vast majority of whom would have been regarded at that time as mentally sub-normal? I know that that is an awful phrase, but it was the one used at that time.
Ms Jowell: I should be very happy to supply to my hon. Friend all the information available to me on those studies. I should be happy also to supply him, for his information, with the material that has been provided to me for this debate.
Based on encouraging results from the tests, the authors provided suggestions for future study and subsequent use of measles vaccine. Based on their safety and efficacy data, the authors concluded:
"At this time it seems appropriate to recommend the extension of clinical trials of attenuated measles vaccine in special groups."
A "special group" means one in which measles causes high levels of serious illness and death.

365
I have made a point of starting my reply to this debate with information about the 1960 published review, because it predates the first United Kingdom trial of measles vaccine. The authors of the 1961 UK study referred to the 1960 review in their research. The UK study was built on the US work, and based on the recommendation that special high-risk groups be examined.
Some children have long been known to be at higher risk of suffering severe consequences of measles. Those groups include children with conditions such as Down's syndrome, cerebral palsy, cystic fibrosis and malnutrition. Children with Down's syndrome, such as those in the study, have congenital heart disease, which means that they are much more likely than other children to die or suffer serious injury from measles.
Children in residential care are also a high-risk group. Not only do those children often have underlying medical problems, but measles spreads very rapidly in closed communities. It has been estimated that the introduction of measles into residential units was associated with 70 per cent. to 90 per cent. of attack rates in susceptible children. It is worth nothing that, in May 1968, when measles vaccine was eventually offered to all children, the then Chief Medical Officer wrote to all doctors stating that those who should receive vaccine first, despite anticipated shortages of vaccine, should include
"susceptible children living in residential establishments aged between 1 and 7."
Prior to the 1961 study, therefore, the researchers were in the following position: first, they knew that an outbreak of measles was coming; secondly, they knew that children with disabilities such has Down's syndrome were at particularly high risk from measles; thirdly, they knew that the US studies had shown the vaccine to be sufficiently safe and effective to recommend that it be given to special high-risk groups; fourthly, they had an opportunity to give the vaccine to such a high-risk group.
More importantly—I believe that this point has not yet been raised in the debate—the researchers then approached the parents of those children. As reported in Hansard on 4 December 1961 at columns 925–26, the children's parents had been asked and gave their consent to the trial in writing. The study went ahead, with immunisation occurring in January and February 1961.
In 1961, the largest recorded measles epidemic in the United Kingdom occurred, in which 764,000 cases were notified. Of those, 152 deaths were reported. Of those deaths, 132 occurred in the first six months of 1961. Of those 132 deaths, 66 deaths—exactly half—were among people with chronic disease or disability. If we examine those 66 deaths more closely, we discover that more than half those people either had Down's syndrome—accounting for 20 deaths—or were classified as having mental retardation or deficiency, accounting for a further 17 deaths. Most of the 66 people had been resident in hospitals or institutions for at least six months before the onset of measles and all but eight of them were aged under 15.
366
I am sure that my hon. Friend will agree that those figures tragically demonstrate the heavy toll paid by children with Down's syndrome or mental retardation during measles outbreaks before immunisation.
Mr. Smith: The point that I am trying to make is that conclusions reached as a result of tests on Down's syndrome children cannot be applied to the general population. That is my argument and my criticism of the way in which the tests were conducted. I accept that parents signed agreements to the tests—most people would expect them to have signed agreements—but such agreements do not justify the tests.
Ms Jowell: Clearly, there is an issue of consent. The issue would have arisen then, and it arises now. The important factor, however, is that the parents of those children gave consent to testing—on a group of children who, on the information available to me, were at high risk of measles.
In the 1961 UK vaccine study, the authors reported that none of the 56 vaccinated children developed measles and that none of the children suffered serious side-effects. The authors went on to recommend that the number of instances of rash and fever after immunisation in the study might be reduced by work further to weaken the vaccine virus strain used.
I understand my hon. Friend's concern about such studies and I, too, am determined to ensure that clinical trials are conducted to the highest standards of ethical behaviour and ethical practice. On the evidence available, however—because written parental consent was obtained, supporting research had already been conducted, an epidemic was imminent and the group being vaccinated was at high risk from the disease—I do not believe that that research can be equated with the situations that my hon. Friend mentioned in the Republic of Ireland or Australia.
It may be helpful to the House if I explain the process by which vaccine safety is ensured in the United Kingdom and how we continue to monitor vaccines after they are in widespread use. All manufacturers wishing to market vaccines in the United Kingdom have to apply for marketing authorisations. The applications include full data on the manufacturing process and quality control of the vaccines. The applications are reviewed by staff of the Medicines Control Agency, and advice is taken from experts on the Committee on Safety of Medicines and its biologicals sub-committee.
Each vaccine is considered individually, and a marketing authorisation is licensed only if all aspects of its quality, safety and efficacy are satisfactory. Furthermore, vaccines used in the childhood immunisation programme are batch released by the National Institute for Biological Standards and Control, which means that no vaccine is issued in the United Kingdom unless it passes the highest standards for purity.
Once that rigorous process of licensing has been completed, the licensed vaccine is available for use. Measles vaccine was introduced into routine use in the UK in 1968, by which time the UK had observed the experience in the US, where measles vaccine was first licensed and recommended for use in 1963.
Once vaccines are used, all reported adverse reactions to them are carefully monitored by the Committee on Safety of Medicines and the joint committee on

367
vaccination and immunisation, which advises my Department. I tell my hon. Friend the Member for Blaenau Gwent that I am keen to ensure that all fresh evidence about any possible adverse reactions are submitted to that committee for proper scientific assessment and appraisal.
Mr. Smith: I should like to make three quick points, all of which I am sure that you will answer. Will you tell me, first, what safety trials have been conducted on re-vaccination? Secondly, will you comment on the studies by Dr. Andrew Wakefield of the Royal Free Hospital? Thirdly, do you accept the link between vaccination, measles, MMR and MR and autism and Crohn's disease? If not, can you explain—
Mr. Deputy Speaker (Sir Alan Haselhurst): Order. I remind the hon. Gentleman that he is addressing the Chair.
Ms Jowell: In the time left in this debate, I will endeavour to cover the points raised by hon. Friend. If
368
time runs out, however, I will write to him to deal with them. I am aware of the concern about an alleged link between measles, autism and Crohn's disease. I understand that evidence submitted to the joint committee on vaccination and immunisation could not establish such a link, and that the absence of such a link has been confirmed by a further study of the evidence by the World Health Organisation. I make it clear to my hon. Friend, however, that, if fresh evidence becomes available, I will insist that further investigation of that evidence is undertaken.
Secondly, I know that Dr. Andrew Wakefield of the Royal Free hospital has conducted research in this area, and I will ensure that proper attention is given to it and its conclusions by my officials. However, I have to make it clear that it is the joint committee on vaccination and immunisation—an independent body—which currently advises the Department on vaccine safety.
Mr. Deputy Speaker: Order. We now come to the next debate.

New Age Travellers (Harborough)
1.30 pm
Mr. Edward Garnier: I am grateful for the opportunity to raise the issue of new age travellers in my constituency. I am also grateful to the Under-Secretary of State for the Environment, the hon. Member for Greenwich and Woolwich (Mr. Raynsford), for his attendance to respond to the debate.
Until relatively recently, my constituency was mercifully free of trouble from new age travellers. Two years ago, a small group of them set up camp on farmland in Blaston, but, following the intervention of the landowner through the courts—albeit at considerable expense to himself—they were moved on, and have not been back since. This year, however, things have taken a turn for the worse.
In February and March, an illegal encampment of travellers was set up in Welham lane in the parish of Great Bowden. Welham lane is a public highway that leads from the A6 Market Harborough bypass eastwards towards the village of Welham. It is about three miles from the A6 to Welham along that lane—a single-track road with wide grass verges. There is a hedge down each side of the lane, and beyond the hedges lies typical Welland valley pasture land, which for centuries has been used by local farmers to graze cattle and, more recently, sheep.
At the A6 end of the lane, there is a farmyard to the north and a pheasant hatchery and farmhouse to the south. Halfway along the lane to Welham there is a hump-backed bridge over a stream. When the bypass was completed, the bridge was blocked to road traffic, but it remains open to horses, bicycles and pedestrians. The lane has been used extensively by local residents and farmers for recreational and agricultural purposes for many years.
The land either side of the lane is farmed by tenants and landowning farmers. This spring, as in earlier years, the fields were used for ewes and lambs as well as for the beef cattle for which Harborough is justly famous, but all this changed when the new age travellers arrived.
To begin with, there were only a few who parked their caravans, lorries and old buses on the verges to the west of the mid-way bridge. They were mostly in their twenties and thirties, although there were a few young children. They also had dogs—large dogs which ran up and down the lane, chasing the farmers" pick-up trucks carrying feed to the sheep, or barking at the heels of the horses being ridden down the lane.
At first, the new age travellers were seen as a curiosity by local residents, but, as their numbers grew, their behaviour became worse. By April, there were about 80 people living along the lane. It was by now impossible to take a dog for a walk along the lane without being menaced by the travellers' dogs. Riders would not risk taking their horses down the lane.
At weekends, the travellers held noisy parties, setting up large amplifiers in the fields and blasting music across the countryside to the annoyance of my constituents. One couple who live in a village two or three miles from Welham lane had to stay with relations in Suffolk to be sure of getting some sleep at night.
The encampment became a centre for drug dealing, as dealers from the city of Leicester found a ready market there. The site became a health hazard as the travelers
370
defecated in the hedgerows, left litter and burned open fires along the verges. The travellers would steal petrol from local garages and demand drinking water from nearby farmers. The farmers themselves were also being abused. The travellers' dogs were allowed to roam free across the neighbouring fields, worrying and killing ewes and lambs. When the farmers came down the lane each morning and evening to feed their beasts, their vehicles were damaged and their access was blocked.
In the end, it became impossible to use the land at all, and flocks had to be moved to other land. That meant that tenant farmers had to pay hundreds, and even thousands, of pounds to rent the grazing that was effectively now out of bounds. For tenants and owners alike, it meant facing the possibility of over-grazing other land, at a time when rain and new grass were scarce. As if all that were not bad enough, the way in which the local authorities and the police dealt with the illegal encampment left much to be desired.
Before I say what I am about to say, let me make it clear that, on an individual basis, the Home Office, the county council and district council officials and the police officers from Market Harborough, whose task it was to deal with the new age travellers, did their best, and genuinely wanted to help. But what I and my constituents found so frustrating was the slowness of the official reaction and the apparent failure to anticipate and then co-ordinate a response to the problem caused by the travellers.
It seems that each agency of government was nibbling at the problems but without reference to any other relevant department, and that no one was taking a strategic overview or producing a co-ordinated response. To illustrate what I mean, I cite the following example: the nuisance caused by the loud music systems was a matter for the district council's environmental health department. The environmental health officer had powers to serve a noise abatement order, but, for understandable reasons, he would not go down Welham lane to serve the order without a police escort.
The police headquarters in Leicester felt that it was not a proper use of precious resources to send a regiment of policemen to protect one environmental health officer in far-off Great Bowden while he served a noise abatement order, when officers could be more fruitfully employed patrolling the streets of the city of Leicester. Nor would the police escort farmers to and from their fields through the encampment twice a day. They could not arrest the drug dealers or drug users unless they had evidence, and none of sufficient quality was available. If the vehicles were unlicensed and uninsured, it was a small matter compared to what needed doing elsewhere.
Action eventually came from the legal department of the county council, the highway authority with responsibility for Welham lane. In my naivety, I thought that the council would take proceedings under section 77 of the Criminal Justice and Public Order Act 1994—one of the provisions of that statute designed specifically to deal with the increasing problem of new age travellers.
I had several discussions with the county council in April this year, and I formed the distinct impression—although it was not put in so many words—that, as a matter of policy, Leicestershire county council and other local authorities do not use the 1994 Act, because it does not achieve its intended purpose. It was suggested to me

371
that the Act allows for defences to be raised which hinder and delay the implementation of court orders made under it.
Instead of using that Act, the county council had applied to the district judge by originating summons under order 113 of the rules of the Supreme Court—a procedure for recovering possession of land wrongfully occupied by trespassers, which has been in use for 20 years or so and which is designed to deal primarily with urban squatters where not every trespasser can be identified.
The district judge was sympathetic to the county council's application but felt constrained to adjourn the hearing for two weeks, which was extended to three weeks, to allow the respondent new age travellers to gather evidence of hardship, to apply for legal aid and to apply to the divisional court to review the county council's decision to evict them. This was done on the advice of a firm of solicitors which has made something of a name for itself in this aspect of the law.
To my constituents, this meant that the very people who were continuing to do them harm were now being financially assisted by the state—over and above the welfare benefits that they were already receiving—through legal aid to allow them to do further harm. It was a case of the law-abiding, taxpaying citizen subsidising the unlawful, social-welfare-receiving trespasser in the continuance of his anti-social conduct.
The only thing that my farming constituents and I found in the least amusing throughout this episode was the new age travelers' denial that it was their dogs that had killed the sheep. It could not have been their dogs, they told the district judge, because their dogs were vegetarians.
The other illegal encampment in my constituency is in Mill lane in Smeeton Westerby. This village is about eight miles north-west of Market Harborough, and eight miles south-east of the city of Leicester. Mill lane runs north from the village main street towards the parish of Fleckney. The first half mile of the road from the village is a metal road; the remainder is not made up but is still part of the public highway. Like Welham lane, it is hedged and verged, and runs through grazing land. At one point, there is a privately owned wood or orchard adjacent to the lane.
About three or four years ago, a small group of travellers broke into the wood and set up camp there. They did all the things that trespassers usually do, but, as the site was on private land and the owner lives in Australia and has either lost interest in it or cannot be found, the travellers have stayed in the wood. So long as there were not many of them and they kept their dogs under control, nobody did anything much about them. Indeed, they have been there for so long that I believe the Post Office has given them a postal code, and two children from the camp attend the local primary school.
Unfortunately, the site has acted as a magnet for other new age travellers, who have camped along the verge of the lane. The problems experienced by residents and farmers in Great Bowden with the Welham lane site are now being replicated in Smeeton Westerby.
372
There are now approximately 80 new age travellers living along Mill lane. Their dogs have killed sheep and lambs—two of the dogs have been shot dead by a local farmer to protect his sheep. The new age travellers have begun to attract drug dealers from Leicester, and they have made it impossible for villagers to ride their horses or bicycles along the lane, or even to walk their dogs.
Attempts to remove the new age travellers from Mill lane have been frustrated by two things: first, by the travellers simply moving to the adjacent private land and then, after an interval, returning to reoccupy the verges; and, secondly, by the landowner's absence abroad.
However, following the lessons learned from the Welham lane episode, the police, Leicestershire county council and Harborough district council are working together in a more organised fashion to decide how best to deal with the 50 or so vehicles and their inhabitants on Mill lane. Inspector Steve Hanson, who has recently taken over as officer in charge of the Market Harborough local police unit, has introduced a greater sense of purpose and focus. The chief executives of the two councils and their legal departments are now working closely together.
When the Welham lane site was eventually vacated by the new age travellers after the district judge's order had been finalised in May, the police said that they were prepared to provide back-up in sufficient numbers to let the travellers know that they meant business, and the travellers withdrew their application to the divisional court. A vast amount of public money had been spent dealing with the encampment—not just on police and local authority officers' time, but on lawyers' fees, legal aid, Home Office inquiries by me, and the collective dealing with the public inquiries by the several agencies involved. The Smeeton Westerby travellers are still on site. Proceedings against them are being contemplated by the county and district councils.
We need to reconsider the issue of new age travellers with a greater sense of urgency. It is the Government's duty to persuade local authorities to co-ordinate their approach to the problem more effectively. If one county has information about a convoy or encampment of new age travellers, it should make sure that its neighbours know. Removing travellers from Leicestershire helps the people of my county, but that may mean that the encampment moves on to one of the several adjacent counties, and the legal process has to be gone through again at further public expense.
Why cannot the Home Office or the Department of the Environment set up a unit to monitor the activities of new age travellers and advise local authorities on the best means of solving the problems they cause? The same approach should be taken by the police across the country. Intelligence and previous experiences should be shared for the greater advantage of the law-abiding and tax-paying public.
Within counties, district and county councils should talk to each other, plan together and act in concert with the police. It is also incumbent on local authorities to let Members of Parliament and the Government know if they are unclear about or dissatisfied with a statute and its perceived effects or defects, rather than keeping their misgivings to themselves and failing to use it.

373
Local authorities and the police are misleading themselves about the Criminal Justice and Public Order Act 1994 and recent case law. Section 61 gives the police a power to direct trespassers to vacate land. That power arises if the police believe
"that two or more persons are trespassing on land and are present there with the common purpose of residing there for any period, that reasonable steps have been taken by or on behalf of the occupier to ask them to leave and—

(a) that any of those persons has caused damage to the land or to property on the land or used threatening … behaviour towards the occupier … or

(b) that those persons have between them six or more vehicles on the land".

The police need only have reasonable grounds for believing the persons concerned to be trespassers. The trespass does not have to be established by an order of the court before the power under section 61 arises. The period of residence is not specified. I suggest that it can be any period.
The section requires only that the owner should have taken reasonable steps to ask the trespassers to leave. When passing the Bill into law, Parliament did not say that the occupier should be expected to have taken legal action or obtained a court order before the power in section 61 may be invoked. We do not ask those who are assaulted to take civil action before the police become involved to press criminal charges. The power under the section arises if there are at least six vehicles on the land, even if none of the events that I have just recited has occurred.
The statutory purpose of section 61 is clear. When we passed the Act, we wished the police to have the power to direct that land be vacated if at least six vehicles are present, even if no criminal activity or damage to land is involved, without expecting the landowner to use a civil remedy before acting. The importance of that parliamentary intention is emphasised by the reduction in the number of vehicles that must be present, from 12 under the Public Order Act 1986 to six.
Section 77 enables a local authority to serve a direction requiring persons to vacate land, the failure to comply with which may also constitute a criminal offence. However, there are some important differences between section 77 and section 61. The power in section 77 arises if persons are residing in only one vehicle on land in an authority's area. The requirement of at least six vehicles does not apply. It applies if vehicles are located on highway land, unoccupied land or occupied land without the consent of the occupier.
Even for an occupation of fewer than six vehicles, there is no requirement that any of the criminal conduct referred to in section 61 should have occurred for section 77 to apply. An offence is committed under section 77 when a person knowing of the direction fails to leave the land as soon as practicable.
Any defence is restricted to a failure to comply caused by
"illness, mechanical breakdown or other immediate emergency."
The defence under section 61, by contrast, includes
"a reasonable excuse for failing to leave the land as soon as reasonably practicable".
374
If a direction under section 77 is contravened, the local authority may apply to the magistrates court for an order requiring the removal of any vehicle, property or resident person. The order may also authorise the authority to remove vehicles or property. Under section 61, the police have a power to arrest, and under section 62 they have the power to seize and remove vehicles without the need for a warrant or order of the court.
I hope that I have shown that sections 61 and 77 are different. If they were not, one of them would be unnecessary. Section 61 is directed at situations in which trespassers remain present on land despite the occupier's request that they should leave and certain misconduct has occurred. That power is available to the police if any of the events set out in section 61(1)(a) have occurred. The police can take direct action against the persons thought to be wrongfully present and their property. The section is clearly intended by Parliament to be a speedy and effective remedy, without the need for additional legal proceedings before the trespass is brought to an end.
In contrast, section 77 deals with a broader range of circumstances, in which criminal activities or substantial numbers of vehicles need not be involved and the interests of private landowners need not be affected. Although the local authority is unable to take direct action without court proceedings, the defence under section 77(5) is relatively limited.
Local authorities and police forces have placed reliance on the case of R. v. Lincolnshire county council and Wealden district council ex parte Atkinson, which was decided by Mr. Justice Sedley in 1996. They have also been influenced by the Department of the Environment circular 18/94.
That case and that circular gave some police forces the false impression that the same principles enunciated by the judge in the Wealden case apply to orders issued by the police or local authorities under the 1994 Act. Some police forces think that inquiries about education, housing, social service needs and similar matters have to be made before a local authority direction can be made, and that, before the police can invoke their powers under the Act, account should be taken of the personal circumstances of the travellers.
The judge in the Wealden case did not analyse section 61 of the 1994 Act in detail. His decision was based as much on the statutory duties placed on local authorities under the Children Act 1989 and the Housing Act 1985, as well as the obligation on local education authorities to provide education for all children of school age in their area.
The Wealden judgment does not support the view that a local authority or chief constable owes a duty of care to trespassers who are the subject of action under section 61. The function of the police is to enforce the law. It is not their primary duty to take a view on social welfare. There is no legal basis for asserting that the police are under a legal duty to take social factors into account before acting under section 61. The annexe to the Home Office circular 45/94 does not suggest that the Wealden case is relevant, or that any such duty applies.
The powers provided to the police under section 61 and to local authorities under section 77 of the 1994 Act to deal with new age travellers are clear. Parliament deliberately provided those powers, and my constituents and I have a right to expect that they will be exercised by public agencies and authorities when necessary.

375
As a lawyer, I am the first to admit that the law is not always certain, but it can be made more certain if the Government take the steps that I am advocating: the organisation of greater co-operation across the country in dealing with new age travellers on the one hand, and on the other hand instilling a firmer sense of purpose among police forces and local authorities in applying the powers and remedies deliberately given to them by Parliament under the 1994 Act.
Local government officers and police officers are human—so, too, are lawyers—and they naturally have a well-intentioned concern for the welfare of travellers with whom they are required to deal, but I suggest that such well-intentioned concerns should not be placed above the rights of the law-abiding and tax-paying citizens, whose lives and businesses in my constituency—and no doubt many others as well—have been so badly affected by the unlawful activities of new age travellers.
1.49 pm
The Parliamentary Under-Secretary of State for the Environment, Transport and the Regions (Mr. Nick Raynsford): I congratulate the hon. and learned Member for Harborough (Mr. Garnier) on securing this debate on an issue of concern in his constituency: the unauthorised camping by so-called new age travellers on land which they do not own, and the appalling nuisance that has been caused, particularly in relation to their dogs roaming on adjacent land, noise from rave parties and intimidation of people living in the area. The hon. and learned Gentleman and his constituents have my sincere sympathy for the obvious distress that the travellers have caused.
As the hon. and learned Gentleman has made clear, this is a complex and emotive area, which can have a real impact on local businesses and communities. It inevitably covers a range of issues: unauthorised camping, noise nuisance, threatening behaviour, dogs, and many others—the list is very long. He has drawn particular attention to how the issue involves working with a number of different authorities and different powers. The spread of responsibility inevitably crosses administrative boundaries not only locally but in central Government. Indeed, I think that he was a little surprised that I was the Minister responding to the debate.
As the hon. and learned Gentleman will be aware, although my Department has policy responsibility for local authority powers under the Criminal Justice and Public Order Act 1994, my right hon. Friend the Home Secretary has responsibility for those powers available to the police, which deal not only with trespass on land but with drug dealing and general criminal activity—whether among travellers or anyone else. There are also important links between our Departments in policy on dogs and dealing with noise nuisance and raves.
The hon. and learned Gentleman has identified the frustrations which can arise when the agencies involved do not, for whatever reason, work well together. It is precisely because the issues are so complex that my officials and their colleagues in the Home Office keep in constant touch on such matters, and have indeed discussed this very case over the past few days.
My officials have also been in touch with officers at Leicestershire county council, who I understand have evicted the travellers camped at Welham lane using civil powers, to regain possession of the council's land, despite
376
attempts to challenge it through the courts. That proves that such situations can be dealt with effectively, and that unauthorised campers, particularly those who make life a misery for everyone else, can be evicted. One point about the case, however, is the time that the process can sometimes take, which has obviously caused considerable irritation locally.
I am very conscious of the real difficulties that encampments such as the ones described by the hon. and learned Member can present to local authorities, particularly when the travellers involved seek to use every ruse to prolong their stay on a totally unsuitable site. Nobody pretends that it is easy, especially when such large groups are involved, to strike a balance between the need to control what can be—and clearly was in this case—an appalling public nuisance and the rights of the campers concerned, but local authorities which have a consistent, workable policy in place and have good working relationships with the local police and other agencies are more likely to be able to evict successfully when the need arises.
It is precisely such a co-operative attitude—all agencies working together and being clear about one another's responsibilities—that we want to encourage. My Department is examining the scope for disseminating the good practice already in place in some authorities for dealing with unauthorised camping—whether by new age travellers, gipsies or others. We have appointed research contractors from the university of Birmingham to carry out the work. They have just completed phase I of their project, which comprised detailed case studies in six local authority areas where unauthorised camping is known to be a problem, concentrating on the methods employed by those authorities to deal with it.
The researchers have interviewed officers, covering a range of issues such as those pertaining to environmental health, social services, education and enforcement. I look forward to seeing the outcome of their research so far, which will form a vital part of our collective ministerial education on matters concerning gipsies and other travellers. I can already tell from my postbag that the issue excites much public interest across the country. I am, however, bound to say that I get the strong impression that there is no one easy solution to the problem. If there were, someone would presumably have found it by now.
I turn to some of the specific points that the hon. and learned Gentleman raised—first, drug misuse. He says that the Welham lane site became a centre for drug dealing in the Leicester area. I should say straight away that tackling drug misuse, whether by new age travellers or anybody else, is a priority for the Government. He may know that my right hon. Friend the Prime Minister has appointed my right hon. Friend the President of the Council to serve as Chair of a Cabinet Committee to oversee the development of the Government's drug strategy.
Part of the remit of my right hon. Friend the President of the Council will be the appointment of a drugs tsar—someone who will play a major role in ensuring that the Government's strategy for dealing with the problem is effective as it can be. He or she will have the power to gather together key people from health, the police, education, prisons, the probation and other services to ensure that they work closely together. Much good work

377
is already being done, including that led by the drug action teams across the country at local level. I understand that there is such a team in the Leicestershire area.
More generally, police officers have the power to search persons for possession of drugs under the Misuse of Drugs Act 1971. Section 23 of that Act provides that a constable may stop and search any person—or search any premises—for the purposes of finding controlled drugs. The search must be carried out in accordance with a code of practice issued under the Police and Criminal Evidence Act 1984, and an officer must have reasonable grounds to suspect that the items are being carried before undertaking a search.
The hon. and learned Gentleman painted a worrying and disturbing picture of the travellers' dogs killing a number of sheep on land adjacent to the camp. The excuse offered by travellers that their dogs could not have killed sheep "because they were vegetarian" is one of the richest that I have ever heard.
The hon. and learned Gentleman may be aware that provisions of the Environmental Protection Act 1990 make it an offence for an owner or person in charge of a dog to permit it to be in a public place not wearing a collar with the name and address of the owner on the collar or on a plate or badge attached to it. The Act also allows for the seizure of dogs on private land, provided that the landowner or occupier has given his consent. The Control of Dogs Order 1992 lists certain types of dogs as exemptions, but dogs belonging to gipsies and travellers are not included.
I turn to the powers available to the police under section 61 of the 1994 Act, which I know is of particular concern to the hon. and learned Gentleman. Such matters are properly for my right hon. Friend the Home Secretary to consider, but I can say that his general position is that he will not comment on specific police operations since they are the responsibility of the chief constable.
It is for the chief constable to decide how to use the resources at his disposal and how to order his policing. It is also important to remember that the power is discretionary, and that only in circumstances where there is a serious threat to public order or of criminal activity will the police consider using the power. I know that the hon. and learned Gentleman has already been in touch with the Leicestershire constabulary on the matter.
The hon. and learned Gentleman has given a reasonable description of the section 61 powers, and he was right to say that the Wealden case did not concern the use of the power. He will, I am sure, know that it is not for me or
378
any ministerial colleague to give a definitive interpretation of the law. That, rightly, is for the agencies involved and ultimately for the courts.
It seems only common sense that the police and local authorities should liaise with one another in such cases, so that, if the police decide to use their public order powers, the relevant local authorities can take steps to fulfil any statutory responsibilities that they may have towards the trespassers. The police will also wish to take into account welfare factors in using their powers, and responsibility for judging how to do that rests with the chief constable.
As for setting up a unit to monitor new age traveller activity, I understand that a body called the northern intelligence unit, which is hosted by Cumbria police, and a sister unit, which is hosted by Wiltshire police, collect data from all forces about the movements of new age travellers and ravers in England and Wales. Intelligence is provided to police forces as appropriate, and I would expect forces to liaise with local authorities on the basis of such intelligence where that is appropriate. We have, however, to remember that there may be some sensitivity surrounding the use of intelligence obtained by the police for agencies outside the police service.
The police also have powers under the 1994 Act to deal with unlicensed mass night-time raves on land, which, as at Welham lane, cause an unacceptable public nuisance and affect many people, who are kept awake, sometimes for nights on end, by incessant music played at intolerable levels. I know that the hon. and 1 Gentleman will agree with me that local communities should not have to fear the prospect of mass invasions of land by those who selfishly seek entertainment regardless of the rights and amenities of others. The police are, for example, able to stop persons who they believe will attempt to go to a rave site within a radius of five miles of the site and direct them not to proceed. It is an offence not to obey that direction.
Once again, I thank the hon. and 1 Gentleman for bringing this important arid difficult subject to the attention of the House. He has highlighted a number of points which ministerial colleagues and I will want to bear well in mind as we consider the range of issues involved. He has also highlighted all too well the difficulties which can arise when agencies responsible for eviction try rightly to balance the need to restore public order with the rights of the campers concerned. Nobody pretends that that is, or ever has been, an easy balance to strike—
It being Two o'clock, the motion for the Adjournment of the House lapsed, without Question put.
Sitting suspended, pursuant to Standing Order No. 10 (Wednesday sittings), till half-past Two o'clock.

Oral Answers to Questions
  WALES

    Devolution
    Mr. Tyrie: To ask the Secretary of State for Wales what representations he has received from Blaenau Gwent relating to the referendum on devolution in Wales. [6995]
    The Secretary of State for Wales (Mr. Ron Davies): I have received two such representations.
    Mr. Tyrie: The hon. Member for Blaenau Gwent (Mr. Smith) has alleged, on several occasions, that he was threatened with expulsion from the Labour party if he continued his opposition to a Welsh Assembly. Does the Secretary of State regret having made those threats?
    Mr. Davies: I did not make any such threats, and neither of the representations that I received from Blaenau Gwent concerned my hon. Friend the Member for Blaenau Gwent (Mr. Smith). If the hon. Gentleman had witnessed an incident last night, when I saved my hon. Friend from being run over by a ministerial car, he would realise just what a close and loving relationship we have.
    Mr. Touhig: Does my right hon. Friend agree that the people of Blaenau Gwent and the whole of Gwent would benefit if the result of the referendum were in favour of an assembly? We would have a democratically elected assembly to run services in Wales such as education, instead of unelected quangos, such as the body that runs the Gwent tertiary college. It has increased staff costs by £4.5 million in two years while student numbers have been static, has made 40 people redundant and is now cutting courses.
    Mr. Davies: My hon. Friend is right. I am aware of the problems of the Gwent tertiary college, which are of great concern to the community, the students, the staff and the management of the college. I know that my hon. Friend and others from Gwent have made representations to my hon. Friend the Under-Secretary who is dealing with the matter. I agree with the thrust of my hon. Friend's question—if we had a democratic settlement in Wales and if the quangos were subject to democratic accountability, the situation would not arise.
    Mr. Ancram: The Secretary of State really cannot take refuge behind humour on what is a serious matter. Will he take this opportunity to deny categorically that he ever threatened the hon. Member for Blaenau Gwent (Mr. Smith) with expulsion from the Labour party or brought undue pressure to bear on him, either directly or vicariously through advisers, if he did not toe the party line on devolution? If the Secretary of State denies that, is he accusing the hon. Gentleman of not telling the truth?
    Mr. Davies: I have already answered that question by reference to an incident that occurred last night. The right hon. Gentleman should not assume that the generosity of spirit that I showed last night would necessarily apply were Ito see him in the same circumstances.
    Mr. John Smith: Will my right hon. Friend take every opportunity, when he receives representations, to point out
    380
    that a Welsh Assembly will give a bigger boost to the Welsh economy than it has seen in the past 20 years—indeed, since the creation of the Welsh Development Agency by the last Labour Government?
    Mr. Davies: My hon. Friend had a distinguished career in furthering the economic development of Gwent before he re-entered the House. All of us recognise the great work that he has done. He paid tribute to the Welsh Development Agency. I am pleased to say that we will announce next week a positive programme to modernise the WDA by creating a new economic powerhouse. The name of the Welsh Development Agency is of worldwide renown. When it has the support of a democratically elected assembly, it will continue to improve our economic prospects in Wales.
    Mr. St. Aubyn: To ask the Secretary of State for Wales what plans he has for campaigning with his parliamentary colleagues during the referendum on devolution for Wales. [6996]
    Mr. Whittingdale: To ask the Secretary of State for Wales what will be his role in the referendum campaign. [6997]
    Mr. Ron Davies: I shall play a vigorous part in securing a yes vote, along with my right hon. Friend the Prime Minister, other Cabinet colleagues and hon. Members representing constituencies all over the United Kingdom in the referendum to be held later this year. The Government are launching a crusade to create a modern constitution for the entire United Kingdom, and a Welsh Assembly is a vital part of that.
    Mr. St. Aubyn: Will the Secretary of State and his colleagues in the campaign promise that the new Welsh Assembly will decide such matters as the legal age at which people can buy cigarettes in Wales? Will the new Welsh Assembly be able to decide such matters as how foxes are controlled in Wales? If the right hon. Gentleman will not promise to let the Welsh Assembly decide such matters, is that not because he trusts the choice of the people of Wales in such matters as little as he trusts the people of Blaenau Gwent in their choice of their Member of Parliament?
    Mr. Davies: The hon. Gentleman is new to the House, and I welcome him to Welsh Question Time. Clearly, he has not yet had the opportunity to learn the difference between primary and secondary legislation. We are not proposing to give to the Welsh Assembly discretion to pass laws on the matters that he cites. The assembly will, however, have responsibility for determining a block allocation of finance, which is currently running at a record level of more than £7 billion a year. It will have a range of responsibilities for secondary legislation. It will be able to deal with many of the administrative matters that I currently deal with as Secretary of State for Wales. More important, it will bring an end to the quango years during which our democratic government in Wales has been corrupted by previous Conservative Governments.
    Mr. Whittingdale: Does the right hon. Gentleman believe, as is now apparent, that the Prime Minister and the Deputy Prime Minister are to front the referendum

    381
    campaign as a direct response to the embarrassing revelations of the right hon. Gentleman's threats to his own Back Benchers to try to silence opposition?
    Mr. Davies: No, I do not recognise any truth in that. The real question that must be asked is, where is the no campaign? [HON. MEMBERS: "Behind you."] The Labour party will run a whole-hearted and vigorous campaign to secure the support of the people of Wales in the referendum. It appears that the Conservative party is frightened to mount its own campaign and has decided to hide behind the millions of pounds being put up front by a tax exile from Jersey.
    Mr. Llew Smith: Whether we are for or against a Welsh Assembly, does not the Secretary of State regard it as wrong that massive amounts of taxpayers' money will be spent pushing the yes vote, but not one penny of taxpayers' money will be spent to assist those trying to put an alternative view?
    Mr. Davies: If that were the case, I would indeed be worried, but let me assure the hon. Gentleman and every Member—[Interruption.] Let me assure the whole House that there is no question of one penny of taxpayers' money being spent to assist the yes campaign. The Government will put their proposals before the people in a referendum. We have a responsibility to explain to the people of Wales the details of our proposals. We will do that. It will, however, be a matter then for the political parties to seek to persuade people either to support or to oppose those proposals.
    Mr. Donald Anderson: When my right hon. Friend enters the referendum debate, will he, in his usual gentle way, point out that the people of Wales do indeed have a choice? They can choose either movement and constitutional change, or the status quo—a status quo that suits Conservatives, who can never win power in Wales through the ballot box, but have to rely on stuffing the quangos with their friends and relations and bypassing the normal processes of democracy.
    Mr. Davies: I agree with my hon. Friend, and it is a great surprise to me to note the arrogance of the Conservative party. Conservatives have just come through a bruising general election in which they lost every seat in Scotland and Wales because they wanted to defend the over-centralised status quo. If they continue as they are, they will manage to create in England precisely what they recently achieved in Scotland and Wales—a Tory-free zone.
    Mr. Dafis: Would the Secretary of State be interested to know that I was in Cardiff this morning, collecting names for Plaid Cymru's petition on parity with Scotland, and that the vast majority of people approached enthusiastically signed up to that principle, as well as to the principle of establishing a democratically elected body for the whole of Wales?
    Mr. Davies: I am pleased to note the hon. Gentleman's second comment—that the people in Cardiff enthusiastically supported the creation of a democratically elected assembly. His earlier question, however, was a little late, because we have finalised the proposals in the
    382
    White Paper. They are now at the printers and will shortly be made public, so I am afraid that it is a little too late to accept the sort of amendment that he suggests.
    Mr. Gareth Thomas: In view of the report in today's edition of The Times that my right hon. Friend usually takes his holiday in Wales, does he agree that the quality of debate, especially at Welsh Question Time, would be substantially improved if Conservative Members, none of whom represents a Welsh constituency, followed his example and learned something about Wales, especially about the huge demand for a renewal of democracy there?
    Mr. Davies: I certainly know that my hon. Friend will attend the National Eisteddfod at Bala in August, and I look forward to joining him there and spreading the message for a yes vote. I also note that he has been enthusiastically campaigning in north Wales, and I am delighted to assure him that when the White Paper is published next week he will see that we have many positive proposals to ensure that the interests of north Wales are properly represented, and that the assembly we create will be a truly inclusive one, representing all interests in Wales.
    Mr. Evans: The Secretary of State cannot take all the credit for the fiasco that best sums up his first few weeks in office. As he gently roams the hills and valleys of Wales, trying gently to persuade the Welsh people about the merits of his argument on devolution, he will have to answer some serious allegations relating to his special adviser.
    What advice did the right hon. Gentleman give his special adviser after the embarrassing revelations about the advice that that person gave to Blaenau Gwent council? What role will that special adviser play during the referendum campaign? Will he accompany the Secretary of State on his tour of Wales, or will he be confined to barracks with strict instructions not to use the telephone to issue any advice on behalf of the Secretary of State, especially to local authorities in Wales?
    Mr. Davies: The hon. Gentleman is new to the Front Bench, and it falls to me to congratulate him on his appointment—but I must say that when we refer to the valleys of Wales, we do not always think of Ribble Valley as one of them.
    Mr. Evans: Answer the question.
    Mr. Davies: I shall answer the question. One of the reasons why I support a new democratic arrangement for Wales is because of the way in which over the years the hon. Gentleman's party systematically corrupted public life in Wales. Last weekend, Viscount St. Davids, a former Welsh Office spokesman in the Lords, confessed to having plotted with David Hunt, a former Conservative Secretary of State for Wales, to ensure political bias in Welsh quangos. I should have thought that the hon. Member for Ribble Valley (Mr. Evans), in his first

    383
    appearance at the Dispatch Box, would take the opportunity to apologise for the previous misdeeds of his party.
    Mr. Caton: To ask the Secretary of State for Wales when he expects to publish the White Paper on the Welsh Assembly; and if he will make a statement. [6998]
    The Parliamentary Under-Secretary of State for Wales (Mr. Win Griffiths): The White Paper will be published on 22 July.
    Mr. Caton: I thank my hon. Friend for that reply. Clearly, it is time to shift the focus from the democratic rights of individual Welsh Members of Parliament to the democratic right of all the people of Wales to hold their Government accountable. Does my hon. Friend agree that the challenge for the Conservative party and any allies that it may have in Wales is how they can justify supporting devolved power, in the form of the Welsh Office, while denying the democratisation of that power through a Welsh Assembly? Is not that the key democratic question at the centre of the debate?
    Mr. Griffiths: It is indeed, and we know why the Conservative party does not want a Welsh Assembly: through the appointments that it has made over the years, it has taken powers from local government—creating Tai Cymru, for example—and by and large packed the quangos with its own supporters, who have often been defeated in elections in Wales. The sooner we get back to a democratic Wales, in which the people have a real voice in its government, the sooner we can be assured of even better government in Wales.
    Mr. Livsey: Can the Minister confirm that, when the White Paper is published, the interests of mid-Wales will be looked after by the continuation of the Development Board for Rural Wales? There is great concern about structural funds being renewed and, in the agriculture industry, about green pound devaluations. Can he give us an assurance?
    Mr. Griffiths: I can assure the hon. Gentleman that the concerns and needs of mid-Wales will be fully catered for in the new economic powerhouse that we will create. We want the Welsh Assembly to be fully inclusive and to ensure that mid-Wales benefits, like all of Wales, from the new arrangements.
    Mr. Rowlands: Can my hon. Friend also assure us that the White Paper will foreshadow legislation that will abolish the unappointed quango boards and not, as has been suggested, merely make them accountable to a Welsh Assembly? Our rhetoric must be matched by our legislative action.
    Mr. Griffiths: Without wishing to prejudge what the White Paper will say, I can tell my hon. Friend that some quangos will disappear immediately and others will be democratised, after which the Welsh Assembly will have a choice to make about the best way of proceeding with democracy and the organisation of quangos in Wales.
    Mr. William Ross: Given the earlier assurance that the Government would welcome an input from all parts of
    384
    the United Kingdom on the question of devolution for Wales, can the Minister give us a precise assurance that, in preparing the White Paper, the Government have taken fully into account the experience of devolved government in Northern Ireland, from which it is apparent that only when a Unionist party has a say can the Union of the whole Kingdom be maintained? Will the policy of Labour members elected to a new devolved body be to maintain and secure the Union?
    Mr. Griffiths: I assure the hon. Gentleman that the Union will be maintained, by consent, and that in the preparation of our White Paper we considered not only what has happened in the United Kingdom but what has happened in Europe and many other parts of the world.
    Mr. Ancram: I thank the Minister for at least trying to answer the questions: a great improvement on the Secretary of State, who has not answered a single question that the Opposition have asked him. Can he confirm the report in yesterday's Financial Times that, far from getting rid of quangos, the intention in the White Paper is to merge the highly successful Welsh Development Agency and others into what can only be termed, in the Secretary of State's words, an over-centralised super-quango? How does that square with him and his colleagues calling themselves the slayers of quangos?
    Mr. Griffiths: The right hon. Gentleman will have to wait for our White Paper on 22 July to see specifically what is proposed across the range of quangos in Wales. I am quite sure that he will then have plenty of opportunity to make whatever response he likes.
    Mr. Alan W. Williams: When the White Paper is published, will it describe a system of proportional representation for elections to the Welsh Assembly, which will involve additional members, based on the Euro constituencies? It appears that the Government will conform to proportional representation for the European elections nationally in 1999, or certainly by 2004. Those elections will be based on the regional list system. Does that mean that our Euro-constituency basis for the additional members has to be rethought?
    Mr. Griffiths: To respond to my hon. Friend, I would have to move into Departments over which the Welsh Office has no control. I reassure him that no decisions have been taken about what will happen at the next round of European elections. We need to take each bridge as it comes, and I do not propose to cross that one at the moment.

    Regional Air Network
    Mr. Öpik: To ask the Secretary of State for Wales if he will make a statement on the promotion of a regional air network for Wales. [6999]
    The Parliamentary Under-Secretary of State for Wales (Mr. Peter Hain): The development of air services is primarily a commercial matter for airline operators. I will, however, be considering the role of air services, along with all other transport modes, in the context of the development of an integrated transport policy for Wales.
    Mr. Öpik: I thank the Minister for that answer. As Welshpool airport has a serious chance of expanding to become the mid-Wales airport, will he commit to giving that initiative serious consideration as we make progress with it?
    Mr. Hain: The hon. Gentleman's constituents will thank him for raising that matter because the improvement of air services to mid Wales is obviously important. I will do everything that I can to assist. In the case of Welshpool airport, discussions are taking place between the landowner and the airport owner. I hope that they can come to an agreement from which we can all move forward.

    Devolution
    Mr. Green: To ask the Secretary of State for Wales what representations he has received concerning the no campaign in the referendum on an assembly in Wales. [7000]
    Mr. Ron Davies: I have received several such representations.
    Mr. Green: Since the Secretary of State has failed twice to answer this question, I thought that I would give him another opportunity. Can he say whether he uttered the threat of expulsion from the parliamentary Labour party to the hon. Member for Blaenau Gwent (Mr. Smith)? If he says as he has before that he never uttered it, can he explain why the hon. Gentleman insists that he did?
    Mr. Davies: I have answered that question several times.
    Mr. Barry Jones: Does my right hon. Friend recollect the meeting in Flintshire, north Wales, on 7 July, which he addressed and which was so crowded that many people had to stand throughout the duration of the meeting? Surely there will be a yes vote victory. How will he ensure a large turnout for the referendum, and how will he seek to bring the governance of Wales closer to the people?
    Mr. Davies: I should say at this stage that I was grateful for my hon. Friend's support at that meeting in Mold, which was very well attended. We will be producing a White Paper next week. We will be ensuring that a popular version of that White Paper is distributed to every household in Wales. As I said, it will then be a matter for the political parties in Wales to persuade people to vote in the referendum.
    It is certainly my intention, along with that of my colleagues in the Cabinet, the Prime Minister, the Deputy Prime Minister and many Members of Parliament from all political parties in the House, to campaign as vigorously as I can in the summer and in the run-up to the referendum. When the people of Wales are given the opportunity to create a real voice for themselves and a democratic framework to improve our economic performance and the quality of our public services, they will turn out in large numbers and give a positive yes vote.
    Mr. Forth: In regard to an assembly in Wales, what proposals do the Government have for consulting the people of England, who will probably end up paying for most of it anyway?
    Mr. Davies: This is Welsh Question Time. The Welsh Office has no proposals to consult the people of England.
    Mr. Wigley: Will the Secretary of State tell the House how many constructive representations he has received from the no campaign for improving government in Wales, or is its campaign entirely based on retaining the status quo, quangos and all? Is it not true that the general election result in Wales showed overwhelmingly that, whatever our other differences, the overwhelming majority of the people of Wales rejected the status quo as totally unacceptable?
    Mr. Davies: All 40 Welsh Members were elected on the basis of manifestos that were committed to changing the discredited status quo. I understand that the no campaign is being fronted by a tax exile from Jersey. It is supported by the Conservative party and it has a large measure of support from hereditary peers in another place. I am not sure which is the least attractive.
    Mr. Hanson: Does my right hon. Friend agree that the climax of the no campaign was reached on 1 May, when the only party arguing against the Welsh Assembly secured no seats in Wales?
    Mr. Davies: That was not quite the climax, as I understand the meaning of the word. I hope that we shall have a rather more exciting occasion in the middle of September, when we celebrate a yes vote.

    Proportional Representation
    Mr. Gibb: To ask the Secretary of State for Wales what representations he has received concerning the use of proportional representation in the elections for an assembly in Wales. [7001]
    Mr. Ron Davies: I have received several such representations.
    Mr. Gibb: Does the right hon. Gentleman agree that any use of PR using a list system would give tremendous power to the Labour party machine? The right hon. Gentleman talks glibly about transferring power from Westminster to the people of Wales, but he would be transferring power from the people of Wales to himself and his Labour colleagues who are in charge of the Labour party list.
    Mr. Davies: No. I reject that entirely. The hon. Gentleman is new to Welsh Question Time, and I welcome him. It is clear, however, that he does not understand the system of PR that is the Labour party's policy. The Labour party will not benefit from these proposals. The Conservative party, which has 20 per cent. of the vote in Wales but no parliamentary representation, would benefit. Plaid Cymru and the Liberal Democrats would be the main beneficiaries.

    Devolution
    Mr. Fabricant: To ask the Secretary of State for Wales what representations he has received on the conduct of the devolution referendum campaign in Wales. [7002]
    Mr. Hain: Several.
    Mr. Fabricant: Does the Minister recall the report in the Western Mail four and a half years ago of the attempt by the present Secretary of State for Wales to duff me up in the Corridor outside the Chamber for daring to table a question for Welsh Question Time? Does he agree that he was wrong then? Does he agree also that it is wrong now for him to employ similar bully-boy tactics against the hon. Member for Blaenau Gwent (Mr. Smith)?
    Mr. Hain: I hope that the hon. Gentleman did not lose his hair in the incident. I know that the hon. Gentleman is trying hard, as are his colleagues, to divert the debate from the main issue that will face the people of Wales in September, when they will be invited to give a resounding yes vote to establishing a real voice for Wales and thereby rejecting the bankrupt, quango-ridden, corrupt politics that the Tories visited upon Wales for 18 years. Is it not time that the Tories came out clearly and honestly and mounted their no campaign? When they do, they will be given a thrashing by the people of Wales, just as on 1 May.
    Mr. Flynn: Does my hon. Friend recall that only a week ago, not four years ago, there was a splendid and crowded meeting in Newport, during which representatives of Blaenau Gwent and other areas in the county expressed their overwhelming support for the yes campaign? Did they not say with one voice that they want decisions on health and education in Wales to be taken in Wales, not in London?
    Mr. Hain: My hon. Friend is right. There was a massive meeting—there was standing room only—in Newport last Friday. Such meetings are taking place throughout Wales. People want to get out and campaign for the yes vote in September because they want a real voice for Wales. They want decisions on jobs, schools, hospitals and on all the other issues that are now taken by the Welsh Office to be made in a much more democratic way. They want a new democratic constitution for Britain and a new democracy for Wales.
    Mr. Hogg: Can the Minister explain why, on tax-raising powers, a distinction is being made between proposals for the Scottish Parliament and those for the Welsh Assembly? Why are the people of Wales being denied tax-raising powers? In the referendum, will the Minister ask the people of Wales whether they would like tax-raising powers to be given to the Welsh Assembly?
    Mr. Hain: I congratulate the right hon. and learned Gentleman on asking a different question from those of his colleagues. [HON. MEMBERS: "Answer."] Will hon. Members wait just a minute—or a second, even? The answer is quite clear. Scotland has its own legal system and therefore requires a different form of devolution from that appropriate for Wales.

    Health Targets
    Mr. Rhodri Morgan: To ask the Secretary of State for Wales what targets he has set for improvements in the health of the Welsh population. [7003]
    Mr. Win Griffiths: The Welsh Office issued advice to the NHS in Wales on 11 June this year on a number of targets to improve the health of people in Wales and to improve the responsiveness of health services.
    Mr. Morgan: I thank my hon. Friend for that reply. Does he agree that one of the most tragic legacies of the previous Government's failure in public health matters in Wales was their failure to set any achievable targets in life style-related public health issues, such as diet, exercise, obesity and, above all, the teenage take-up of smoking? Does he further agree that the sooner the present Government get around to implementing the proposed ban on tobacco advertising, the better for everybody, including young people in Wales?
    Mr. Griffiths: My hon. Friend will be pleased to know that I was able to attend the anti-smoking summit earlier this week, which was very successful. I can assure him that legislation will be introduced after consultation to effect the ban on tobacco advertising.

  PRIME MINISTER

    Engagements
    Dr. Marek: To ask the Prime Minister if he will list his official engagements for Wednesday 16 July. [7025]
    The Prime Minister (Mr. Tony Blair): This morning, I had meetings with ministerial colleagues and others. Later today, I will continue to have such meetings.
    Dr. Marek: Is the Prime Minister aware that there is a growing consensus in Gibraltar that the constitution should be changed so that Gibraltar becomes a little less of a colony and a little more of a Crown dependency? Should proposals be placed before him that do not affect the treaty of Utrecht in any way, will he give them his careful and serious consideration?
    The Prime Minister: What I can say is that my right hon. Friend the Foreign Secretary said to the Chief Minister of Gibraltar, on 7 July, that any proposals made by the Gibraltar Government would, of course, be given careful consideration. They must be compatible with the treaty of Utrecht. I can certainly say to my hon. Friend that we will never consent to any arrangement that goes against the freely expressed wishes of the people of Gibraltar.
    Mr. Hague: I welcome the further fall in unemployment announced this morning. What lessons does the Prime Minister draw from the fact that unemployment has now been falling in Britain for four and a half years, but rising elsewhere in Europe?
    The Prime Minister: The lesson I learn is that it was the Conservative Government who put it up in the first place.
    Mr. Hague: Would the Prime Minister not be more convincing if he admitted that the huge reductions in

    389
    unemployment in this country, while it has risen elsewhere, have a great deal to do with the policies of the previous Government? Is he not aware that we have had in recent years the best record of job creation of anywhere in Europe? But, specifically, does the Prime Minister agree that measures that increase the costs of employing people would tend to reduce the number of jobs available?
    The Prime Minister: I see no incompatibility at all between measures that are fair treatment for people at work and a successful economy. In case the right hon. Gentleman had not noticed, he is now in opposition.
    Mr. Hague: In case the Prime Minister had not noticed, he is now in government and he has to answer the question.
    Does the Prime Minister agree that increasing the costs of employing people reduces the number of jobs available? Since the Prime Minister believes—he must believe, since the Government's welfare-to-work scheme is subsidising employment—that reducing the costs of employment increases the number of jobs available, why does he not believe that increasing the costs of employment reduces the number of jobs available?
    The Prime Minister: First, as I told the right hon. Gentleman, the previous Government put up unemployment from the level that they inherited. Secondly, as I told him, I do not believe that treating people fairly at the workplace is inconsistent with decent employment measures. Thirdly, if the right hon. Gentleman wants to improve the unemployment situation, particularly for the young unemployed, whose numbers rose under the Conservative Government, he should support our welfare-to-work programme, not oppose it.
    Mr. Hague: The House is entitled to less waffle and more answers to questions. I am not talking about fairness in the workplace; I am talking about the Prime Minister's tax on pension funds, which will cost companies billions of pounds and increase the cost of employing people.
    Is it not the truth that all Labour Governments in history have left office with unemployment higher than when they took office? Is it not the truth that loading costs on to businesses through a tax on pension funds, signing up to the social chapter and adopting a minimum wage will put at risk the jobs that have been created for thousands of hard-working people in recent years?
    The Prime Minister: What would put people's jobs at risk is a return to Tory boom and bust: a return to the days when, under the Government that the right hon. Gentleman supported, interest rates were higher than 15 per cent.—as they were during the last recession—and borrowing was running at more than £40 billion. [HON. MEMBERS: "Answer the question."] The answer to the question is very simple. The way to secure a strong economy is to take measures to put public finances and monetary policy in order, rather than causing a Tory boom and bust. That is the answer.

    Lockerbie
    Mr. Dalyell: To ask the Prime Minister what assessment he has made of the statement of 1 July made
    390
    by Mr. Abdel Meguid, former Foreign Minister of Egypt, a copy of which has been sent to him, relating to the Organisation of African Unity's policy towards the trial of Libyans indicted for the Lockerbie bombing; and if he will make a statement on Her Majesty's Government's response. [7026]
    The Prime Minister: The Secretary-General of the Arab League referred the joint letter from the league and the Organisation of African Unity to the United Nations Security Council. The Governments of the United Kingdom, France and the United States have replied to that letter. I have made a copy available to my hon. Friend, and it is also available to the House.
    The Security Council renewed the sanctions on 10 July. It is still our view, as was made clear in the joint letter, that the sanctions should remain in being until the Security Council resolutions have been complied with.
    Mr. Dalyell: What did President Mandela say to the Prime Minister last Thursday about Libyan sanctions and Lockerbie?
    The Prime Minister: President Mandela did indeed raise the issue of Libya and sanctions. He made the point that the Organisation of African Unity has made. The organisation wants the sanctions to be lifted. Our view, however, is and remains that, if the sanctions are to be lifted, it is important for the Security Council resolutions to be complied with. We believe that that is right, and we reject the case that is made that a fair trial of the Libyan suspects cannot be held in Scotland.

    Engagements
    Mr. Clappison: Given the answer that the Prime Minister gave my right hon. Friend the Leader of the Opposition, and given that the Prime Minister now has responsibility for employment, is he prepared to say whether he believes—[Interruption.]
    Madam Speaker: Order. Some hon. Members seem to think that this is not a proper question, but it is a perfectly proper question.
    Mr. Clappison: Is the Prime Minister prepared to say whether he expects unemployment to be lower or higher than it is now at the end of the current Parliament? [7027]
    The Prime Minister: I expect that, as a result of the measures that we are taking—particularly the welfare-to-work programme—we will get unemployment down. I have to say to the hon. Gentleman that, if we do not tackle structural, long-term and youth unemployment, the economic costs and burdens that increased so significantly under the last Government will remain. We are not going back to those days.
    Mr. Gordon Prentice: Is my right hon. Friend aware that the overwhelming majority of people found guilty of perjury receive immediate custodial sentences? Is it not astonishing that the former Conservative Cabinet Minister, crusader for truth and arms dealer, Jonathan Aitken, should swan off on holiday in California and France? I understand that press reports

    391
    today suggest that Jonathan Aitken has now returned to the United Kingdom. Will my right hon. Friend urge the Leader of the Opposition to ensure that Jonathan Aitken stays in this country, faces the music and does not do another runner? [7028]
    The Prime Minister: I do not want to comment on any particular cases. Obviously, issues relating to perjury or any other criminal offence are matters for the appropriate authorities.
    Mr. Ashdown: The Prime Minister promised that his Government would be about education, education, education. Good words, but how are they honoured by forcing Somerset and Oxfordshire to sack more than 140 teachers?
    The Prime Minister: As I said to the right hon. Gentleman last week, we have made the single largest investment in education that any Government have ever made. Before the Budget, he asked for a £500 million programme of school repairs over the Government's lifetime—[Interruption.] No, over the lifetime of the Government: Liberal Democrat Members should read their press releases properly. We gave double that amount, but the right hon. Gentleman now criticises us for not giving enough.
    Mr. Ashdown: The Prime Minister knows perfectly well that that money is for next year, not this year, as I pointed out last week. Does he understand that those two councils are not examples of high spending and inefficiency? Oxfordshire has the second lowest spending and Somerset the most cost-effective delivery of education in the country. Is it not true that, whatever the Government provide next year, the real reason for this devastating cut is that they have adopted Conservative education cuts and have decided to spend less on education this year than the Conservatives would have spent?
    The Prime Minister: I do not accept that. I am not criticising the activities of the councils to which the right hon. Gentleman has drawn attention, but the Budget has had to be very tight this year because of the huge structural deficit in the public finances that we have inherited. If we do not take action now, we shall be in a serious position in the coming years. We have set aside for next year the largest single increase in investment of any Government. That is a far greater record than that of the previous Administration.
    Mr. Ennis: Does the Prime Minister agree that the Government's proposal to disband the current, two-tier GP fundholding system is a giant step forward in the rebuilding of the national health service? Does he also agree that, in future, the treatment that patients receive from the national health service will be based purely and simply on clinical need? [7029]
    The Prime Minister: My hon. Friend is absolutely right. I am astonished that the Conservative party has attacked our proposal, because it will ensure that people are treated on the basis of need and not according to who
    392
    their doctor is. It is based on two simple ideas—rebuilding the national health service, and fairness—neither of which the Conservative party understands.
    Mr. Öpik: If I could get the House the Commons Library to confirm that the Welsh Office will be £55 million worse off in real terms over the next two years than it would have been under the Tories, would the Prime Minister believe me? [7030]
    The Prime Minister: I have already made it clear to the right hon. Member for Yeovil (Mr. Ashdown) that the settlement has had to be extremely tight. I say to the hon. Gentleman sincerely that the only way we will get public finances under control is to take the measures that we have taken, including those that were in the Budget. If we do not do that, we will end up with old Tory boom and bust, and we are not going down that route.
    Dr. Lynne Jones: Will the Prime Minister join me in welcoming the decision of the employment appeals tribunal that gives transsexuals the protection of the Sex Discrimination Act 1975? Does he agree that more needs to be done to help to combat the appalling discrimination faced by sufferers of gender dysphoria? In particular, they should have the right to have their birth certificates amended to give their correct gender. [7031]
    The Prime Minister: I have not seen the tribunal decision to which my hon. Friend refers, but I have no doubt that it will be studied by the appropriate people.
    Mr. Donaldson: Will the Prime Minister explain how the Government's policy of no contact and no communication with Sinn Fein-IRA can be reconciled with the approach of the Secretary of State for Northern Ireland, who has confirmed that there have been six telephone calls with Sinn Fein, and that the Government responded to Sinn Fein by letter on 9 July? Has the Prime Minister's repudiation of Sinn Fein-IRA following the murders of the two policemen in Lurgan now been set aside, and is a new policy being pursued?
    The Prime Minister: No. What we said after the Lurgan murders is that there would be no meetings between Sinn Fein and the Government, and there have been no such meetings.
    It is correct, as my right hon. Friend the Secretary of State has made clear, that there have been responses to telephone calls and letters, and I shall tell the hon. Gentleman why. I want a situation in which either Sinn Fein gives up violence and comes into inclusive talks or, if it does not, it is absolutely clear that it is not coming into those talks because it will not give up violence. If this has to be given clarification so that everyone is under no doubt as to the Government's position, that will be done. The basic principles remain: consent, which is absolutely essential, of the people of Northern Ireland to any change made; and no one participating in those talks unless they give up violence unequivocally and clearly.
    Mr. Llew Smith: Madam Speaker—[Interruption.] I am obviously grateful for the howls of support.
    Over the past 12 months, I have tabled approximately 100 questions and have had two Adjournment debates on matters relating to measles, mumps and rubella

    393
    vaccinations. Would the Prime Minister care to comment on the dramatic increase in the number of children suffering from Crohn's disease and autism after such vaccinations? Will he commit himself to organising independent investigations—I emphasise the word "independent"—into possible links between those vaccinations and the diseases? [7032]
    The Prime Minister: I am grateful to my hon. Friend for raising this issue, which I know he raised in an Adjournment debate earlier. In assessing the evidence on this matter, the Government rely on the independent expert committee, the Joint Committee on Vaccination and Immunisation, and we follow its advice. It has considered all the evidence of a link between the measles, mumps and rubella vaccine and autism and Crohn's disease. It concluded that, on balance, no such link existed. This evidence, I am advised, is kept constantly under review and is reassessed and re-evaluated. Should there be any change in that, of course the committee will act on it, and so will the Government.
    Mr. Spring: When the right hon. Gentleman next travels to his constituency, will he look afresh at the delicate balance between our cities and towns and the countryside? Is he aware of the real concern among many people who live in our country areas that their way of life is under threat and that their interests are marginalised? Does he, as Prime Minister of the whole of our country, not recognise the illiberal inconsistency of his supporting and defending the often quite genuine concern and viewpoints of many minorities in our country, while denying the self-same freedoms to those with whom he happens to disagree? [7033]
    The Prime Minister: Of course we do not want to see conflict between town and countryside. The issues that the hon. Gentleman has raised and the points that he has made will be weighed by all Members of Parliament in the run-up to the vote on the Bill. I am sure that every hon. Member will look at it very carefully. I do not believe that there should be any conflict between town and countryside that prevents us from examining this issue dispassionately and properly.
    Mr. Blizzard: I should like to say how much people in my constituency will welcome this morning's announcement on the reintroduction of fairness to the national health service. Will my right hon. Friend comment on the importance of efficiency and the effective use of resources in the national health service, particularly in the light of comments that were made to me yesterday by a most senior consultant director in my local NHS trust, who said that there was no doubt that the internal market has been an enormous waste of resources which is depriving patients of the care they need?
    The Prime Minister: My hon. Friend is absolutely right. Of course, one of the reasons for getting rid of the internal market that the Conservatives introduced is the enormous cost—£150 million a year just to administer fundholding. If we look at the way in which the NHS has gone in the past few years, we see that one of the reasons why this Government were elected was to restore the
    394
    national health service as a proper national health service, based on need, not ability to pay, and that is a manifesto commitment that we will carry out with pride.
    Mr. Tyler: I accept that some welcome progress has been made in dealing with the bovine spongiform encephalopathy crisis caused by the previous Government, but may I ask the Prime Minister whether he has had drawn to his attention the critical situation that is developing in cattle markets throughout the country, from Caithness to Cornwall, as a result of the reduction in the over-30-months scheme payments which will be made on 4 August, and the consequent collapse in beef prices? Those prices are now down to about a third of what they were last year. Will the right hon. Gentleman's Ministers be prepared to meet those of us from livestock areas who have this crisis on our doorstep? [7034]
    The Prime Minister: I am sure that the Minister of Agriculture, Fisheries and Food and the Department will be prepared to meet anyone with a concern about this issue. The hon. Gentleman will realise that the problem is that it is necessary to try to get the costs of the compensation scheme down, because they will run over a period to about £4 billion. It is essential that we try to reduce those costs. I am aware of the situation in the cattle markets and I am sure that that is one of the reasons why the matter will be closely examined by the Minister of Agriculture, who will be in touch with the hon. Gentleman.
    Mr. Hanson: Will my right hon. Friend join me in welcoming yet again the fulfilment of another Labour pledge—the publication of the devolution White Paper next week? When will he be able to come to Wales to campaign for the yes vote, and what steps does he intend to take to ensure that there is a massive yes vote, which the people of Wales so richly deserve? [7035]
    The Prime Minister: I believe that these proposals will give Wales a strong voice. They will improve the decentralisation of government, which is important for the long-term future of this country. I shall go to Wales on Friday, and I have no doubt that I will be going to Wales many times during the forthcoming months.
    Mr. Tyrie: Will the Prime Minister tell the House and the country what he meant when he said some months ago that Labour had no plans to raise taxes at all? [7036]
    The Prime Minister: We actually set out in our manifesto very clearly the commitments on tax. We have kept to those manifesto commitments. We have also kept to the commitment that we gave that we would introduce a windfall tax to cure the problems of unemployment in this country. We said that we would increase expenditure on schools and hospitals, and we did so. The difference between this Government and the old Tory Government is that we make promises and keep them.
    Mr. Pike: The Prime Minister will know that many people in low-pay constituencies such as mine, Burnley, will be very concerned by what the Leader of the Opposition said earlier today about working conditions. Will my right hon. Friend repeat the news that this Labour

    395
    Government are committed to giving a fair national minimum wage as soon as possible to the people of this country?
    The Prime Minister: My hon. Friend is absolutely right. One thing that I did not mention to the Leader of the Opposition is that, in the United States, for example, which has a lower unemployment rate than we do, there is a minimum wage. There will be proper and fair treatment for people, first, because it is right in its own terms and, secondly, to save the vast public expenditure on benefits in the present system. What sticks in my craw is Tory Members attacking the minimum wage when they would never for a single instant have any relative of theirs paid that amount of money.
    Mr. Luff: Why does the Prime Minister think that there are more people in work here and fewer jobless—[Interruption.] I am sorry that Labour Members think that is funny. Why does the Prime Minister think that there are more people in work here and fewer jobless than in any other European Union country? [7037]
    The Prime Minister: I have already given the hon. Gentleman the example of the United States, where fewer people are unemployed, but, as I said to his leader just a few moments ago—the hon. Gentleman should have listened—there were more people unemployed when the Tories left office than when they came to office. They shake their heads. I suggest that they go to the same House of Commons Library and see the figures.
    Mr. Gunnell: Will my right hon. Friend welcome today's inward investment in Yorkshire, and join the Deputy Prime Minister, who is welcoming that investment on-site? Does the Prime Minister agree that the combination of a Labour Government and Labour-led local authorities, all committed to inward investment, will improve our performance in coming years?
    The Prime Minister: My hon. Friend is right, and we welcome that inward investment. It is very good news. I seem to remember being told before the election that all the inward investment would dry up once Labour came to power. Another Tory lie bites the dust.
    Mr. Welsh: Does the Prime Minister intend to introduce a proportional representation voting system for future European Parliament elections? If so, will he guarantee that the distinctive political systems in Scotland and Wales are specifically recognised in any such set-up? [7038]
    The Prime Minister: It is our clear manifesto commitment to introduce proportional representation for elections to the European Parliament. The electoral systems in Scotland and Wales will be set out clearly in the White Papers on devolution that will be published shortly.
    Mr. Sheerman: My right hon. Friend shares with me an enthusiasm for the European Union, but does he share my concern that there should be a strict criterion of democratic excellence before we allow enlargement? My constituents have expressed two worries. The first is that many of the European countries coming into the EU
    396
    do not have a long track record of being stable democracies. The second is that they will be a net drain on the EU's resources. Will my right hon. Friend keep a careful eye on progress and ensure that our national interest is not damaged by the new entrants?
    The Prime Minister: My hon. Friend is right to draw attention to some of the difficulties associated with enlarging the European Union. However, I think that enlargement is right as a process. This country should be fighting for changes in some of the ways in which Europe works to ensure that enlargement happens in the best way possible for existing countries as well as those coming in. Chief of the changes will be fundamental ones to the common agricultural policy. The way in which it works is a disgrace, and it should be reformed in the interests of all the people of Europe.
    Mr. Burstow: Has the Prime Minister seen the report published by Scope today, which reveals that, of the polling stations surveyed, 81 per cent. had two or more access problems? Will he take urgent action to deal with the issue? In particular, will he consider the problems of blind or partially sighted people and introduce any necessary legislation that will enable them to vote unaided and in person at polling stations by using Braille templates and large print? [7039]
    The Prime Minister: We welcome the study by Scope, and we will take its suggestions seriously. It is obvious that people should be entitled and able to vote irrespective of any disability they have. As most people found at the last election, the current position is not satisfactory. We will look at any ways to improve it.
    Mr. Mike Hall: Does my right hon. Friend agree that the announcement by the Economic Secretary of a reversal of the cut in the number of customs officers will help this Government in their fight to combat drug crime?
    The Prime Minister: My hon. Friend is absolutely right. One of the biggest worries about the cut in the number of customs officers was that it would impede the fight against crime, especially international crime. My hon. Friend will be aware of the discussions that the Foreign Secretary has been having in Moscow. It is important that we have the right controls and checks on our frontiers so that we can bear down on any form of international crime coming into this country from the rest of Europe. It is an extremely serious problem, and one of the matters that will form the centrepiece of our presidency of the G8 summit next year.
    Mr. Stunell: Does the Prime Minister accept that figures supplied by the House of Commons Library show that the total to be spent on education next year will be only £10 million more, allowing for the changed inflation allowances? Does he further accept that that comes on top of large cuts in education in this financial year by many authorities throughout the country? [7040]
    The Prime Minister: I do not accept that education authorities will not get the benefit of the money that will go into education next year. The hon. Gentleman is right to say—I say this to all his hon. Friends who are raising this issue—that the settlement will be tough; there is no doubt about that. We have a simple choice: we can go back to the days of the early 1990s, with a borrowing requirement of more than £40 billion, with all the damage that that did, or we can take the action which is necessary now to put our finances on a prudent and stable footing. The money from the windfall tax going into school repairs and the additional funding for education together make the largest single injection of finance into education that any Government have made for some time.
    Mr. Barry Jones: Does my right hon. Friend recollect visiting the Raytheon Jets factory last September? May I persuade him to instruct the Secretary of State for Defence to award a contract for my constituent to service the very jets that the Ministry of Defence now flies?
    The Prime Minister: I certainly admire my hon. Friend's audacity, although I do not think that it would be appropriate for me to award contracts to any company
    398
    from the Dispatch Box. I know the Raytheon Jets factory very well, and I am sure that it will submit an excellent bid.
    Mr. Soames: On the day that the Secretary-General of the United Nations is to unveil a programme of reforms, will the Prime Minister reflect for a moment on the extraordinarily distinguished role that the United Kingdom has played over the years in the United Nations, not least in peacekeeping operations, in which our troops have given a golden account of themselves? Will he tell the House precisely what his ambitions are for reform of the United Nations?
    The Prime Minister: I agree entirely with the hon. Gentleman's sentiments on the United Nations and the part that Britain has played in it. We are proud of playing a major part in founding the United Nations. United Nations forces—in which Britain has played such a notable part in recent years—have done an outstanding job, and I congratulate all those who have been involved in them. The most important aspects of UN reform are that it reforms internally, in its secretariat, and externally, by drawing up the right principles to allow us to decide when it is appropriate to intervene and when it is not. The Government intend to be heavily involved in that process, and I believe that the new Secretary-General has made an excellent start in his work on both aspects.

GP Fundholding
3.31 pm
Mr. John Maples(by private notice): To ask the Secretary of State for Health whether he will make a statement on his plans for GP fundholding.
The Secretary of State for Health (Mr. Frank Dobson): My announcement today of fair waiting lists for patients of all general practitioners is an attack on unfairness. It is not an attack on GP fundholding. The previous Government introduced the internal market into the national health service, creating a two-tier system in which patient was set against patient, and GP was set against GP. That was unfair to patients and repugnant to the doctors and nurses who had to apply the system, and it cost a fortune in extra paperwork.
At the general election, we promised to restore fairness to the health service, to end the two-tier system and to ensure that access to treatment is based on need, and need alone. We pledged to change the system so that no patients and no GP practices should suffer any longer from the unfairness introduced by the Conservatives. We are keeping that election promise.
From now on, all NHS trusts must operate a fair waiting list for urgent admissions, regardless of who is commissioning the care. With effect from 1 April 1998, when current contracts run out, all health authorities must establish common waiting time standards for all people living in their area. From the same date, health trusts must not offer preferential treatment to any particular group of patients from health authorities, regardless of whether they are patients of GP fundholders. Faster treatment must be provided only on accepted clinical or social grounds. That change will be fair to every patient, and will be more comfortable and acceptable for doctors and nurses to operate.
My announcement today has been welcomed by the British Medical Association, the Royal College of Nursing and the NHS Confederation. The National Association of Fundholding Practices has made it clear that it fully accepts the principle of fair waiting lists and that, if properly implemented, the new policy will benefit all patients.
In two thirds of all health authorities, the patients of non-fundholding practices have to wait longer for hospital treatment. What is not so well known is that, in the other one third, the patients of GP fundholders lose out under the present system.
We are determined to have a national health service which is fair to all patients. That fairness will be achieved through co-operation in place of the competition and division of recent years. It will be achieved by levelling up to the best that has already been achieved, not by levelling down.
In our general election manifesto, we recognised that the development of fundholding had brought advantages as well as disadvantages. We promised to remove the disadvantages. We are keeping that promise. A month ago, we set out to bring fairness to the financing of non-fundholder practices. Today, we are bringing fairness to their patients.
We are now consulting the professions and patient organisations on how best to develop a primary care system fit for the next century, in which doctors and
400
nurses can play a leading part in planning local health services for all the patients in their area. In this way, we hope to reconcile the better aspects of fundholding with fairness for all patients. We are discussing this with all the professionals involved, and will test out our proposals through pilot schemes in every part of the country.
The new system, like the announcement that I have made today, will be based on the principle that access to health care is based on need, and need alone. That is the principle of fairness, quality and equality on which the Labour party founded the health service. It is the principle of fairness, quality and equality on which we will run the national health service so that it is fair to every patient. Who could possibly quarrel with that?
Mr. Maples: Well, the chairman of the Association of Fundholding Practitioners for one, because he did so on the radio this morning. Perhaps the Secretary of State has got at him since, but this morning on the radio he was expressing considerable reservations.
What we have just heard is a prologue to the slow death of fundholding in the national health service. [HON. MEMBERS: "Hear, hear."] That is the authentic voice of the Labour party. It is happy that it is going to be abolished.
Fundholding has been one of the great successes of the NHS over the past few years. It has put money, power and responsibility in the hands of GPs. They are the people who really understand their patients' needs and who know their local hospitals and local consultants. More than half of GPs have voluntarily become fundholders. They account for more than 60 per cent. of all patients. There would be many more if the Secretary of State had not balked at the last wave. Doctors have voted the scheme a success.
We believe that the Secretary of State plans a slow death for fundholding because it does not fit his model. He knows best, and he plans to direct everything from Whitehall. The idea that individuals should be trusted to make decisions or take initiatives is anathema to him and his party. It is the beginning of the end for fundholding. [HON. MEMBERS: "Ask a question."] There will be some questions—do not worry.
If the Secretary of State does not believe us, perhaps he will believe the Audit Commission, which said:
There is evidence that the direct involvement of GPs had led to improvements in service".
The Organisation for Economic Co-operation and Development said:
"GPs seem to have done a better job of purchasing … GPs have been prepared to diversify providers, challenge hospital practices and demand providers".
The King's Fund described fundholding as one of the major successes of the reforms, and an Edinburgh university study found that it had achieved savings.
Professor Glennerster, a former member of the Labour research department, said:
"All the dire predictions … were unfounded.. efficiency gains had more than outweighed costs."
By any standard, fundholding has been a great success. The Secretary of State's excuse for beginning to dismantle it is that it has produced a so-called two tier NHS. Let us be clear that it is an allegation—[HoN. MEMBERS: "Question."] It is an allegation—
Madam Speaker: Order. I remind hon. Members that this is a private notice question and that the Member who

401
tabled it has to ask a question on the statement that has been made. Of course I allow hon. Members to make a preamble—that is absolutely right—but this preamble is rather long. I think we now have to have pertinent questions.
Mr. Maples: I am coming to the end of the preamble.
Equality is best pursued by maximising opportunities, not minimising them. Arguing about a two-tier health service is akin to saying that equality in human need is best achieved by starving everybody.
Why does the Secretary of State not extend the power held by fundholders to all GPs and all patients? Why not extend to everyone the advantages of a successful experiment? Will he give us a cast-iron assurance that his policy is not to destroy or neuter fundholding? Will he give a cast-iron assurance that GP fundholders will continue to be free to refer their patients to the consultants and hospitals of their choice? The Secretary of State wanted specific questions, but he is not making any note of them. Will he give a cast-iron assurance that GPs will have the power and the money to make those referrals?
Thousands of fundholding GPs and millions of their patients want answers to those questions. If the Secretary of State cannot give us those answers, we and they will know what we have long suspected—that he plans to end the most successful experiment ever in improving patient care and NHS efficiency. If that is what he plans and does, patient care will deteriorate, waiting lists will increase and he will go down in the history of the NHS as a vandal as well as a dinosaur.
Mr. Dobson: I think that the hon. Gentleman was better when he was asking questions. He should consider the interests of patients in his area. In his constituency, as in the constituency of the right hon. Member for Fylde (Mr. Jack), the shadow Minister, the patients of fundholding practices are treated more slowly than others. He should pay a little attention to the people whom he allegedly represents.
I assure the hon. Gentleman that what we have announced today has the support of the British Medical Association, which represents all doctors, the Royal College of Nursing and the National Health Service confederation. Mr. Rhydian Morris, who represents fundholders, has explained to me that they support in principle our effort to establish fair and common waiting lists, provided we do that effectively and deliver on our aims. We shall do that.
The hon. Gentleman's contribution shows that the Tories are not interested in patients or in fairness. They are still obsessed with institutions that they introduced, largely on the advice of a heroin addict and prescription fraudster. We are not prepared to continue that system. We shall replace it with a system that will be the product of consultation with all doctors, all nurses and all people involved in providing primary care. We need a decent primary care system that is fair to every patient of every practice. We shall bring that about.
Dr. Howard Stoate: Is my right hon. Friend aware that many GPs, including fundholders, are far from happy with the fundholding system as it stands? Is he
402
further aware that many GP fundholders entered fundholding only because they felt that they had to? Many of those fundholders are trying to get out of fundholding, because they know that it has not been best for their patients.
Is my right hon. Friend also aware that the Audit Commission report showed that 70 per cent. of GP fundholders were unable to manage their funds as well as they might because they did not have the necessary management expertise and skills available? Does he therefore agree that a far better model for primary health care provision would be locality commissioning, which would mean lower bureaucratic costs, better management expertise, a far better deal for patients and, above all, more efficiency for the NHS, using public funds most effectively for the benefit of all patients? That would also lead to equality in waiting lists, and therefore a better service to patients.
Mr. Dobson: I welcome my hon. Friend's contribution, drawing on his professional experience as a doctor. I assure him that our consultation on the future of primary care will include all representative organisations, including the representatives of fundholding GPs, who have said to our faces that they approve of the changes that we are making and of our approach to the further changes that we intend. We believe that that is the way forward. We want to carry the profession with us and do not want to force people to do things that they do not want to do. It is my belief that the bulk of the medical profession and the bulk of the nursing profession want to do the best by their patients. That is why they support what we have announced today.
Mr. Simon Hughes: The Secretary of State is right. On all three points we support him, and on all three points the Conservative spokesman, the hon. Member for Stratford-on-Avon (Mr. Maples), is wrong. Fundholding, with the right to buy advance treatment, is wrong and unfair, and should go. That does not necessarily mean the end of fundholding. Fundholders support the announcement, and are clear that such advance treatment is unjustified. Fundholders' representatives, including the very man who was on the radio this morning speaking for fundholding doctors, have told me so to my face. The Secretary of State has our unreserved support, and I am delighted that he has been able to make the announcement.
The follow-up question that will be in people's minds is whether, given that we have abolished the two-tier system for GPs, the Secretary of State has in mind the abolition of the multi-tier system which results in shorter treatment times in certain parts of the country and much longer treatment times in other parts. How soon one is treated is, in effect, a national lottery. When will the other manifesto pledge to treat more people, and, by implication, to bring down waiting lists for all, be achieved?
Mr. Dobson: We are treating more patients. This year, we shall be devoting to patient care £100 million which would have been spent on bureaucracy. Of the £20 million that we will save from the bureaucracy of the eighth wave of fundholding, £10 million is being devoted to breast cancer treatment and £5 million to improvements in

403
children's intensive care. I thank the hon. Gentleman for his welcome for our proposals, but I have forgotten what his other question was.
Mr. Robin Corbett: Those of my constituents who did not have fundholding GPs and were told that they had to wait a minimum of nine months for treatment were very upset when they found out that patients of fundholding GPs had to wait only a maximum of six months, so they will commend what my right hon. Friend has said today. Will he include pharmacists in the consultation about primary care? They have an important role to play.
Mr. Dobson: On the latter point, I can assure my hon. Friend that we shall be consulting everyone involved about the future of primary care and how we can extend the roles of the various professions so that they meet the needs of patients who are feeling poorly. That is the most important thing that we can do.
I think that everybody realises that the present system is manifestly unfair. The bulk of people in this country are profoundly fair people and they want a fair system; they have an unfair system. Such unfairness was emphasised by James Johnson, the chair of the BMA's central consultants and specialists committee, when he said:
"The present two-tier system is manifestly unfair to patients."
Even more important, he said:
"Elective surgery patients are no longer being treated on the basis of clinical need."
We will put a stop to both those things.
Mrs. Virginia Bottomley: Is the right hon. Gentleman aware that the real strength of GP fundholding has been to change totally the balance of power in the NHS towards the family doctor? Is not his real problem that, having so failed with the Chancellor of the Exchequer to get even the amount of money secured for this year by his predecessor, he has already been condemned by the BMA, so, rather than take any steps to help patients, he has thrown an ideological bone to his Back Benchers? It is a classic Labour party levelling down, not levelling up, and no patient will benefit.
Mr. Dobson: All I can say about funding is that, as a result of the decision announced by my right hon. Friend the Chancellor of the Exchequer, the NHS in England will gain £1.7 billion more next year in comparison with this year—the Budget set by the Cabinet of which the right hon. Lady was a member. If we are expected to take lessons from her about ways of organising the health service, I can only presume that she is saying that she was not one of the Tory Ministers whom Clive Froggatt came to see—before which, according to his memoirs, he used to shoot up.
Ms Julia Drown: My constituents and I welcome my right hon. Friend's statement, as does the BMA—I have just come from a meeting with it. Does my right hon. Friend agree that his statement will be welcomed not only by the doctors and nurses he mentioned, but by many health care workers? As a former finance director in the health service, I was deeply affected by the internal market introduced by the previous Government.
404
Before the internal market, I could tell patients that, however difficult the financial circumstances of my hospital, they would be seen in order of clinical priority. If they had the most urgent need, they would be first to be seen by the doctor. It was deeply destructive to doctors, nurses and administrative staff who dealt with patients to turn that round and to have to say, "I am sorry, but it now depends who your doctor is." I welcome with open arms the return of a national health service in which, once again, patients are seen in order of clinical priority.[Interruption.]
Mr. Dobson: I thank my hon. Friend for her endorsement of my announcement today. It is revealing that her direct experience, like that of my hon. Friend the Member for Dartford (Dr. Stoate), of the problems caused by the internal market is received with mockery by Opposition Members—sorry, I should say Tory Members, in fairness to the Liberals.
Mr. James Paice: The right hon. Gentleman will know that one of the benefits of fundholding has been that doctors could send patients to the hospital most appropriate for their needs and often most convenient geographically. In my constituency, many people live in one health authority, but the best and nearest hospitals are in a different health authority area. Will the Secretary of State answer the question put by my hon. Friend the Member for Stratford-on-Avon (Mr. Maples) and confirm that fundholding GPs will still be able to send their patients to the hospital most suited to their needs, or will there be some form of central direction of the hospitals they should attend?
Mr. Dobson: The hon. Gentleman ought to recognise that, until the Conservative party made its changes—[HON. MEMBERS: "Answer the question."] I am answering the question. Before the Tories made their changes, any GP in any part of the country could refer any patient to any hospital that he thought suitable. The Tory party took away that right and then started to hand it out as a privilege. We will ensure that all doctors are in the same position to look after their patients and exercise their clinical judgment, which the fundholding system took away from far too many doctors.
Laura Moffatt: As a nurse who worked in the health service for 20 years, may I share with my right hon. Friend what such an announcement will mean for my many former colleagues? I am so sad to hear the comments from Tory Members about ideological bones, because I can honestly tell my right hon. Friend that—
Madam Speaker: Order. I am sorry to interrupt the hon. Lady. I have tried to explain that when we are in Question Time hon. Members must ask the Secretary of State a question. I understand the hon. Lady's anxiety and keenness about the statement that has been made and I am sure that she endorses it—I would expect her to do so from the Government side of the House—but she must put a question to the Secretary of State and not make a long speech. I hope that we will soon have a debate on

405
the health service and I will be able to call anybody who wishes to make a statement. Meanwhile, let us have a question.
Laura Moffatt: Is my right hon. Friend aware that we desperately need some improvement in the morale of health service staff?
Mr. Dobson: I entirely accept the point made by my hon. Friend in her excellent question. [Interruption.] Well, there was more of a question than we had from the hon. Member for Stratford-on-Avon (Mr. Maples). My hon. Friend is right. The fact that doctors, nurses and others working in hospitals had to treat one patient unfairly compared with another was etched deeply into the morale of all concerned. They will be delighted that that rotten, unfair system is to end and be replaced by one that is fair.
Sir Richard Body: With respect, I wonder whether the Secretary of State has quite answered the questions from two of my hon. Friends. They asked whether fundholding doctors would still be able to send their patients to the consultant of their choice. The Secretary of State referred to the hospital of their choice. There is a distinction. Will he make it plain that, if his proposals are accepted, fundholding doctors will not be able to send their patients to the consultant of their choice?
Mr. Dobson: I am sorry, but the hon. Gentleman, for whom I have considerable respect, has missed the point. Fundholding doctors can keep sending their patients to the hospital of their choice and to the consultant of their choice, but neither the hospital nor the consultant can promise to treat them more quickly than another patient equally deserving of treatment.
Mr. Eric Illsley: I welcome my right hon. Friend's announcement, especially, as two years ago, the Sheffield hospitals trust refused all clinical admissions other than those of patients of GP fundholders. Is he aware that a GP fundholding practice in my constituency, which has made underspends of £300,000 over the past few years, has spent that money on buildings which now belong to that practice? Figures for the latest financial year show that practice with an overspend of
406
£80,000, which now falls to be met by the district health authority. Will my right hon. Friend put an end to such malpractice?
Mr. Dobson: As I understand it, any overspending this year will be taken from the practice's future budget, so things should even out. We want a system in which all practices get a fair share of the national health service resources. The measures that we announced about three weeks ago are intended to deal fairly in financial terms with non-fundholding and fundholding practices. That is what the representatives of the non-fundholders say they want, and so do the representatives of the fundholders.
Dr. Evan Harris: I, too, welcome the statement by the Secretary of State. From talking to former colleagues at the BMA this morning, I can confirm that they also welcome the abolition of that two-tier system. Is the Secretary of State aware that doctors are concerned about another two-tier system? Those people on long waiting lists who can afford to go privately can jump the queue, leaving those without means to wait even longer. Does he have any proposals to prevent waiting lists this year getting longer and longer for my constituents in Oxford and those of other hon. Members?
I remind the Secretary of State of the question from my hon. Friend the Member for Southwark, North and Bermondsey (Mr. Hughes). Can he say when waiting lists will come down by the 100,000 that he promised in the Labour manifesto?
Mr. Dobson: I am not making any wild promises about when waiting lists are coming down. I have been looking at the facts. At present, waiting lists are the highest that they have ever been in the history of the national health service. When we took over, they were rising faster than they have ever risen, and there is still a great deal of momentum behind that rise, so we cannot promise any short-term reductions.
If there is a harsh winter, I have said—and I take responsibility for it—that the first priority for the hospital service must be to deal with emergencies. If that means that the waiting lists must rise in order for the emergency demands to be met, I will take responsibility for it. That is what one must do when one is in government.
Several hon. Members rose—
Madam Speaker: Order. We shall now move on.

Foreign Income Dividends
3.47 pm
Mr. David Heathcoat-Amory: On a point of order, Madam Speaker. I wish to raise a matter concerning the status of the Finance Bill and whether it represents the will of the House at Second Reading. On Friday before last, the Paymaster General implied in the House that the Government were having second thoughts about the treatment of foreign income dividends. He said that he was
"looking sympathetically at the position of UK-based groups with a substantial amount of foreign income."—[Official Report, 4 July 1997; Vol. 297, c. 586.]
He realised that many such groups would be driven away from the United Kingdom if the Finance Bill were enacted in that form.
The following week, at Question Time, the Economic Secretary to the Treasury said that no changes were envisaged. However, confusion was created the same day by the Chief Secretary to the Treasury, who said that the position of the Government was "absolutely clear". He added:
"The situation is widely understood, particularly by those affected".—[Official Report, 10 July 1997; Vol. 297, c. 1068.]
Since then, it has become clear that the position is far from widely understood, and emergency consultations are taking place between the Treasury and a number of United Kingdom financial groups, as has been widely reported in the press.
My point of order for you, Madam Speaker, is that you have always been vigilant to ensure that the House is the first to know of any change in the treatment of legislation. Further than that, although the Bill has received a Second
408
Reading, we now learn that it does not represent the intentions of the Government. The House has voted on a false prospectus.
Furthermore, the Bill is now in its Committee stage, yet the matter is not only unresolved but has been the subject of contradictory statements by Ministers. I know that you, Madam Speaker, cannot force Ministers to come to the Dispatch Box and explain themselves, but, as the matter affects legislation now before the House—indeed, later today we are to debate the very clause affecting foreign income dividends—will you agree to a postponement of those proceedings until the matter has been resolved and clarified by those on the Treasury Bench?
Madam Speaker: No, I cannot agree to postponing the legislation. As far as the Chair is concerned, it is perfectly in order for us to continue with our proceedings in Committee as arranged. The right hon. Gentleman will, of course, be aware that there is a Report stage to come, and we ought to be a little cautious about such points of order at this stage in Committee. If the right hon. Gentleman has other matters to raise, no doubt those on the Treasury Bench will be able to respond to the political arguments that he puts. Our procedures are perfectly in order at this time.

BILL PRESENTED
  ELECTIONS (VISUALLY IMPAIRED VOTERS)
  Mr. Paul Burstow, supported by Mr. Harry Barnes and Mr. Peter Bottomley, presented a Bill to make provision for blind and partially sighted people to vote unaided in person at elections through the use of braille template and large print; and for connected purposes: And the same was read the First time; and ordered to be read a Second time upon 13 February 1998, and to be printed [Bill 50].

Animal Health (Amendment)
4.1 pm
Mr. Paul Flynn: I beg to move,
That leave be given to bring in a Bill to improve the welfare of animals in quarantine; and for connected purposes.
Our quarantine laws are cruel to animals and distressing to their owners. Those laws are entirely irrational, unnecessary and inefficient. They cost the taxpayer £1 million a year, and animal owners £5 million a year. They survive only because of the previous Government's reluctance act in the face of all the objective opinion, including the unanimous decision of the Agriculture Select Committee, that there was no need for the present system to continue for animals coming from rabies-free countries, especially in Europe.
Quarantine has played little or no part in reducing the incidence of rabies worldwide. That has come about through the use of vaccine, and there is now a sophisticated and far superior method of controlling the spread of rabies, as well as controlling other diseases coming in from other countries.
Most countries, especially the Scandinavian countries, have abandoned quarantine as archaic, inefficient and even dangerous. It is dangerous, because people seeking to evade the six-month quarantine period smuggle animals in. We know that 374 dogs and 234 cats were smuggled in the past six years—and those represent the cases that were detected. There will almost certainly be many thousands more coming in, and we do not know whether they have been vaccinated, or from what countries they come. They may come from countries where rabies is endemic.
The superior system should be used in this country, and I believe that the Government will have the courage to challenge the general public's prejudiced and ill-informed view of the dangers of rabies. Sadly, past Governments have played on people's emotions and vastly exaggerated the threat.
It is extraordinary how futile the process has been: 200,000 animals have been held in quarantine since 1970, and there has not been a single proven case of rabies among them. The last two cases of rabies that we had were in the 1960s, and both the animals had been held in quarantine.
It is extraordinarily unfair that, with certain precautions, we allow bred animals, such as racehorses and cattle, to enter in great numbers. More cattle come into this country from France alone than do dogs from all the rest of the world, yet every warm-blooded mammal can contract and pass on rabies. It is sobering to realise that more people than dogs—13 people since 1974—have entered the country suffering from rabies.
We put our citizens, and especially service men and others who serve this country abroad, at a great disadvantage, and we do not help the disabled: a concession was refused for dogs for the blind, which seems very mean to me. The fact that concessions are allowed exposes the futility of the present laws.
I know that the Government are considering major reforms and that the robust campaign being conducted by Passports for Pets and the Royal Society for the Prevention of Cruelty to Animals will bear fruit. The purpose of my Bill is to correct a major defect in the law
410
that prevents welfare facilities from being guaranteed for animals in quarantine. The Government currently have no power to enforce animal welfare standards in kennels and the RSPCA cannot insist on inspection of quarantine areas.
Many quarantine kennels are run well by people who are doing their best, but it is impossible to overcome the trauma for domestic pets who are parted from their owners and suffer terribly because of their incarceration. Even worse are those rogue kennels that treat animals in an abominable way. Sadly, there is a great deal of evidence of that.
I have testimony of 100 cases of bad treatment by kennels, and I shall refer to one or two. I will not mention the names of the kennels on this occasion, but I may well do so another time. A lady told of how her dog had gone into kennels and she recognised that he had something wrong with his eyes. She tried to get him to a specialist, although the kennel owner was against it.
The dog was eventually taken to a specialist, who went mad and asked why the manager of the kennels had not brought the dog to her earlier. The lady got no support from the kennels and was sworn at by the owners. The kennels were filthy, and there was no effective heating, no exercise and a bad food supply. The animal went blind.
Another lady talks of her three cats in kennels. One died after a couple of months from flu-like symptoms, and another died some time later from an infection, picked up in the kennels, that travelled to the animal's brain.
Another lady talks of her dog who went into kennels that were permanently running with water. She had to ask the managers to clean the dog, because he was in such a state and his feet were sore. She got no co-operation, the animal's bedding was not raised from the ground, he developed trench foot and finally had to have his toes amputated.
Sadly, there is an endless catalogue of cases in which there has been no access to the kennels for those who should be helping out and should be able to inspect them. There is a misapprehension that, because inspections are carried out by the Ministry of Agriculture, Fisheries and Food, the kennels and other quarantine areas are approved. The Ministry has only to inspect the security of the site and ensure that the animals will not escape. There is no guarantee of the welfare standard.
We must look forward to the major reform of quarantine, but this modest Bill can and will become law—people are usually cynical about ten-minute Bills and suggest that they have no chance of becoming law, but 59 have. I hope that the Government will co-operate on the Bill. I know that the Ministers are sympathetic to its aim and I hope that they will ensure it a swift passage so that we correct this defect, which was an error or an oversight in the Animal Health Act 1981.
In the House, we all recognise our duty to protect defenceless animals from unnecessary and avoidable suffering. The appalling conditions in some of our kennels besmirch our reputation as a nation of pet lovers. The Bill will bring force to bear to protect those defenceless animals and I commend it to the House.
Question put and agreed to.
Bill ordered to be brought in by Mr. Paul Flynn, Mr. Charles Kennedy, Mr. Edward Davey, Mr. Ken Livingstone, Mr. Nick Palmer, Mr. David Hanson, Mr. Tim Loughton and Mr. Huw Edwards.

ANIMAL HEALTH (AMENDMENT)
Mr. Paul Flynn accordingly presented a Bill to improve the welfare of animals in quarantine; and for connected purposes: And the same was read the First time; and ordered to be read a Second time upon Friday 28 November, and to be printed [Bill 51].
Orders of the Day

  Finance Bill
  (Clauses 1, 15, 17 and 19)
  Considered in Committee [Progress, 15 July].
  [MR. MICHAEL LORD in the Chair]

  Finance Bill
    Clause 17

      WITHDRAWAL OF RELIEF ON MEDICAL INSURANCE PREMIUMS
      4.11 pm
      Mr. Tim Boswell: I beg to move amendment No. 13, in page 11, line 15, leave out from "section" to end of line 16 and insert
      "shall not take effect until Her Majesty's Government has published a study of the additional National Health Service spending required to accommodate the extra patients resulting from the consequential cancellation of medical insurance contracts".
      The Second Deputy Chairman of Ways and Means (Mr. Michael Lord): With this, it will be convenient to discuss amendment No. 14, in page 11, line 15, leave out from "section" to end of line 16 and insert
      "shall not take effect until Her Majesty's Government has published an assessment of the effects of the withdrawal of this tax relief on National Health Service spending in 1997–98,1998–99 and 1999–2000.'.
      Mr. Boswell: The amendment would defer the implementation of any Budget changes to health insurance until a full appraisal of their impact on the national health service and its waiting lists had taken place and been published by the Government. I am bound to say that such an appraisal is sorely needed. I will deal in due course with some of the evidence that I have on the matter, but we need an authoritative Government statement, in particular, as my right hon. Friend the Member for Wells (Mr. Heathcoat-Amory), who is on the Front Bench beside me, has been labouring hard to ascertain some of that material from the Treasury by way of written questions. He has received a number of holding answers on relevant matters, but he has not received the substantive answers. It is regrettable that we did not have the information before this afternoon's debate.
      I should at the outset declare an interest in that I have been a member of BUPA for a large number of years. Despite any appearance to the contrary, I do not yet qualify by virtue of age for any tax relief. My mother, on the other hand, is also a member of BUPA, and she does.
      In certain respects, this debate mirrors yesterday's debate on mortgage interest tax relief, yet there is a subtle difference in the Government's approach to the two. It is a difference in the scale of the potential revenue. The mortgage interest revenue being discussed yesterday was about £950 million in a full year. By 2000, the revenue gain from the withdrawal of this relief will be £140 million. There is, however, a considerable and significant difference in impact.
      Yesterday, we sought to advance the argument that the Government's proposals on mortgage interest would have a widespread effect. After all, there are more than 10 million mortgagors. In contrast to that approach,

      413
      which I have occasionally described as saturation bombing, today involves precision bombing on a much smaller number of potentially affected persons, including those who are often least well equipped to fight back in the argument. I shall return to numbers and the impact of the proposed changes later.
      If my tone is a little quieter than it was last night, it is because we would all do well to reflect that those who are likely to be affected by the proposed change have generally made a great part of their lifetime's contribution to society through their work, through voluntary work, through raising their families and through many other endeavours. When they write, they often state that they had front-line experience of the second world war and experienced times of real difficulty. They grew up through that.
      In many cases, including that of my mother, we are talking of people who have relieved the national health service of costs over many years through their membership of private medical insurance schemes. It is worth saying also that they are not generally candidates for some fairly familiar procedures for younger people. For example, they are not candidates for cosmetic surgery on the NHS, nor are they candidates for orthodontia or the repair of sports injuries. Their cases typically—I use my words delicately and I hope that they will not be misinterpreted—involve the more degenerative conditions such as cataracts and the need for hip joint replacements.
      Both in the NHS and the private sector of health care, the expectations of society have changed massively over the past generation. People expect to have cataracts and problems with hip joints rectified. They expect the machinery to be in place to enable them to have operations so that they might maintain or enhance their quality of life.
      It is a striking fact that almost half of all health expenditure in the United Kingdom is on persons over the age of 65. In 1966, 16 per cent. of our citizens came within that sector of the population, but we look forward to the greying of the baby boom generation and, over the next 25 years, the proportion will increase to 18 per cent. The impact on the target group and, I concede, on potential savings, will increase commensurately.
      It will be clear to all of us who were in the Chamber to hear the exchanges following the private notice question that the health service is under severe funding pressure. The Government, as the Secretary of State for Health admitted, are struggling to contain waiting lists. Perhaps it is not for the Committee to debate why that should be and who gave the impression that they had a magic answer during the general election campaign, but the Government promised to reduce waiting lists, and they, have offered no extra current spending to meet the problems of the health service.
      In the context of an aging population and the demand for better health services and rectification of diseases linked to aging and degeneration, the Government's proposals, as set out in clause 17, are characteristic of their general approach to the Budget. They reveal some of the besetting sins that we discussed last night in respect of mortgage interest relief. First, there is haste. Haste has curtailed the reasonable representations—indeed, the time for hon. Members to consider those representations—of
      414
      responsible outside bodies on the matter and, perhaps more regrettably from the Government's point of view, led them into error. It has not been in their own interest to rush this measure. Indeed, the Association of British Insurers made the point that it would be prepared to consider phasing out the relief, but it does not want rushed changes implemented in a Budget with immediate effect from 2 July. I shall come to the specific points about that in a moment.
      Haste is the first problem. The second problem, which goes through much of what the Government announced in their Budget, is an emphasis on dressing up measures of class spite as though they provide a springboard for surmounting real-world and acknowledged problems in financing public services. Even if we believe the Government's figures for savings as set out in the Red Book—a figure rising to £140 million a year from the current estimate and £120 million in the first full year—the Committee would do well to remember that that would finance the operation of the national health service for precisely 24 hours. Even if they got the lot back, the Government are not buying themselves very much time.
      The third characteristic of the Government's approach to the Budget is, of course, the iron law, as we must now call it, of the Financial Secretary—in effect, "If you damage someone, you are acting with their best interests at heart." I invite the Financial Secretary—just as she argued on pensions, and just as one of my hon. Friends did on mortgage interest relief—to talk to my mother, or any other policyholder with medical insurance policies, and explain how this measure will help them.
      My fourth and final point about the Government's general approach is that the present Prime Minister and Ministers on the Treasury Bench gave solemn assurances during the election campaign about their wish not to increase taxation. This measure is clearly a withdrawal of a tax expenditure, or, to put it in English, an increase in taxation. That is not good enough.
      On openness and transparency, a matter that we discussed last night, I heard a suggestion from the hon. Member for Dudley, North (Mr. Cranston), who is present. Perhaps I did not do him justice in the short time allowed for the winding-up speeches. Perhaps he would have liked to say something, if only space had permitted, in his election address.
      I have in my constituency a company called Freight Media, in which I have no interest but which I respect. It operates for all political parties and puts out the wagons with sandwich boards on the side that tell people who they should vote for. Indeed, the company was also in evidence at the grand prix at Silverstone this week.
      I wonder whether the Government were really prepared to level with their electors and supporters, given that they are proud of the way in which they have secured, for the first time, representation on the south coast. Would it not have been more appropriate for the Labour party to tour the south coast during the election campaign, when people could still have changed their minds, with large boards affixed to the sides of lorries saying, "We do not propose to increase taxes but"—for reasons that may or may not be explained this afternoon—"we think it right that you, the elderly, should have your health insurance tax relief removed."

      415
      By way of context, it is important to flag up that the relief, which was introduced in 1990, was reduced to the basic rate by the Chancellor in 1994. Because it is credited at source, lower rate taxpayers and people who pay no tax can also join in and get the full benefit of it.
      There is little evidence that the relief goes largely to the affluent. What is quite clear is that the elderly—those who have retired—are not by any means the richest, let alone the most directly influential, section of society, although some are relatively well off. The Government's proposal targets the weak in a way that I, as a Conservative, find unacceptable.
      I want to analyse the Government's proposals, and I shall begin by inviting them to consider one or two points. I should make it clear to the Financial Secretary that they are not in any sense political points; they are Committee points. I hope that the Financial Secretary will do me the courtesy of listening. Although I sometimes challenge her to give an immediate response, and although I would prefer her to try to reply to my points today because of the uncertainties that may well affect some of those involved—including the providers of health insurance—I ask her to reflect on what I shall say about the detailed operation of clause 17, and perhaps introduce further measures on Report.
      I concede that the Government have, to an extent, recognised that, even when a Chancellor of the Exchequer gets up to make an announcement, both providers and policyholders are caught when the music stops and there may be inequities if some smoothing relief is not given. As the notes on clauses helpfully explain, an attempt has been made to provide for the renewal of existing contracts—subject to some safeguards—as well as for new contracts that were in the pipeline.
      According to my analysis, there are three outstanding points. Some of my hon. Friends who raised those points with me may well want to return to them in more detail. I am not sure whether the first is dealt with in the Bill as currently drafted, but I regard it as important. I refer to cases in which the insurance provider has passed the contract offer for the year just ahead of 2 July, which is the operative cut-off date, to ensure that contracts that are ready to go out are available for the whole year. I am told by some of the providers that there has been no phoney business and no bunching up of contracts. I feel that, when people have made normal commercial arrangements not designed to frustrate anticipated legislation, those arrangements should stand.
      My second point relates to oral contracts. Both a provider and the Association of British Insurers have told me that many contracts are now arranged through telephone sales. People give credit card numbers over the telephone, and nothing is written down initially. As I read the Bill, it is pretty clear that the contract exceptions are confined to contracts in writing.
      No one wants to promote gross abuse of the system, but there ought to be some way of providing for genuinely understood contracts. I am no lawyer, but I take an interest in such matters. If there is no way of providing for that type of contract, will not a real difficulty be created between policyholder and insurer in that a contract that has been undertaken orally on one basis will then be materially frustrated by a change in tax law? Such a change would create an inequity if the insurer held the policyholder to the contract.
      416
      The third point is narrower, but I think that it is important to some providers. I am familiar with it from my own experience with paying monthly for an annual contract. I understand that, for reasons that appear to relate to consumer credit law, a number of such contracts are written on the basis of a renewable monthly contract. If that is so, as I read the Bill, come 2 July it would be possible to make one such renewal, which would run until 2 August, but it would not be possible to have a full year's renewal by a series of monthly contracts. I suggest to the Financial Secretary that, if that has been the traditional and reasonable way of constructing these matters, she should consider some relief.
      4.30 pm
      We are faced with a guillotine in Committee and, as a result of the Chancellor's decision, with a guillotine on these tax reliefs. It is incumbent on the Government to think hard about the transitional effects and to soften them where appropriate. I genuinely do not want to press the Financial Secretary on this matter, except to ask her to consider these essentially Committee points and see whether she can come up with some alleviation.
      I shall now deal with the general issues that are more germane to the amendment. There is a continuing incoherence in the Government's figures, which is why we want a structured and comprehensive report on what is going on. It is remarkable that the Budget Red Book of 2 July refers to the potential catch in the withdrawal of this relief. It refers to a third of a million people—which is an unusual fraction for the Red Book—whereas the Financial Secretary, in a written answer 24 hours earlier on 1 July at column 108 of Hansard, referred to a written answer given by the previous Government in the shape of my right hon. Friend the Member for Fylde (Mr. Jack) on 13 March at column 322, which referred to 600,000 people. That figure seems to be in line with independent studies, although the precise number is not certain.
      The Financial Secretary to the Treasury (Dawn Primarolo): If the hon. Gentleman studies the parliamentary answer to which he referred, he will see that the figure was an estimate, not an exact figure.
      Mr. Boswell: If so, we were given an estimate of 600,000 on 1 July, and another estimate of a third of a million in the Red Book on 2 July. That is a divergence of almost 100 per cent.
      Dawn Primarolo: I refer the hon. Gentleman to the Adjournment debate that was secured by the hon. Member for Eastbourne (Mr. Waterson). The figures were given in that debate and were confirmed in a written answer to his hon. Friend.
      Mr. Boswell: I am grateful for that information. We shall reflect on what the Financial Secretary said and we shall come back to her if appropriate. Throughout this process we have had some difficulty getting answers to written questions.
      The hon. Lady just said that the figure given was an estimate. That is precisely the point. We are still uncertain about the impact of this measure, which is why we are calling for a full analysis.

      417
      My second point concerns the likely impact on national health service waiting lists. On 14 July, which was after the Budget, the Minister of State, Department of Health, the hon. Member for Darlington (Mr. Milburn) was asked by my hon. Friend the Member for Romsey (Mr. Colvin) to estimate the impact on waiting lists. The Minister replied:
      "Any such estimate would be pure speculation. Most of the people who benefited from the tax relief were existing policy holders. It would be wrong to assume that they will turn to the National Health Service in large numbers for treatment because the relief which had not been available when they first opted for private health insurance was now being withdrawn."—[Official Report, 14 July 1997; Vol. 298, c. 78–9.]
      I understand that line of argument, which is fairly familiar from the Treasury, but it is rather alarmingly plain that it is suggested that nobody knows anything about the subject. We know quite a bit about it, and what we know gives rise to concern about the Government's estimate of the saving. The matter should be more thoroughly reviewed.
      Perhaps it should no longer surprise me that the Government not only cannot get their figures overtly consistent but do not appear to be able to read reports that have been commissioned from reputable outside bodies, notably the Economists Advisory Group. A detailed report, which is in my hands, was sent by that group to the Secretary of State for Health and to the Chancellor and the Financial Secretary in mid May. It must have been in their hands when they were preparing their Budget proposals.
      It seems from the answer that I quoted a moment ago that the Government may be claiming that ignorance is a defence. They may claim not to have read the EAG report, which makes challenging reading. It analyses price elasticity for private medical insurance and the flows that are reported in the series, with which some hon. Members will be familiar, on private medical insurance by Laing and Buisson. It suggests some systematic flaws in those recent studies. For example, it suggests that they do not separate out the price impacts from total revenue, and the effect is that they grossly under-estimate the results of price increases on demand and the cost of medical services.
      According to the Economists Advisory Group analysis, which I remind the House is in the hands of the Financial Secretary, what seems to have happened is that people have been trading down in response to the higher premiums that are required as they move into the next quinquennium of their health insurance and because health insurance is getting more expensive anyway because of higher costs and greater demands on the service. As people have been trading down, health insurance tax relief has enabled them to maintain their membership of a scheme. I did that myself, although I did not benefit from health insurance.
      The danger is that people will no longer trade down, but will trade out altogether and go back to the national health service. Our amendment does not state absolutely that that will happen, but that everyone should pause while the matter is properly analysed.
      Some of the proposals are a little high flown and complex, even for lay economists like me. It is necessary to put the matter in English in terms of its impact on the
      418
      individual. I was impressed by the Economists Advisory Group's quotation of the comments of one elderly policyholder:
      "We pay £133 a month but if the tax relief were abolished the cost would go up to £173 a month, which is really prohibitive. It seems a tragedy that we have been members of BUPA for such a long time then just when we need the cover the most we would find it expensive."
      We are dealing with a known hit on a significant number of electors and constituents set against a speculative benefit to the national health service.
      I draw the House's attention to one specific point that is incontestable in terms of the Red Book figures. There is a suggestion of a small saving from the withdrawal of this relief because it is being taken away midway through the tax year in year one, 1997–98. However, we know from the Budget statement that no additional funds have been made available to the national health service in the current year. All that the Chancellor did was pre-empt some of the reserve that was available for 1998–99 and commit it five months ahead of the normal time to the health service, so if even one person with private medical insurance has to chuck it in and go back to the NHS, he will go on a waiting list and there will be no extra money to fund provision for him.
      If the Financial Secretary studies the analysis, she will see that there is strong resistance among insurance policyholders to increases, which tend to take place every five years as they move into a new medical insurance bracket and annually as costs rise in both the private and public sectors of the health service.
      It is difficult to calculate exactly how many people will leave. I have mentioned that it appears—I do not think that the Financial Secretary dissented, but I will need to study the record carefully—that the probable net number of policyholders who will be affected by the changes is about 600,000. I am not claiming that all those people will go back. What I can say is that the EAG study worked out that, for acute major procedures only, about 30,000 policyholders per annum could go back, increasing NHS waiting lists by that number.
      Two other points also cast grave doubts on the Government's arithmetic in working out the benefit to the Treasury of the changes. First, there will be a loss of insurance premium tax from any withdrawal of policyholders. The insurers estimate that that loss will amount to about £7 million a year. Secondly, the health service benefits from the use of private beds in NHS hospitals and that benefit is estimated to be about £20 million a year.
      In the amendment, I have been seeking not to give a final, definitive answer to the question how many of the 600,000 people will up sticks and go back into the NHS, but to suggest that there is a sufficient problem here for the House not easily to accept the changes without a proper, published study and discussion. We could, for example, ask the Health Committee for a short report.
      Many of these people will not only suffer, but indirectly impose a further load on the NHS. Frankly, we should be told more. The net effects of the changes should be properly analysed and their damaging effect on individuals avoided until these matters have been cleared up and thoroughly resolved.
      Dawn Primarolo: Nice try. That is a standard ploy of oppositions: when in doubt, ask for a report. We used it

      419
      on one or two occasions. The Opposition are unable to find a genuine amendment to the clause and apparently unable to bring to bear the great intellectual depth that the hon. Member for Daventry (Mr. Boswell) suggests, so he makes this proposal.
      The Committee's deliberations will be assisted if I present the facts that support the Government's decision to withdraw tax relief on private medical insurance for the over-60s. In explaining the Opposition case before Opposition Members retire to the bar, rather than when they return and are in a disruptive and public school boy frame of mind, I hope—
      Mr. Boswell: On a point of order, Mr. Lord. Last night, I heard some remarks by the Financial Secretary that were in that vein and I have today again heard it asserted that Opposition Members are in some sense not treating these matters with the seriousness that they deserve and that their inability to do so is related to the consumption of alcohol. The matter has been drawn to the attention of the Chair on past occasions. I do not have a copy of "Erskine May" in front of me, but in the absence of any definite information should not the Financial Secretary be invited not to proceed further with her line of argument and, indeed, to withdraw the remarks that she has just made?
      The Second Deputy Chairman: The obvious answer is for everyone in the Chamber to concentrate on the matters in hand.
      4.45 pm
      Dawn Primarolo: When private medical insurance relief for the over-60s was introduced by the Conservative Government in 1990, they claimed that it would encourage the growth of insurance cover for that group in society. They did not undertake any research to find out whether it would work, and it did not. The subsidy did not secure a significant growth in provision.
      When the relief was introduced, some 350,000 contracts existed, covering 500,000 individuals. Those people had already purchased medical insurance, so the tax relief was a subsidy to them. No doubt they were very grateful to receive it, but it played no part in their decision to take out insurance. The question that the hon. Member for Daventry (Mr. Boswell) must answer is, should people be subsidised for action that they would have taken anyway?
      Mr. Tim Loughton rose—
      Dawn Primarolo: I will give way to the hon. Gentleman in a moment.
      Since 1990 and up to 1997, the number of contracts has increased only marginally, by 10 per cent.—yet the cost to the taxpayer for that 10 per cent. increase is £140 million. Perhaps the hon. Member for East Worthing and Shoreham (Mr. Loughton) will explain why taxpayers' money should be used to benefit a very few people who had already decided what they would do.
      Mr. Loughton: Later, I hope to elaborate on my comments and take up the question why, yet again, it is a Government onslaught on minorities.
      420
      I want to pick up the hon. Lady on her remarks and, with reference to the major health care providers, ask on what evidence she is basing her claim that people who took out health care insurance before 1990 have not changed during the years to 1997. What about those who have died? What about those who have been priced out of the market because the average price of pensioner health care insurance has gone up by at least 11 per cent. a year? Is the hon. Lady really saying that there has been no change in policyholders over those years?
      Dawn Primarolo: Conservative Members need to make up their minds on their line of argument against the Government. The hon. Member for Daventry said that people were long-standing contributors to the schemes and that they should not be deprived of them. Now, the hon. Member for East Worthing and Shoreham is taking a different line, saying that that is not the case.
      Mr. Boswell: The substance of my argument was that some members were long-standing contributors, and that they had some wish, in equity, to get some benefit from their long-standing withdrawal from imposing, at least partially, any cost on the NHS. Equally, some were marginal cases and might otherwise have stayed with the NHS rather than subscribe to private medical insurance.
      The matter is not entirely clear, but it could be clarified by the sort of report for which we have asked. If the hon. Lady does not wish to produce one, I suggest that she speaks to those who produced the EAG report, and explains what is wrong with the calculations in it.
      Dawn Primarolo: I shall demonstrate that insurance companies—by using information that they themselves have provided; and they provide the insurance cover—expect that there will be almost no impact on the number of people who have insurance policies. Already those companies are offering solutions.
      Provision of the subsidy is truly a measure that benefits only the few—5 per cent. at most—at the expense of the majority. Why should taxpayers pay for relief that offers no clear benefits? The Government have therefore decided to use the money saved from abolition of the relief to help pay to cut VAT on fuel to 5 per cent., thereby particularly benefiting low-income households and pensioners.
      It is truly breathtaking for the Conservative party, after 18 years of undermining the national health service, to try to portray itself as the pensioner's friend, worrying about the NHS while painting a bleak picture of it.
      Mr. Desmond Swayne: The parliamentary newsletter of the Association of British Insurers states:
      "Although presented as helping to pay for the cost of reducing VAT on heating, the Association's submission to the Chancellor indicated that it will cost the Government more in terms of extra NHS costs and loss of insurance premium tax than it will save on the relief itself."
      Will the Minister comment on that?
      Dawn Primarolo: I am so glad that the hon. Gentleman has managed to have an original thought, although it has been supplied by someone outside the Chamber. I will, however, deal with precisely that point.

      421
      There is no indication that those who have private medical insurance and receive relief will change their minds because of our decision. In the name of fairness, however, the Government have made specific provisions in the clause to ensure that relief is not ended immediately, but honoured to the end of the annual contract. Such provision will give individuals who are concerned about their private medical insurance time to seek advice from their insurers and examine the options available.
      I will deal with the options that insurance providers say are available after I allow the hon. Member for Grantham and Stamford (Mr. Davies) to intervene. Perhaps he can tell us whether it is right that people should be subsidised to do something that they would have done anyway.
      Mr. Quentin Davies: The Minister just said that there is no indication that relief withdrawal will reduce the number of people who qualify on age grounds taking out private health insurance. That proposition is extraordinary, and essentially amounts to saying that one can increase the price of something—the net price to individuals taking such insurance cover will increase substantially after abolition of tax relief—without reducing demand for it. Surely that proposition is fundamentally implausible, and cannot possibly be true in the health care or any other sector.
      Dawn Primarolo: What do the insurance companies say about the point raised by the hon. Gentleman? In The Times of 3 July 1997, in an advertisement headed "If you think private healthcare will be too expensive without tax relief, consult a specialist", Norwich Union—one of the largest providers of such insurance packages—stated:
      "If you're over 60, you've probably benefited from tax relief on your healthcare premiums. That changed after yesterday's Budget and you'll soon start paying up to 30 per cent. more. But to find out how you won't have to, no matter who your policy's with, call the Norwich Union Healthcare Tax Relief Helpline now."
      Norwich Union will ensure that people can continue their policies without extra cost. A report in The Independent states that Norwich Union, one of the largest providers of this type of insurance, is confident that 98 per cent. of customers need not pay any more and could keep their private medical insurance. Those are the facts.
      Mr. Quentin Davies rose—
      Mr. Nick St. Aubyn rose—
      Dawn Primarolo: I am sure that the hon. Gentlemen, to whom I am not giving way, will be able to catch your eye, Mr. Lord, and make their own contributions.
      These are the facts. The Government have outlined their case for abolition on the basis that the relief is not justified. It has not worked. There has been no substantial increase in the number of people with private medical insurance. The amendment is defective. There is no reason why the many taxpayers should continue to provide this massive subsidy for the few. I hope that the Committee will reject the amendment, and support the Government.
      Dr. Vincent Cable: I support amendment No. 13. It echoes amendment No. 14, tabled
      422
      by my hon. Friends the Members for Gordon (Mr. Bruce) and for Kingston and Surbiton (Mr. Davey) and me, but in a rather different spirit.
      It was clear from our interventions on Second Reading that we share the Government's philosophy in many respects. We believe that it is inequitable that a relatively well-off section of the community should be subsidised through tax relief. This tax relief was originally introduced by the previous Government for the wrong motive—to weaken the NHS. We therefore support the Government's broad policy position, which is why we supported the Government on Second Reading.
      However, this is the Committee stage. It is an opportunity to review the proposals in more detail, and, echoing some of the points that have already been made, we seek a much more thorough analysis of the financial implications. There are people employed in the Treasury—econometricians labouring in the bowels of the Ministry—who could be asked to produce some useful figures with which we can work.
      At the moment, there is a wide spread of estimates about what will happen. Within the insurance industry, for example, Western Provident commissioned a survey by Gallup, which showed that an increase of 50 per cent. in premiums would lose it about 70 per cent. of its subscribers. That is a very high price elasticity of demand. Indeed, it seems implausibly high.
      At the other extreme, the Government are telling us that their proposals will have no impact. Somewhere between those two extremes almost certainly lies the truth. In his intervention, the hon. Member for Grantham and Stamford (Mr. Davies) captured very clearly where that truth might be.
      Mr. Quentin Davies: One always tries to avoid technical terms in this place, but the hon. Gentleman mentioned price elasticity of demand. Underlying the Minister's presentation of the Government's case is the clear assumption that price elasticity of demand for health care insurance is precisely zero. Does the hon. Gentleman agree that that is fundamentally implausible? Can he think of any commodity on God's earth for which the price elasticity of demand is literally zero, because it is only in that context that the hon. Lady's remarks make any sense?
      Dr. Cable: The hon. Gentleman is right; I can think of no such commodity. The logic of the Budget suggests that the Government believe that behaviour can be changed through taxes and tax incentives. The purpose of increasing petrol taxes was to discourage motoring; the purpose of increasing excise duties on cigarettes was to discourage smoking; and the purpose of reducing MIRAS was to dampen the demand for housing. We know from experience that any impact is likely to be relatively small, but not zero. That is the point of my contribution.
      In the absence of any sensible estimates, we have to work with the rough arithmetic we have been given. My understanding is that the cost to the Treasury of this tax relief is about £120 million to £140 million. I also believe that the total annual pay-out for medical insurance is about £400 million, so it would require only a quarter of the insurers to drop out of the scheme to eliminate completely the gain to the Treasury from the abolition of relief.

      423
      We have to put that in the context of the overall health service budget. The Liberal Democrats have been labouring to bring to the Government's attention the marginal position of the health service budget. On the basis of estimates produced by the Library, we believe that increased inflation will cut the health service budget in real terms by £400 million this year. After the additional injection of cash, the budget may be increased by about £420 million next year.
      That means virtually no increase in health service provision over two years. Any loss from this relatively small measure will mean a reduction in per capita spending in the health service. That is why we support the amendment, and are pressing the Government for a more thorough analysis of the economic impact of their proposal.
      5 pm
      Mr. Ross Cranston: I start with a digression. The hon. Member for Daventry (Mr. Boswell) referred to my contribution yesterday. When winding up last night, he quoted Shakespeare. I should have thought that a close study of Shakespeare would have given him an appreciation of the use of irony, but apparently not.
      The hon. Gentleman also does not seem to appreciate the impact of the defeat that his party suffered on 1 May. He has not realised that our victory was so massive because we appealed to the many rather than the few. The tax relief that we are talking about benefits very few—little more than 500,000 individuals. Only the relatively affluent can take out private medical insurance. The hon. Gentleman quoted a premium of £133 a month. Most people over 60 in my constituency cannot afford £133 a month.
      A great deal has been made of the possible impact of the measure on the national health service. The Conservative amendment would defer the removal of the relief until the impact on the NHS has been assessed. There can be some speculation about the possible impact of the measure. There seems to be a price inelasticity. Many of those who are already taking out private medical insurance will continue to do so. I think that the hon. Member for Grantham and Stamford (Mr. Davies) finally grasped that a moment ago.
      The insurers have made various assessments of the impact on the NHS. PPP suggested that the measure would increase NHS waiting lists by more than 100,000. Western Provident said that the added cost to the NHS would be as high as £300 million. BUPA has given a different estimate. If the insurers are unclear about the impact, I suggest that we should not postpone the measure for an assessment that will not be clear for a number of years.
      I was taken by the remarks of Mr. William Laing, a leading analyst in the area. He was quoted in the Financial Times as saying:
      "the amount of a typical PMI premium is far higher than the cost to the NHS of the treatment covered."
      He went on:
      "Taken together, this means the tax relief was ridiculous and could not possibly be justified in terms of savings to the NHS".
      Mr. Swayne: Does the hon. Gentleman agree that the most important testament is that of the voters? [Laughter.]
      424
      May I therefore ask him whether he shared his enthusiasm for doing away with the tax relief with his voters in his election address, or whether he kept it from them, much as he did with his enthusiasm for doing away with mortgage tax relief?
      Mr. Cranston: The hon. Gentleman does not seem to listen, quite apart from his inability to appreciate irony.
      The hon. Member for Daventry made certain remarks about the aging population and the increasing demand on the health service that it would impose in coming years. There is certainly an element of truth in that.
      The important reason why the Government have taken this measure is that it frees up money for other steps which will have an immediate impact on helping the elderly—especially, as my hon. Friend the Financial Secretary to the Treasury said, the reduction of VAT on fuel. On Second Reading, I gave some figures of the extent of fuel poverty. It is a serious problem, which causes very serious health problems among the elderly, and the Government have taken an immediate step on it.
      In addition, as my hon. Friend the Financial Secretary to the Treasury said, this tax relief measure has been ineffective. It began in 1990. At that time, about 500,000 individuals took out private medical insurance. One estimate I have seen is that, in 1995, only 550,000 people took out private medical insurance; so there is little evidence that that relief has led to any significant increase in the purchase of private medical insurance.
      Indeed, Mr. William Waldegrave, who is no longer in the House, following the voters" decision on 1 May—to take up a point raised earlier—argued at one point for the abolition of medical insurance premiums relief. He said that it had not increased take-up of private medical policies, and was expensive to administer. Conservative Members would benefit from sometimes taking into account what some of their former colleagues have said.
      The expense of the measure has been referred to. According to the Red Book, it has cost about £560 million since its introduction in 1990. That is very significant. One reason why the cost has gone up is that insurance premiums for the elderly have gone up at three times the rate of those for everyone else. The removal of such an expensive measure will free up funds which, as I said, will more immediately benefit the elderly.
      I oppose the amendment, and support the budgetary measure.
      Mr. St. Aubyn: I welcome the comments by my hon. Friend the Member for Daventry (Mr. Boswell), because some of the points he raised—I hope the Financial Secretary will take them on board—will have a direct impact on Prime Health, a major health insurance firm based in Guildford, and on many elderly people in my constituency.
      I estimate that more than 5,000 elderly people in the Guildford constituency currently enjoy the benefit of the tax relief. In the light of what the Financial Secretary said this afternoon, I am concerned that if—or rather when, for I fear it will happen—some of those 5,000 people cancel their health insurance policies, because the removal of the relief has increased the costs so much, they will at some point make a claim on our local health service. When that happens, the many will suffer as a result, not just the few. Everyone who wants to use the health service at the Royal Surrey hospital in Guildford will suffer.

      425
      It should be understood that one of the reasons for delaying the implementation of the clause is that private health insurance benefits the whole community, not just those who take it out. It benefits the whole community, because it relieves the national health service of costs that it would otherwise have to meet.
      Kali Mountford: What is your evidence for suggesting that all private medical insurance holders would be forced to use the national health service? I have had only one person in my constituency complain about the measure, on general grounds. What is your evidence to the contrary?
      Mr. St. Aubyn: I assure the hon. Lady that I have considerable evidence to the contrary. I have received almost as many letters on this subject as on any other that has arisen in the past few months.
      Many of those who have written to me have said that they fear that they will have to stop receiving the benefit of private health insurance. They will have to rely on the local health service, and, as a result, they will impose a burden on it that all will have to share, if the speculative savings from abolishing the tax relief are to be diverted into changing the rate of VAT on fuel. It is obvious that those parts of the country with the most people having health insurance will have the most cancellations. The damaging results of the measure will hit all the people in such areas, including my constituency.
      The Secretary of State for Health said earlier today—I wrote down his words as he said them—that, if there is a harsh winter this year, he will take responsibility. I will remind him of those words this winter when people who have had private health insurance in my constituency can no longer afford it.
      My hon. Friend the Member for Daventry raised three specific consequences of the measure, which his amendment would mitigate while the Government worked out the damaging results of rushing the measure through the House. Representatives of Prime Health in my constituency spoke to me at some length about the three points on Friday.
      The provision on verbal contracts will affect the firm specifically. People live busy lives and like to conduct business on the telephone—I do not mean hard-pressure telephone selling, but straightforward, modern business conducted on the telephone. Prime Health has entered contracts with its customers, and it is concerned that those contracts that predate the 2 July cut-off date will not be covered by the transitional provisions in clause 17. I would welcome an assurance from the Financial Secretary that verbal contracts will be covered in the transitional arrangements.
      5.15 pm
      It is normal for annual policies to be renewed about a month ahead of the renewal date. By the cut-off point of 2 July, a month's worth of renewals had been contracted for between health insurers and their customers. By changing the rules and imposing a guillotine on the tax benefit, the Government will change those contracts after the event.
      426
      I ask the Minister to consider applying the old rules to such contracts, just as we apply the old rules and rates to property contracts that have been exchanged but not completed. That would be consistent with the conduct of the previous Government, and it should be the approach of this Government. If contracts have been exchanged, but the start date has not yet been reached, the provisional arrangements should allow for that situation. The wording of clause 17 is not clear, and I should be grateful if the Minister could clarify the point.
      As my hon. Friend the Member for Daventry pointed out, more than half the business of some private health insurers will be affected if monthly contracts are not taken into account. Monthly contracts are a form of payment for health insurance over a year, and they have been specially approved by the Inland Revenue. Had the Government taken more time over the introduction of the measure, they could have spoken to the Inland Revenue and found out more about the situation before they made speculative and highly optimistic assumptions about the effects of the clause.
      It is essential, in the interests of the Government's objectives, that monthly contracts fall within the transitional arrangements. If all the monthly contracts are denied relief from the end of this month, all the customers with such contracts will require consultations at once, instead of over the year as their contracts come up for renewal and the ending of the tax relief hits them. It is unrealistic to expect even Norwich Union, let alone any of the other insurers, to cope with half their customers at once calling to ask about less expensive insurance.
      We can predict the consequences. Many of those people, because they will not receive adequate counselling, will take the only decision they can afford, and cancel their insurance contracts. As a result, the savings on which the Government's arguments are based will disappear in additional costs to the national health service.
      The Financial Secretary has already pointed out that the measure will make a 25 per cent. saving. Only one in four of those currently enjoying the benefit of private health insurance will have to cancel for the Financial Secretary's entire calculations to be thrown out of the window.
      We know that health insurance costs for the elderly have gone up by much more than inflation.
      Mr. Derek Twigg: Does the hon. Gentleman recall a report in the Financial Times on 24 April 1997 that the chief executive of Western Provident Association, Julius Stainton, had told a recent conference that insurers had only themselves to blame for the Labour party's plans for abolition, as many had used the introduction of the tax relief as a cover for a sharp increase in premiums for the elderly.
      Mr. St. Aubyn: The hon. Gentleman makes an interesting point. There is always a risk that a tax relief will be misused in some way. If that is the case, the Government should phase out the relief step by step over a number of years, and see what consequences that might have for the numbers involved.
      Mr. Twigg rose—
      Mr. St. Aubyn: Let me answer the question.

      427
      I understand from the industry that the real reason why costs have gone up is that, as private health insurance has become more popular, the industry has no longer been able to subsidise the cost of elderly patients by charging more than can be justified in commercial terms to younger patients.
      Mr. Boswell: Does my hon. Friend agree that the costs in the national health service for provision for elderly patients have also risen sharply? To my recollection, when the age of 75 is reached, the annual cost to the public purse is about £1,300. It is not surprising that private medical insurance costs should have risen commensurately.
      Mr. St. Aubyn: My hon. Friend makes a good point. Over the past seven years, many of those costs have risen. In a commercial world, the increase in the cost of health insurance for the elderly primarily reflects market forces, not any effect of the tax relief. Despite the increased cost, the number of elderly taking advantage of health insurance has risen. Without the relief, the number would have fallen, and the costs to the health service would have been very much higher.
      Mr. Twigg: You cannot have it both ways. You said that, in that case, the Government should phase out the tax relief. Now you say that you agree that it should be phased out.
      Mr. St. Aubyn: It would be extremely unwise to phase out the tax relief at all, but you would be much wiser to phase it out over a number of years than to cancel it halfway through this year. That is the point that I was making.
      My general point is that the rush with which the change is being introduced shows a greed on the part of the Treasury for which all patients—those who are well off and those who are not—will suffer. More people will make demands on the health service, and that demand has not been budgeted for this year or beyond. We will all suffer as a result. The proposal is damaging to the many, not just the few.
      Liz Blackman: I begin by saying to Conservative Members that I am staggered that you have come to the House to talk about a relief that you implemented in 1990—
      The Second Deputy Chairman of Ways and Means (Mr. Michael Lord): Order. Several hon. Members keep using the word "you". Will they please try to remember not to do that when they make their speeches? I know that it is difficult to do, and that everyone is new to it, but it helps enormously if I do not have to keep getting to my feet to interrupt hon. Members.
      Liz Blackman: I apologise, Mr. Lord. I am staggered that Conservative Members who implemented the relief in 1990 and have had seven years to operate it should come with so little evidence and ask Labour Members to evaluate their measure. I want Conservative Members to reflect on that. Was no evaluation undertaken during that time? It seems incredible that the effect of the relief has not been analysed.
      428
      One of the factors that distinguish the Labour Government from the previous Government is their attitude to taxation—the way that we raise revenue to fund policy and to service debt. In that respect, we inherited a considerable legacy.
      Taxation strategies are not neutral. Behind them are values and priorities of a particular political complexion. What is taxed, and how, reveals a Government's priorities. Whacking tax or VAT on fuel reflects a different set of values from those that underlie the proposal to remove the tax relief on medical insurance premiums.
      It is essential that the principles are clearly spelled out, to give people a yardstick by which to judge us. Labour has made no bones about the principles that should underpin the taxation system that we impose. We aim to promote work, to encourage savings, to encourage investment and to demonstrate an element of fairness. Those are the principles by which we will be judged.
      By fairness, we mean a broad-based system, under which no sector of the population is unfairly burdened or has an unfair advantage, and where taxation serves the majority, not the minority, and specifically avoids punishing the less well-off. The tax relief that we are discussing fails all those tests. It does not serve the majority. It gives an unfair advantage to the few. It falls unduly on the less well-off as taxpayers.
      The Government are committed to the NHS, to which all taxpayers contribute and which is open to all. We showed that commitment in the Budget. The private health sector is part of the market economy. That is accepted by the Government. The market economy, in the private health sector, offers choice to a small number of people. What is desperately unfair is the expectation that the majority of taxpayers should fund that personal choice. It is a subsidy. I hope that I can use the word "you" in this context. The adage, "You pays your money and you takes your choice" is applicable.
      It is interesting to note that the assisted places scheme is a similarly unfair tax. The same logic has applied to the abolition of that scheme.
      The substantial funds would be far better used to reduce the VAT on fuel, as has been mentioned. That would have significant benefits for many people in this society, especially those on limited incomes. That is just.
      By their own standards, the previous Government did not achieve what they had intended from the measure, which was to increase the uptake of private medical insurance. The Conservatives have no statistics of their own to demonstrate its impact. They failed by their own criteria, but, above all, they failed the test of fairness, which, under a Labour Government, is a significant test. That is why the relief will be abolished.
      Mr. Nick Gibb: This clause, and clause 19, which we shall debate later, make the Budget one that hurts pensioners. Pensioners suffer from an 11 per cent. devaluation of their pension funds from the ACT changes, and they suffer from the vindictive and envy-motivated decision to abolish tax relief on medical insurance for the over-60s.
      The relief was introduced by the then Chancellor, Nigel Lawson, in his 1989 Budget as a way of encouraging people to take out or to keep on their private medical insurance in retirement. That, in turn, would help to relieve some of the burden on the NHS.

      429
      It is an entirely sensible policy to encourage people who can afford it, or who could afford it with a small tax incentive, to make their own provision for health care. It is especially sensible if it can be demonstrated, as I shall seek to do, that the cost of the tax relief is less than the savings that the NHS makes when the patients are treated at their own expense.
      The Labour party seems to think that, if the articulate middle-class pensioners are "creamed off" by the private sector and are therefore no longer dependent on the NHS, the NHS itself will suffer because fewer people using it will be demanding a good service. The argument is that, if 600,000 articulate people stop using the NHS, it will cease to provide first-class clinical services. That is utter nonsense. It is the same argument that the Labour party uses against private education, and the Labour party is simply wrong.
      5.30 pm
      The existence of a strong private sector in both health and education provides a gold standard against which the state sector can compare itself and towards which it can seek to improve. Of course, that assumes that the private sector will provide a better service, which the Labour party does not necessarily accept.
      Here we see the root of Labour's plan to abolish tax relief on private medical insurance—the old Labour insecurity about the private sector, old Labour's drive towards homogeneity and lack of choice. Thanks to 18 years of a Conservative Government who believed in free enterprise and choice, 5.7 million people now have private medical insurance—about 10 per cent. of the population.
      As Labour Members have said, only about 5 per cent. of people over 60 have medical insurance—a proportion significantly lower than that in the population in general. The tax relief was introduced to encourage take-up in that section of the population. Although the Labour party claims that the introduction of the tax relief has not increased take-up among the over-60s, the facts state otherwise.
      In 1989, there were about 400,000 individuals over 60 with private medical insurance. Today, there are 600,000. There are our statistics. That amounts to a 50 per cent. increase while the tax relief was being given. It is an especially high increase given that, in the same period—between 1990 and 1997—the total number of individuals covered by medical insurance dropped by 7 per cent. in the early 1990s and rose over the following seven years to broadly the 1990 level.
      In other words, there was no overall increase in the number of people covered by medical insurance between 1990 and 1997, yet there was a 50 per cent. increase in the number of people over 60 who were covered. The over-60s now account for one third of all individuals with medical insurance, compared with only one quarter when the relief was introduced.
      We should not be hearing Ministers and other Labour Members claiming that the tax relief had no effect on the numbers taking out private medical insurance. The facts state otherwise, and those who say that there has been no effect are simply wrong.
      430
      I shall now say something about the cost of abolition. The Red Book shows that the gross savings from the abolition of the tax relief would be £115 million in 1998–99 and £135 million in 1999–2000. The relief equates to more than £500 million of gross premiums.
      According to the Association of British Insurers, the overall claims ratio for that age group—the cost of claims expressed as a percentage of premiums—is about 80 per cent. That means that £500 million in gross premiums represents £400 million—worth of medical treatment. The insurance industry has estimated that abolition of relief, which will increase premiums by about £25 a month, will result in one third of the over-60s with insurance terminating their policies and becoming reliant on the NHS. That corresponds to £133 million—worth of extra medical care, which the NHS will have to find as a result of the abolition of the relief. That compares with a saving of only £115 million.
      It is absurd for the Financial Secretary to the Treasury to dispute those figures on the basis of a marketing advertisement in The Times. I hope the Government are basing their statistical analysis on more than that. Their figures do not add up.
      There is worse. As my hon. Friend the Member for Eastbourne (Mr. Waterson) pointed out in an Adjournment debate on 16 June, there will be a domino effect if 200,000 people cancel their policies. As the number of private medical insurance policyholders decreases, an additional burden will fall on those who remain. That means higher premiums for them. Thus, more people will be priced out of insurance and become reliant on the NHS.
      When one considers that the types of medical treatment most likely to be required under the private insurance contracts are hip replacements, cataract removals and knee joint replacements—operations which are already stretching the NHS to breaking point—one realises how absurdly the Government are acting in abolishing the relief. People who need hip replacements and new knee joints suffer much discomfort and pain, and the Government's policy will mean longer waiting lists for those procedures in the NHS. That shows how mean-spirited is the Government's abolition of the relief.
      I have received many letters from retired people in Bognor Regis and Littlehampton asking me to urge the Government not to abolish that much needed and sensible tax relief. On their behalf, I urge the Government to drop their proposal, and I urge right hon. and hon. Members on both sides of the Committee to vote for the amendment and against clause 17.
      Jacqui Smith: I oppose the amendment because it is designed to put off the implementation of an important measure in our Budget. I cannot understand why Conservative Members are so keen to keep a measure which clearly has not worked, even in their own terms. It has fulfilled neither the Opposition's aims nor ours.
      Let us talk about the Opposition's aims first. The hon. Member for Daventry (Mr. Boswell) has used similar arguments to those used yesterday, when the Opposition said that mortgage interest relief at source promoted home ownership. I disagreed with him at the time.

      431
      Today, the argument is that we should keep private medical insurance because it promotes the practice of older people taking out private insurance—
      Mr. Boswell: The hon. Lady said that she disagreed with the proposition that MIRAS promoted home ownership. Does she therefore feel that it should be abolished altogether?
      Jacqui Smith: My argument yesterday was that the decision in the Budget on MIRAS was right, because MIRAS does not promote home ownership, and that the money saved by the Government's current proposal on MIRAS could be put to better uses.
      The Conservatives" argument presumably is that the tax relief promotes the take-up of private medical insurance by older people. Incidentally, it seems strange to argue that the only way to save the NHS is by persuading as many people as possible not to use it. That says something about Conservative Members' attitude to our national health service, which Labour Members believe should be available to everyone who needs it.
      Private medical insurance relief has not achieved what the Opposition want it to achieve. Despite the fact that it has cost £560 million since April 1990, there is little, if any, evidence of an increase in take-up of private medical insurance among the over-60s. In fact, I would argue that those receiving it would have taken out private medical insurance in any case. That seems to be the suggestion from the fact that when an extra incentive is given people in large numbers do not take out more insurance. There is no reason to believe that scrapping the relief will cause a flood of elderly people returning to the NHS. The amendment does not stand up.
      The relief has failed even in Conservative terms—the previous Government recognised that when they reduced it at the higher level—and it certainly does not achieve what the Government want. It subsidises the few who can already afford private health insurance.
      I am sure that all hon. Members were interested to hear about the mother of the hon. Member for Daventry; I am extremely pleased that she can afford private health care. My mother is not yet 60, so she would not have qualified for the relief in any case, but my dad is; he does not have private medical insurance, but, through his taxes, he subsidises that of the hon. Gentleman's mother. I have no animosity towards her, but I feel that it is slightly unfair that my dad should have to subsidise her private choice through taxation.
      Mr. Boswell: As the hon. Lady has been kind enough to refer to my mother, does she recognise the inequity of the position whereby my mother's private health tax relief will be withdrawn to support my expenditure on heating oil in a somewhat larger house than hers?
      Jacqui Smith: It may be my fault, but I do not quite follow the logic of that. My argument about inequity was that, at the moment, the taxpayer is subsidising private choices.
      The relief shows the same defeatist attitude towards public service that my hon. Friend the Member for Erewash (Liz Blackman) pointed out in the case of the previous Government's attitude to the assisted places scheme. Have our public services really got to the state where, to keep
      432
      them going, we need to bribe people with taxpayers' money not to use them? Conservative Members clearly think that we have to bribe people out of the state education system and the national health service.
      If that is so, it is because of the effect of 18 years of Conservative government on our schools and hospitals. We should not accept that as a fait accompli: we should consider ways of improving those facilities so that we no longer have to ask taxpayers to fund people opting out of public services.
      Unlike the hon. Members for Guildford (Mr. St. Aubyn) and for Bognor Regis and Littlehampton (Mr. Gibb), I do not have people queuing up at my surgery and begging me to maintain the tax relief. I met an elderly man last week who had already waited 18 months for a knee operation and did not have private health insurance.
      Mr. Swayne: Will the gentleman's condition be assisted by additions to the queue owing to people having to give up their private health insurance?
      Jacqui Smith: There is no evidence that the relief has increased the number of people taking out private medical insurance, and I therefore believe that there is no reason to suppose that its removal will cause people to flood back into the NHS.
      Mr. Gibb: The hon. Lady cannot have been listening when I pointed out that, in 1990, there were 400,000 people over the age of 60 with private medical insurance and that, by 1996, the number had increased to 600,000. Those are the statistics that are needed. Why was not the hon. Lady listening?
      5.45 pm
      Jacqui Smith: If the relief was so effective, why did the previous Government lose faith in it and take it away at the higher rate?
      Older people who come to see me say not that they want the tax relief to be maintained but that the health service should be able to deal with their needs as they arise. Most of those people are not in the fortunate position of so many people in the constituency of the hon. Member for Guildford and cannot afford private medical insurance, even with the relief that was previously offered, and they understand that in an emergency they will be protected not by private health care schemes but by a properly supported national health service.
      It is depressing for Labour Members to see the crocodile tears shed by the hon. Members for Daventry and for Guildford on the subject of health care for the elderly. Yes, those older people have contributed throughout their lives: they have done so through taxation and national insurance, to ensure that they have a health service that looks after them properly in their old age. That is why I welcome my right hon. Friend the Chancellor's announcement of an extra £1.2 billion for health care.
      The Budget clearly shows the different priorities of the Government and the Opposition. What does the amendment say about the Opposition's priorities, and what does the proposal to remove private medical insurance relief say about ours? It shows that we are honouring the pledge made in our manifesto—and in my election literature—that our taxation system would be fair.

      433
      Conservative Members suggested yesterday that, somehow or other, they lost the general election because the public had misunderstood our tax plans. I believe that it was because the Conservatives patronised people, as they did yesterday, and people felt betrayed and wanted a Government who were fair about taxation. People contrasted our promises on tax—to be fair, and to encourage work, saving and investment—with Conservative proposals and betrayals, and knew that we would spend their money wisely.
      The Chancellor reiterated in the Budget what the money saved from scrapping the relief would be spent on. He said:
      "The principle of fairness in taxation will guide all my Budget decisions."—[Official Report, 2 July 1997; Vol. 297, c. 312.]
      That is why the £120 million saved in 1997–98 and the £140 million saved in 1999–2000 on the failed relief for private medical insurance will contribute to cutting value added tax on fuel—another important pledge in our manifesto.
      As I suggested, that shows the clear distinction between our taxation values and those of the Opposition. While they are happy to maintain an expensive and ineffective relief on private medical insurance, we want to use that money to cut value added tax on fuel—the most unfair and regressive tax introduced by the previous Government.
      In case some Opposition Members are keen to jump up with the environmental justifications, which was, perhaps, what the hon. Member for Daventry was referring to earlier—although, there is a certain irony in Opposition Members claiming those green credentials and I am not sure which Opposition Member believes that he is Swampy—there are many other ways in which the taxation system should be used to achieve environmental aims. Value added tax on fuel was one tax which gave green taxation a bad name.
      The choice represented by the amendment is clear—the deferral of the positive proposal to get rid of private medical insurance and use the money to cut the unfair and regressive VAT on domestic fuel or the maintenance of private medical insurance, which is ineffective and benefits only a few people. For that reason, I oppose the amendment.
      Mr. Swayne: The Treasury team has shown a remarkable assurance about the estimate for the consequences of this measure. Indeed, the Financial Secretary to the Treasury said that she thought that the demand for private medical assurance was perfectly inelastic. That assurance is misplaced. At the beginning of the week, on Monday, the Association of British Insurers wrote to me saying:
      "The Association remains concerned that the Bill seeks to implement policy decisions with very complex implications with no prior consultation and allowing for only a very limited period of consideration of the Bill by Parliament. This could lead to measures proving unsatisfactory and needing amendment in a subsequent Finance Act."
      My experience is that, far from being inelastic, the demand is—
      Mr. Derek Twigg: On that point, an article in the Financial Times stated:
      "PMI market analysts Laing and Buisson said that it believed these estimates were all incorrect. "To date the market for PMI has been price inelastic; increases in price have not been met by
      434
      proportionate big drops in demand. Coupled with that, the amount of a typical PMI premium is far higher than the cost to the NHS of the treatment covered. Taken together, this means the tax relief was ridiculous and could not possibly be justified in terms of the savings to the NHS" said director Mr. William Laing".
      Mr. Laing makes a completely different point from that made by the hon. Gentleman on the elasticity of the market.
      Mr. Swayne: I am not sure what the question was, but I will have a stab at answering it. It is very much the answer that I gave to another hon. Gentleman who has since departed from the Chamber. The best estimate of the elasticity of demand comes not from City scribblers, but from the voters. I represent a constituency with three hunts and yet, given my mailbag during the election campaign—
      Mr. Jim Murphy: On a point of order, Mr. Martin. I understood that we were discussing amendments to the Finance Bill and not fox hunting. I would ask the hon. Member for New Forest, West (Mr. Swayne) to concentrate on the matter at hand.
      The First Deputy Chairman of Ways and Means (Mr. Michael J. Martin): I am sure that the hon. Member for New Forest, West (Mr. Swayne) will get to the amendment in due course.
      Mr. Swayne: I was trying to give some indication of the strength of feeling among my constituents. My mailbag on this measure has been greater than that I have received on hunting, which has been considerable. That is not surprising, since I represent those well-known retirement areas of Milford on Sea, Barton on Sea and New Milton.
      That brings me to the nub of this mean-minded measure. What is extraordinary about it is the lack of consideration for elderly people and the retired. People who have retired are not as capable as those youthful Labour Members of adjusting their financial decisions relatively quickly. The elderly make long-term financial plans and commitments. The rug is being pulled from under the assumptions that they have made and the plans that they laid on retirement and beyond. It is a disgraceful and mean-minded measure. I support the amendment.
      Kali Mountford: I cannot help but think of the many postbags that we have already discussed today. I must mention my postbag of one letter in support of the measures that the Opposition are discussing and the huge postbag and the many phone calls that I have received from elderly constituents, young constituents and people in poverty and difficulty—people who told me before the election, "If you don't do something about fuel costs, we'll never vote for you again." Is that not the nub of the matter?
      Was it not absolutely right for my hon. Friend the Member for Erewash (Liz Blackman), in an outstanding speech, to point out the benefits of a taxation system being put together with social policy, which indicates the policies of the Government of the day? If ever a measure was more heralded than this Budget, I should like to know what it was. Opposition Members seem to suggest that my constituents had no knowledge of what was to be put before them. They know about it now, but I have still had only one letter in support of the measures that the Opposition are discussing.

      435
      Where are the measures? The hon. Member for Guildford (Mr. St. Aubyn) is not in his seat. He seemed to suggest that Opposition Members could have tabled amendments on phasing out the proposal on the relief on medical insurance for people over 60, but no such amendment has been tabled.
      Mr. Boswell: Far be it from me to speak on behalf of my hon. Friend, but the timetable imposed under guillotine by the Government and the consideration of this Bill at such short notice after Second Reading, followed by a Committee stage on successive days, imposed severe strains both on practitioners who wanted to submit amendments for our consideration and on our being able to process and table amendments and have them considered. I have put the points to the Financial Secretary, and I am sure that she will do her best to answer them.
      Kali Mountford: I am interested in that contribution, but the hon. Member for Guildford clearly had some measures in mind. Since our measures were well heralded long before the election—far earlier this year—they are no surprise to anyone. I should have expected the Opposition to be prepared if they felt the matter was so important.
      Mr. Boswell: Were the measures in the hon. Lady's election manifesto?
      Kali Mountford: Yes, they were. I will indulge the hon. Gentleman. I spoke in person to more than 1,000 people in my constituency on that very matter and, in particular, on VAT on fuel. I do not think that any of my constituents will have found the measure a surprise. Indeed, it is typical of this Government and my party to consult widely when any measure is introduced, so I do not need to go further on that point.
      Mr. Peter Brooke: Will the hon. Lady give way?
      Kali Mountford: I will be indulgent.
      Mr. Brooke: I am grateful to the hon. Lady for her indulgence. How much consultation has taken place on advance corporation tax?
      Kali Mountford: I am interested that you want to broaden the debate.
      The First Deputy Chairman: Order. The right hon. Member for Cities of London and Westminster (Mr. Brooke) may want to broaden the debate, but I do not.
      Kali Mountford: I concur completely with your wisdom, Mr. Martin.
      I shall share a short story with the Committee. I visited two of my constituents in January on an entirely different matter. These people had worked hard throughout their lives and had made savings, but they were having some difficulties. They showed me into their best room because they wanted to show themselves at their very best, and certainly provide me with a cup of tea. I became blue with cold in that room because they could not afford to put on their heating.
      436
      6 pm
      Some while ago, I remembered a Conservative Member who used to represent Derbyshire, South advising people such as the two constituents to whom I have referred that they would do well to wear hats and silk underwear to keep warm. That was said at about the time when value added tax on fuel was introduced. That piece of advice has not benefited my constituents, but they will benefit from the ability to pay the fuel bills that are now causing them so many problems.
      Conservative Members ask why a review has not taken place. At the same time, they do not support the reviews that we are conducting. Conservative Governments did not conduct a review and we have decided to repeal tax relief for medical insurance. We are following the trend set by the previous Government in relinquishing the higher tax benefit, so there is nothing new in our approach.
      We are a Government who follow common sense. Surely it is common sense to say that we shall do what we promised before the general election, at the same time taking into account factors that the Conservative Government seem not to have considered. The cold temperatures in which my constituents live contribute to their illhealth, and that illhealth is a cost to the nation through the national health service. Many medical reports set out the consequences of cold weather, leading to the illhealth of the elderly and the very young, whom I care about deeply.
      As I said, I have received one letter in support of retaining private medical insurance tax relief. That constituent did not state that he would be part of a great haemorrhage from private medical insurance schemes—indeed, quite the opposite.
      We are saying that we shall fulfil our election promises in a thoughtful way. We shall give people time to take proper decisions for themselves. They will be able to make choices for themselves. The greatest benefit will go to those people who do not have a choice, such as the two constituents to whom I have referred.
      The Government are saying, as I have always said, that there must be fairness in taxation. We must have an equitable taxation system and an egalitarian society that ensures that those in most need will receive benefit. Those who have the least needs should not receive benefits that they do not require.
      Mr. Loughton: I cannot be alone in feeling that, whenever a Labour Member contributes to the debate, he or she succeeds only in tying the Government up in a knot. Earlier, the Financial Secretary accused me of some inconsistency. Perhaps she will consider the inconsistency that she introduced by claiming that there has not been a net increase in the numbers of pensioners taking advantage of tax relief on medical policies. If there has not been a large increase in those numbers over the past seven years, that suggests to me some contentment with the way in which the national health service has been run for most of the 18 years under a Conservative Administration.
      Another inconsistency comes from those who suggest that the tax relief that the Government are seeking to claw back is worth more than the underlying treatment in the NHS for which patients will have to qualify. There is a

      437
      further absurd inconsistency when it is suggested that there is no price elasticity. When it comes to mortgage interest relief at source, however, there is elasticity, because the Government have been using it as a way of cooling down the property market. These arguments do not add up.
      I should disclose an interest as someone who has enjoyed a corporate BUPA subscription for some years, although I have never taken advantage of it. For many years, however, I have had to pay tax on it as a benefit in kind, and have been happy to do so. That has provided additional funds that can be used for patients using the NHS, as my family and I have done frequently.
      It has become a cri de coeur or soundbite of the Government that they are a Government of the many, not of the few. It is a cliché that we hear time and time again. But this mean-minded measure is entirely consistent with the abolition of the assisted places scheme. There is no firm evidence that it will produce financial savings. No consideration was given to the future education of those children who are now enjoying assisted places. The Government will proceed, however, because it is politically correct so to do.
      We shall have the same ordeal with country sports, but in the meantime the Government have decided to attack those pensioners who chose to spend their money as they thought fit on taking out their own private medical insurance, and in doing so took some pressure off the NHS, which we are constantly reminded is under pressure. That pressure is not denied, and in my constituency it is a key issue.
      Let us remember that between 40 and 50 per cent. of expenditure in the NHS is directed to pensioners, who constitute just 16 per cent. of the population. That is happening because pensioners are a claims-intensive part of the community when it comes to spending in the NHS. They require longer stays in hospital, understandably. With further medical advances being made all the time, the situation will be compounded.
      Many figures have been cited in the debate, and I shall add to them by saying that more than 400,000 private medical insurance contracts for pensioners have been taken out, involving more than 600,000 individuals. Many of the contracts are taken out for families.
      Dawn Primarolo: Does the hon. Gentleman accept that the Inland Revenue's figures show that there were 375,000 such contracts in 1996–97, 25,000 more than in 1990, covering a maximum of another 50,000 people?
      Mr. Loughton: I shall not argue the toss between 375,000 and 400,000. I think that my point was well made. Different figures have been presented by different Labour Members. I shall use figures that come from BUPA, which is the largest provider of private medical health care insurance cover for pensioners. It takes account of about 48 per cent. of the market. BUPA estimates that the average cost to pensioners is just under £1,200 a year, which amounts to just under £300 a year in terms of tax relief. The figures are almost double for married couples.
      These are not small sums. They apply to people who have saved for many years. We are talking of those—certainly this applies in my constituency—who have
      438
      cheaper premiums as elderly people because they were members of medical insurance schemes before they were pensioners, and have remained so all the way through. Now, all of a sudden, without so much as a by your leave, it is all to go. They will be faced with deciding—it will be a hard decision—whether they will be able to afford to keep their insurance. That is what we are talking about.
      Kali Mountford: When some of my constituents suffer the degenerative illnesses to which we referred earlier and require a long stay in hospital, they often find that they are not covered by their private medical insurance. Have the hon. Gentleman's constituents had similar problems?
      Mr. Loughton: Indeed, the hon. Lady makes a fair point. That is why in some insurance policies there is great leeway in the cover that one can purchase. That will not go away, regardless of how we pay for it. Those patients will have to be looked after at some stage, be it through private medical insurance and private health care or through the NHS. It makes no difference. If the hon. Lady is saying that there should be better regulation of the services provided under medical insurance cover, that is an entirely different point, and it is not proposed in the Budget. I shall return to my point and then deal with my constituency in particular.
      BUPA has suggested a likely lapse rate of about 30 per cent., which would mean that 180,000 people would become reliant on the NHS. That probably translates to between 40,000 and 50,000 hospital episodes—when people have to go to hospital for treatment that they would previously have had under private medical insurance cover.
      What will the impact be in my constituency? I said at the beginning that I should declare an interest. I should declare a further interest in that Worthing has the largest pensioner population in the country, and West Sussex has the highest density of pensioners with private medical insurance cover. The hon. Member for Colne Valley (Kali Mountford) may be interested to know that this measure impacts on my constituency one heck of a lot.
      I do not want to trade numbers over mailbags, but this is a significant issue and it has come before me time and again, both before and after the election. I do not say that it has suddenly come out, but a very real fear has been put around. Perhaps that is why there was such a reduced swing against the Conservatives in my constituency—but I shall not press that point.
      The people who have private medical insurance, particularly those in Worthing, are not rich. They are people who were previously on average earnings and are of average means. They live in modest bungalows, particularly those in parts of Worthing. In Worthing, more than 1,000 pensioners have private medical cover with BUPA. That is a lot of people, just in the borough of Worthing.
      As my hon. Friend the Member for Bognor Regis and Littlehampton (Mr. Gibb)—just up the coast from me—said, cataract and hip replacement operations are some of the most frequent treatments required by pensioners. The waiting list for those operations has gone up to 18 months and is worsening. [HON. MEMBERS: "Whose fault is that?"] We looked in the Budget for the great panacea that we were promised for all the ills of the national health service, but any additional money, which in any case

      439
      works out less than the additional money that the Conservative Government added last year, will not come into effect until next year.
      The Government have done nothing about the crisis that may afflict the people of Worthing and other high-density pensioner populations this winter. It is entirely in the Government's hands and remit to decide whether to act now.
      Mr. Jim Murphy: Will the hon. Gentleman give way?
      Mr. Loughton: I should like to continue my point. I have given way several times.
      I should also mention that elderly people have the least time available to wait, yet they are denied the opportunity to speed up their treatment by using money from their own savings, and must queue up with everybody else for the national health service. That will not improve. We know the demography of the population. We know that it is an aging population. At the moment, there are about 3.2 working people for every pensioner. In 30 years' time, there will be about 2.5 working people for every pensioner. The problem is getting worse.
      The irony is, as my hon. Friend the Member for Bognor Regis and Littlehampton said earlier, that there is no material gain to the Government or the Exchequer in this measure. The cost of the tax relief has been estimated in the Red Book at about £115 million, or £120 million, as my hon. Friend said.
      Mr. Murphy: Will the hon. Gentleman give way?
      Mr. Loughton: I will now.
      6.15 pm
      Mr. Murphy: I understand that the hon. Gentleman has already declared a corporate interest in receiving the gift from BUPA for private medical insurance. Does he believe that it is correct, just and in the interests of the health service that the majority of pensioners in his constituency subsidise a very small minority who benefit from this relief? Indeed, does that not show that the Government are entirely right to remove it?
      Mr. Loughton: The fact that the hon. Gentleman referred to corporate private health care as a gift underlines that he has got this thing entirely the wrong way up. It is not a gift; it is a condition of employment on which many people pay tax at the marginal rate, as it is a benefit in kind, and contribute a great deal to the Exchequer. The hon. Gentleman is not taking account of the fact that people who enjoy private health care as a result of putting their own money into it are saving the national health service funds that it would have to devote to them were they solely dependent on the NHS.
      That brings me back to the point I made right at the beginning—obviously the hon. Member for Eastwood (Mr. Murphy) was not listening. The tax relief does not outweigh the cost of the NHS treatment that it is there to cover. The sums do not add up.
      Mr. Murphy: Will the hon. Gentleman give way?
      Mr. Loughton: I have already given way. I am repeating the point that I made earlier.
      Mr. Murphy rose—
      Mr. Loughton: I shall continue. No doubt the hon. Gentleman will want to come back for another stab at this later.
      440
      Not only is the cost to the NHS of extra patients likely to be in excess of £100 million, but those patients will add to the waiting list, so waiting times will be pushed up. There will be a further cost in the insurance premium tax, which is likely to lose just over £8 million to the Exchequer, and a further cost in the revenue through NHS pay beds, which will not now feed through from pensioners who use private health care insurance for their treatment—an estimated cost of up to another £20 million.
      If all those figures are taken into account, certain people make a very credible case for how much the measure will cost the Exchequer, not only financially but in terms of the great misery that it will cause people who have saved hard and used their moneys as they saw fit: that rug has now been neatly pulled from beneath them. Yet Labour Members accuse Opposition Members of not making firm proposals. We have made some firm proposals, but Labour Members have ridden roughshod over suggestions to adapt the scheme. They have made no attempt to suggest how we might broaden the age band, if the Government are really determined to change the current tax relief. There has been no attempt to suggest that the tax relief rates should be reduced.
      Mr. Murphy: Will the hon. Gentleman give way?
      Mr. Loughton: I shall give the hon. Gentleman a chance.
      Mr. Murphy: I thank the hon. Gentleman. I wish to raise a different point, as he has moved on. I understand that, in 1994, the previous Government brought about changes. Did the previous Government have consultations such as those identified in the amendments this evening, or did they simply ride roughshod over the opinion of the constituents whom the hon. Gentleman now represents? I would appreciate an answer.
      Mr. Loughton: There is a considerable difference between adapting the rates of tax relief that are available—that has happened in many other contexts; we were talking about MIRAS yesterday—and, in one fell swoop, abandoning it altogether, with no prospect of its return under the present Government and no possibility of pensioners' being able to make up the amount from other sources. There is a heck of a lot of difference between a marginal change and abandoning tax relief altogether. I think that the hon. Gentleman knows that full well.
      Mr. Murphy: Will the hon. Gentleman give way?
      Mr. Loughton: May I continue?
      The First Deputy Chairman: Order. The hon. Member for East Worthing and Shoreham (Mr. Loughton) is not going to give way.
      Mr. Loughton: I detect in the hon. Member for Eastwood the qualities of a pretender to the throne of the architect of the endogenous growth theory, one Ed Balls. It seems that a missive has gone out from Mandelson

      441
      towers to the effect that Balls-speak—or should I say "speak Balls"—is now the order of the day as far as new Labour is concerned.
      Mr. Murphy: Will the hon. Gentleman give way?
      Mr. Loughton: I shall be delighted to give way to the hon. Gentleman if we are to hear yet another version of what I have just alluded to.
      Mr. Murphy: I only rise to speak when the hon. Gentleman's comments bear some comparison with the name of the colleague of mine whom he mentioned earlier—Mr. Balls.
      Mr. Loughton: I am afraid that I am entirely lost. I shall continue with my speech before the entire Committee goes to sleep.
      The Government have made no attempt to broaden the age bands. They have made no attempt to come up with a compromise in the form of a reduction in tax relief rates; we did that. They have made no attempt to phase out the current arrangements gradually. People are being left in the lurch as the Government introduce this measure by means of one of their familiar guillotines.
      There have been further inconsistencies. The Government are prepared to subsidise false jobs—jobs that will no doubt turn out to be short term and ineffective—through the windfall tax, but they are not prepared to give a tax subsidy to those who are happy to put up the money themselves and, indeed, do the NHS a service by making their own arrangements. The measure will only exacerbate the problems of the NHS, while depriving people of choice and undermining their self-reliance and independence.
      This is a mean, dogmatic measure. It is another case of cutting off the nose to spite the politically correct face, and—as I said at the outset—a further onslaught on minority interests. I firmly support the amendment.
      Charlotte Atkins: There are more than 15,000 pensioners in my constituency. That is a high proportion. I have had many meetings with those pensioners, and have received many letters from them; but only one couple have ever spoken or written to me about this issue.
      What concerns pensioners in my constituency is having to eke out an existence on a pittance. A third of pensioners are on means-tested benefits: that is a legacy of the last Government. What concerns them is that the NHS should be there when they need it, but the last Government's market policies have helped to destroy the NHS. Pensioners also live in fear of losing their homes because they cannot meet the cost of their long-term care needs without giving up those homes.
      Why is tax relief not the burning issue that Conservative Members suggest it is? Why is my postbag not bulging with letters? Why have I not been telephoned every day about this issue, both before and after the Budget? Is it because it was only relatively recently—in April 1990—that tax relief was given to both basic and higher-rate taxpayers? As some of my hon. Friends have pointed out, that did not last long: by April 1994, tax relief at the higher rate was withdrawn.
      442
      Does that constitute a ringing endorsement of the scheme by the former Government? I think not. Does it demonstrate serious reservations on their part? I think that it does. We are seeing crocodile tears.
      Between 1990 and 1997, the number of contracts increased by only 25,000, from 350,000 to 375,000. The Financial Secretary gave those figures earlier. The number of people covered by the contracts increased by 50,000 at the most. That is an increase of just 10 per cent. The last Government stated that tax relief was intended to encourage the elderly to take up medical insurance, but the 10 per cent. increase signifies not success but failure in those terms.
      The situation must be seen in the context of a national health service that was being run down—a national health service that was consumed by stories of agism featuring elderly people who could not get the operations that they needed, and were not considered worth treating. An atmosphere of fear was created. In such a climate, if the number of people covered by contracts increased by only 10 per cent., I do not think that that was down to tax relief. The fear that the NHS was incapable of providing care from the cradle to the grave became an increasing reality during the 18 years of Conservative rule—yet the figure increased by only 10 per cent.
      That suggests that the cost of tax relief is largely dead weight, benefiting people who had already taken out medical insurance or who would have done so anyway, rather than those who were encouraged to do so by tax relief. I understand that the cost of the relief last year was £110 million, and that it will rise to £120 million in the next full financial year. That amount cannot be justified—as I have said, it is largely dead weight—when schools and the NHS are crying out for funds. If the elderly decide that they want to be treated privately, that is fine, but the state should not have to foot the bill.
      I appreciate that, in opting out of the NHS, the elderly are exercising their right to choice, but many elderly people decide to go private. A number of hon. Members on both sides of the Committee have talked about their parents. I will talk about mine, and, in particular, about my mother. She paid for a hip replacement operation some three years ago. Because of the excruciating pain that she was experiencing, she managed to raise the money to go into a private hospital. She had to wait for well over a year, and, at the age of 81, faced the prospect of having to wait for a further two years. She therefore decided to raise the necessary funds as best she could, and to meet the bill herself.
      My mother did not get any tax relief. She received no benefit from the state. She decided to pay the bill herself: that was her choice, and I applaud it. It was her decision, backed by her family. We could see that she was in pain, that she was confined to her home and that she could not enjoy life. She could not go out for the walks that she had enjoyed every day of her life, because she could not walk. She therefore decided to find the money for the operation, but there was no subsidy from the state. My mother had to make the choice between finding the money and suffering the pain, because the NHS had failed to provide the service that she needed.
      No person, young or old, should have to make such a choice, but, unfortunately, 18 years of Tory government have forced people to make that choice. My mother was lucky—she was able to raise the money with the help

      443
      of her family—but, because of the parlous state of our national health service, she had to be treated privately. We should ensure that the state does not subsidise people who opt for private medical insurance. The money should be spent on the NHS, on schools and on services from which we know that everyone will benefit, not just on people who can afford to pay.
      Mr. Peter Brooke: As you, Mr. Martin, have particular occasion to know, I sat here throughout the windfall tax debate yesterday hoping to speak on behalf of the City of London. I make no criticism of the fact that I was not called, and I know that you did your level best to ensure that I would be called. I mention it merely to make the point to new Members that one can just as easily be asked to sit through the whole of a debate and still fail to make a constituency speech when one has been in the House 20 years as after being here 20 days, 20 weeks or 20 months.
      I apologise to my hon. Friend the Member for Daventry (Mr. Boswell) for not having been present when he opened the debate. I do not know whether he alluded to the fact that, like the MIRAS proposal, this measure was not in the Labour party manifesto. I am sure that it is pure coincidence that the measures directly relating to tax on individuals slipped out of the manifesto.
      6.30 pm
      I am over 60 and I do not have any private health insurance. I represent an inner-city seat, and it is a commonplace that such seats have a greater proportion of elderly people than do the generality of seats: that is certainly true of my constituency. The health service reforms were substantially directed to demography and to the growing numbers of the elderly. We have had a long debate in London on the availability and supply of hospital beds. Professor Jarman of St. Mary's hospital in my constituency has made a series of notable contributions to that debate, and I am delighted that he has been put on the Secretary of State's panel reviewing the position with regard to London hospitals.
      You will rule me out of order, Mr. Martin, if I go on too long about long-term issues of the national health service in inner London. The resource allocation working party was established by a Labour Government, supported by the Liberal Democrats at the time of the Lib-Lab pact and endorsed by the Conservative Government in 1979. One of the consequences of RAWP was the serial closures of hospitals in London. There was bipartisan agreement for resources deliberately to be moved out of inner London to other sites across the country. Charing Cross and St. George's hospitals in my constituency had already been closed.
      Dawn Primarolo: I agree with the right hon. Gentleman about Professor Jarman's contribution. The right hon. Gentleman also referred to RAWP and the health authority funding formula. Does he accept that the problem of draining money out of London resulted from the Tomlinson report, which was commissioned by the Conservative Government?
      Mr. Brooke: I apologise to the Financial Secretary, but I do not agree with her. Westminster hospital in my constituency closed and moved its services to the new
      444
      Chelsea and Westminister hospital at the end of the 1980s. The decision to merge the Middlesex hospital with University College hospital was taken well before the Tomlinson report. The Tomlinson report was responsible for the closure of St. Bartholomew's, and I shall come to that in a moment. There is a separate point about NHS accounting, which causes people in inner cities to subsidise the rest of the country twice, but that is by the by.
      We are already in difficulty, because 30,000 of the 300,000 people in the Bart's catchment area are seriously disadvantaged by the move. That area covers my constituency, the constituency of the Secretary of State for what I will now call the Department of Culture, Media and Sport and the constituency of the hon. Member for Hackney, South and Shoreditch (Mr. Sedgemore). Elderly people went to live in the Barbican because of the NHS services available there, so their anger at the closure of Bart's was understandable. I acknowledge that that decision was made by a Conservative Government, so their anger was partly vented on me. The problem has been exacerbated by the present unsatisfactory alternative arrangements.
      I draw attention to the straitened circumstances of the NHS in London. I am joined in that by London Labour Members, who have applauded the review that the Secretary of State for Health is undertaking. London is not well placed to absorb further strains. The establishment of a panel has been welcomed, and I can remember debates before the election in which London Labour Members called for a moratorium on hospital closures and an end to the practice of withdrawing hospital beds from London.
      I acknowledge my ignorance, because I do not know how many of my elderly constituents who have private medical insurance—obviously, there are some—will transfer out of their present arrangements as a result of the proposed tax change. I have an 80-year-old constituent whose gross premium for himself and his wife is £3,105.46, with tax relief of £714.21.
      The Financial Secretary said that the cut in VAT on fuel would benefit pensioners. I know that she knows that pensioners were, in fact, compensated for the original VAT on fuel, and I acknowledge that the cut in VAT will make a difference at the margin. If that is so, it must also follow that pensioners who have private medical insurance may also be affected at the margin if sums of some £60 a month are involved.
      In her opening remarks in reply to my hon. Friend the Member for Daventry, the Financial Secretary said that the Opposition had had a good try. Imitation is the sincerest form of flattery. The Opposition have had long cause in the two months since the election to note the Government's enthusiasm for reviews in every possible direction.
      Given the present problems of the national health service in London, I fear for all my constituents and not just for those who have private insurance, because we do not know whether the system can take the strain of patients transferring over. Like the hon. Member for Redditch (Jacqui Smith), I have constituents who have been waiting 18 months for operations. I am concerned about how many of those who do not have medical

      445
      insurance will be adversely affected by the extra demand that this measure will create if the amendment is not carried.
      Mr. Jim Murphy: I am pleased to follow the right hon. Member for Cities of London and Westminster (Mr. Brooke). I have considerable respect for him and for his contribution in varied areas of government over many years. I enjoyed the informative nature of his speech and his analysis of London's health service. I want to direct my points primarily to the amendments, so I shall not respond to the specifics of the London health service, of which I do not claim to be a specialist. However, I shall talk about the plight and aspirations of Scotland's pensioners, who will be affected by the Budget.
      The Government's plans on private medical insurance have been strongly welcomed by Age Concern Scotland and the Scottish Pensioners Forum, who speak on behalf of approximately 600,000 pensioners in Scotland. More particularly, I am certain that the more than 14,000 pensioners of Eastwood will strongly support the proposals in the Finance Bill. I have not yet received any communication or telephone call giving a negative view of our plans for private medical insurance. I shall not pre-empt what may happen this weekend, when I shall have eight separate advice surgeries, but thus far none of my constituents has criticised our plans—quite the contrary.
      The Government's plans to reform the health service to ensure that more people have access to quality health care have been strongly welcomed. I am certain that today's announcement on GP fundholding will be mentioned in my constituency surgeries over the weekend. Labour is trusted on the health service, which is why the Opposition's genuine concerns will not be understood or felt by the constituents of Eastwood.
      The announcement in the Budget was not a surprise, whatever Conservative Members may say. In 1989, the Chancellor—then shadow Chief Secretary to the Treasury—announced that Labour would introduce this measure if we were in government. More recently, in 1996 no less, the current Chief Secretary to the Treasury stated that we would reduce VAT on domestic heating to the lowest legal minimum threshold, and reduce the subsidies for private medical insurance. That was less than a year ago, and the assertion that it was not well known in advance shows a misunderstanding of what the Government are trying to achieve.
      For two reasons, the proposal did not come as a surprise. First, the Chancellor said in his Budget speech that the arrangement had not worked and was still failing. It did not encourage widespread take-up of private medical insurance, although I understand that the Conservative Government introduced measures to try to increase the take-up, which had fallen throughout the 1980s. I understand that the measures in 1989 and 1990 were intended to bring some dynamism into the market for private medical insurance.
      The second reason for introducing our measures relates to VAT on domestic fuel, and our approach should be compared with that of the Conservative Government. As I have said, their approach to the matter caused significant surprise. On 6 April 1994, they introduced changes to
      446
      private medical insurance relief. It is incredible that Opposition Members have the audacity to demand of the new Government that which they did not have the confidence to present to Parliament when they were in government.
      Mr. Boswell: Will the hon. Gentleman give way?
      Mr. Murphy: I will give way later. The hon. Gentleman has the old hand's technique of coming to the Dispatch Box and asking to be allowed to intervene. I would be more responsive if the hon. Gentleman did not shout as he was approaching the Dispatch Box.
      Mr. St. Aubyn rose—
      Mr. Murphy: I will give way to the hon. Gentleman on the Back Bench.
      Mr. St. Aubyn: I am sorry that my hon. Friend the Member for Daventry (Mr. Boswell) fills the hon. Gentleman with such fear.
      How will pensioners in the hon. Gentleman's constituency benefit when any cut in energy costs will be reflected by state benefit adjustments in the following years? Pensioners in his constituency will have to give up their private health insurance and increase the waiting lists, but no account is taken of that in the Government's proposals. Pensioners will suffer. Indirectly, they will lose because of the abolition of the tax relief and they will gain nothing from the reduction in VAT on fuel.
      Mr. Murphy: Unlike the hon. Gentleman, I shall respond to questions. During his speech, he refused point blank to comment directly on questions that were put to him. He spoke of my refusal to allow the hon. Member for Daventry (Mr. Boswell) to intervene. I have spoken three times in the Chamber and I have been interrupted on two or three occasions by that hon. Gentleman. The experience filled me with many things, but fear was not one of them.
      The hon. Member for Guildford (Mr. St. Aubyn) spoke about waiting lists. As I understand it, the vast majority of those who are currently on private medical insurance had taken it out before tax relief was introduced. People are scaremongering by saying that, as a consequence of the Government's change, people will move to the national health service. People may be tempted to do that because the NHS will be safe in the Labour Government's hands and they did not believe that it was safe under the Conservatives, but there is no independent evidence to show that people on private medical insurance will seek service in the NHS.
      Mr. St. Aubyn rose—
      Mr. Murphy: The hon. Gentleman should allow me to complete my answer to his first question before rising to ask another one.
      The hon. Gentleman asked how my constituents feel about subsidies. My constituents, especially pensioners, have a strong sense of what is right and what is wrong. They strongly object to the fact that every one of them paid a subsidy into the coffers of BUPA and many other private medical insurance companies and received little or

      447
      nothing in return. Because of underfunding and the mistreatment of our health service, more and more people were encouraged to take out private insurance. There was an unfair subsidy paid by the many for the few.
      Mr. St. Aubyn: As the hon. Gentleman thinks that I did not answer his questions when I spoke earlier, I doubt whether he will understand what I have to say this time. The Government's proposals will indirectly reduce health spending and put the money into other areas. Anyone who is concerned about health spending must realise that Government support will fall and money will be redirected. That will damage the interests of everyone who relies on health provision.
      6.45 pm
      Mr. Murphy: The hon. Gentleman's conversion to the interests of the national health service is illuminating, if a bit late. The Conservative attitude towards the NHS and the way in which it was not considered safe in their hands are two of the major reasons why we are in Government and why I have the privilege to serve the people of Eastwood. The hon. Gentleman alludes to concern about the treatment of the NHS and its funding. He has not read carefully the contents of Budget and health service pronouncements. The Chancellor in his Budget speech and other Ministers have clearly said that the health service is one of our priorities and that there is new money for it.
      We should like to reach a situation in which there is no fertile ground for scaremongering and in which BUPA and others are not able to scare pensioners and others into a private system at the expense of the public system. I have given way twice to the hon. Gentleman and tried to answer his questions. He may not like the answers, but that is because we were elected on different manifestos and it would be hard to reconcile our aspirations.
      Initially, BUPA and other private companies expressed some concern about the effects of our proposed changes. Those companies were aware of the changes because they commented on them before the election. If they were aware of the changes, it is strange that Opposition Members suggest that they were a surprise. The Opposition's attitude is directly parallel with their attitude to our welfare-to-work programme, which tries to enhance the opportunities for the many using the finances of the few.
      As I said on Second Reading, the Opposition seem keener to protect the profits of the privatised utilities than are the utilities themselves. The direct parallel to that attitude is that Opposition Members seem keener to protect the interests of the private medical insurance companies than are the insurance companies. David Bryant is a senior representative of BUPA. As I have said, BUPA initially engaged in much scaremongering. It talked about the impact of our proposals on the NHS and said that tens of thousands or hundreds of thousands of people would move out of private medical insurance and into the NHS.
      However, BUPA has revisited its analysis in a way that Conservative Members have thus far refused to do. David Bryant has said:
      "There are always ways that increases can be alleviated."
      He believes, and BUPA seems to believe, that there are ways in which any difficulty can be alleviated. I do not claim to be a specialist on BUPA's finances, but I found
      448
      out from the House of Commons Library that last year BUPA's operating profits went up by 7 per cent and that its reserves rose by 13 per cent. to a total of £638 million.
      Like other hon. Members, I do not object to the fact that such companies exist and operate in a private market. What I object to is a system whereby a majority of the pensioners of Eastwood had to subsidise the minority to support the profits of BUPA and others. If BUPA's profits are affected as a consequence of our investing in and reorienting towards a public health service, David Bryant and others will, I am sure, understand our reasons for doing so. It is not the existence of these companies or of private medical insurance that I object to: it is the fact that the majority are being asked to subsidise the minority.
      Mr. Boswell: This has been a revealing debate. I have been struck by the consistency of Labour Members in referring, without exception, to their passionate concerns about the public service. There is no doubt that their ability to project that to the electorate has probably put them where they are. However, there are some Conservative Members who share those concerns. Equally, some of us are concerned—even in our own long-term interests—that Labour Members may not have spotted that concern for the public service without an understanding of the means to improve it or to generate resources for it is likely to lead to disillusion, disappointment and electoral disaster in the long term. If they pump up people's expectations and then let them down, that is a sad fraud on the electorate.
      Labour Members have suggested that the right hon. Nigel Lawson did not do much analysis in introducing the measures in 1990. Of course, there can be no substitute for experience. We now have seven years, analysis of the tax. We have the annual series. We also have substantive work from the Economists Advisory Group, to which I have referred extensively and which the Government should consider and respond to.
      The next point shows the difference in philosophy between the two parties. If the hon. Member for Eastwood (Mr. Murphy) had allowed me to intervene, I would have said that there is a distinction between introducing a benefit that is given by tax relief and helps quite a large group of people, and withdrawing that benefit for some nugatory and speculative advantage for the NHS as a whole.
      If the Opposition could show a real benefit to the NHS from these proposals, they might be in business, but I do not believe that they can—and the Chancellor does not believe it either, because he has assigned the money that he is saving from this measure to the reduction of VAT on fuel.
      Mr. Murphy: Will the hon. Gentleman give way?
      Mr. Boswell: I will do so once.
      Mr. Murphy: I thank the hon. Gentleman, and this is the only intervention that I plan to make. He has suggested that there is no identifiable benefit to the health service from our plans. Will he comment on the benefits to the health service of the changes that the Conservative Government brought about in 1994?
      Mr. Boswell: What I do know, and we are discussing and debating the current proposals of the Chancellor,

      449
      is that, whatever happens, the plans will throw more patients back on to the NHS without providing a single extra resource for it.
      Perhaps I may continue with my remarks, which I have been anxious to curtail because we have had an interesting debate. In conversation with me, one of my colleagues—a former Treasury Minister, although wild horses would not extract the name from me—once described his experience as a Treasury Minister as the best postgraduate education in town. The Financial Secretary is coming on in a couple of respects. First, she is learning Trappism: if she does not say anything or respond to the debate, I suppose that she cannot upset anyone, which may in her terms be an advance. Secondly, along the way, she has learnt the meaning of dead weight: the whole substance of the argument of Labour Members, including the Financial Secretary in her short contribution, has been that there is some dead-weight cost—that the abolition of the relief will be cost-free, with no repercussive effects.
      My hon. Friends and I mentioned some specific points and I said to the Financial Secretary that there was no absolute need to reply tonight, but they remain substantial and I hope that she will reflect on them.
      Dawn Primarolo: Did the hon. Gentleman read the explanatory notes on clauses? If so, he will have noticed that his questions with regard to contracts—including whether contracts entered into before 2 July would be honoured—are covered in the notes. The transitional proposals to cover those people are also detailed in the notes, as is a point that another Conservative Member made about a verbal contract and the honouring of contracts. If the hon. Member for Daventry (Mr. Boswell) had read the papers, he would know the answers to his questions.
      Mr. Boswell: With the greatest respect to the hon. Lady, that is not a sufficient answer. I have posed some specific points, which she has not replied to in terms. The whole purpose of a Committee debate is for the Opposition and other Members to seek elucidation of the points. The hon. Lady may feel that she has given me those assurances, and I will look again at the notes on clauses to find out whether they are sufficient, but I do not believe that they are.
      I will concede to the Financial Secretary that some policyholders will probably maintain their health insurance, regardless of the withdrawal of tax relief, if at the same time she will concede to me that some policyholders are likely to end their health insurance because of the withdrawal of that relief. The issue between us is the extent to which the measure will have real effect and the extent to which the NHS will face further pressures from the people who throw in the towel. That is why our amendment argues for a longer and more detailed analysis of the matter.
      Treasury Ministers have been unable to offer that analysis. They did not submit it in the Red Book. They did not even get the figures right in the Red Book—they are entirely different from the number of people who are covered by private medical insurance. There is also a difference of opinion or doubt about the net costs of the measures. I instanced to the Financial Secretary some of
      450
      our concerns: the return of policyholders to the NHS; the likely impact on resources for the NHS; the impact of the withdrawal of insurance premium tax; the loss of fee revenue from NHS beds.
      In the absence of a clear Government outline of the effects, I am drawn back to what seems an authoritative and sober analysis by an independent agency—the Economists Advisory Group, of which I know the Financial Secretary is aware. That analysis showed that the measures could produce not savings, but net losses. I am not certain of that, but the EAG concludes that when the factors to which I have referred are taken into account the total extra costs of the measures could be 9.1 per cent. above the expected net savings. I am sure that the Financial Secretary does not intend that and that the Treasury does not wish it. I hope that it will not happen, but I do not have the information to refute it.
      I am not arguing that Labour Members are not committed to the public services or that they would not wish to improve them, but it would be the greatest irony and it would disappoint them and their constituents if, after all this effort and after the damage to the livelihoods of the some 500,000 people who benefit from private health insurance, there were no savings at all, even possibly net costs, and no great benefit—no benefit that will sustain the NHS for more than the twinkling of an eye and no extra resources to cope with any additional waiting lists.
      In those circumstances, we should press for further analysis before casting the 600,000 policy holders on to the tender mercies of the Chancellor. I advise the Government to reflect on the impact of their measures for longer and in more detail than they have done so far, and to withdraw them.
      In that spirit, I invite my right hon. and hon. Friends to support the amendment.
      Amendment negatived.
      It being Seven o'clock, THE CHAIRMAN put the remaining Question required by the Order [14 July] to be put at that hour.
      Question put, That the clause stand part of the Bill:—
      The Committee divided: Ayes 332, Noes 181.

      Division No. 59]

      [7 pm

      AYES

      Abbott, Ms Diane

      Best, Harold

      Adams, Mrs Irene (Paisley N)

      Betts, Clive

      Ainger, Nick

      Blackman, Liz

      Ainsworth, Robert (Cov'try NE)

      Blears, Ms Hazel

      Allen, Graham (Nottingham N)

      Blizzard, Bob

      Anderson, Donald (Swansea E)

      Boateng, Paul

      Anderson, Janet (Rossendale)

      Borrow, David

      Armstrong, Ms Hilary

      Bradley, Keith (Withington)

      Ashton, Joe

      Brinton, Mrs Helen

      Atkins, Charlotte

      Brown, Rt Hon Nick (Newcastle E)

      Austin, John

      Brown, Russell (Dumfries)

      Banks, Tony

      Browne, Desmond (Kilmarnock)

      Barnes, Harry

      Buck, Ms Karen

      Barron, Kevin

      Burden, Richard

      Battle, John

      Burgon, Colin

      Beard, Nigel

      Butler, Christine

      Beckett, Rt Hon Mrs Margaret

      Byers, Stephen

      Bell, Stuart (Middlesbrough)

      Caborn, Richard

      Benn, Rt Hon Tony

      Campbell, Alan (Tynemouth)

      Bennett, Andrew F

      Campbell, Mrs Anne (C'bridge)

      Benton, Joe

      Campbell, Ronnie (Blyth V)

      451

      Campbell-Savours, Dale

      George, Bruce (Walsall S)

      Canavan, Dennis

      Gerrard, Neil

      Cann, Jamie

      Gibson, Dr lan

      Caplin, Ivor

      Gilroy, Mrs Linda

      Casale, Roger

      Goggins, Paul

      Caton, Martin

      Golding, Mrs Llin

      Cawsey, lan

      Gordon, Mrs Eileen

      Chapman, Ben (Wirral S)

      Graham, Thomas

      Chisholm, Malcolm

      Griffiths, Jane (Reading E)

      Clapham, Michael

      Griffiths, Nigel (Edinburgh S)

      Clark, Dr Lynda (Edinburgh Pentlands)

      Griffiths, Win (Bridgend)

      Grocott, Bruce

      Clark, Paul (Gillingham)

      Grogan, John

      Clarke, Charles (Norwich S)

      Gunnell, John

      Clarke, Eric (Midlothian)

      Hall, Mike (Weaver Vale)

      Clarke, Rt Hon Tom (Coatbridge)

      Hall, Patrick (Bedford)

      Clarke, Tony (Northampton S)

      Hamilton, Fabian (Leeds NE)

      Coaker, Vernon

      Hanson, David

      Coffey, Ms Ann

      Heal, Mrs Sylvia

      Cohen, Harry

      Henderson, Doug (Newcastle N)

      Colman, Tony (Putney)

      Henderson, Ivan (Harwich)

      Connarty, Michael

      Heppell, John

      Cook, Frank (Stockton N)

      Hesford, Stephen

      Cook, Rt Hon Robin (Livingston)

      Hewitt, Ms Patricia

      Cooper, Yvette

      Hill, Keith

      Corbett, Robin

      Hinchliffe, David

      Corbyn, Jeremy

      Hoey, Kate

      Cousins, Jim

      Home Robertson, John

      Cranston, Ross

      Hood, Jimmy

      Crausby, David

      Hoon, Geoffrey

      Cryer, Mrs Ann (Keighley)

      Hopkins, Kelvin

      Cryer, John (Hornchurch)

      Howarth, Alan (Newport E)

      Cummings, John

      Howarth, George (Knowsley N)

      Cunningham, Jim (Cov'try S)

      Howells, Dr Kim

      Cunningham, Rt Hon Dr John (Copeland)

      Hoyle, Lindsay

      Hughes, Kevin (Doncaster N)

      Cunningham, Ms Roseanna (Perth)

      Hurst, Alan

      Hutton, John

      Curtis-Thomas, Mrs Claire

      Iddon, Dr Brian

      Dafis, Cynog

      Illsley, Eric

      Dalyell, Tam

      Ingram, Adam

      Darling, Rt Hon Alistair

      Jackson, Ms Glenda (Hampstead)

      Darvill, Keith

      Jackson, Helen (Hillsborough)

      Davey, Valerie (Bristol W)

      Jamieson, David

      Davies, Geraint (Croydon C)

      Jenkins, Brian (Tamworth)

      Davies, Rt Hon Ron (Caerphilly)

      Jones, Barry (Alyn & Deeside)

      Davis, Terry (B'ham Hodge H)

      Jones, Ms Fiona (Newark)

      Dawson, Hilton

      Jones, Helen (Warrington N)

      Dean, Mrs Janet

      Jones, leuan Wyn (Ynys Môn)

      Dewar, Rt Hon Donald

      Jones, Ms Jenny (Wolverh'ton SW)

      Donohoe, Brian H

      Doran, Frank

      Jones, Jon Owen (Cardiff C)

      Drew, David

      Jones, Dr Lynne (Selly Oak)

      Drown, Ms Julia

      Kaufman, Rt Hon Gerald

      Dunwoody, Mrs Gwyneth

      Keeble, Ms Sally

      Eagle, Angela (Wallasey)

      Keen, Alan (Feltham & Heston)

      Eagle, Maria (L'pool Garston)

      Keen, Mrs Ann (Brentford)

      Efford, Clive

      Kennedy, Jane (Wavertree)

      Ellman, Ms Louise

      Khabra, Piara S

      Ennis, Jeff

      Kidney, David

      Etherington, Bill

      Kilfoyle, Peter

      Fatchett, Derek

      King, Andy (Rugby & Kenilworth)

      Field, Rt Hon Frank

      Ladyman, Dr Stephen

      Fisher, Mark

      Lawrence, Ms Jackie

      Fitzpatrick, Jim

      Laxton, Bob

      Fitzsimons, Lorna

      Lepper, David

      Flynn, Paul

      Leslie, Christopher

      Foster, Rt Hon Derek

      Lewis, Ivan (Bury S)

      Foster, Michael Jabez (Hastings)

      Liddell, Mrs Helen

      Foster, Michael John (Worcester)

      Linton, Martin

      Foulkes, George

      Livingstone, Ken

      Fyfe, Maria

      Livsey, Richard

      Galbraith, Sam

      Lloyd, Tony (Manchester C)

      Galloway, George

      Lock, David

      Gapes, Mike

      Love, Andrew

      Gardiner, Barry

      McAllion, John

      452

      McAvoy, Thomas

      Ross, Ernie (Dundee W)

      McCafferty, Ms Chris

      Rowlands, Ted

      McCartney, lan (Makerfield)

      Roy, Frank

      McDonagh, Siobhain

      Ruddock, Ms Joan

      Macdonald, Calum

      Russell, Ms Christine (Chester)

      McDonnell, John

      Salter, Martin

      McFall, John

      Sawford, Phil

      McGuire, Mrs Anne

      Sedgemore, Brian

      McIsaac, Shona

      Shaw, Jonathan

      Mackinlay, Andrew

      Sheerman, Barry

      McNulty, Tony

      Sheldon, Rt Hon Robert

      MacShane, Denis

      Shipley, Ms Debra

      Mactaggart, Fiona

      Simpson, Alan (Nottingham S)

      McWalter, Tony

      Singh, Marsha

      Mahon, Mrs Alice

      Skinner, Dennis

      Mallaber, Judy

      Smith Rt Hon Andrew (Oxford E)

      Marek, Dr John

      Smith Angela (Basildon)

      Marsden, Gordon (Blackpool S)

      Smith, Jacqui (Redditch)

      Marsden, Paul (Shrewsbury)

      Smith John (Glamorgan)

      Marshall, David (Shettleston)

      Smith, Llew (Blaenau Gwent)

      Marshall, Jim (Leicester S)

      Snape, Peter

      Marshall-Andrews, Robert

      Soley, Clive

      Maxton, John

      Spellar, John

      Meale, Alan

      Squire, Ms Rachel

      Michael, Alun

      Starkey, Dr Phyllis

      Michie, Bill (Shef'ld Heeley)

      Steinberg, Gerry

      Milburn, Alan

      Stevenson, George

      Miller, Andrew

      Stewart, David (Inverness E)

      Mitchell, Austin

      Stewart, lan (Eccles)

      Moonie, Dr Lewis

      Stoate, Dr Howard

      Morgan, Alasdair (Galloway)

      Stott, Roger

      Morgan, Ms Julie (Cardiff N)

      Strang , Rt Hon Dr Gavin

      Morgan, Rhodri (Cardiff W)

      Stringer, Graham

      Morley, Elliot

      Morris, Ms Estelle (B'ham Yardley)

      Stuart, Ms Gisela (Edgbaston)

      Morris, Rt Hon John (Aberavon)

      Sutcliffe, Gerry

      Mountford, Kali

      Taylor, Rt Hon Mrs Ann (Dewsbury)

      Mudie, George

      Mullin, Chris

      Taylor, Ms Dari (Stockton S)

      Murphy, Jim (Eastwood)

      Thomas, Gareth (Clwyd W)

      Norris, Dan

      Timms, Stephen

      O'Brien, Bill (Normanton)

      Tipping, Paddy

      O'Brien, Mike (N Warks)

      Todd, Mark

      O'Hara, Edward

      Touhig, Don

      Olner, Bill

      Trickett, Jon

      O'Neill, Martin

      Truswell, Paul

      Organ, Mrs Diana

      Turner, Dennis (Wolverh'ton SE)

      Osborne, Mrs Sandra

      Turner, Desmond (Kemptown)

      Pearson, lan

      Twigg, Derek (Halton)

      Pendry, Tom

      Twigg, Stephen (Enfield)

      Perham, Ms Linda

      Vaz, Keith

      Pickthall, Colin

      Vis, Dr Rudi

      Pike, Peter L

      Walley, Ms Joan

      Plaskitt, James

      Ward, Ms Claire

      Pollard, Kerry

      Watts, David

      Pond, Chris

      Welsh, Andrew

      Pope, Greg

      White, Brian

      Prentice, Ms Bridget (Lewisham E)

      Whitehead, Dr Alan

      Prentice, Gordon (Pendle)

      Wicks, Malcolm

      Primarolo, Dawn

      Wigley, Dafydd

      Prosser, Gwyn

      Williams, Rt Hon Alan (Swansea W)

      Purchase, Ken

      Quin, Ms Joyce

      Williams, Alan W (E Carmarthen)

      Quinn, Lawrie (Scarborough)

      Williams, Mrs Betty (Conwy)

      Radice, Giles

      Wills, Michael

      Rapson, Syd

      Winnick, David

      Reed, Andrew (Loughborough)

      Wise, Audrey

      Reid, Dr John (Hamilton N)

      Wray, James

      Robertson, Rt Hon George (Hamilton S)

      Wright, Dr Tony (Cannock)

      Wright, Tony D (Gt Yarmouth)

      Robinson, Geoffrey (Cov'try NW)

      Wyatt, Derek

      Roche, Mrs Barbara

      Rogers, Allan

      Tellers for the Ayes:

      Rooker, Jeff

      Mr. David Clelland and

      Rooney, Terry

      Mr. Jim Dowd.

      453

      NOES

      Ainsworth, Peter (E Surrey)

      Hague, Rt Hon William

      Allan, Richard (Shef'ld Hallam)

      Hamilton, Rt Hon Sir Archie

      Amess, David

      Hammond, Philip

      Ancram, Rt Hon Michael

      Hancock, Mike

      Arbuthnot, James

      Harvey, Nick

      Ashdown, Rt Hon Paddy

      Hawkins, Nick

      Atkinson, Peter (Hexham)

      Heald, Oliver

      Baker, Norman

      Heath, David (Somerton & Frome)

      Baldry, Tony

      Heathcoat-Amory, Rt Hon David

      Ballard, Mrs Jackie

      Hogg, Rt Hon Douglas

      Beggs, Roy (E Antrim)

      Horam, John

      Beith, Rt Hon A J

      Howard, Rt Hon Michael

      Bercow, John

      Howarth, Gerald (Aldershot)

      Blunt, Crispin

      Hunter, Andrew

      Body, Sir Richard

      Jack, Rt Hon Michael

      Boswell, Tim

      Jackson, Robert (Wantage)

      Bottomley, Peter (Worthing W)

      Jenkin, Bernard (N Essex)

      Bottomley, Rt Hon Mrs Virginia

      Johnson Smith, Rt Hon Sir Geoffrey

      Brady, Graham

      Brand, Dr Peter

      Jones, Nigel (Cheltenham)

      Brazier, Julian

      Key, Robert

      Breed, Colin

      King, Rt Hon Tom (Bridgwater)

      Brooke, Rt Hon Peter

      Kirkbride, Miss Julie

      Browning, Mrs Angela

      Kirkwood, Archy

      Bruce, lan (S Dorset)

      Laing, Mrs Eleanor

      Bruce, Malcolm (Gordon)

      Leigh, Edward

      Burnett, John

      Letwin, Oliver

      Burns, Simon

      Lewis, Dr Julian (New Forest E)

      Butterfill, John

      Lidington, David

      Cable, Dr Vincent

      Lilley, Rt Hon Peter

      Cash, William

      Lloyd, Rt Hon Sir Peter (Fareham)

      Chapman, Sir Sydney (Chipping Barnet)

      Luff, Peter

      Lyell, Rt Hon Sir Nicholas

      Chidgey, David

      MacGregor, Rt Hon John

      Chope, Christopher

      MacKay, Andrew

      Clark, Dr Michael (Rayleigh)

      Maclean, Rt Hon David

      Clarke, Rt Hon Kenneth (Rushcliffe)

      Maclennan, Robert

      McLoughlin, Patrick

      Clifton-Brown, Geoffrey

      Major, Rt Hon John

      Collins, Tim

      Maples, John

      Colvin, Michael

      Mates, Michael

      Cormack, Sir Patrick

      Maude, Rt Hon Francis

      Cotter, Brian

      Mawhinney, Rt Hon Dr Brian

      Curry, Rt Hon David

      May, Mrs Theresa

      Davey, Edward (Kingston)

      Merchant, Piers

      Davies, Quentin (Grantham)

      Michie, Mrs Ray (Argyll & Bute)

      Day, Stephen

      Moore, Michael

      Donaldson, Jeffrey

      Nicholls, Patrick

      Dorrell, Rt Hon Stephen

      Norman, Archie

      Duncan, Alan

      Oaten, Mark

      Duncan Smith, Iain

      Öpik, Lembit

      Emery, Rt Hon Sir Peter

      Ottaway, Richard

      Evans, Nigel

      Page, Richard

      Faber, David

      Paice, James

      Fabricant, Michael

      Paisley, Rev lan

      Fallon, Michael

      Paterson, Owen

      Fearn, Ronnie

      Prior, David

      Flight, Howard

      Redwood, Rt Hon John

      Forth, Rt Hon Eric

      Rendel, David

      Foster, Don (Bath)

      Robathan, Andrew

      Fowler, Rt Hon Sir Norman

      Robertson, Laurence (Tewk'b'ry)

      Fraser, Christopher

      Roe, Mrs Marion (Broxbourne)

      Gale, Roger

      Ross, William (E Lond'y)

      Garnier, Edward

      Rowe, Andrew (Faversham)

      Gibb, Nick

      Ruffley, David

      Gillan, Mrs Cheryl

      Russell, Bob (Colchester)

      Goodlad, Rt Hon Alastair

      St Aubyn, Nick

      Gorman, Mrs Teresa

      Sanders, Adrian

      Gorrie, Donald

      Sayeed, Jonathan

      Gray, James

      Shephard, Rt Hon Mrs Gillian

      Green, Damian

      Shepherd, Richard (Aldridge)

      Greenway, John

      Simpson, Keith (Mid-Norfolk)

      Grieve, Dominic

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

      Gummer, Rt Hon John

      Smyth, Rev Martin (Belfast S)

      454

      Soames, Nicholas

      Trend, Michael

      Spelman, Mrs Caroline

      Tyler, Paul

      Spicer, Sir Michael

      Tyrie, Andrew

      Spring, Richard

      Viggers, Peter

      Stanley, Rt Hon Sir John

      Wallace, James

      Steen, Anthony

      Walter, Robert

      Streeter, Gary

      Wardle, Charles

      Stunell, Andrew

      Waterson, Nigel

      Swayne, Desmond

      Webb, Professor Steve

      Syms, Robert

      Whitney, Sir Raymond

      Tapsell, Sir Peter

      Whittingdale, John

      Taylor, lan (Esher & Walton)

      Widdecombe, Rt Hon Miss Ann

      Taylor, Rt Hon John D (Strangford)

      Willis, Phil

      Taylor, John M (Solihull)

      Wilshire, David

      Taylor, Matthew (Truro)

      Woodward, Shaun

      Taylor, Sir Teddy

      Yeo, Tim

      Temple-Morris, Peter

      Young, Rt Hon Sir George

      Thompson, William

      Tonge, Dr Jenny

      Tellers for the Noes:

      Townend, John

      Mr. Malcolm Moss and

      Tredinnick, David

      Mr. James Cran.

      Question accordingly agreed to.
      Clause 15 ordered to stand part of the Bill.

    Clause 19

      PENSION FUNDS NO LONGER ENTITLED TO PAYMENT OF TAX CREDITS
      7.15 pm
      Dr. Cable: I beg to move amendment No. 15, in page 12, line 41, leave out from "section" to end of line 42 and insert
      "shall not take effect until Her Majesty's Government has published an assessment of the effects of this section on local authority finance for 1997–98, 1998–99, 1999–2000 and 2000–01.".
      The background to amendment No. 15 is our general concern about the Budget's advance corporation tax reforms. Because of anomalies and distortions, there is a good case for tax reform in this sphere. It has become clear in the very short time that has been made available to us that many of the anomalies that arise from the reforms have not been properly thought about. The specific matter that our amendment is meant to highlight is the impact the ACT reforms will have on local government. They will result not in a saving to the public sector but in a shuffling of resources within the public sector.
      The reforms will affect a large part of the public sector. About 10 per cent. of the asset value of pension funds under management is accounted for by local authorities, so a large chunk of the pension industry and a very large number of people are affected. About 1.25 million people are paying into local authority pension funds and about 1.6 million people are local authority pension fund pensioners.
      We are considering pension funds that are in a state of financial crisis, a large part of which was caused by the actions of the previous Government. Local authority pension funds were allowed to reduce their funding requirements from 100 per cent. to 75 per cent. Such a reduction in the private sector would have been excoriated as highly unethical. None the less, local authorities were encouraged to take that action to reduce poll tax bills. Consequently, many local authority pension funds are in dire financial trouble, which must be repaired.

      455
      Furthermore, local authority pension funds now have an additional cost to bear of about £300 million. The Local Government Association provided that estimate and, as it is Labour-dominated, one might assume that the figure is not over-estimated. Where will that additional money be found? How will it be paid for? Full understanding of the matter will not be possible until next March when, according to an answer provided by the Minister for London and Construction to a parliamentary question, an actuarial review is due. By next March or April, therefore, we should have a proper understanding of the state of local authority pension funds after the changes.
      Our concern is that the Bill is being rushed through before those implications are properly spelt out. Logically, we can think of various consequences, one of which is that the burden will be borne in reduced benefits by local authority pensioners. Another possibility is that services will be cut to top up pension funds. Another is that the burden will be borne fully by the council tax. One estimate is that council tax might have to rise by, on average, 10 to 20 per cent. to make good the deficit.
      As the Government have insisted on capping, it is very likely that local authorities will have to choose painful options. The context in which the very difficult decisions have to be made is that local authorities are, as we know, facing great financial difficulties. Many Labour Members come from local authorities under Labour control and have had responsibility for managing them. They therefore know the difficulties.
      We estimate that there will be a real cut in local authority budgets of about 1 or 2 per cent. next year. As a result of questions put to the House of Commons Library, we have established that the impact of higher rates of inflation will be to take out of central Government support for local authorities about £570 million this year and double that next year. The Audit Commission report published this morning referred to a gap of about £5 billion in local authority capital spending; so the £300 million, which is the extra damage being inflicted on local authority pension funds, comes on top of considerable difficulties.
      We appeal to the Government to give us a clear understanding of what the burden will be and how it will be paid for. Also, we want to hear that local authorities will be recompensed for the additional burden they will have to bear. I commend the amendment to the Committee.
      Mr. John MacGregor: I support the amendment. I know that the Committee wants to make progress, so I shall be brief.
      I was so concerned about this part of the Budget proposals—as I am about all of those that affect pension funds and ACT—that I got in touch with the chief executive of Norfolk county council straight away. He informed me that, although it is a bit early for the council to be absolutely sure and that he hoped to have an actuarial view in the early autumn, his current assessment is that the change will require an additional contribution of £5 million a year from the county council for one pension fund alone to meet the extra bill for county council employees. That would be the current employer's contribution rate.
      In accordance with the relevant regulations, the next effective date for increased contributions is April 1999. That seems to reinforce the point made by the hon.
      456
      Member for Twickenham (Dr. Cable). There is great concern about what will happen in 1999 and what the effect will be by then of having to meet extra contributions earlier. County councils have very real concerns, and it is likely that the additional cost will have to be met from increases in council tax. It is therefore important to sort the matter out now so that county councils, local authorities and others know where they stand. I strongly support the amendment.
      Mr. David Heathcoat-Amory: I support the amendment. There is no doubt that all local authorities with funded pension schemes have faced an immediate and large cut in their pension fund income. That started from the actual date of the Budget, so it is already happening. The size of the cut is open to dispute, but it certainly amounts to several hundred million pounds a year.
      The answer to a written question asked by my hon. Friend the Member for South Suffolk (Mr. Yeo) states that the local government pension scheme, to which I understand most local authorities belong, has an annual income of some £2.1 billion. If all that were invested in UK equities, the change would mean a drop in income of some £400 million a year. That may be unrealistically large, but even if we assume that only 60 per cent. is invested in UK equities, it still means an annual reduction in income of some £250 million.
      My county, Somerset, has estimated that it faces having to make up a shortfall of some £2.1 million. That is for the Somerset fund as a whole, which includes the district councils. Devon county council reports a drop in income of at least £3.5 million in a full year.
      The Local Government Association wrote to the Government estimating the drop to be about £300 million a year, and made the good point that it would be quite irresponsible to ignore the matter now. Government advice appears to be to ignore the problem at the moment and simply roll up the deficit in the hope that the Government make good the shortfall in two or three years' time. I suggest to the Economic Secretary that that is irresponsible. No commercial organisation would dream of ignoring a drop of that magnitude in its income; it would reserve for it annually. Local authorities therefore face having to make up the deficit by cutting services.
      Somerset expects to be rate-capped later this week by Government order, so, even if it wanted to, there is no prospect of its placing the burden on the council tax payer. It has to cut services. Is it the Economic Secretary's advice that local authorities should ignore the consequences of the Budget and the shortfall in their pension funds, either because she does not think it is very important to maintain pension contributions and eventual benefits to members of funds or in the hope that the Government will make up the shortfall in due course? If the latter is the case, will she promise local authorities and the Committee that she will indeed make up the difference, preferably now? If she can provide no certainty this year, will she at least do so in due course?
      The Economic Secretary to the Treasury (Mrs. Helen Liddell): I congratulate the hon. Member for Twickenham (Dr. Cable) on managing to get the

      457
      amendment selected. He has done rather better than the official Opposition who, despite their crocodile tears about this issue, have not been particularly successful in tabling amendments. It is interesting to hear Conservative Members express concern about local authorities—would that they had done so some time ago.
      The hon. Member for Twickenham recognises that the purpose of the abolition of ACT is to deal with distortions in the taxation system. He also recognises that those distortions exist. However, the amendment would delay implementation of the clause restricting the payment of tax credits until after the Government had reported on the effect of the change on local authority finances. Were the amendment to be accepted, one effect would be to produce opportunities for pension funds to sidestep the change by getting companies to pay dividends in the meantime. That in itself would add to the distortion with which we are dealing.
      I recognise the extent of the publicity about the abolition of tax credits for pension funds. I am aware of the good intentions behind the amendment, but it is wrong to seek to scaremonger. I share the concern about the impact on any pension fund, but we have to take into account the fact that there is to be a revaluation of local authority pension schemes in England and Wales in March 1998. I am conscious that the hon. Member for Gordon (Mr. Bruce) is in his place—in Scotland, the revaluation will not take place until the following year.
      There will therefore be no impact on local authority budgets in England and Wales until 1999 to 2000. That means that there is no immediate need to provide increased support for local authorities. Indeed, there will be other factors to take into account, not least a valid point made by actuaries themselves, which is that, because of the changes in corporation tax, actuarial calculations will have to take account of the increased capital values of companies.
      I must take up the point raised by the right hon. Member for Wells (Mr. Heathcoat-Amory) about local authority pension funds investing all their reserves in equities. That is unrealistic. I recognise that the right hon. Gentleman acknowledged that.
      Mr. Heathcoat-Amory: I specifically did not assume that all the funds were invested in UK equities. I made a rough calculation on the basis that only 60 per cent. were—a fairly modest figure. Will the Minister give her estimate of the collective drop in income experienced by local authorities as a result of the Budget? She must have done that work. Her officials must have advised her during the planning of the Budget. The Committee would be grateful if she would impart the information, in the spirit of openness.
      7.30 pm
      Mrs. Liddell: I am sure that the right hon. Gentleman is being mischievous rather than naive. He is well aware that it would be bizarre to attempt to second-guess what will happen in equities markets. If I could do that, I would probably replace Mystic Meg on the national lottery programme.
      458
      One important effect of the abolition of tax credits is that it allows companies to take decisions on their future performance and to invest from retained profits, leading to growth in those companies. That growth will result in better dividends.
      There is a bizarre obsession with the short term here. We are talking about a situation that will not come to fruition until 1999–00. The right hon. Gentleman invites me to say whether the Government are ignoring the advice of local authorities. It would be foolish for the Government to jump to conclusions before the revaluation of pension funds in March 1998—March 1999 for Scottish local authorities. I am surprised that someone of the right hon. Gentleman's experience should make that point.
      The right hon. Member for South Norfolk (Mr. MacGregor) talked about increases in council tax bills. He is falling into the same trap as the right hon. Member for Wells, trying to extrapolate figures that no one can know until after the revaluations. After those revaluations next spring, actuaries will have to take into account the capital values of companies.
      Mr. Malcolm Bruce: The Minister is making an interesting point, saying that we should not worry about this until the actuarial revaluations have been done. Does she not acknowledge that, when a tax relief that has been in place for many years is removed, it is a reasonable assumption that contributions will have to go up? Will she give an assurance that, if local authorities have to find extra money, the Government, who control 85 per cent. of their revenue, will make up the difference, or at least undertake to take it into account?
      Mrs. Liddell: The hon. Gentleman makes a valid point, but there is more to the revaluation than simply looking at the impact of the abolition of tax credits. Capital valuations also have to be taken into account. Any Government reviewing local authority settlements have to consider the broader picture. We shall do that in due course.
      I therefore regret that it is not possible for the Government to accept the amendment. I hope that it will not be pressed to a Division.
      Dr. Cable: We intend to press the amendment to a Division, because we do not believe that we are scaremongering by raising our concerns.
      One of the useful aspects of this short but focused debate has been the additional colour that has been supplied. We have heard from Norfolk and Somerset, where councils are directly affected. Yesterday, Oxfordshire county council, which is controlled by Labour and the Liberal Democrats, produced a report estimating an additional £4 million cost resulting from the measure. Council treasurers throughout the country, who are not of any political leaning, are expressing great concern about the measure and the loss of income that will result from it. They want reassurance about how they are to deal with it when the time comes.
      My hon. Friend the Member for Gordon (Mr. Bruce) has already said that, although an actuarial analysis will

      459
      be made in due course, there will be a loss of income. That is why we want to push the amendment to a Division.
      Question put, That the amendment be made:—
      The Committee divided: Ayes 176, Noes 313.

      Division No. 60]

      [7.34 pm

      AYES

      Ainsworth, Peter (E Surrey)

      Gillan, Mrs Cheryl

      Allan, Richard (Shef'ld Hallam)

      Goodlad, Rt Hon Alastair

      Amess, David

      Gorman, Mrs Teresa

      Ancram, Rt Hon Michael

      Gorrie, Donald

      Arbuthnot, James

      Gray, James

      Ashdown, Rt Hon Paddy

      Green, Damian

      Atkinson, Peter (Hexham)

      Grieve, Dominic

      Baker, Norman

      Gummer, Rt Hon John

      Baldry, Tony

      Hague, Rt Hon William

      Ballard, Mrs Jackie

      Hamilton, Rt Hon Sir Archie

      Beggs, Roy (E Antrim)

      Hammond, Philip

      Beith, Rt Hon A J

      Hancock, Mike

      Bercow, John

      Harris, Dr Evan

      Blunt, Crispin

      Harvey, Nick

      Body, Sir Richard

      Hawkins, Nick

      Boswell, Tim

      Heald, Oliver

      Bottomley, Peter (Worthing W)

      Heath, David (Somerton & Frome)

      Bottomley, Rt Hon Mrs Virginia

      Heathcoat-Amory, Rt Hon David

      Brady, Graham

      Horam, John

      Brand, Dr Peter

      Howard, Rt Hon Michael

      Brazier, Julian

      Howarth, Gerald (Aldershot)

      Breed, Colin

      Hughes, Simon (Southwark N)

      Brooke, Rt Hon Peter

      Hunter, Andrew

      Browning, Mrs Angela

      Jack, Rt Hon Michael

      Bruce, lan (S Dorset)

      Jackson, Robert (Wantage)

      Bruce, Malcolm (Gordon)

      Jenkin, Bernard (N Essex)

      Burnett, John

      Johnson Smith, Rt Hon Sir Geoffrey

      Burns, Simon

      Butterfill, John

      Jones, Nigel (Cheltenham)

      Cable, Dr Vincent

      Key, Robert

      Cash, William

      King, Rt Hon Tom (Bridgwater)

      Chapman, Sir Sydney (Chipping Barnet)

      Kirkbride, Miss Julie

      Kirkwood, Archy

      Chidgey, David

      Laing, Mrs Eleanor

      Chope, Christopher

      Leigh, Edward

      Clarke, Rt Hon Kenneth (Rushcliffe)

      Letwin, Oliver

      Lewis, Dr Julian (New Forest E)

      Clifton-Brown, Geoffrey

      Lidington, David

      Collins, Tim

      Lilley, Rt Hon Peter

      Colvin, Michael

      Livsey, Richard

      Cormack, Sir Patrick

      Lloyd, Rt Hon Sir Peter (Fareham)

      Cotter, Brian

      Luff, Peter

      Cran, James

      Lyell, Rt Hon Sir Nicholas

      Cunningham, Ms Roseanna (Perth)

      MacGregor, Rt Hon John

      MacKay, Andrew

      Curry, Rt Hon David

      Maclennan, Robert

      Dafis, Cynog

      McLoughlin, Patrick

      Davis, Rt Hon David (Haltemprice)

      Major, Rt Hon John

      Davies, Quentin (Grantham)

      Maples, John

      Day, Stephen

      Mates, Michael

      Donaldson, Jeffrey

      Mawhinney, Rt Hon Dr Brian

      Dorrell, Rt Hon Stephen

      May, Mrs Theresa

      Duncan, Alan

      Merchant, Piers

      Duncan Smith, Iain

      Michie, Mrs Ray (Argyll & Bute)

      Evans, Nigel

      Moore, Michael

      Faber, David

      Morgan, Alasdair (Galloway)

      Fabricant, Michael

      Moss, Malcolm

      Fallon, Michael

      Nicholls, Patrick

      Fearn, Ronnie

      Norman, Archie

      Forth, Rt Hon Eric

      Oaten, Mark

      Foster, Don (Bath)

      Öpik, Lembit

      Fowler, Rt Hon Sir Norman

      Ottaway, Richard

      Fraser, Christopher

      Page, Richard

      Gale, Roger

      Paice, James

      Gibb, Nick

      Paterson, Owen

      460

      Prior, David

      Taylor, lan (Esher & Walton)

      Redwood, Rt Hon John

      Taylor, John M (Solihull)

      Rendel, David

      Taylor, Matthew (Truro)

      Robathan, Andrew

      Taylor, Sir Teddy

      Robertson, Laurence (Tewk'b'ry)

      Thompson, William

      Roe, Mrs Marion (Broxbourne)

      Tonge, Dr Jenny

      Ross, William (E Lond'y)

      Townend, John

      Rowe, Andrew (Faversham)

      Tredinnick, David

      Ruffley, David

      Tyrie, Andrew

      Russell, Bob (Colchester)

      Viggers, Peter

      St Aubyn, Nick

      Wallace, James

      Sanders, Adrian

      Walter, Robert

      Sayeed, Jonathan

      Wardle, Charles

      Shephard, Rt Hon Mrs Gillian

      Waterson, Nigel

      Shepherd, Richard (Aldridge)

      Webb, Professor Steve

      Simpson, Keith (Mid-Norfolk)

      Wells, Bowen

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

      Welsh, Andrew

      Smyth, Rev Martin (Belfast S)

      Whittingdale, John

      Soames, Nicholas

      Widdecombe, Rt Hon Miss Ann

      Spelman, Mrs Caroline

      Wigley, Dafydd

      Spring, Richard

      Woodward, Shaun

      Stanley, Rt Hon Sir John

      Yeo, Tim

      Steen, Anthony

      Young, Rt Hon Sir George

      Streeter, Gary

      Stunell, Andrew

      Tellers for the Ayes:

      Swayne, Desmond

      Mr. Paul Tyler and

      Syms, Robert

      Mr. Edward Davey.

      NOES

      Abbott, Ms Diane

      Chapman, Ben (Wirral S)

      Adams, Mrs Irene (Paisley N)

      Chaytor, David

      Ainger, Nick

      Chisholm, Malcolm

      Ainsworth, Robert (Cov'try NE)

      Clapham, Michael

      Allen, Graham (Nottingham N)

      Clark, Dr Lynda (Edinburgh Pentlands)

      Anderson, Janet (Rossendale)

      Armstrong, Ms Hilary

      Clark, Paul (Gillingham)

      Ashton, Joe

      Clarke, Charles (Norwich S)

      Atkins, Charlotte

      Clarke, Eric (Midlothian)

      Austin, John

      Clarke, Rt Hon Tom (Coatbridge)

      Banks, Tony

      Clarke, Tony (Northampton S)

      Barnes, Harry

      Clelland, David

      Barron, Kevin

      Coaker, Vernon

      Battle, John

      Coffey, Ms Ann

      Beard, Nigel

      Cohen, Harry

      Bell, Stuart (Middlesbrough)

      Colman, Tony (Putney)

      Benn, Rt Hon Tony

      Connarty, Michael

      Bennett, Andrew F

      Cook, Frank (Stockton N)

      Benton, Joe

      Cook, Rt Hon Robin (Livingston)

      Best, Harold

      Cooper, Yvette

      Betts, Clive

      Corbett, Robin

      Blackman, Liz

      Corbyn, Jeremy

      Blears, Ms Hazel

      Cousins, Jim

      Blizzard, Bob

      Cranston, Ross

      Boateng, Paul

      Crausby, David

      Borrow, David

      Cryer, Mrs Ann (Keighley)

      Bradley, Keith (Withington)

      Cryer, John (Hornchurch)

      Bradshaw, Ben

      Cummings, John

      Brinton, Mrs Helen

      Cunningham, Jim (Cov'try S)

      Brown, Rt Hon Nick (Newcastle E)

      Cunningham, Rt Hon Dr John (Copeland)

      Brown, Russell (Dumfries)

      Browne, Desmond (Kilmarnock)

      Curtis-Thomas, Mrs Claire

      Buck, Ms Karen

      Dalyell, Tarn

      Burden, Richard

      Darling, Rt Hon Alistair

      Burgon, Colin

      Darvill, Keith

      Butler, Christine

      Davey, Valerie (Bristol W)

      Byers, Stephen

      Davies, Rt Hon Denzil (Llanelli)

      Campbell, Alan (Tynemouth)

      Davies, Geraint (Croydon C)

      Campbell, Mrs Anne (C'bridge)

      Davies, Rt Hon Ron (Caerphilly)

      Campbell, Ronnie (Blyth V)

      Davis, Terry (B'ham Hodge H)

      Campbell-Savours, Dale

      Dawson, Hilton

      Canavan, Dennis

      Dean, Mrs Janet

      Cann, Jamie

      Dewar, Rt Hon Donald

      Caplin, Ivor

      Donohoe, Brian H

      Casale, Roger

      Doran, Frank

      Caton, Martin

      Dowd, Jim

      Cawsey, lan

      Drew, David

      461

      Drown, Ms Julia

      Keen, Mrs Ann (Brentford)

      Dunwoody, Mrs Gwyneth

      Kennedy, Jane (Wavertree)

      Eagle, Angela (Wallasey)

      Khabra, Piara S

      Eagle, Maria (L'pool Garston)

      Kidney, David

      Efford, Clive

      Kilfoyle, Peter

      Ellman, Ms Louise

      King, Andy (Rugby & Kenilworth)

      Ennis, Jeff

      King, Ms Oona (Bethnal Green)

      Etherington, Bill

      Ladyman, Dr Stephen

      Fatchett, Derek

      Lawrence, Ms Jackie

      Field, Rt Hon Frank

      Laxton, Bob

      Fisher, Mark

      Lepper, David

      Fitzpatrick, Jim

      Leslie, Christopher

      Fitzsimons, Lorna

      Lewis, Ivan (Bury S)

      Flynn, Paul

      Liddell, Mrs Helen

      Foster, Rt Hon Derek

      Linton, Martin

      Foster, Michael Jabez (Hastings)

      Lloyd, Tony (Manchester C)

      Foster, Michael John (Worcester)

      Lock, David

      Foulkes, George

      Love, Andrew

      Fyfe, Maria

      McAllion, John

      Galbraith, Sam

      McAvoy, Thomas

      Galloway, George

      McCafferty, Ms Chris

      Gapes, Mike

      McCartney, lan (Makerfield)

      Gardiner, Barry

      McDonagh, Siobhain

      George, Bruce (Walsall S)

      Macdonald, Calum

      Gerrard, Neil

      McDonnell, John

      Gibson, Dr lan

      McGuire, Mrs Anne

      Gilroy, Mrs Linda

      McIsaac, Shona

      Goggins, Paul

      Mackinlay, Andrew

      Golding, Mrs Llin

      McNulty, Tony

      Gordon, Mrs Eileen

      MacShane, Denis

      Graham, Thomas

      Mactaggart, Fiona

      Griffiths, Jane (Reading E)

      McWalter, Tony

      Griffiths, Nigel (Edinburgh S)

      Mahon, Mrs Alice

      Griffiths, Win (Bridgend)

      Mallaber, Judy

      Grocott, Bruce

      Marsden, Gordon (Blackpool S)

      Grogan, John

      Marshall, David (Shettleston)

      Gunnell, John

      Marshall, Jim (Leicester S)

      Hall, Mike (Weaver Vale)

      Marshall-Andrews, Robert

      Hall, Patrick (Bedford)

      Maxton, John

      Hamilton, Fabian (Leeds NE)

      Michie, Bill (Shef'ld Heeley)

      Hanson, David

      Milburn, Alan

      Heal, Mrs Sylvia

      Miller, Andrew

      Henderson, Doug (Newcastle N)

      Mitchell, Austin

      Henderson, Ivan (Harwich)

      Moonie, Dr Lewis

      Heppell, John

      Morgan, Ms Julie (Cardiff N)

      Hesford, Stephen

      Morgan, Rhodri (Cardiff W)

      Hewitt, Ms Patricia

      Morley, Elliot

      Hill, Keith

      Morris, Ms Estelle (B'ham Yardley)

      Hinchliffe, David

      Mountford, Kali

      Home Robertson, John

      Mudie, George

      Hood, Jimmy

      Mullin, Chris

      Hoon, Geoffrey

      Murphy, Jim (Eastwood)

      Hopkins, Kelvin

      Norris, Dan

      Howarth, Alan (Newport E)

      O'Brien, Bill (Normanton)

      Howarth, George (Knowsley N)

      O'Brien, Mike (N Warks)

      Howells, Dr Kim

      O'Hara, Edward

      Hoyle, Lindsay

      Olner, Bill

      Hughes, Kevin (Doncaster N)

      O'Neill, Martin

      Hurst, Alan

      Organ, Mrs Diana

      Hutton, John

      Osborne, Mrs Sandra

      Iddon, Dr Brian

      Pearson, lan

      Illsley, Eric

      Pendry, Tom

      Ingram, Adam

      Perham, Ms Linda

      Jackson, Ms Glenda (Hampstead)

      Pickthall, Colin

      Jackson, Helen (Hillsborough)

      Pike, Peter L

      Jenkins, Brian (Tamworth)

      Plaskitt, James

      Jones, Barry (Alyn & Deeside)

      Pollard, Kerry

      Jones, Ms Fiona (Newark)

      Pond, Chris

      Jones, Helen (Warrington N)

      Pope, Greg

      Jones, Ms Jenny (Wolverh'ton SW)

      Prentice, Ms Bridget (Lewisham E)

      Prentice, Gordon (Pendle)

      Jones, Jon Owen (Cardiff C)

      Primarolo, Dawn

      Jones, Dr Lynne (Selly Oak)

      Purchase, Ken

      Kaufman, Rt Hon Gerald

      Quin, Ms Joyce

      Keeble, Ms Sally

      Quinn, Lawrie (Scarborough)

      Keen, Alan (Feltham & Heston)

      Radice, Giles

      462

      Rapson, Syd

      Stuart, Ms Gisela (Edgbaston)

      Reed, Andrew (Loughborough)

      Taylor, Rt Hon Mrs Ann (Dewsbury)

      Reid, Dr John (Hamilton N)

      Robinson, Geoffrey (Cov'try NW)

      Taylor, Ms Dari (Stockton S)

      Roche, Mrs Barbara

      Thomas, Gareth (Clwyd W)

      Rogers, Allan

      Timms, Stephen

      Rooker, Jeff

      Tipping, Paddy

      Rooney, Terry

      Todd, Mark

      Ross, Ernie (Dundee W)

      Touhig, Don

      Rowlands, Ted

      Trickett, Jon

      Roy, Frank

      Truswell, Paul

      Ruddock, Ms Joan

      Turner, Dennis (Wolverh'ton SE)

      Russell, Ms Christine (Chester)

      Turner, Desmond (Kemptown)

      Sawford, Phil

      Twigg, Derek (Halton)

      Sedgemore, Brian

      Twigg, Stephen (Enfield)

      Shaw, Jonathan

      Vaz, Keith

      Sheerman, Barry

      Vis, Dr Rudi

      Sheldon, Rt Hon Robert

      Walley, Ms Joan

      Shipley, Ms Debra

      Ward, Ms Claire

      Simpson, Alan (Nottingham S)

      Watts, David

      Singh, Marsha

      White, Brian

      Skinner, Dennis

      Whitehead, Dr Alan

      Smith, Rt Hon Andrew (Oxford E)

      Wicks, Malcolm

      Smith, Angela (Basildon)

      Williams, Rt Hon Alan (Swansea W)

      Smith, Jacqui (Redditch)

      Smith, John (Glamorgan)

      Williams, Alan W (E Carmarthen)

      Smith, Llew (Blaenau Gwent)

      Williams, Mrs Betty (Conwy)

      Snape, Peter

      Wills, Michael

      Soley, Clive

      Winnick, David

      Squire, Ms Rachel

      Wise, Audrey

      Starkey, Dr Phyllis

      Wray, James

      Steinberg, Gerry

      Wright, Dr Tony (Cannock)

      Stevenson, George

      Wright, Tony D (Gt Yarmouth)

      Stewart, David (Inverness E)

      Wyatt, Derek

      Stewart, lan (Eccles)

      Stoate, Dr Howard

      Tellers for the Noes:

      Stott, Roger

      Mr. John McFall and

      Stringer, Graham

      Mr. David Jamieson.

      Question accordingly negatived.
      Mr. Gibb: I beg to move amendment No. 16, page 12, line 42, at end insert—
      '(4) Section 468Q of the Taxes Act 1988 (dividend distributions to corporate unit holder) shall be amended as follows—

      (a) In subsection (1) at the end of paragraph (b) there shall be inserted—

      "or is a pension fund as defined in section 231A(4)"

      (b) In subsection (2) the words "or income tax" shall be inserted after the words "corporation tax".".

      I should at the outset declare an interest, in that I am a chartered accountant, a member of the Institute of Chartered Accountants in England and Wales, and I write a six-weekly article for Accountancy Age.
      The amendment seeks to deal with an anomaly created by clause 19, which has been caused, like so much else in the Finance Bill, by the rushed and ill considered way in which the new Labour Government are proceeding. As such, and in the spirit of ensuring that the House produces well drafted legislation, I hope that the Government will accept the amendment.
      The anomaly in question concerns the position of pension funds that invest through unit trusts. Clause 19 prevents pension funds from reclaiming the tax credits on dividend income—an outrageous change to the previous position, which all parties had accepted, that pension funds should be allowed to accumulate assets from income tax-free, thus encouraging the build-up of pension fund assets. As far as we know, it is not the

      463
      Government's intention to tax other income within a pension fund, such as interest income and income from property. At the moment, all the Government intend to do is tax dividend income received by pension funds.
      The problem arises when a pension fund invests in a unit trust that itself invests in bonds or property. Unit trusts themselves are taxable, but pension funds could effectively reclaim the tax by receiving the tax credits attached to the dividend paid by the unit trust. Now that pension funds are no longer able to reclaim that credit, investing in a balanced unit trust becomes unviable for them, because that would now be taxable. However, if the pension fund itself received the income, it would be non-taxable.
      If the Government accepted the amendment, it would apply existing provisions in section 468 of the Taxes Act 1988 to stream income paid by a unit trust to reflect the nature of the income it receives, and enable the recipient to claim back only the tax on the income that, had it received such income directly, would not have been taxable. Applying those provisions to pension funds would deal with the problem.
      Mrs. Liddell: I regret to tell the hon. Member for Bognor Regis and Littlehampton (Mr. Gibb) that I cannot accept his amendment, but I congratulate him, as a new Member, on getting his amendment debated, albeit briefly. However, I do not see too much enthusiasm for his amendment among his hon. Friends. I do not accept his argument about the anomalous position.
      I shall go into some of the background to the debate. Authorised unit trusts were introduced as vehicles for investment by individuals, and can be included in personal equity plans. Most PEP-ed investment is in authorised unit trusts and investment trusts. The tax rules are designed to ensure that tax-paying individuals do no worse by investing via an authorised unit trust than they would if they were to invest directly. Those rules involve treating authorised unit trusts like companies for taxation purposes, and the dividends that they pay out to pension funds are treated by clause 19 in exactly the same way as dividends paid to pension funds by a UK company. That is the structure for authorised unit trusts.
      I come to my point of disagreement with the hon. Member for Bognor Regis and Littlehampton. I do not accept that the position of authorised unit trusts is anomalous. An authorised unit trust that pays dividends out of income it receives from a mixed investment portfolio is in exactly the same position as an investment trust or any other company that pays dividends out of profits arising from different income sources.
      Furthermore, most pension fund investment through unit trusts in real property is done through unauthorised rather than authorised unit trusts. The treatment of interest and rental income flowing through unauthorised unit trusts to pension funds will not be affected in any way by our proposals. It is now open to many pension funds to invest through pension fund pooling vehicles—a type of unit trust that receives a completely transparent tax treatment.
      The justification for the amendment is not clear. I know that the change has been touted by the Association of Unit Trusts and Investment Funds, which has written to my hon. Friend the Paymaster General on the subject. However, it is not apparent that the issue is a major one,
      464
      not least because pension funds can and do invest in real property through unauthorised unit trusts rather than authorised ones.
      I can give the hon. Member and the Committee an assurance that we will review the position should compelling reasons emerge why a pension fund investing in property through an unauthorised unit trust or pension fund pooling vehicle might be placed at a real disadvantage compared with one investing through an authorised unit trust. I am sorry that that sounds so convoluted, but it is better to get the clear position on the record.
      We see no justification for the amendment, and we do not accept that the change it would make is especially necessary. Pension funds can take action to avoid being disadvantaged in the way that has been suggested. The amendment would also have repercussions, because pension funds would want similar treatment for other dividends, and it would run counter to the whole thrust of the tax credit changes. The Government cannot accept the amendment.
      Mr. Gibb: I am grateful to the hon. Lady for accepting that, without the amendment, pension funds will be put at a disadvantage if they continue to invest through authorised unit trusts. The Government's position will be a great disappointment to the industry, because that is another unintended consequence of the proposals, which will require the pensions industry to make sweeping changes to its investment policy as a result of one Budget measure. However, in the interests of later debate, I beg to ask leave to withdraw the amendment.
      Amendment, by leave, withdrawn.
      Question proposed, That the clause stand part of the Bill.
      Mrs. Liddell: I realise that the Opposition were anxious to have a wide debate on this issue, and I am willing to allow them as much time as possible. I will take on board any points they make, and sum up in some detail later. I stress that the purpose of removing tax credits is specifically to ensure that we remove a distortion from the tax system. The previous Government started the process, and we seek to promote a tax system that is fairer and that encourages longer-term investment in companies.
      Mr. Heathcoat-Amory: I am glad that the Financial Secretary will answer the debate in some detail, because we have several questions that remain unanswered. So far, we have been unsuccessful in getting the Government to come clean about what really happened on Budget day to their promises on taxation. More specifically, the Government have not come clean about the damage they have done to millions of people who contribute to pension schemes.
      Nowhere was the Government's pledge not to increase taxes more quickly—and deceitfully—broken than in clause 19. I wish to establish beyond dispute that the abolition of dividend tax credits for pension fund contributors was a huge tax increase. From Budget day, all pension funds investing in UK equities suffered an immediate and serious drop in their income. I say immediate because the provision took effect from Budget day.

      465
      The Government will get an extra £5 billion a year from the change. There is no magic about that—the money has to come from other people. The new Government have a large majority and can repeal many things, but they cannot repeal the laws of arithmetic. If the Government take £5 billion a year from the income accruing to pension funds, clearly that will have an impact on the millions of ordinary people who contribute to those schemes. They will be hit by an eventual reduction in their pension benefits or by the need to increase their contributions.
      I make no apology to the Committee for returning to the stated view of the Government on the effects of their proposals. The words of the Financial Secretary were:
      "The measure"—
      she was referring to the abolition of advance corporation tax credits—
      "is good for pensions and pensioners… People should understand that our reforms will benefit pension funds."—[Official Report, 3 July 1997; Vol. 297, c. 507.]
      Those words have gone unamended and uncorrected in the ensuing days, so that remains the official Government view of the effect of these tax changes on pension funds. This enormous tax hit is a benefit for pensioners and pension funds.
      It is almost breathtaking that the Government can continue to assert that taking £5 billion a year from those who contribute to such schemes is good for them. If that is new Labour economics, we have been warned.
      The Chancellor was hardly any better on Budget Day. He airily dismissed the matter by saying that pension funds were mostly in surplus, so no one would really be any the worse off. I have news for the Government. More than three quarters of UK pension funds are money-purchase schemes. They do not have surpluses. There is no pot of gold in money-purchase schemes that enables the Government to raid them without anyone noticing. The Budget simply reduces the prospective pensions paid for by those money-purchase schemes, or it will require contributors to them to increase their monthly payments.
      8 pm
      Typically, a 30-year-old with such a money-purchase scheme will now have to pay between £12 and £20 a month extra to maintain his or her benefits. To be told by the Government that that change is good for contributors is an insult.
      As the hon. Lady is clearly anxious to respond, I invite her to repudiate the words of the Financial Secretary, or to explain how it can be good for someone to have to pay in between £12 and £20 a month extra for the same prospective pension.
      Mrs. Liddell: I am grateful to the right hon. Gentleman for giving way. I shall deal first with the second point—payments into money-purchase schemes. Will the right hon. Gentleman inform the Committee on what basis his sums were arrived at? Anyone who knows money-purchase schemes knows that there are different impacts at different ages.
      Secondly, on the point made by my hon. Friend the Financial Secretary, it is a well known fact that the strength of British companies is mirrored in the
      466
      performance of pension funds. Indeed, her point is perfectly correct. If companies perform better and are stronger, with more stable long-term growth, that inevitably benefits pension funds. Will the right hon. Gentleman explain why, whenever the previous Government reduced tax credits, there was no mention of pension funds at that time?
      Mr. Heathcoat-Amory: I am afraid that that simply will not do as an apology or explanation for the extraordinary remarks of the Financial Secretary on 3 July. The Economic Secretary has not explained how it is good for pensions and pensioners to have a sum of £5 billion a year extracted from the schemes.
      The hon. Lady asked where my sums came from. I can explain in outline that, if there is a 20 per cent. cut by the abolition of ACT credits accruing to a pension fund, it follows that that income stream, discounted to the present day, has been cut by 20 per cent. Therefore, a pension fund investing purely in UK equities has been affected by that amount.
      I generously recognise, however, that most UK pension funds do not invest only in UK equities. I therefore assume, for the sake of argument—the figures have been prepared for me by actuaries and outside commentators—that 60 per cent. is a reasonable figure to assume that many pension funds invest in UK equities. If that is so, the reduction is 12 per cent., not 20 per cent.
      It is entirely fair for me to suppose that a man or woman contributing £100 a month to a pension scheme will have to increase contributions by the sum I mentioned. If the hon. Lady has alternative figures, we would be grateful to hear them. There has been a terrible dearth of information about the real reduction in benefits, or the necessary increase in contributions. All we have had is the daft assertion that it is all good for contributors, and that paying in additional sums is somehow helping them to build up higher pensions for their old age.
      I concede that a minority of pension schemes are final-salary schemes. Some, at least, have the ability to be in surplus. The National Association of Pension Funds conducted a survey, which showed that most of its members do not have such surpluses, but some do.
      The bottom line is that millions of people investing in thousands of pension schemes will have been hit badly and immediately by the Budget. It is deceitful to try to disguise that. I use that word deliberately and with care.
      On Budget day, the Government issued "The Pocket Budget", which was designed to be a summary or distillation of what we in Committee know as the Red Book. It is designed to make the Budget clear and easy to understand. It was published so that people could see how the Budget would affect them, and to make it understandable and accessible to people outside.
      All are agreed, I think, that the pension fund change was central to the Budget. It is the unexpected tax change in the Budget and the largest one. When it is up and running, it will raise more each year than the windfall tax will raise in total.
      The only reference in "The Pocket Budget" to that colossal tax change affecting millions of people is:
      "the Budget… makes other tax changes to encourage companies to invest profits in the future".
      If that is not deceitful, I do not know what is, especially as it comes from a Government who go on about trust, openness and accountability.

      467
      Earlier on the same page from which I have quoted, the following is stated:
      "Openness. The Government is committed to building trust."
      They could have started in the very booklet in which those words appear.
      There is nothing in "The Pocket Budget" about the affect on pension funds. There is no figure. Of course there are plenty of figures to show how the money will be spent. Billions and hundreds of millions of pounds bandied about on the expenditure side of the Budget are explained in the booklet, but there is nothing about this huge tax-raising measure on pension funds.
      Even the possibility of investment is a smokescreen. I read out the reference that supposes that the entire purpose of the pension fund tax changes is to encourage investment.
      That is not true, because many companies will have to pay more into their pension funds now, and as a result will have less to invest. Companies, especially some of the larger ones that still have final salary schemes, will have to make up the lost income with their own contributions; so a company having to make up the deficit will have less money to invest in plant and machinery, not more. Therefore, even the excuse, or description, offered, incomplete and misleading as it is, is untruthful.
      I hope that, when the Minister replies to the debate, which she said she would do with some care and at some length, she will agree that that publication is a disgrace. It is published at public expense, yet it is clearly designed to disguise rather than to illuminate the true nature of the Budget.
      I have a practical suggestion about how the Government could compensate for the crime. They should certainly withdraw the "The Pocket Budget" from circulation, but does the Minister agree that the members of pension schemes, even at this late stage, have a right to know what has happened to them? The Government are promising a "right to know" Bill in the next Session, and they could start to implement their words now, by giving the members of pension funds the right to know what the Government have just done to them.
      Indeed, if the law of Bristol, South is true, and more taxation really is good for pension funds, perhaps the Government will want to send a letter to all pension fund members explaining exactly how good the Budget was for their pension funds and their eventual pensions.
      I hope that the Minister will take the suggestion seriously, and use the fact that pension funds write to their members regularly in any case. If the Government were to help with funding, I am sure that the funds could be persuaded—perhaps they should be told—to explain to all members what happened to them on Budget day.
      There are several other unanswered questions about clause 19. One concerns the relationship between the clause and the state earnings-related pension scheme. More than 5 million people have opted out of SERPS, and many did so on a calculation of comparative advantage, having measured SERPS against alternatives such as taking out a personal pension.
      A particular aspect of that calculation concerns the national insurance rebates that we made available to those who left SERPS and made alternative arrangements. In the Budget, the Government reduced at a stroke the attractiveness of the alternative personal pension, and that has rendered the original calculation invalid.
      468
      I am not talking about anyone being missold a pension; I am describing people who were properly, rationally and objectively advised that the SERPS scheme offered less good prospects than taking out a personal pension, helped by the national insurance rebates. The Government have now rendered that advice invalid.
      In previous debates, we have heard that the Government will not increase the rebates. It is the Opposition's contention that the Government are guilty of misselling pensions on a colossal scale. I should like the Minister to return to that issue and explain how she can avoid the charge that she has retrospectively let down the millions of people who took a decision about their future pension provision on what has turned out to be a false prospectus.
      Mrs. Liddell: It is rather rich for the Opposition to talk about pensions misselling, because they blatantly ignored the pensions misselling that took place when they were in government, and completely failed to take into account the fact that 600,000 people at or near retirement had been missold pensions. The people who were missold pensions under the aegis of the previous Government deserve an apology from the right hon. Gentleman.
      Mr. Heatheoat-Amory: The misselling of pensions is always a serious matter, and the Conservative Government put in place a mechanism to find out what had happened and recompense the victims. I draw a clear and immediate contrast between that and what the Government are now doing deliberately to millions of people, in which the Minister seems to take some pride. I hope that, when she replies to the debate, she will deal with the national misselling of pensions scandal on the part of the Treasury Bench, which is taking place before our eyes.
      The Government are attempting a pensions robbery on a scale that makes Robert Maxwell look like an amateur. It means less investment in British industry, lower pensions and higher contributions. Almost the worst of it is that they have tried to cover it all up by describing it as a minor tax change—something to do with company profits. That has now been exposed, and people know what has happened, so I look forward to hearing the Minister's apologies.
      8.15 pm
      Yvette Cooper: I have a strange sense of deja vu, rising in the House to speak about pensions and tax credits all over again, but I shall resist the temptation simply to read from Hansard my contribution to the previous debate on pensions.
      Again I find it strange, in discussing the tax credits, to listen to Conservative Members talking about their concern for the plight of future pensioners, when they did so little for the future pensioners who suffered so badly from the misselling of pensions. In their objection to the clause, they seem to be trying to claim two things—first, that the tax credit is good for the economy and for investment, so that to abolish it would be terrible for both, and secondly, that to take it away would be bad for future pensioners.
      Both those claims are wrong. Is the tax credit really as good for the economy as Conservative Members profess? Consider a company that has made profits. What should

      469
      it do with those profits? Where should it invest them? Should it give them back to the shareholders, probably including a few pension funds, who are breathing down its neck? Or should it put the profits into investment, into expanding jobs and the future value of the company for those with shares in it, including those very pension funds?
      Mr. Gibb: Does the hon. Lady not realise that it is not necessarily best for capital to remain within the company where the profits were earned? Surely it is better for the capital to go back into the capital market, and for independent assessors of the best use of it to decide where it would be best invested. That does not always mean that the profits should reside where they were made.
      Yvette Cooper: That is an interesting claim, which several Conservative Members have made. They seem to argue that capital is always best used by the pension funds. In some cases, it may be. There may be good pension fund managers who are good at investing capital wisely—but there may also, as today's Office of Fair Trading report points out, be some who are not quite so good at making such decisions.
      Equally, there may also be managers of companies who are good at making investment decisions. Others will not be quite so good. The problem with the tax credit is that it distorts the decision. Instead of allowing managers, pension fund managers and shareholders to make the best decisions about whether the money should go into investment, into dividends, or elsewhere, the Government and the taxpayer intervene, giving one group a subsidy to shunt the money out as dividends. That does not allow the managers simply to make a balanced decision about what is best.
      It may be best to keep the money in the existing company; it may be best to take it out. We should at least let the managers make the best decision, according to the full information that they have about the state of the market at the time, rather than distorting the decision and letting the Government intervene to say, "We know what is best. We shall subsidise a particular use of that money." That is not a sensible or effective procedure for a Government who want to encourage investment and sensible decisions.
      The tax credit has been used as a subsidy, and Britain pays out a huge proportion of its national wealth—double the proportion paid out by the Americans—in dividends. That is no wonder, when we have a tax credit that distorts the system. The Americans reinvest an awful lot more into their companies, and that might account for our low rate of long-term sustainable growth.
      We have now allowed companies to take their own decisions about where best to spend their money. To balance the removal of the tax credit, we have cuts in corporation tax to encourage companies to make the best use of their resources. Our corporate tax rate is now lower than that of most countries in the industrialised world. That is a positive boost for investment.
      Conservative Members argue that the measure is a massive blow to future pensioners, who will suffer terribly. That is a bizarre argument. They say that pension funds should inform all their current members of the
      470
      potential impact, but how is that impact to be calculated? Surely it depends far more on what happens to the economy over the next five, 10 or 20 years than on anything that happens in this Budget. We should look to the long term rather than trying to pluck figures out of thin air.
      The biggest blow to pension funds and the corporate sector in the past five years was the recession, which could have been avoided but was escalated by the Conservatives' mismanagement of the economy. If we really want to protect the future of pension funds, we must take into account the effect of the overall economy on their performance.
      Conservative Members seem to have few qualms about triggering another recession. Their position in the run-up to the general election was that the Bank of England did not need to take operational control of interest rates and that no tax increases or cuts in Government borrowing were necessary. They are not quite prepared to commit themselves, but they now seem to be saying that no interest rate increases were necessary.
      Given the escalation in consumption, Conservative Members' refusal to act on all those matters would probably have encouraged the economy into another boom, followed by another recession. That would have done far more damage to British pension funds than anything of which they are accusing the Government.
      I always wondered why Conservative Governments never seemed all that concerned about escalating into a boom or going into a recession, or about the long-term future of the economy. They did not seem to want to get us out of the boom-bust cycle. It is clear from Conservative Members' speeches today that they do not recognise the impact of the business cycle on pension funds. Presumably they also think that it has no impact on companies or on all the people who lose their jobs. We believe that that is a huge issue.
      Labour Members believe that the boom-bust cycle that Britain has been in for so long has had a massive impact on pension funds. That is why the measures in the Budget are based on the long term, and not on the short-term quibbles that we have heard from Conservative Members today. I support the clause.
      Mr. Malcolm Bruce: The hon. Member for Pontefract aud Castleford (Yvette Cooper) has rehearsed arguments that we have heard before. If the issue is so massive, one wonders why it did not manage to get into the Labour party manifesto in advance of the general election. That is what causes so much concern about the proposals and the way in which they are being introduced.
      The hon. Lady has advanced arguments that many of us would accept as having some plausibility. They are a matter of opinion, and time will tell whether she is right, but the real concern is that, although the measure was not a manifesto pledge and the issue has not been widely debated, it is being rushed through in a matter of days before people have had a real chance to calculate the impact.
      The shadow Chief Secretary has asked questions and expressed concerns that the Economic Secretary refutes. In a sense, that is logical. The right hon. Gentleman says, "We think this might happen"—and the Economic Secretary says, "We don't think so"—and the reality is that we all make a judgment about a dynamic situation the

      471
      consequences of which we cannot entirely foresee. That justifies the case for fuller consideration of the matter in the context of a general review of corporate taxation, to ensure that we get the balance right.
      If I have a criticism, it is not that the measure is fundamentally wrong—it may or may not be—but that the Government are implementing it in such a hurry that nobody has a chance to consider the impact and get the questions aired and explored.
      I can testify to the fact that the outside interest groups that are affected have barely had time to digest the complex impact. I have in my hand some suggested amendments that arrived too late to be tabled for debate today. They were sent by some of the people affected who want some answers, but they will not get them unless we manage to bring the matter up on Report, when there is strict timetabling.
      I suspect that many people will begin to realise the implications only after the Bill becomes the Finance Act 1997. As has happened so often before, a new Finance Act in 1998 or 1999 will amend the mistakes. That is what we spend most of our time on in Finance Bill Standing Committees, year in, year out, because of the way in which we go about things.
      The argument that it is simply a matter of changing the corporate tax system to make it more efficient and to encourage companies to retain profits that would otherwise be paid out in dividends and to invest is not as yet proven or provable. It certainly is not the whole answer, and no Labour Member is suggesting that it is. The hon. Member for Pontefract and Castleford was clearly advancing it only as one of the building blocks of her argument.
      It is naive in the extreme to suggest that the measure is merely a change in corporate taxation: it is a form of personal taxation. Closing a tax loophole amounts to putting up taxes and means that people have to pay more. Effectively, therefore, it is a tax increase. As the exchange between the Economic Secretary and the shadow Chief Secretary demonstrated, the impact is not foreseeable and will be uneven. Some pension funds may be able to redistribute their funds in a way that reduces or eliminates the impact, and others may not.
      The Government's arguments would have been more persuasive if they had not introduced the tax with effect from Budget day, which meant that there was no possibility of making any forward provision. I understand the reasons for that, but it means that even better management is required, to try to improve performance and offset any possible losses. The reality is that if, as the National Association of Pension Funds suggests, the measure could lead to an average increase of, say, 15 per cent. in contributions for people who are paying their own occupational pensions or personal pensions, with or without employers' contributions, it could easily be the equivalent of 1 p or 2p on the standard rate of income tax, which will be deducted from their salaries to bring their pensions up to the final salary calculations that they thought they were paying for.
      8.30 pm
      The Economic Secretary and other Labour Members will not be surprised to hear Liberal Democrats saying that it would have been more honest for the Government
      472
      to put up income tax rather than finding a back-door method of doing exactly the same thing unevenly. Effectively, that is what is happening. My worry is that the Government think that taxing the corporate sector does not affect individual citizens, when clearly it does. Certainly, the way in which this measure is being applied will do so. I might ask the Economic Secretary whether that is wise or whether a compensating adjustment is coming down the track.
      The Minister for Welfare Reform, the right hon. Member for Birkenhead (Mr. Field), is charged with a comprehensive review of social security and pensions, which could clearly lead to a recommendation—most of us expect that it will—that individual citizens should make a substantial compulsory contribution to the pensions industry to achieve future top-up pensions to replace SERPS and provide care in the community and for people's care in their old age. As a consequence, the financial institutions will, potentially, have massive additional income. Perhaps they are being persuaded to back off and swallow this measure quietly because of the benefit that may come at a later date.
      If that were the case, it would be regrettable, because those are real issues—one for the long term and one for the here and now. The here and now is that people will almost certainly have to find additional money to get the same pension benefit that they started paying for when the tax relief was built in.
      I have some sympathy with the argument that tax reliefs are a distortion in the marketplace. I hope, however, that the Economic Secretary will not quite follow the line of argument of the hon. Member for Pontefract and Castleford, who has the ear of all sorts of people who influence policy and who suggests that all tax reliefs are a bad thing and a distortion and should be abolished. Or are only some of them bad?
      What is a good or a bad tax relief is a subjective analysis, as is the effect of such reliefs. It has always been an accepted part of Government policy that tax and tax reliefs are not merely revenue-raising powers but are about altering people's behaviour—for example, to encourage saving or to discourage the buying of polluting equipment, and so on. Ministers put forward those arguments on many occasions. Indeed, the Chancellor of the Exchequer chose to argue that the massive and additional increase in the petrol tax in the Budget was an environmental measure. Of course, it was nothing of the kind—it was a revenue-raising measure. The argument used to justify it was that it would discourage the use of cars, which was good for the environment—the consequence is not arguable.
      I hope that the Government do not believe that all tax allowances are equally bad. It would be helpful if they gave us a broad indication of which allowances they think are good and which bad, so that we can anticipate those that might be strengthened or introduced and those that might be abolished or reduced. We are all beginning to have to second-guess Government thinking.
      This is a serious issue. I do not dispute that the Government have some valid arguments on their side, but introducing the measure at short notice, without full consultation and the opportunity for all the implications to be assessed and for those affected to get answers to their questions, was not wise, desirable or the right way to do things.

      473
      I hope that I can give the Government the benefit of the doubt—they thought that in their first Budget they had to do something that would bring in extra revenue, that this was the way to do it and that they were likely to get away with it now. We have on the record Ministers' suggestions that, in future, they intend to consult about tax changes. They intend to have a consultation on the future of corporate taxation. I hope that we will be able to have proper, informed debates in the House and with organisations and interested parties outside it, so that never again will a major tax change, which will bring in £5 billion a year for the foreseeable future, be forced through the House in a matter of days before any of us have had a full opportunity to assess its implications. Fundamentally, that is why we will vote against the clause.
      Mr. Cranston: I should be more persuaded by the Opposition's claim that they are the pensioners' friend if my hon. Friend the Economic Secretary to the Treasury did not have to spend so much of her time clearing up the mess left by the previous Government because of the huge misselling of pensions. I should also be more persuaded if the Office of Fair Trading had not published a report this morning on the nature of the pensions industry and the extent to which it has not been adequately regulated.
      Opposition Members have mentioned our manifesto in this and previous debates. I am prepared to give way if they can tell me how many of their 22 tax rises between 1992 and 1997 were mentioned in their 1992 manifesto—I suspect, none.
      The background to this measure is this country's imputation system. We attempt to avoid the double taxation of dividends. Other countries do not have the same approach. ACT is a product of our system. For example, the United States does not have our imputation system.
      Mr. John Swinney: Is the implication of the hon. Gentleman's opposition to double taxation that he wants to wipe away the double taxation treaties that this country has with a variety of other countries, to try to get some consistency in the taxation system?
      Mr. Cranston: The hon. Gentleman completely misunderstands. The imputation system was designed to avoid double taxation in the sense of taxation when the moneys are in the hands of the company and then in the hands of shareholders when they receive dividends. That has nothing to do with double taxation treaties between different countries.
      As the American experience demonstrates, our system is not universal or sacrosanct. The result of our imputation system, however, is that, in the case of pension funds and charities, a tax credit is paid. Base rate taxpayers do not have to pay anything in taxation on dividends because of the system, but pension funds get paid a credit.
      As my hon. Friend the Member for Pontefract and Castleford so lucidly explained, that leads to a distortion in the way in which decision makers, such as pension funds, invest. They invest in United Kingdom equities to a greater extent than they would otherwise have done because of the tax credit. It also means—this is one of the themes of the Office of Fair Trading report—
      Mr. Gibb: Will the hon. Gentleman explain his last statement, which I, and I suspect many hon. Members, do
      474
      not understand? Given that pension funds receive a tax credit on receipt of dividend income because the tax fund is not a taxable entity, so the interest and property income that they receive is not taxable, how can the imputation system give pension funds an incentive to invest in UK equities—all the income that the funds receive is tax-free?
      Mr. Cranston: I am pointing out that the measure affects the portfolio decisions of pension funds. As we have seen in recent days, the speculation is that pension funds will turn from UK equities, for example, to commercial property, foreign equities or gilts.
      The OFT report has underlined that the present system gives protection to inefficient fund managers. We know that fund managers have been able to produce good results and to charge high fees—I must be careful, because of the previous occupations of some Conservative Members—and we know also that fund managers have been able to earn extremely large salaries, even when particular funds have performed less well than funds that have merely tracked the FT stock exchange index. The current system leads to distortions in investment decisions taken by pension funds and to other inefficiencies.
      Mr. Denzil Davies: I do not follow my hon. Friend's argument. It has already been said that pension funds used not to pay tax on dividends, rents from property developments or gilts. In future, they will pay tax on dividends but not on rent from property development and gilts. The anomaly, if there is one, lies in the fact that until now all the investment income of pension funds was tax-free. That has nothing to do with the imputation system.
      Mr. Cranston: I find that intervention helpful. If my right hon. Friend reads the report of my speech in Hansard, he may follow my argument, which I hope and trust is correct.
      The economic health of pension funds turns in the long run on the state of the economy. In other words, it turns on general economic conditions, including the stable long-term growth of the economy, and the Government have taken steps to ensure that there will be stable long-term growth. My hon. Friend the Member for Pontefract and Castleford has alluded to some of the measures that have been taken, such as the steps to ensure the operational independence of the Bank of England.
      In assessing claims of the losses that pension funds will suffer, we must give some attention to how pension funds are valued, which is on a discounted cash flow basis. In other words, actuaries measure cash assets earned through dividends, which are discounted in accordance with ordinary accounting practice. There is growing pressure from international accounting groups to move away from that approach and to use market valuation, which is to value the assets and then to adjust them, for example, for inflation.
      The present method of valuation means that the company that pays a dividend will be treated differently from the company that distributes capital in an authorised way, or which, for example, distributes to shareholders by buying back shares. It seems that the method of assessing the losses that pension funds suffer—there has been wild speculation about this—must be discounted to some extent because of the discounted cash flow method that is currently used in this country to value pension funds.

      475
      As far as final salary schemes are concerned, pensioners are protected. It is up to their employer to make up any shortfall as a result of these measures.
      8.45 pm
      The Budget introduces a cut in corporation tax. There are other benefits for corporations, which, to an extent, will allow companies to make up any shortfall that might occur as a result of these measures. In some cases, companies have been taking substantial pension holidays. They will have no difficulty in making up the shortfall.
      Labour has said that, in the long term, there is a need for a new savings account for individuals which will build on the experience of TESSAs and PEPs, and will encourage long-term savings, which would be encouraged through tax relief. I very much look forward to the day when it will be introduced.
      Mr. Gibb: It is always a pleasure to follow the hon. Member for Dudley, North (Mr. Cranston), who always makes my speeches sound interesting.
      I was disappointed that the Government felt unable to accept the amendment that I tabled. The measure will cause additional alarm in the pensions industry, as it is still reeling from the disastrous effect of the abolition of credits on dividends. The additional concern—the right hon. Member for Llanelli (Mr. Davies) hinted at this—is whether the Government ultimately intend to tax other income received by pension funds, such as interest income and income from property. They have already broken the principle that pension funds should be tax-free vehicles. The Labour party may now think why not go the whole hog and tax everything that a pension fund receives. That would be a nice little earner to fund the Labour party's next spending bonanza.
      Mrs. Liddell: Perhaps the hon. Gentleman will tell the Committee whether in his election manifesto he supported the previous Government's proposal to take away the tax-free contribution of employees' pension contributions. Does he believe that that is an effective way to deal with employees' pension contributions?
      Mr. Gibb: There was no mention in my manifesto on that issue. I shall continue.
      I refer hon. Members to clause 19(4), which provides a definition of income. It says:
      "'income", in relation to a pension fund, means income derived from investments or deposits held for the purposes of the pension fund".
      Why does it say "investments" and "deposits" and not simply UK equities? After all, only UK equities are being taxed in the clause. Is this a Freudian slip, revealing the Government's long-term plans for pension funds? The industry, pensioners and people contributing to pension funds would appreciate a statement on that from the Minister—a statement that categorically rules out any intention further to tax pensions in the future, or at least during the lifetime of this Parliament.
      476
      The Government's decision to confiscate 11 per cent. of the value of pensions has already had a very damaging effect on confidence—the confidence that people feel when they are paying into a pension fund that was formerly considered a safe haven.
      Mr. Cranston: Can the hon. Gentleman provide evidence to support his claim that the figure is 11 per cent?
      Mr. Gibb: The same calculations have been used before. It can be assumed, for example, that about 55 per cent. of the assets of an average pension fund are held through United Kingdom equities. If 20 per cent. is applied to that figure, the total is roughly 11 per cent.
      Mr. Cranston: All other things being equal.
      Mr. Gibb: Yes.
      As I was saying, pension funds were considered a safe haven, but they are now deemed a reasonable quarry for an ever-hungry Labour Government.
      The Government have not given enough thought to the severe consequences of their decision to abolish tax credits on dividends. They have not thought about, for instance, the circumstances of someone who is self-employed or in non-pensionable employment and is already paying the maximum 17.5 per cent. of his net income into a personal pension fund. Thanks to this measure, that person will now need to increase his contributions to maintain the value of his pension, but the law prevents him from increasing his contributions beyond 17.5 per cent. if he is to receive a tax deduction. Why have the Government not raised the limit?
      I note from page 46 of the Red Book that the Government have considered the impact that the Bill will have on companies. As is made clear in paragraph 2A.7, businesses will have to make higher pension contributions, and that will have an effect on corporation tax receipts. I can only say "Well done" to the Government—but what about the effect on local authorities? Why have the Government not made extra provision for higher local government contributions to employees' pension funds?
      What will happen to councils that are already spending up to their capping limits? Should they cut services? Should they make people redundant? Or should they—as the Prime Minister suggested to the House, and as the Economic Secretary to the Treasury reiterated in the debate—simply rely on the fact that local government pension funds are not due for revaluation for a year or two, and do nothing about it until then? Is that the conclusion that the Government reached once they got round to considering the consequences of this measure? If so, I hope that no responsible local authority will follow that advice.
      Why did the Government decide to allow higher-rate and basic-rate taxpayers to keep the tax credit on dividends, but refuse to allow non-taxpayers to reclaim it? Was it yet another deliberate attack on pensioners, two out of three of whom are non-taxpayers, or was it yet another unforeseen consequence of an ill-considered and ill-thought-out policy?
      This one clause is the most damaging and far-reaching clause in the Bill. It will raise £3.95 billion in 1998–99 and £5.4 billion in 1999–2000. That is more than the

      477
      windfall tax raises, and it is an ever-recurring annual event. It is equivalent to a 3p rise in income tax. It will result in millions of people paying more into personal and occupational pension schemes, and in companies having to pay higher employer pension contributions. It will take 11 per cent. off the value of the nation's pension fund assets, and it will cause pension fund managers to switch whole swathes of investment—billions of pounds—out of equities and into other assets. As we discovered earlier, they will be transferring their money from authorised unit trusts, for instance.
      That will force local authorities to sack staff or raise the council tax. It will undermine confidence in the sanctity of pension funds as a way of saving. It will increase the likely level of state dependency in the decades ahead, which will feature an ever-aging population. It vandalises one of the great successes of the past 18 years of Conservative government—the fact that the country has built up £650 billion in private pension fund assets.
      The clause was introduced in a rush, as a wheeze to raise billions of pounds for future spending plans, but its unforeseen consequences are hugely damaging to pensioners and to the country as a whole. I urge hon. Members to throw it out.
      Mr. Geraint Davies: I would not describe that speech as interesting.
      Let us put this matter in context. Who is the pensioners' friend? What legacy did we inherit, and what does that legacy mean for pensioners? On 1 May, we inherited a situation in which Britain was falling down the skills league and the earnings per head league, so that, of the 15 member states of the European Union, only Portugal, Spain and Greece were below us. Was that good in the long term for pensioners investing in UK equities? UK plc became weaker and weaker under the Tories because of under-investment, year after year, in human and physical capital. The big challenge we faced was to put pensions on firm ground for the future.
      We also inherited an enormous public sector debt, which we had to control. The Tory legacy meant future tax rises, which threaten future pensions. That is the real economics of the situation. The short-termist, accountancy approach taken by the Conservatives has taken Britain down the economic league of countries. In the present unstable consumer boom, the economy is disabled by undercapacity due to under-investment, and there is a propensity for inflation to increase and for interest rates to zoom up, which is not in the interests of home owners or of investors.
      As for Conservatives being the pensioners' friend, we all know that, in the past, because of their economic mismanagement, they increased VAT on fuel, which hurt pensioners, and then tried to do it again. More than half a million people were missold pensions, and that problem was never sorted out. We need no lectures from Conservative Members, given their legacy of short-term chaos and long-term inadequacy.
      I have said before and I shall say again that the Chancellor boldly created conditions in which pension funds could prosper. They can prosper only if UK plc is profitable in the long term. The delegation of responsibility for setting interest rates to take the risk
      478
      premium out of investment in Britain and thus reduce long-term borrowing rates was a great move for pensions. The reduction of corporation tax to the lowest level in Europe, which will make the United Kingdom attractive again for international investment, was another brilliant move, as was the tax reduction for small and medium-sized enterprises. Those changes will help the prospects of pension funds that invest in British industry.
      What is advance corporation tax and where did it come from? In the first instance, ACT was a neutral measure to speed up the payment of corporation tax. Under the previous Government, tax credits were used to subsidise dividend payments to pension funds. On the face of it, that seemed very good, but it created a distortion. The judgment about what proportion of operating surplus should go into dividends—into the City—and what should be reinvested in research and development, future products and profitability was distorted in favour of the former. Other major trading nations, such as Japan, the United States and Germany, do not have such a distortion: they invest more in research and development, in innovation and in new products. It is not surprising that those countries are going up in the skills league.
      We need to think carefully about the distorting effect of the subsidy and whether it is in everybody's interest, as has been asserted. I suggest that it is not. It may be in the short-term interests of some pension fund managers, but the history of the professionalism of pension fund management in Britain is not inspiring. Many pension funds and managers are characterised by excessive fees and charges and by salaries and bonuses to managers who are incapable of increasing their fund value above the FTSE average.
      Most funds do worse than the average. I was on a pension fund board, and anyone who knows anything about the distribution of numbers will realise that that is possible. [Interruption.] Conservative Members laugh. Some of them are obviously in the industry. The board to which I referred employed some managers for a local authority who consistently failed even to track the average, and we changed them.
      9 pm
      Mr. Graham Stringer: Would my hon. Friend be surprised to learn that I was told by the chairman of one of Britain's leading manufacturers that he spent his time trying to hide from the City the amount of research and development that was carried out in that company? If the City had known about the large percentage of potential pension funds being spent in that way, it would have put pressure on him to reduce his company's research and development.
      Mr. Davies: Unfortunately, I am not surprised to hear that. My hon. Friend's example is characteristic of the disgraceful activity throughout United Kingdom industry. Before I ran my own business and was in a multinational business, I found that there was an increasing propensity to have short-term financial returns. There was no longer an annual return, because every quarter the marketing and advertising spends, which were strategic investments, had to be cut to hit the City's requirements, its hunger for dividends. As hon. Members have said, such actions were carried out at the expense of long-term strategic investment.

      479
      Who is best equipped to make long-term strategic investment in research and development? Is it the people who create profits for companies in the first place, the managers and directors who invest their time, life, skills and energy fighting in competitive markets and delivering returns, or is it the City, which behaves in an accountancy fashion and just wants to drain the lifeblood from British industry?
      It is obvious that a balance must be struck between dividends and research and development and reinvestment. The distorting effect of the subsidy has led to inadequate performance by many pension funds, and has allowed massive bonuses and the starvation of companies that want to invest and succeed. The balance is not right for our long-term economic prospects and, therefore for the economic well-being of pensions and pension funds.
      The new Government bring with them a new culture to support the one that I have mentioned, which relates to investment, innovation and long-term thinking. It supports company directors and managers who want to succeed and does not simply respond sheepishly to the voice of the City.
      In an earlier debate, Opposition Members spoke about the subsidies to private health care. People quoted industry sources which were subsequently shown to be inaccurate by reference to the Inland Revenue. In its own interests, the voice of the pension fund industry is prone to exaggerate the results of the Government's changes. We all know that the predictions about the impact on pension fund values derive purely from a calculation that is based on dividend flows which, in actuarial terms, do not stand up to scrutiny, because they will be unable to account for the likely capital growth of pension funds.
      Mr. Gibb: How does the hon. Gentleman think the capital values of companies are calculated if not from their income flows?
      Mr. Davies: It is now acknowledged by consultants in the industry that one has to give some idea of companies' future values in terms of stock market value and the like. That is not ascertained simply from the dividend flow. There have, on average, been large increases in stock value since the Labour party came to power, and those will continue if the Government create an environment, in terms of the Bank of England, research and development and corporation tax, in which we can expect rapid growth of investment and profitability in UK plc.
      Future values should be factored in. Basically, the word on the street is that they will now have to be. The hon. Gentleman can use his somewhat simplistic arithmetic in this debate, but in a year or so, that will be inadequate and those changes will be made. Time will tell, but that is clearly the industry's view.
      The simple fact is that, again, a small scatter of the Opposition have been cobbled together to talk about the short-term impact, warning that there will be victims, as if there were an election next week and they were still trying to pull themselves together. They are unable to confront the fact that the new Government, unlike the previous one during their 18 years of office, have a long-term policy that will deliver economic and social benefits for pensioners, other people and future generations.
      Mr. Brooke: I am pleased to follow the hon. Member for Croydon, Central (Mr. Davies). To his credit, he has
      480
      been in the Chamber for much of the Committee, but he repeated the old canard about VAT on fuel hitting pensioners, when pensioners were the one element of the community that were protected from the tax's effect.
      I spoke on this subject during the Budget debate. Yesterday, the Paymaster General rebuked us for not raising different points from those that we had made during the Budget debate, on Second Reading or, in the context of this debate, in the pensions debate. Plenty of hon. Friends wish to make new points, so I will confine mine, whether new or old, to three.
      Before I do, may I say that it was a pleasure to welcome the right hon. Member for Llanelli (Mr. Davies), who I am sorry has now left the Chamber, to the debate? It is one of the signs of the new Government's overweening confidence that they thought that they could manage without the right hon. Gentleman, who was a distinguished Treasury Minister when Labour was in power before 1979.
      First, the Government have given us remarkably little justification for their confidence that, if the payment of dividends is made less attractive, investment will be more likely. In one respect, I am in the Government's debt, as the subject is not one with which I have had to get to grips since I was a postgraduate student at Harvard business school 40 years ago. The baldness of the Government's confidence that their measures will have a particular long-term effect has driven me back this month to the academic literature, even if a fair amount of the latter comes from those modern seats of earning, the business schools.
      I have also studied the 1994 Select Committee on Trade and Industry report on the competitiveness of UK manufacturing and industry. Interestingly, there were many fewer and much briefer recommendations in the chapter on the City and industry than in some of the other chapters, but it will not surprise the Committee if I recount that there were charges of short-termism, to which the hon. Member for Croydon, Central referred.
      The Procrustean circumstances of the abbreviated and accelerated procedures in the Bill have still allowed me to read "Short-termism on Trial" by Professor Paul Marsh of the London business school, which was published by the Institutional Fund Managers Association, which is regularly quoted in the Select Committee's report, but which effectively finds the City not guilty of the charge as made.
      I fear that, due to the accelerated procedures on the Bill, I have not been able to get hold of Mr. David Miles's "Testing for Short-Termism in the UK Stock Market", published in 1992 as Bank of England working paper series No. 4. I am sorry for that failure, but I blame the Government's business managers more than me. It is an omission, because, in paragraph 174 of the Select Committee's report, the argument over whether share prices properly reflected the value of long-term investment is primarily underpinned by Mr. Miles's study. I have already confessed that I have not had the opportunity to read it, but I have been advised that the working paper does not comprehensively underpin the conclusion that the Select Committee drew from it.
      Interestingly, one immediate consequence of the Government's actions has been to drive funds out of manufacturing equities and into property, as the hon. Member for Dudley, North (Mr. Cranston) conceded.

      481
      I hope that the Economic Secretary will say why the Government are so confident about the effects of their measure. In particular, if the Government are wrong, the national price will be heavy.
      My anxieties are compounded by the relative unfamiliarity of Ministers with their briefing under pressure. The words of the Financial Secretary have been quoted by my right hon. Friend the Member for Wells (Mr. Heathcoat-Amory) and others during the debate. My suspicion is that the Financial Secretary did not expand on the simple words she used because she would have got herself into deeper and unfamiliar water.
      Even the Economic Secretary startled me when she was being cross-examined by Mr. James Naughtie on the "Today" programme on the subject of personal pensions in the context of this clause. She suddenly threw in the fact that pension funds were in surplus—which had nothing to do with the immediate price of eggs, in answer to the question asked by Mr. Naughtie.
      Mrs. Liddell: I am surprised at the right hon. Gentleman's ungraciousness. I have always listened closely to his speeches. The point that I made specifically to Mr. Naughtie related to occupational pension schemes, which are a critical part of the mix in resolving pensions misselling. That is why I was discussing funds in surplus and the ability to rectify pensions misselling. I cannot believe that the right hon. Gentleman is comfortable in his soul with the way that the previous Conservative Government, in which he served, behaved on pensions misselling.
      Mr. Brooke: The Economic Secretary is entitled to come back on such points, but the fact remains that she was deciding the agenda with Mr. Naughtie. She switched the argument to a subject on which she felt she was on safer ground—she was not responding to the question that he specifically asked her. [Interruption.] We can readily examine the transcript.
      I am struck by the Government's confidence that companies that retain their earnings will do better. The Government are stripping the windfall tax from companies where investment is requested and regarded as important. Some Minister—I cannot remember who—said that the utilities could afford to pay the windfall tax out of their borrowings. I am struck by the difference between that use of borrowing and the Chancellor's golden rule, as expressed in the Budget, on what borrowing should be used for, at least in the public sector. I am left with the sense that the man in Whitehall knows best.
      There is reasonable agreement that one effect will be to make final salary schemes less attractive and therefore drive people into money payment schemes. The irony is that those investing in money payment schemes are themselves penalised by the arrangements. I have never been enamoured of the phrase "double whammy", but the consequence of the Government's actions appears to be one. I suspect that the issues of short-termism and long-termism are ones that we will revisit in this Parliament. I hope that in the future, including tonight, the Government will afford us more argument and less asseveration than we have had so far.
      Mr. Vernon Coaker: It is remarkable to be attending the Committee stage of the Finance Bill and to
      482
      hear Conservative Members pretend to be the friends of pensioners. During the recent election campaign, we discovered that pensioners were concerned about their circumstances and their prospects.
      The Conservative party is portraying itself as the friend not only of today's pensioners but of future pensioners. However, the previous Administration's record—Conservative Members want nothing to do with that—show exactly what Conservative Members did for tomorrow's pensioners. Since 1979, the number of active members in occupational pension schemes has fallen. Moreover, hundreds of thousands of people were encouraged to leave occupational pension schemes and to take out personal pension schemes, for which many of them are still awaiting compensation.
      Nevertheless, Conservative Members say that they represent future pensioners. Where were Conservative Members when pensions were being missold?
      9.15 pm
      Mr. Shaun Woodward: Here we go again.
      Mr. Coaker: The hon. Gentleman says that, but why should today's or tomorrow's pensioners trust Conservative Members, who failed so miserably in their obligation and responsibility to help pensioners when they had the power to do so? Conservative Members will have to answer that question.
      Conservative Members have offered idle speculation on the consequences of the Budget's tax reforms and talked about Labour's scaremongers—but who are the scaremongers?
      Lorna Fitzsimons: Does my hon. Friend agree that Opposition Members would not be scaremongering if they genuinely cared—as they profess to do—about pensioners? Conservative Members had 18 years in which to prove in deed and in word that they cared about pensioners, whereas VAT on fuel is a testament to their hypocrisy. Do you therefore agree that Conservative Members are shedding crocodile tears and are more in favour of pension funds?
      The Chairman of Ways and Means (Sir Alan Haselhurst): Order. The hon. Lady is not conducting a conversation with one of her colleagues; she is addressing the Chair.
      Mr. Coaker: I thank my hon. Friend for her intervention, because she has made point that I was trying to make. When Conservative Members were in power, they did nothing to protect future pensioners. As she said, now that we have a Government who are determined to take action for the benefit of the entire community, Conservative Members disagree and offer idle speculation to frighten people and to undermine the Government's proposals.
      Much of the basis of the argument offered by Conservative Members reminds me of my time at university, when I was studying economics. Our economics lecturer stood in front of the class and drew models, saying, "If you keep this, this and this the same, the outcome will be that." We asked what would happen if we changed one part of the formula, and he said, "You can't change one of the variables, because that would

      483
      spoil it." Conservative Members refuse to accept the Government's argument that the value of pension funds is determined not only by the amount of money paid into them but by many other variables.
      My hon. Friend the Economic Secretary to the Treasury has said in this debate that pension fund values are determined not only by the income paid into them but by economic confidence and growth and generally by how people feel about the economy. All those factors will affect pension fund values and prospects.
      If Conservative Members want to lower pension fund values, they should continue talking down pension funds and trying to undermine economic confidence. Future pension fund values, on which so many workers rely, will be affected by such activities.
      Like all my hon. Friends, I support the Government's measures. They are designed to encourage investment and to do something to tackle the blight that we see all around us. We have a new Government, and it is incumbent on Conservative Members to remember that the new Government have different priorities and are determined to do things differently.
      The tax changes outlined in the Budget, including the ACT proposals, are part of a package that aims to serve the whole community and put people back to work. It is about investment in the economy and about rewarding that investment rather than rewarding speculative gain.
      Finally, I remind hon. Members that what the Labour party promised during the election campaign, and what the Labour Government are now delivering, is a fairer tax system which encourages and rewards investment and which, through that investment, generates a fairer society in which there are opportunities for all.
      Mr. Woodward: You may not be surprised to hear, Sir Alan, that I do not intend to take up the invitation issued by the hon. Member for Gedling (Mr. Coaker) to share his views.
      I believe that clause 19 should be withdrawn. It goes hand in hand with a Budget which is, by and large, full of carelessness and broken promises, although I admit that in that respect this clause is something of a surprise. Throughout the election, and in the run-up to it, we were treated to a series of promises by the Prime Minister and the Chancellor of the Exchequer. They told us, quite fairly, that there would be windfall tax, and we can find it in their deliciously framed manifesto and prospectus. When pressed on whether there would be other tax increases, the answer was, "Absolutely not—we have declared all our taxes and you will find in our manifesto everything we will do."
      In the Chamber on Tuesday, however, my hon. and learned Friend the Member for Harborough (Mr. Garnier) repeatedly pressed the Financial Secretary to assist him in his inquiries, trying to find a reference in the Labour party's prospectus to the abolition of the ACT credit for pension funds. The Financial Secretary seemed to be having some difficulty answering his question. I believe that the Financial Secretary did not answer his question. Indeed, I would go so far as to suggest that she probably could not answer his question, because there is no such proposal in the Labour party manifesto—if there is, I shall be more than happy to give way to the Economic Secretary so that she can tell me where I can find it.
      484
      Out of nowhere, the Labour party will produce a bonanza to fund its spending programme by abolishing the ACT credit. The aim is, of course, laudable. There cannot be one hon. Member who does not think that one of the most important tasks of anyone in politics is to create employment—[Interruption.] I am sorry to see the hon. Member for Dudley, South (Mr. Pearson) shaking his head as I suggest that our task should be to create employment. He could learn a few lessons by looking back at what the previous Government did to create employment.
      Every other European country has rising unemployment but, just today, we have celebrated yet another fall in unemployment because of Conservative policies of the past few years. Those policies have created real jobs, not phoney or subsidised jobs that will disappear when the subsidy goes. If the hon. Gentleman wants to learn how to create real jobs, I suggest that he looks hard at the work of the past few years.
      Mr. Geraint Davies: Will the hon. Gentleman accept that only one in six of the new jobs created in the final year of his party's failed Government were full-time jobs and that the rest offered poorly paid, part-time or temporary work which was inherently insecure and in which, in many instances, people were stripped of their pension rights and other benefits? Those are not real jobs—they are bogus jobs.
      Mr. Woodward: The hon. Gentleman asked me simply whether I agree. No, I do not.
      The aim of the clause—welfare to work—is laudable, but the means are crude.
      Mr. Stringer: Will the hon. Gentleman give way?
      Mr. Woodward: No, I shall not give way for the moment. At best, the clause is careless; worse than that, I believe that it will produce instability in the economy, depriving it of investment and creating uncertainty—not just for the pensions industry, where there is huge uncertainty as a result of the Budget, but for pensioners. I am sure that hon. Members on both sides agree that one of our most important tasks is to provide certainty for people in their old age and as they approach old age. I hope that Labour Members agree that the building up of more than £650 billion of pension funds in the United Kingdom—whomever we give the credit to—is a considerable achievement and reflects well on the country.
      Mr. Davies: The hon. Gentleman has just asserted that the best prize that we could give the British public is certainty. Is it not the case that the only certainty that the previous Government brought was uncertainty? All that we saw was a cycle of boom and bust: in the housing market, in recession and unemployment—the list goes on. The Budget will bring about stability, certainty, long-term investment, security, wealth, prosperity and fairness for the British people for the new millennium.
      Mr. Woodward: The hon. Gentleman will not be surprised that, yet again. I do not agree with him. I am sorry to disagree with him, but I am afraid that I have to.
      There was huge uncertainty a week before the election when the right hon. Member for Sedgefield (Mr. Blair) went around the country terrifying pensioners. He ran

      485
      around saying that the Tories were going to scrap the basic state pension. He was challenged for evidence. Did he find it? No, yet he went on repeating the scare. I do not believe that anybody should scaremonger and frighten old people for the sake of it. The Conservatives want to talk about the clause in detail because, most of all, we want proper consultation before such measures are taken.
      It is ironic that the right hon. Member for Sedgefield made those claims about the future of pension. We have a Labour Government—
      Mr. Davies: Will the hon. Gentleman give way?
      Mr. Woodward: No, I will not give way. I have given way to the hon. Gentleman twice.
      The Government are robbing not the few, but the many. The only equitable aspect of this careless tax is that it will hit every fund and everyone. Sooner or later we shall all, like Mother Hubbard, find ourselves going to the cupboard only to find it bare—emptied by the Labour Government as they look for every opportunity to take money from success.
      The accountancy firm Kidson Impey said of the Chancellor in The Independent on 3 July:
      "What he's really done is to steal from every person and business who pays into a pension."
      The chairman of the Association of Consulting Actuaries, which represents pension fund consultants, said that abolishing the ACT credit would lead some companies, especially small companies, to abandon sponsorship of occupational pension schemes. He said:
      "Any employer considering introducing or extending occupational pensions may now be dissuaded from doing so."
      He went on:
      "This move is in direct opposition to the Government's stated aim of increasing private funded pensions to reduce reliance on the state."
      Mr. Ivor Caplin: Will the hon. Gentleman address the important issue of pension holidays? I have heard nothing so far in the hon. Gentleman's eight minutes—or from any of his Conservative colleagues—about the massive pension holidays that took place. That money could have been reinvested to benefit pensioners, but no, the companies had the right to pension holidays.
      9.30 pm
      Mr. Woodward:The hon. Gentleman is obviously excited about what I have said and what might be coming in my speech. He will indeed find that I shall refer to other matters concerning pensions.
      Firm after firm report that this careless clause is damaging and vindictive. It is planned for short-term gain but will do long-term harm. Just at the time when Britain is emerging as Europe's most successful country in building up pension provision, along comes the Chancellor and whack—he raids the kitty.
      To be charitable, the Government—or some Ministers—may not have not quite understood the impact. Obviously, the Financial Secretary to the Treasury does not quite understand. On 3 July, she told us:
      486
      "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."
      Hon. Members may be forgiven for being a trifle nervous about the hon. Lady having such responsibility, given her failure to comprehend not how good the measure is for pensions but just how bad it is for them. I will give some examples of how bad it is.
      ICI says that the cost of the shortfall to its company alone will be tens of millions of pounds. The Post Office fund reckons that the cost of abolition is some £130 million. To take an individual—Labour Members spend a great deal of time talking and thinking about individuals—a 35-year-old who has accumulated a fund of £20,000 on contributions of £1,000 a year will now pay an extra £315.10 a year to make up the shortfall. That is an extra £26.26 a month. Is that good or bad? The Financial Secretary says that the measure is good for pensioners, but to me that extra cost does not seem all that good.
      Chantrey Vellacott has shown that, on average, the 19 million members of company or personal pension schemes—probably even more members than there are of the Prime Minister's fancy club in Sedgefield—will require an average increase in contributions of £190 a year. Is that good or bad? It is bad.
      Sir Teddy Taylor: Is my hon. Friend aware of the huge problems and worries facing local councils such as Essex county council, which has found and announced only yesterday that it will have to spend several millions of pounds extra on cut services? Is it not rather silly to engage in politics when real problems are facing real councils in providing real services to people, including pensioners and poor people? Would it not be better to stop talking politics and realise that local councils are facing huge problems due to this silly scheme?
      Mr. Woodward: My hon. Friend is of course correct and makes a very important point. It is a great shame that Labour Members, in their precipitate haste to hit the ground running, have not considered the impact of the measure on local authorities.
      I find the Financial Secretary's conclusion that the Budget will be good for pensioners extraordinary. It demonstrates a fundamental lack of understanding of the economics of the pensions industry and a careless disregard for pensioners themselves.
      Mr. Caplin: That is rubbish.
      Mr. Woodward: I am sorry that the hon. Gentleman thinks that that is rubbish. Pensioners will not think so in years to come when they find that the money that they thought was there is not there because the hon. Gentleman's party has raided the store.
      Lorna Fitzsimons: Will the hon. Gentleman give way?
      Mr. Woodward: I will not.
      As individuals up and down the country start to calculate just how much money Labour is robbing from their pockets for the future, they will seek out those responsible and those who patronisingly told them, as the Financial Secretary did:

      487
      "The measure is good for pensions and pensioners, not bad for them."
      The Financial Secretary of course has a defence. She said:
      "the existence of pension fund contribution holidays demonstrates that there is scope to absorb the measure."—[Official Report, 3 July 1997; Vol. 297, c. 507.]
      If we look at the figures, however, as my right hon. Friend the Member for Wells (Mr. Heathcoat-Amory) did earlier in the debate, we see that three quarters of UK pension schemes are money purchase schemes. They have no surplus. Unfunded, final salary schemes such as the civil service and health pension schemes also have no surplus. Just like the smash and grab raid on the utilities, with the tax on water, gas and electricity, Labour now turns to rob the pensioners. The Chancellor called the Budget a people's Budget. Does he not realise that pension fund money is the people's money?
      Lorna Fitzsimons: The hon. Gentleman mentioned certainty for pensioners, and we agree with the need for that, so would he care to comment on the lack of certainty that 18 years of Tory government gave to those people who relied on the constant value of the state earnings-related pension scheme? It was halved in those 18 years, when the Tory Government had responsibility for establishing the certainty that the hon. Gentleman thinks is so important for pensioners.
      Mr. Woodward: The hon. Lady knows full well that, after those 18 years, pensioners were considerably better off than they were when we took office. We should remember that when Labour was last in government it froze the state pension for two years in a row. This time, within eight weeks, it is taking more money from pensioners.
      Lorna Fitzsimons: Will the hon. Gentleman give way again?
      Mr. Woodward: I will not.
      The Financial Secretary believes that there is a lot of surplus about. There may be a lot about, but why? It is because the Conservative Government created financial conditions under which companies in Britain could do well, and British pension funds have done well.
      What do we see now that the Labour party is in government? We see old Labour. Its attitude is, "If it's successful, tax it." Its motto, amply demonstrated in the Budget, is, "If it is a company that should succeed, tax, tax and tax again." As a result, millions of pensioners will be markedly damaged by the tax on savings and investment.
      Much has been made by Labour Members, including the hon. Members for Manchester, Blackley (Mr. Stringer) and for Croydon, Central (Mr. Davies), about investment in research and development, but this is not a Budget for investment. The National Association of Pension Funds has said:
      "companies which pay dividends are more likely to invest in research and development. The research and development of dividend-paying companies is also significantly higher than that of non-dividend paying companies."
      The idea that UK companies sacrifice research investment in favour of excessive dividend payments should be set aside in the face of that research, unless Labour Members wish to dismiss the work of the National Association of Pension Funds.
      488
      The measure will take an extra £50 billion of pension contributions in the next 10 years—money that would otherwise have gone into research and development, investment and creating real jobs, not subsidised employment schemes that will end when the subsidy goes. Far from allowing more money for investment, the measure will hit companies hard. Companies with final salary pension funds will increasingly be required to find additional contributions from businesses, further diverting funds from investment. That will be the case for funds that are not now in surplus and, in the longer term, in most cases as fund surpluses are used up.
      The clause is short-termism run amok. Labour has seen a pot of gold to fund its new culture—as Labour Members called it earlier—its new Jerusalem. With all the feather-like delicacy of a sledgehammer, Labour has smashed the pot and grabbed the gold in the hope of playing Robin Hood. However, the only Robin in this story is the robbin' of the savings of every pension fund in the land by Labour.
      We have seen the twinkle in Labour Members' eyes and their excitement as they spot the potential to raid the money from pension funds, but the tax has all the properties of a Paul Daniels magic show. Like the magic candle on a child's cake, no sooner have they robbed the funds of £5 billion one year than they will rob them of £5 billion the next. The Labour Government are clearly exposed as serial raiders, but they will discover themselves to be false raiders.
      The money is set aside for real long-term investment, a subject about which Labour Members do not care, understand or worry about much. In words and rhetoric, in manifestos, prospectuses and little handouts for the Budget, they care—but as we have seen so ably demonstrated in the Budget and in this specific clause, they do not understand the substance.
      When the Labour Government came to power, they said that they would hit the ground running. The only thing that the Government have proved that they will hit running are the elderly. The brutal raid on the pension funds will cause lasting damage to our economy.
      Is it not ironic that, wherever they turn, the Government say, "Let's have a review"? Wherever they move, they say, "Let's have a working party." But on this one issue, was there a working party? Was there a review? Was it in their manifesto? No. Why not? Why no consultation? Why no mention in the manifesto? The Association of British Insurers has sensibly called on the Chancellor to put the proposal into abeyance pending consultation. The association has rightly pointed out that it is a major change to taxation policy in the corporate sector. It is a significant change in taxation in our country. What is to be lost by proper consultation? The Government believe in reviews and in working parties, so why is there no working party on the proposed change? Why is there no review?
      The clause abolishing the ACT credit is full of potential problems. One cannot ignore the advice from all the bodies in the City that have built up successful funds. To do so is wilfully negligent.

      489
      In closing, I ask the hon. Lady to bear in mind the request—not from Conservative Members, but from those who have successfully created pension funds—to put the proposal into abeyance until full consultation has taken place.
      Mrs. Liddell: I am glad to have the opportunity to respond to the debate. I should tell the hon. Member for Witney (Mr. Woodward) that the Carnegie medal for children's literature was awarded today. I get the impression that that is what his contribution was aimed at achieving. Given that he is a former director of communications for the Conservative party, he has obviously made a career out of saying things that he does not believe.
      There has been a more mature debate this evening than we have had on previous evenings. Perhaps the playmates are engaged elsewhere, but we may see them before 10 o'clock.
      There has been a brittleness about some of the contributions of distinguished Conservative Members. I am thinking in particular of the shadow Chief Secretary to the Treasury, the right hon. Member for Wells (Mr. Heathcoat-Amory), and the right hon. Member for Cities of London and Westminster (Mr. Brooke), both of whom are distinguished Members in their own right. I recognise that I am a junior Member and it is not for me to criticise, but I have to admit that I feel that there is still an inability to come to terms with the scale of the defeat that the Conservative party suffered on 1 May. I was surprised at some of the remarks that were made.
      I shall deal with the points raised by the shadow Chief Secretary—[Interruption.] I see that some more hon. Members have joined us. That adds to the atmosphere in the Chamber. The right hon. Gentleman referred to "The Pocket Budget". In another context, the word "sophistry" was used—and it was the word that came to mind in the middle of his speech. I shall return to that in detail later.
      If we look at the substance of the clause, we see that its purpose is to take away pension funds' ability to obtain payment of a tax credit, with effect from 2 July. That is part of a two-stage process under which payable tax credits will be removed from the tax system in April 1999.
      As I said at the beginning of the stand part debate, the purpose of the change is to remove a damaging distortion from the system while reducing levels of corporation tax. Several Opposition Members have referred to Labour saving up for a spending wheeze in the future. What utter nonsense. The move is part of a Budget that has significantly reduced corporation tax, permitting a better climate for business. I shall develop that idea later, when I talk about what was said by the right hon. Member for Cities of London and Westminster.
      9.45 pm
      My hon. Friend the Member for Dudley, North (Mr. Cranston) referred to the imputation system. As my hon. Friend pointed out, the tax credit system is designed to mitigate the double taxation of distributed company profits—once at the company level and again in the hands of the shareholder. That is what the system does, continues to do and will still do after the 1999 changes.
      490
      However, the old system that we seek to change went further. Some shareholders, such as pension funds, could claim payment of the tax credit. That means that the system did more than relieve double taxation; it effectively reduced the rate on company profits when those profits were distributed. That meant, among other things, that there was an incentive to invest in companies that distributed a high proportion of their profits rather than in those that reinvested profits to build up their capital.
      The right hon. Member for Cities of London and Westminster talked about his time some years ago at the Harvard business school. I wish that I had had the opportunity to study there, but I shall refer him further back, to the days of the industrial revolution.
      After the industrial revolution, there was a decline in Britain's industrial performance because subsequent generations did not reinvest their profits. Basically, the present change is designed to create a climate in which companies can again, of their own volition, through decisions based on their own judgment, reinvest their profits.
      We have heard numerous references to short-termism, but most graphically and eloquently from my hon. Friend the Member for Pontefract and Castleford (Yvette Cooper). The climate of short-termism has been the cause of considerable concern to people in British business.
      The right hon. Member for Cities of London and Westminster, as a defender of the City of London—in my role as Economic Secretary I, too, have cause to defend the City—says that it does not necessarily breed short-termism. I must tell him that the pressure on companies to maximise dividend payments and the pressure that the tax system puts on them to distribute their profits in payments to pension funds breed a forced short-termism in the performance of company executives and boards. That in itself is a significant distortion.
      The right hon. Member for Wells said that £5 billion would be lost to pension funds. His figures are wrong. The figure that I have is about £3.6 billion. I think that the right hon. Gentleman may have taken into account shareholders' dividends, some of which are not distributed in the United Kingdom, at the same time. That is the only conclusion that I can draw from the figures he used.
      The right hon. Gentleman's peroration was not in character, as he is said to have a reputation for intellectual honesty. I can only conclude that, for want of a better argument, he has stooped to trying to frighten people who are saving for their pensions. That is especially offensive, in view of the misselling of pensions that took place on such a massive scale, without correction, during the life of the Government of which he was for so long a member.
      It is important that pensioners have a clear view of exactly what the proposals are. The previous Government made a similar change in 1993, reducing the rate of tax credit from 25 per cent. to 20 per cent. Last year, they took action against some of the more blatant exploitation encouraged by the distortion of payable tax credits by removing them from share buy-backs and certain special dividends.

      491
      I am tempted again to refer to the remarks made by the right hon. Member for Hitchin and Harpenden (Mr. Lilley), who pointed out that the Government had sought to raise revenue in a way that did the least economic damage, but I will resist the temptation to develop that point. The previous Government did not use any of the money that was raised to cut the rate of corporation tax, as we have done.
      The hon. Member for Gordon (Mr. Bruce) asked why we were making the change now: it is because, according to the Government Actuary's assessments, many pension funds are in surplus by as much as £50 billion. In combination with the current high level of the stock market, that means that there is a much greater opportunity for funds to absorb the change without any great difficulty.
      Mr. Swinney: Will the Economic Secretary give way?
      Mrs. Liddell: I shall give way to the hon. Gentleman in a second, because I know that he did not get a chance to contribute to the debate.
      I reiterate the point that pension funds should benefit substantially from the improvement in company performance as a result of the Budget.
      Mr. Swinney: I am grateful to the Economic Secretary for giving way. There is undeniably a surplus in many pension funds. Can she give the Committee a guarantee that there are no solvency questions over any pension funds that may be affected by the proposed change?
      Mrs. Liddell: I believe that the hon. Gentleman is referring to the minimum funding requirement for pension funds. The vast majority of funds are comfortably above that, and my right hon. Friend the Secretary of State for Social Security keeps a close watch on such matters, so we are alert to any possible problems.
      The Government did not take the decision on the abolition of tax credits lightly. Several references have been made to our election manifesto. I am sure that Conservative Members have copies of it—indeed, I can see that the hon. Member for Witney has one in front of him—and if they would care to turn to page 13, they will see that the penultimate paragraph says:
      "We will review the corporate and capital gains tax regimes to see how the tax system can promote greater long-term investment."
      That is a clear sign of the Government's intention, which was flagged up two years before the general election by my right hon. Friend who is now Chancellor of the Exchequer.
      The hon. Member for Gordon spoke of the possibility of compensating adjustments in the comprehensive review of pensions. It is not my place to refer to what the Under-Secretary of State for Social Security, my hon. Friend the Member for Southampton, Itchen (Mr. Denham) is doing in that comprehensive, long-term review. I am sure that hon. Members in all parties will acknowledge that it could not be in better hands.
      492
      Announcements will be made in due course. I am grateful to the hon. Member for Gordon for acknowledging that the Government have valid arguments.
      My hon. Friend the Member for Dudley, North made a good point about how pension funds are valued, which is an area of considerable debate both here and internationally. As he said, valuation is often by reference to discounted cash flow. A number of commentators—not least in the press today, as a consequence of the Office of Fair Trading report—have said that that method is outdated. Indeed, in the United States, much more regard is given to share values.
      A number of companies are considering, with their fund actuaries, whether the basis of valuation should be changed. There is certainly an argument. The time has come for companies to consider seriously the basis of valuation.
      The hon. Member for Bognor Regis and Littlehampton (Mr. Gibb) referred to the tax privileges of pension schemes. Whenever I intervened to ask him whether he had referred in his manifesto to cutting tax relief on employee contributions, he seemed confused about what I was getting at. The party of which he is a member—indeed, the previous Government—was going to cut the tax relief on employee contributions to occupational pension schemes. My right hon. Friend the Chancellor of the Exchequer said clearly during his Budget statement that this Government will not proceed with that move because we believe that it was a wrong decision on the part of the previous Government.
      The hon. Member for Bognor Regis and Littlehampton also referred to the fact that pension funds are tax vehicles. Pension funds' tax exemptions have always been limited and there is a good reason for that. For example, they have never been tax exempt on trading income or other income from investments or deposits. If funds have excessive surpluses, they are also taxable on excess income. They are not, however, being taxed on dividends. We are stopping a subsidy received from the Exchequer.
      On a number of occasions this evening we have discussed pensions misselling. I do not contend that it can possibly be right that the victims of pension misselling should, by their own tax payments, be subsidising pension funds. They really are caught in what the right hon. Member for Cities of London and Westminster described as a double whammy.
      The hon. Member for Bognor Regis and Littlehampton also made a number of points about the Red Book. It allows for extra pension contributions by companies because that affects the yield from corporation tax. Local authorities do not pay tax, so there is no similar need to refer to them on page 46 of the Red Book.
      Mr. Gibb rose—
      Mrs. Liddell: I shall give way if the hon. Gentleman will be brief. I am conscious of the time.
      Mr. Gibb: I realise that, but the point is that if the Government have made an allowance for companies to pay higher contributions into their pension funds, why have they not somewhere else in the Red Book, on the

      493
      expenditure side, made allowance for the fact that local authorities will have to make extra contributions to their pension funds?
      Mrs. Liddell: I refer the hon. Gentleman to the debate on local authorities that we had about two hours ago. I do not want to go over that ground at the moment, because I am anxious to answer the other points raised by Opposition Members.
      The right hon. Member for Cities of London and Westminster made claims about windfall tax damage. As my hon. Friend the Paymaster General made clear in a number of debates on the Budget and the Finance Bill, the Government believe that liable companies can find the means to pay the windfall tax without needing to curtail investment.
      To return to the general point that the Government and I have made throughout this debate, our purpose in the clause is to remove a significant distortion. We want to create the sort of system in which companies, particularly those that might be involved in investments that do not necessarily have a high return at the beginning, for example in new technology or research and development, can fund those investments from their own resources. That is a sound way for companies to make their business grow.
      In effect, that is what lies at the heart of the change that the Government are introducing in the Bill. We are committed to ensuring that, as Britain enters the 21st century, our companies have the revenue that will allow them to invest for the long term. That is one of the reasons we have reduced the level of corporation tax from 33 to 31 per cent., and from 23 to 21 per cent. for small companies. We want to move away from short-termism, a move that will benefit business generally. I commend the clause to the House.
      Question put, That the clause stand part of the Bill:—
      The Committee divided: Ayes 334, Noes 182.

      Division No. 61]

      [9.59 pm

      AYES

      Abbott, Ms Diane

      Blears, Ms Hazel

      Adams, Mrs Irene (Paisley N)

      Blizzard, Bob

      Ainger, Nick

      Blunkett, Rt Hon David

      Ainsworth, Robert (Cov'try NE)

      Boateng, Paul

      Allen, Graham (Nottingham N)

      Borrow, David

      Anderson, Janet (Rossendale)

      Bradley, Keith (Withington)

      Armstrong, Ms Hilary

      Bradshaw, Ben

      Ashton, Joe

      Brinton, Mrs Helen

      Atkins, Charlotte

      Brown, Rt Hon Nick (Newcastle E)

      Austin, John

      Brown, Russell (Dumfries)

      Banks, Tony

      Browne, Desmond (Kilmarnock)

      Barnes, Harry

      Buck, Ms Karen

      Barron, Kevin

      Burden, Richard

      Battle, John

      Burgon, Colin

      Beard, Nigel

      Butler, Christine

      Beckett, Rt Hon Mrs Margaret

      Byers, Stephen

      Bell, Stuart (Middlesbrough)

      Caborn, Richard

      Benn, Rt Hon Tony

      Campbell, Alan (Tynemouth)

      Bennett, Andrew F

      Campbell, Mrs Anne (C'bridge)

      Benton, Joe

      Campbell, Ronnie (Blyth V)

      Best, Harold

      Campbell-Savours, Dale

      Betts, Clive

      Canavan, Dennis

      Blackman, Liz

      Cann, Jamie

      494

      Caplin, Ivor

      Gerrard, Neil

      Casale, Roger

      Gibson, Dr lan

      Caton, Martin

      Gilroy, Mrs Linda

      Cawsey, lan

      Goggins, Paul

      Chapman, Ben (Wirral S)

      Golding, Mrs Llin

      Chaytor, David

      Gordon, Mrs Eileen

      Chisholm, Malcolm

      Graham, Thomas

      Clapham, Michael

      Griffiths, Jane (Reading E)

      Clark, Dr Lynda (Edinburgh Pentlands)

      Griffiths, Nigel (Edinburgh S)

      Griffiths, Win (Bridgend)

      Clark, Paul (Gillingham)

      Grocott, Bruce

      Clarke, Charles (Norwich S)

      Grogan, John

      Clarke, Eric (Midlothian)

      Gunnell, John

      Clarke, Rt Hon Tom (Coatbridge)

      Hall, Mike (Weaver Vale)

      Clarke, Tony (Northampton S)

      Hall, Patrick (Bedford)

      Clelland, David

      Hamilton, Fabian (Leeds NE)

      Coaker, Vernon

      Hanson, David

      Coffey, Ms Ann

      Harman, Rt Hon Ms Harriet

      Cohen, Harry

      Heal, Mrs Sylvia

      Coleman, Iain (Hammersmith)

      Henderson, Doug (Newcastle N)

      Colman, Tony (Putney)

      Henderson, Ivan (Harwich)

      Connarty, Michael

      Heppell, John

      Cook, Frank (Stockton N)

      Hesford, Stephen

      Cooper, Yvette

      Hewitt, Ms Patricia

      Corbett, Robin

      Hill, Keith

      Corbyn, Jeremy

      Hinchliffe, David

      Corston, Ms Jean

      Hoey, Kate

      Cousins, Jim

      Home Robertson, John

      Cox, Tom

      Hood, Jimmy

      Cranston, Ross

      Hoon, Geoffrey

      Crausby, David

      Hope, Phil

      Cryer, Mrs Ann (Keighley)

      Hopkins, Kelvin

      Cryer, John (Hornchurch)

      Howartti, George (Knowsley N)

      Cummings, John

      Howells, Dr Kim

      Cunningham, Jim (Cov'try S)

      Hoyle, Lindsay

      Cunningham, Rt Hon Dr John (Copeland)

      Hughes, Kevin (Doncaster N)

      Hurst, Alan

      Curtis-Thomas, Mrs Claire

      Hutton, John

      Dalyell, Tam

      Iddon, Dr Brian

      Darling, Rt Hon Alistair

      Illsley, Eric

      Darvill, Keith

      Ingram, Adam

      Davey, Valerie (Bristol W)

      Jackson, Ms Glenda (Hampstead)

      Davies, Rt Hon Denzil (Llanelli)

      Jackson, Helen (Hillsborough)

      Davies, Geraint (Croydon C)

      Jenkins, Brian (Tamworth)

      Davies, Rt Hon Ron (Caerphilly)

      Jones, Barry (Alyn & Deeside)

      Davis, Terry (B'ham Hodge H)

      Jones, Ms Fiona (Newark)

      Dawson, Hilton

      Jones, Helen (Warrington N)

      Dean, Mrs Janet

      Jones, Ms Jenny (Wolverh'ton SW)

      Dewar, Rt Hon Donald

      Donohoe, Brian H

      Jones, Jon Owen (Cardiff C)

      Doran, Frank

      Jones, Dr Lynne (Selly Oak)

      Dowd, Jim

      Kaufman, Rt Hon Gerald

      Drew, David

      Keeble, Ms Sally

      Drown, Ms Julia

      Keen, Alan (Feltham & Heston)

      Dunwoody, Mrs Gwyneth

      Keen, Mrs Ann (Brentford)

      Eagle, Angela (Wallasey)

      Kemp, Fraser

      Eagle, Maria (L'pool Garston)

      Kennedy, Jane (Wavertree)

      Efford, Clive

      Khabra, Piara S

      Ellman, Ms Louise

      Kidney, David

      Ennis, Jeff

      Kilfoyle, Peter

      Etherington, Bill

      King, Andy (Rugby & Kenilworth)

      Fatchett, Derek

      King, Ms Oona (Bethnal Green)

      Field, Rt Hon Frank

      Ladyman, Dr Stephen

      Fisher, Mark

      Lawrence, Ms Jackie

      Fitzpatrick, Jim

      Laxton, Bob

      Fitzsimons, Lorna

      Lepper, David

      Flynn, Paul

      Leslie, Christopher

      Foster, Rt Hon Derek

      Lewis, Ivan (Bury S)

      Foster, Michael Jabez (Hastings)

      Liddell, Mrs Helen

      Foster, Michael John (Worcester)

      Linton, Martin

      Foulkes, George

      Livingstone, Ken

      Galbraith, Sam

      Lloyd, Tony (Manchester C)

      Galloway, George

      Lock, David

      Gapes, Mike

      Love, Andrew

      Gardiner, Barry

      McAllion, John

      George, Bruce (Walsall S)

      McAvoy, Thomas

      495

      McCafferty, Ms Chris

      Ruddock, Ms Joan

      McCartney, lan (Makerfield)

      Russell, Ms Christine (Chester)

      McDonagh, Siobhain

      Sawford, Phil

      Macdonald, Calum

      Sedgemore, Brian

      McDonnell, John

      Shaw, Jonathan

      McGuire, Mrs Anne

      Sheerman, Barry

      McIsaac, Shona

      Sheldon, Rt Hon Robert

      Mackinlay, Andrew

      Shipley, Ms Debra

      McNulty, Tony

      Short, Rt Hon Clare

      MacShane, Denis

      Simpson, Alan (Nottingham S)

      Mactaggart, Fiona

      Singh, Marsha

      McWalter, Tony

      Skinner, Dennis

      Mahon, Mrs Alice

      Smith, Rt Hon Andrew (Oxford E)

      Mallaber, Judy

      Smith, Angela (Basildon)

      Mandelson, Peter

      Smith, Rt Hon Chris (Islington S)

      Marek, Dr John

      Smith, Miss Geraldine (Morecambe & Lunesdale)

      Marsden, Gordon (Blackpool S)

      Marshall, David (Shettleston)

      Smith, Jacqui (Redditch)

      Marshall, Jim (Leicester S)

      Smith, John (Glamorgan)

      Marshall-Andrews, Robert

      Smith, Llew (Blaenau Gwent)

      Maxton, John

      Snape, Peter

      Meacher, Rt Hon Michael

      Soley, Clive

      Meale, Alan

      Squire, Ms Rachel

      Michie, Bill (Shef'ld Heeley)

      Starkey, Dr Phyllis

      Milburn, Alan

      Steinberg, Gerry

      Miller, Andrew

      Stevenson, George

      Mitchell, Austin

      Stewart, David (Inverness E)

      Moffatt, Laura

      Stewart lan (Eccles)

      Moonie, Dr Lewis

      Stoate, Dr Howard

      Morgan, Ms Julie (Cardiff N)

      Stott, Roger

      Morgan, Rhodri (Cardiff W)

      Strang, Rt Hon Dr Gavin

      Morley, Elliot

      Stringer, Graham

      Morris, Ms Estate (B'ham Yardley)

      Stuart, Ms Gisela (Edgbaston)

      Mountford, Kali

      Sutcliffe, Gerry

      Mudie, George

      Taylor, Rt Hon Mrs Ann (Dewsbury)

      Mullin, Chris

      Murphy, Jim (Eastwood)

      Talyor, Ms Dari (Stockton S)

      Norris, Dan

      O'Brien, Bill (Normanton)

      Thomas Gareth (Clwyd W)

      O'Hara, Edward

      Timms, Stephen

      Olner, Bill

      Tipping, Paddy

      O'Neill, Martin

      Todd, Mark

      Organ, Mrs Diana

      Touhig, Don

      Osborne, Mrs Sandra

      Trickett, Jon

      Pearson, lan

      Truswell, Paul

      Perham, Ms Linda

      Turner, Dennis (Wolverh'ton SE)

      Pickthall, Colin

      Turner, Desmond (Kemptown)

      Pike, Peter L

      Twigg, Derek (Halton)

      Plaskitt, James

      Twigg, Stephen (Enfield)

      Pollard, Kerry

      Vaz, Keith

      Pond, Chris

      Vis, Dr Rudi

      Pope, Greg

      Walley, Ms Joan

      Pound, Stephen

      Ward, Ms Claire

      Powell, Sir Raymond

      Watts, David

      Prentice, Ms Bridget (Lewisham E)

      White, Brian

      Prentice, Gordon (Pendle)

      Whitehead, Dr Alan

      Primarolo, Dawn

      Wicks, Malcolm

      Purchase, Ken

      Williams, Rt Hon Alan (Swansea W)

      Quin, Ms Joyce

      Quinn, Lawrie (Scarborough)

      Williams, Alan W (E Carmarthen)

      Radice, Giles

      Williams, Mrs Betty (Conwy)

      Rapson, Syd

      Wills, Michael

      Raynsford, Nick

      Winnick, David

      Reed, Andrew (Loughborough)

      Winterton, Ms Rosie (Doncaster C)

      Reid, Dr John (Hamilton N)

      Wise, Audrey

      Robertson, Rt Hon George (Hamilton S)

      Worthington, Tony

      Wray, James

      Roche, Mrs Barbara

      Wright, Dr Tony (Cannock)

      Rogers, Allan

      Wright, Tony D (Gt Yarmouth)

      Rooker, Jeff

      Wyatt, Derek

      Rooney, Terry

      Ross, Ernie (Dundee W)

      Tellers for the Ayes:

      Rowlands, Ted

      Mr. John McFall and

      Roy, Frank

      Mr. David Jamieson.

      496

      NOES

      Ainsworth, Peter (E Surrey)

      Hague, Rt Hon William

      Allan, Richard (Shef'ld Hallam)

      Hamilton, Rt Hon Sir Archie

      Amess, David

      Hammond, Philip

      Ancram, Rt Hon Michael

      Hancock, Mike

      Arbuthnot, James

      Harris, Dr Evan

      Ashdown, Rt Hon Paddy

      Harvey, Nick

      Atkinson, Peter (Hexham)

      Hawkins, Nick

      Baker, Norman

      Heath, David (Somerton & Frome)

      Baldry, Tony

      Heathcoat-Amory, Rt Hon David

      Ballard, Mrs Jackie

      Horam, John

      Beggs, Roy (E Antrim)

      Howard, Rt Hon Michael

      Beith, Rt Hon A J

      Howarth, Gerald (Aldershot)

      Bercow, John

      Hughes, Simon (Southwark N)

      Blunt, Crispin

      Hunter, Andrew

      Body, Sir Richard

      Jack, Rt Hon Michael

      Boswell, Tim

      Jackson, Robert (Wantage)

      Bottomley, Peter (Worthing W)

      Jenkin, Bernard (N Essex)

      Bottomley, Rt Hon Mrs Virginia

      Johnson Smith, Rt Hon Sir Geoffrey

      Brady, Graham

      Brand, Dr Peter

      Jones, leuan Wyn (Ynys Môn)

      Brazier, Julian

      Jones, Nigel (Cheltenham)

      Breed, Colin

      Key, Robert

      Brooke, Rt Hon Peter

      King, Rt Hon Tom (Bridgwater)

      Browning, Mrs Angela

      Kirkbride, Miss Julie

      Bruce, lan (S Dorset)

      Kirkwood, Archy

      Bruce, Malcolm (Gordon)

      Laing, Mrs Eleanor

      Burns, Simon

      Leigh, Edward

      Burstow, Paul

      Letwin, Oliver

      Butterfill, John

      Lewis, Dr Julian (New Forest E)

      Campbell, Menzies (NE Fife)

      Lidington, David

      Cash, William

      Lilley, Rt Hon Peter

      Chapman, Sir Sydney (Chipping Barnet)

      Livsey, Richard

      Lloyd, Rt Hon Sir Peter (Fareham)

      Chidgey, David

      Luff, Peter

      Chope, Christopher

      Lyell, Rt Hon Sir Nicholas

      Clark, Rt Hon Alan (Kensington)

      MacGregor, Rt Hon John

      Clark, Dr Michael (Rayleigh)

      MacKay, Andrew

      Clarke, Rt Hon Kenneth (Rushcliffe)

      Maclean, Rt Hon David

      McLoughlin, Patrick

      Clifton-Brown, Geoffrey

      Malins, Humfrey

      Collins, Tim

      Maples, John

      Colvin, Michael

      Mates, Michael

      Cormack, Sir Patrick

      Mawhinney, Rt Hon Dr Brian

      Cotter, Brian

      May, Mrs Theresa

      Cran, James

      Merchant, Piers

      Curry, Rt Hon David

      Michie, Mrs Ray (Argyll & Bute)

      Davey, Edward (Kingston)

      Moore, Michael

      Davis, Rt Hon David (Haltemprice)

      Morgan, Alasdair (Galloway)

      Davies, Quentin (Grantham)

      Moss, Malcolm

      Day, Stephen

      Nicholls, Patrick

      Dorrell, Rt Hon Stephen

      Norman, Archie

      Duncan, Alan

      Öpik, Lembit

      Duncan Smith, Iain

      Ottaway, Richard

      Evans, Nigel

      Page, Richard

      Faber, David

      Paice, James

      Fabricant, Michael

      Paterson, Owen

      Fallon, Michael

      Prior, David

      Fearn, Ronnie

      Redwood, Rt Hon John

      Flight, Howard

      Rendel, David

      Forth, Rt Hon Eric

      Robathan, Andrew

      Foster, Don (Bath)

      Robertson, Laurence (Tewk'b'ry)

      Fowler, Rt Hon Sir Norman

      Roe, Mrs Marion (Broxbourne)

      Fraser, Christopher

      Ross, William (E Lond'y)

      Gale, Roger

      Rowe, Andrew (Faversham)

      Garnier, Edward

      Ruffley, David

      Gibb, Nick

      Russell, Bob (Colchester)

      Gillan, Mrs Cheryl

      St Aubyn, Nick

      Gorman, Mrs Teresa

      Sanders, Adrian

      Gorrie, Donald

      Sayeed, Jonathan

      Gray, James

      Shephard, Rt Hon Mrs Gillian

      Green, Damian

      Shepherd, Richard (Aldridge)

      Greenway, John

      Simpson, Keith (Mid-Norfolk)

      Grieve, Dominic

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

      Gummer, Rt Hon John

      Soames, Nicholas

      497

      Spelman, Mrs Caroline

      Trend, Michael

      Spicer, Sir Michael

      Tyler, Paul

      Spring, Richard

      Tyrie, Andrew

      Stanley, Rt Hon Sir John

      Viggers, Peter

      Steen, Anthony

      Wallace, James

      Streeter, Gary

      Walter, Robert

      Stunell, Andrew

      Wardle, Charles

      Swayne, Desmond

      Webb, Professor Steve

      Swinney, John

      Wells, Bowen

      Syms, Robert

      Welsh, Andrew

      Tapsell, Sir Peter

      Whitney, Sir Raymond

      Whittingdale, John

      Taylor, lan (Ester & Walton)

      Widdecombe, Rt Hon Miss Ann

      Taylor, John M (Solihull)

      Willis, Phil

      Taylor, Matthew (Truro)

      Woodward, Shaun

      Taylor, Sir Teddy

      Yeo, Tim

      Temple-Morris, Peter

      Young, Rt Hon Sir George

      Thompson, William

      Tonge, Dr Jenny

      Tellers for the Noes:

      Townend, John

      Mr. Nigel Waterson and

      Tredinnick, David

      Mr. Oliver Heald.

      Question accordingly agreed to.
      Clause 19 ordered to stand part of the Bill.
      Bill (Clauses 1, 15, 17 and 19) reported, without amendment; to lie upon the Table.

    DELEGATED LEGISLATION
    Motion made, and Question put forthwith, pursuant to Standing Order No. 118(6) (Standing Committees on Delegated Legislation),
    DELEGATED LEGISLATION

      PUBLIC HEALTH
      That the Food Protection (Emergency Prohibitions) (Paralytic Shellfish Poisoning) Order 1997 (S.I., 1997, No. 1565), dated 20th June 1997, a copy of which was laid before this House on 24th June, be approved.—[Mr. Robert Ainsworth.]
      Question agreed to.
      Motion made, and Question put forthwith, pursuant to Standing Order No. 118(6) (Standing Committees on Delegated Legislation),

      MONOPOLIES AND MERGERS
      That the draft Supply of Beer (Tied Estate) (Amendment) Order 1997, which was laid before this House on 26th June, be approved.—[Mr. Robert Ainsworth.]
      Question agreed to.
      Motion made, and Question put forthwith, pursuant to Standing Order No. 118(6) (Standing Committees on Delegated Legislation),

      NORTHERN IRELAND
      That the draft Further Education (Northern Ireland) Order 1997, which was laid before this House on 3rd July, be approved.—[Mr. Robert Ainsworth.]

      PUBLIC ADMINISTRATION
      Ordered,
      That Mr. Peter Bradley, Mr. Ronnie Campbell, Dr. Lynda Clark, Mr. Mike Hancock, Miss Melanie Johnson, Mr. Fraser Kemp, Fiona Mactaggart, Mr. Rhodri Morgan, Mr. David Ruffley, Mr. Richard Shepherd and Mr. Andrew Tyrie be members of the Select Committee on Public Administration.—[Mr. Robert Ainsworth.]
      Mr. Deputy Speaker (Mr. Michael Lord): With the leave of the House, we shall take the next three motions together.

      FOREIGN AFFAIRS
      Ordered,
      That Ms Diane Abbott, Mr. Donald Anderson, Mrs. Virginia Bottomley, Sir Peter Emery, Mr. Norman A. Godman, Mr. David Heath, Mr. Eric Illsley, Mr. Andrew Mackinlay, Mr. Ernie Ross, Mr. Ted Rowlands, Sir John Stanley and Mr. David Wilshire be members of the Foreign Affairs Committee.—[Charlotte Atkins, on behalf of the Committee of Selection.]

      HOME AFFAIRS
      Ordered,
      That Mr. Richard Allan, Mr. Robin Corbett, Mr. Ross Cranston, Mr. Douglas Hogg, Mr. Gerald Howarth, Ms Beverley Hughes, Mr. Martin Linton, Mr. Humfrey Malins, Mr. Chris Mullin, Mr. Marsha Singh and Mr. David Winnick be members of the Home Affairs Committee.—[Charlotte Atkins, on behalf of the Committee of Selection.]

      TREASURY
      Ordered,
      That Mrs. Liz Blackman, Mr. Malcolm Bruce, Mr. Charles Clarke, Mr. Tony Colman, Mr. Jim Cousins, Mr. Quentin Davies, Ms Ruth Kelly, Sir Peter Lloyd, Mr. Giles Radice, Mr. Brian Sedgemore, Sir Michael Spicer and Sir Teddy Taylor be members of the Treasury Committee.—[Charlotte Atkins, on behalf of the Committee of Selection.]

  Prisons (Drug and Alcohol Abuse)
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. Robert Ainsworth.]
  10.17 pm
  Mr. Humfrey Malins: I am glad to have the opportunity—[Interruption.]
  Mr. Deputy Speaker (Mr. Michael Lord): Order. The hon. Member may like to wait a moment. Will hon. Members leave the Chamber as quickly and as quietly as possible?
  Mr. Malins: I am glad to have the opportunity to raise the important matter of drug and alcohol abuse in prisons. The problem gets worse by the day, and may reach crisis level unless urgent action is taken.
  I shall make two preliminary points. First, I declare an interest as a practising solicitor in the field of crime for many years, a former acting metropolitan stipendiary magistrate, and a recorder of the Crown court. Secondly, I shall not seek to score party political points. The problem that faces this Government was faced by the Conservative Government. As with many other issues, it would benefit from an all-party approach by hon. Members who wish to be constructive and who have some knowledge of and an interest in this subject.
  The problem of drug and alcohol abuse in prisons is much more acute than the public realise.
  Let us go back a little in the offenders cycle and understand that drug and alcohol abuse is a major contributor to criminal offending. Some 50 per cent. of property crimes in this country are related to substance misuse. Most burglars who appear before me have taken the goods simply to sell them to raise the money to fund their drug habit, some of them needing as much as £500 a week. More than half the criminal cases in London's magistrates courts are drink or drug-related, and 20 per cent. of people who are arrested in police stations test positive for drugs.
  A defendant who is addicted to drugs or alcohol may be sent to prison. What next? Incredibly, his problem may get even worse. There are more than 130 prisons, and 150,000 people pass through our prison system each year. Some 25 per cent. of receptions are on drugs at the point at which they enter the prison system. Drug use and distribution in prison can and often do become the focus of daily activity, filling the vacuum left by the regrettable absence of work and education opportunities.
  Are drugs of all sorts and alcohol freely available in prison? In a written reply on 14 July, the Minister told me that, in the year 1996–97, some 21,700 mandatory drug test samples were positive. That figure includes results from both random and targeted tests that led to 16,757 adjudications for misuse of controlled drugs. Information on the number of instances of alcohol consumption was not available, but, anecdotally, I hear that it is very high.
  How do these substances get into our prison system, and what should we do about it? There are perhaps four main ways. First, they enter through social visits by the friends and families of prisoners who are allowed contact visits, who I understand are not intimately searched.
  500
  Secondly, prisoners themselves can and do bring drugs back into prison after collecting them on some outside trip, perhaps to court for a remand or on a hospital visit.
  Thirdly, there are clearly some breaches of the perimeter walls of our prisons, and drugs are occasionally thrown over them to be collected at a preordained point. Fourthly—one is reluctant to say this, because by and large our prison staff are dedicated and excellent—it is likely that in the system there are some corrupt staff and, indeed, some corrupt professional visitors—lawyers and the like—who abuse their preferential access by bringing in drugs.
  I recently asked the Minister whether he would make it his policy to see that prison officers, before they came on duty, were subject to the same search policy as that which applies to visitors. The answer was no. I was told that professional visitors, including prison officers, would be subject to a modified search, while general visitors would continue to be subject to a full rub-search procedure. That follows the Prison Service assessment that, although there are exceptions, professional visitors and staff generally pose a lower risk.
  It may not be possible to eliminate these substances entirely in prisons, and perhaps I am naive in hoping that we might. Let us not forget that more than 1,300 visitors were arrested trying to smuggle illicit drugs into prisons in the past year. The Minister should consider the introduction of even more draconian measures to make the problem of getting drugs and alcohol into prisons, which is fairly easy at the moment, nearly impossible in times ahead.
  I have four suggestions for the Minister, which may help. First, prison officers, all professional visitors and all prison staff could, and perhaps should, be subject to a full rub-down search on entering a prison. Secondly, any prisoner who tests positive after a mandatory drugs test should receive only non-contact visits for the remainder of his or her sentence.
  Thirdly, any such prisoner should also receive a substantial loss of remission of sentence. Fourthly, in addition to any other penalty, any visitor who is caught attempting to smuggle drugs or alcohol into prison should not be entitled to a further visit to that prison or the prisoner during the remainder of the prisoner's sentence.
  Many of those in prison who are addicted to alcohol or drugs cry out for help, and it is that area on which I shall now concentrate. Alcoholism and drug dependency are arguably illnesses which can never be cured. However, I am convinced that substantial investment to help to get addicts off drink or drugs is money well spent. It will ultimately save this country's criminal justice system and people much money and personal anguish.
  I am not sure that much has been done until relatively recently. For many years, I have visited and talked to dozens, possibly hundreds, of prisoners throughout the south-east. Many have been addicts. They have all known that drugs and alcohol were freely available. I have always asked, "What is done here in this prison to help people who wish to be helped to get rid of the habit?", and all too often I have received the reply, "Not very much."
  I recently visited Coldingley prison in the constituency of my hon. Friend the Member for Surrey Heath (Mr. Hawkins), where I learned more about the outstanding work of RAPT—the Rehabilitation of Addicted Prisoners Trust. My hon. Friend the Member

  501
  for Westbury (Mr. Faber) is a trustee of that outstanding organisation, and I commend him for his work and interest.
  RAPT recognises that the majority of inmates continue to use drugs while in prison, and that some will develop the habit for the first time during their stay. It knows, as we know, that the use of drugs in prisons causes problems of violence, disorder and intimidation as well as the spread of infection. It points out that the average cost to the taxpayer of keeping someone in prison is nearly £24,000 a year, and that, unless the addict's problem is confronted and treated in prison, he is almost certain to return to uncontrolled drug use and crime on release. Time in prison is an ideal time to break the vicious cycle of drug abuse, crime and imprisonment.
  RAPT is a charity offering treatment to alcoholics and drug addicts in prison. It was established under the name of the Addictive Diseases Trust in 1991, opening its first treatment unit in Downview prison a year later. Its aim is to help prisoners to recover from addiction while serving a prison sentence, and its programmes are based on the principle of 12-step recovery, which was first applied in prisons in the United States, but was extensively modified to fit the requirements of our system.
  RAPT uses trained counsellors, many of whom are recovered addicts, some with experience of prison life. It has intensive and abstinence-based programmes. It does not offer a soft option. It is a tough course, but it is successful.
  Early evaluation results have shown that more than 50 per cent. of those received on to RAPT's programmes, which are established in a number of prisons, progressed to graduation, usually after 10 to 12 weeks. Among those graduates, relapse into drug misuse and reoffending is rare. I was privileged to meet former prisoners who have successfully completed the programme and are voluntarily helping others to help to recover their self-esteem. One prisoner said:
  "Before coming on the programme, I had used drugs almost every day for the previous 19 years of my life sentence. It is still astounding to me that I had to come to prison to find my freedom. I have not had a drug or a drink for three years, and I am still inside. It's a miracle."
  The RAPT programme has been praised by many people in positions of authority, and I commend it and its like to the Government.
  Therefore, my message to the Government is this. Let us all strive to prevent the circulation of drink and drugs in prison: first understand the scale of the problem; next, continue the previous Government's anti-drug strategy, which has had some success and which I commend in many ways; continue the mandatory drug testing scheme, despite its problems, which we know about; increase the resources available for drug treatment programmes in the prison system; give prisoners real incentives to take advantage of treatment options; consider whether the programme so successfully undertaken by RAPT can be further encouraged and extended; improve after-prison care.
  In the face of what I believe the whole House would acknowledge to be a serious problem, the Government and the Minister will need to be tough but sensitive, and, above all, thoughtful. If he is, he will have the support of the whole House.
  10.29 pm
  The Parliamentary Under-Secretary of State for the Home Department (Mr. George Howarth): I am grateful to the hon. Member for Woking (Mr. Malins) for raising what I agree is an important and pressing issue. I am grateful to him for continuing the bipartisan approach that we adopted when in opposition. The hon. Gentleman was kind enough to brief me on the issues that he intended to raise, which has given me the opportunity to make a better-informed response. He made a thoughtful and constructive speech, and paid generous tribute to a number of organisations and individuals, which was helpful.
  I welcome the opportunity to outline the Prison Service initiatives to reduce the supply of drugs and alcohol into prisons, to deter prisoners from misusing drugs and to provide treatment for substance misusers, from whatever source the abuse arises.
  The hon. Gentleman will be aware that the Prisons (Alcohol Testing) Act was enacted in March this year. The Prison Service is currently considering the potential costs of implementing a pilot programme of mandatory alcohol testing. It is not intended that testing for alcohol will operate on the same scale as mandatory drug testing. That is not because we do not think that it is a serious problem, but it is likely to be undertaken mainly on suspicion, with the possibility of random testing under certain circumstances—perhaps where there is a known arid particular problem of alcohol misuse among prisoners released on temporary licence.
  The issue about which the hon. Gentleman expressed the greatest concern was stopping the smuggling of drugs through prison visits and other means. Between 1 March 1996 and 28 February 1997, there were 2,183 incidents involving drugs in prison in which the means by which the drugs entered the prison could be determined. In 80 per cent. of those incidents, the drugs were found on visitors to prisoners. In other cases, they were brought in by prisoners or thrown over the perimeter, to be picked up at a prearranged time and place.
  A great deal of energy has been devoted to improving the supervision of visits. Improvements have included the use of passive sniffer dogs—I have seen them in some establishments—which are trained to sit in front of a person carrying the drugs, blocking their way. There are clear notices at entrances and in other parts of the prison, setting out the consequences if people are intercepted and prosecuted for carrying drugs. On Thursday, I visited Feltham young offenders institute and saw how effective and clear the notices are. No one is left in any doubt that the police will be brought in and firm and swift action taken.
  Other improvements include the use of locker rooms to minimise the belongings that visitors may carry into the visits. Another initiative is the use of low tables and fixed seating to make the passing of drugs more difficult. It requires a little imagination, but not much, to realise how effective that can be in certain circumstances.
  Closed circuit television operates in a number of areas, as I saw in many institutions. I have seen the evidence that shows visitors passing drugs. It is often the least likely visitor who passes drugs to a family member or other prisoner he or she is visiting. The use of closed or non-contact visits for those found guilty of a drugs offence is another initiative used in some circumstances.

  503
  A pilot programme of mandatory closed and non-contact visits for any prisoner found to have misused drugs is being carefully evaluated. We are certainly prepared to consider such measures.
  Most important, there has been enhanced use of intelligence about prisoners and their visitors to intercept drugs that are intended for prisoners and to detect drugs that are already in prisons.
  The Prison Service must consider the competing needs of security, reducing drug supply and enabling prisoners to maintain reasonable contact with family and friends, which is a difficult balance to strike. The drugs problem could be eradicated if we eliminated all contact between prisoners and the world outside their cells. Although the hon. Member for Woking said that we may need more draconian measures, I do not think that he would think that such action would be desirable in all circumstances. We must specifically take into account the difficulties of prisoners with children who visit.
  The Prison Service is in the business of assessing and managing risk, best to target available resources to the source of the greatest threat. That is the sensible way in which to deal with the problem. Governors are well aware of the possibility of drugs being thrown over perimeter walls and are under clear instructions to ensure that, as far as possible, local searching strategies deal with the possibility.
  After some well-publicised incidents in the past few years, and as part of wider measures to improve security, search procedures for prisoners and visitors have improved. Particular attention is being paid to searching prisoners returning from temporary release, because that is one obvious route for drugs into prisons.
  The hon. Member mentioned rub-down searches. Generally, such searches are not conducted every time a visitor enters any prison, although they are carried out in category A prisons. Visitors to prisoners are given a full rub-down search that involves a visual check of the ears, nose, mouth, hair and shoes. Professional visitors—including probation officers and lawyers and staff—from whom there is thought to be a lesser risk do not have ears, nose, mouth, hair or shoes searched.
  It is self-evident that there is a greater risk of smuggling from visitors to prisoners. Under pressure from a spouse or son, many visitors will be under enormous pressure to smuggle drugs into prison, particularly if they believe that it will make life easier for their loved ones. I realise that other types of pressure can be brought to bear—such as, for example, if groups target friends or relatives outside prisons. At non-category A prisons, the level of searching is decided by the governor, depending on the risk and the category of prison. By no means will all visitors always be subject to a full rub-down search.
  The hon. Member for Woking mentioned intimate searching—by which I assume that he means searching of body orifices. Such searches of visitors by prison staff is unlawful. Strip-searching of visitors is permitted, but only on the basis of reasonable cause—which the hon. Gentleman, as a lawyer, will understand. Governors are empowered to refuse visits by close relatives and others on the grounds of security, good order and discipline, or in the interests of prevention or discouragement of crime.
  The hon. Member paid proper respect to those who work in the Prison Service, but felt that perhaps attention should be paid particularly to prison officers as a source
  504
  of drugs in prison. The difficulty with such an argument is that there is not a great deal of evidence to support it. Centrally held records kept over the past four years show that no members of staff have been disciplined for involvement in drug supply in prisons.
  In six cases, staff have either been dismissed or resigned because of drugs-related behaviour, but that behaviour occurred away from the prison. Seven staff members have been disciplined for bringing alcohol into prison without authority. Of those, two were dismissed and four resigned before the matter could be brought to a conclusion. Nevertheless, it is impossible to deny with absolute certainty that drug smuggling by staff occurs. The available evidence, however, does not suggest that it is a significant problem. If the hon. Gentleman has any evidence, or is aware of any evidence, that would take us further, I should of course be glad to receive it. The Prison Service certainly takes a most serious view of any staff involved in such activities, and the police would become involved in those circumstances.
  I must say a few words about mandatory drug testing. When it was introduced, I was the Opposition spokesman with the relevant responsibility. The Labour party gave its full support to what has been an important innovation. Mandatory drug testing provides, among other things, a clearer picture of the levels of and trends in drug misuse in prison, which assists in the targeting of treatment resources and provides an indicator of where drug strategies are having success and where they need greater impetus. It is also important to send a clear message to inmates that drug misuse in prisons will not be tolerated. We must reinforce that message time and again.
  In 1996–97, approximately a quarter of random mandatory drug tests proved positive, the vast majority being for cannabis. There is widespread concern, which the Government share, about the perverse incentive to switch from cannabis to more harmful drugs such as opiates which are detectable for a shorter time in a urine sample because they stay in the bloodstream for a shorter time.
  The average figures for the estate as a whole conceal a great deal of variation in individual prisons. More work needs to be done on that. The Prison Service aims to learn from prisons with low levels of drug misuse and to apply successful initiatives in other establishments.
  An option open to prisons under the mandatory drug testing programme is to test prisoners at random on reception. Some 550 prisoners were tested on reception in 1996–97, far fewer than under the random testing programme. Nevertheless, the percentage of samples proving positive on reception was 10 per cent. higher than in random tests across the whole prison population. That might tell us something. It suggests that imprisonment does not necessarily worsen drug misuse—perhaps even the reverse.
  Research into mandatory drug testing effectiveness has been undertaken, most notably that commissioned by Oxford university and the National Addiction Centre. The Oxford research into attitudes to mandatory drug testing and wider drug misuse is being conducted at five establishments. I shall perhaps say more about that later.
  A first phase of interviews was undertaken between February 1996 and April 1997. The researchers are now making return visits to the five establishments to gauge changes in attitudes and perceptions over time. The initial

  505
  findings are that mandatory drug testing is only partly successful in deterring prisoners from misusing drugs or causing them to cut down. We need to gather more evidence, and I am not sure that we have a precise picture of what is going on. I certainly mean to keep the data under review to make sure that we get things right and that we are properly informed about what action needs to be taken. The hon. Member for Woking also mentioned treatment in prisons, which we consider very important.
  The Prison Service strategy cannot be about ever-tighter controls alone, although they are important. It must recognise that we need measures to reduce demand and minimise the risks to the health and bodies of individual misusers and, in the longer term, of the public.
  All prisons have for some time provided detoxification, education and counselling to prisoners with substance misuse problems via the health care centre, the probation department or community drug agencies. Many have gone further, providing, for example, rehabilitation units or drug-free areas supported by voluntary testing. These are important sources of help.
  Some 59 prisons are now involved in treatment. The additional cost this year is more than £6 million. Resources are being earmarked, and work is extending throughout the prison population. There are several variations, including therapeutic communities and community-linked through-care programmes. We attach great significance to all of them.
  The hon. Gentleman mentioned RAPT. I acknowledge the good work that it does, not just at Coldingley, but at Downview, Pentonville, Wandsworth and Norwich prisons. I had an opportunity to visit the programme in its early days at Downview. It is an impressive and effective way to deal with the difficulties.
  506
  That is just one of the many community drug agencies that the Prison Service is working with in a proper partnership approach. We aim to break the vicious circle of drug misuse, crime and imprisonment. All those agencies—and perhaps some others that we are not yet using—have a valuable contribution to make.
  The ultimate objective is for all drug misusers in prison to have access to appropriate and cost-effective treatment. We had a manifesto commitment to introduce voluntary testing units so that all prisoners who feel able to do so can prove that they are drug-free. That could be an important contribution to help bring the problem under control. Officials are working on the practicalities. I expect to receive advice in the autumn, when we hope to bring the plans forward.
  The drugs strategy is multi-disciplinary and multi-agency. We intend to keep it that way. I have met many of the staff involved, who play an important role in drug education, counselling and bringing together agencies and other resources to deal with the problems. We should congratulate them.
  It is important that the strategy involves not just security and health care, but probation officers, psychologists and, when appropriate, the chaplaincy. It also relies heavily on drug workers from outside community agencies. I do not claim that improvements cannot be made, because they can, but there is a balance to be struck. The hon. Gentleman mentioned the necessary elements of that balance. I shall consider that over the next few months. We take the problem seriously and hope to get to grips with resolving it. It is important that people are rehabilitated while they are in prison, not exposed to more drug problems.
  Question put and agreed to.
  Adjourned accordingly at fourteen minutes to Eleven o'clock.

HOUSE OF COMMONS

  Statutory Instruments
  Sir Richard Body
  To ask the President of the Council what percentage of statutory instruments introduced into Parliament in(a) 1976, (b) 1986 and (c) 1996 had the European Union as their legislative source; if she will take steps to introduce a physical distinction in the publication of such statutory instruments in the future; and if she will make a statement. [6482]

  Mrs. Ann Taylor
  The total number of Statutory Instruments (SIs) registered as General Instruments in 1976, 1986 and 1996 was:

  Year

  Number of SIs

  1976

  1,168

  1986

  1,359

  1996

  1,832

  Source:

  Statutory Instruments Publication Office. Statutory Instruments are classified as General Instruments if they are in the nature of a public general Act. SIs may also be registered as Local Instruments if they are in the nature of local and personal or private Acts. SIs implementing EC legislation will always be classified as General Instruments.

  It is not possible without incurring disproportionate cost to determine how many of these SIs were introduced to comply with European Community obligations. However, the number of SIs, including amending Instruments, registered in the three years concerned to comply with European Community Directives which were still in force on 31 October 1996 was:

  Year

  Number of SIs

  1976

  26

  1986

  28

  1996

  80

  Source:

  Butterworth's EC Legislation Implementator 1997, Issue 1. The figures are based on material collated up to 31 October 1996 and relate to Directives in force on that date. Directives for which no implementing material has been identified, or which have been repealed or spent, have not been included.

  I have no plans to introduce a physical distinction in the publication of such Statutory Instruments.

  An earlier answer given by the then Chancellor of the Duchy of Lancaster, Official Report, 28 January 1997, columns 131–32 gave figures for the number of Statutory
  166
  Instruments implementing EC Directives between 1992 to 95. An error has since been discovered in the compilation of these figures and corrected figures are now given in the table.

  Year

  Number of SIs

  1992

  124

  1993

  86

  1994

  137

  1995

  127

  1996

  80

  Select Committee on European Legislation
  Mr. Mitchell
  To ask the President of the Council how many(a) regulations, (b) directives and (c) other documents placed before the Council of Ministers were not considered by the Select Committee on European Legislation prior to the dissolution; and if she will take steps to notify (i) hon. Members and (ii) others of the outstanding documents. [8506]

  Mrs. Ann Taylor
  Forty-eight items of business were not considered by the Select Committee on European Legislation prior to the dissolution. These included 14 proposals for Councils regulations, nine proposals for Council directives and 25 other documents.

  I have asked the Clerk of the Select Committee on European Legislation to send details of all remaining business before the Committee to the hon. Member, and to place a copy in the Library of the House.

TREASURY

  Dividend Tax Credits
  Mr. Willetts
  To ask the Chancellor of the Exchequer what are the Government Actuary's estimates of the effect of the Budget proposal to end dividend tax credits on the ability of funded public sector pension schemes to meet their current and future liabilities; and if he will estimate the increased contributions that will be necessary for each scheme. [7403]

  Dawn Primarolo
  The position will vary from scheme to scheme depending on factors such as the type of scheme, the make up of its investment portfolio and its financial circumstances. For example, many schemes have surpluses which can be used to cushion the effect. Pension schemes should also benefit from improved company performance as a result of encouraging quality long-term investment.

  The employers' contribution rates to each individual funded public sector scheme are determined by the funds' own actuarial adviser—not necessarily the Government Actuary. Actuarial revaluations take account of all relevant considerations, including the high returns earned by many funds in recent years, as well as the changes to dividend tax credits.

  Tax Loopholes
  Mr. Jack
  To ask the Chancellor of the Exchequer what estimates he has made for the financial years
  167
  1997–98, 1998–99 and 1999–2000, of the tax yield for each of the measures enacted in the Finance Act 1997 aimed at closing tax loopholes. [3376]

  Dawn Primarolo
  The information requested is shown in the following table.

  Revenue effects of measures enacted in the 1997 Finance Bill aimed at closing tax loopholes

  £ million yield (+)/cost (-) of measure

  Changes from an indexed base

  Anti-avoidance and revenue protection measures

  1997–98

  1998–99

  1999–2000

  Inland Revenue

  Finance leasing of assets

  80

  150

  150

  Capital gains tax: treatment of securities

  5

  15

  20

  Stamp duty reserve tax bearer securities

  50

  50

  50

  Countering contrived claims to double taxation relief

  1—

  50

  50

  PAYE/NICs avoidance: payment in "own company" shares

  110

  30

  30

  Futures and Options—counter avoidance devices

  1—

  50

  50

  Artificial annuties paid by insurance companies

  10

  20

  20

  Tax relief for profit related pay—phased out

  200

  800

  1,800

  Capital allowances—long life assets

  45

  325

  675

  Relief for drilling production oil wells

  1—

  150

  200

  Customs and Excise

  Purchase of international supplies

  1—

  1—

  1—

  VAT on supplies of Land and property

  70

  110

  120

  Insurance premium tax to 17.5 per cent, on insurance sold with certain goods and services

  160

  235

  260

  Bad debt relief

  120

  175

  165

  Telecommunications and similar services

  5

  10

  10

  Sale of donated goods

  1—

  1—

  1—

  Charitable providers of care

  1—

  1—

  1—

  Separation of businesses to get below VAT threshold

  1—

  1—

  1—

  Notes:

  1 Negligible effects on revenue amounting to less than £3 million a year.

  The yields represent the estimated direct effect of the measures with the existing level of activity. Without these measures there could be a more significant loss of revenue in the future.

  Private Finance Initiative
  Mr. Jack
  To ask the Chancellor of the Exchequer if he will make a statement on the progress of the PFI project for the refurbishment of the Government Offices, Great George Street. [3369]

  Mr. Geoffrey Robinson
  Confidential discussions are continuing with Exchequer Partnership plc. A statement will be made in due course.

  Tax Changes
  Mr. Heathcoat-Amory
  To ask the Chancellor of the Exchequer if he will estimate the effects of the tax changes announced in the Budget on each decile of household income. [8142]
  168
  Dawn Primarolo
  [holding answer 11 July 1997]: Estimates of the impact on households of the tax changes announced in the Budget which we can directly model are contained in the table below. The figures show the direct impact of the measures on households. They do not reflect the long term benefits of the Budget, including New Deal spending which will help to move the long-term unemployed from welfare into work; and the long term benefits of reducing Government borrowing.

  Average impact of main Budget tax measures, relative to indexation

  Household income decile

  Change (£ per week)

  As a percentage of net income

  Bottom

  -0.30

  -0.25

  2

  -0.35

  -0.25

  3

  -0.45

  -0.25

  4

  -0.80

  -0.35

  5

  -1.15

  -0.40

  6

  -1.30

  -0.40

  7

  -1.55

  -0.40

  8

  -1.80

  -0.40

  9

  -2.05

  -0.40

  Top

  -2.35

  -0.30

  Average

  -1.20

  -0.35

  The figures include the main tax measures directly affecting households which can be modelled: reduction of VAT on fuel and power to 5 per cent., reducing the Gas Levy to zero, reducing in MIRAS to 10 per cent., real increase in tobacco duty of 5 per cent., real increase in road fuel duty of 6 per cent., and abolition of tax relief on Private Medical Insurance. Figures are rounded to the nearest 5p, or 0.05 per cent.

  Household incomes are adjusted for differences in composition before allocating households to deciles.

  The figures do not reflect that the tax changes affect households very differently depending upon their expenditure. For example estimates for the effect of the Budget on non-smokers are contained in the following table:

  Average impact of main Budget tax measures (excluding tobacco), relative to indexation

  Household income decile

  Change (£ per week)

  As a percentage of Net Income

  Bottom

  0.05

  0.05

  2

  0.00

  0.00

  3

  -0.10

  -0.05

  4

  -0.40

  -0.15

  5

  -0.70

  -0.25

  6

  -0.90

  -0.25

  7

  -1.15

  -0.30

  8

  -1.40

  -0.30

  9

  -1.65

  -0.30

  Top

  -1.95

  -0.25

  Average

  -0.80

  -0.25

  VAT (Fuel)
  Mr. Heathcoat-Amory
  To ask the Chancellor of the Exchequer what estimate he has made of the effect of his Budget's reduction in VAT on domestic fuel on(a) a single pensioner and (b) a pensioner couple on average income net of upratings of pensions and benefits. [7093]
  169
  Dawn Primarolo
  [holding answer 7 July 1997]: The reduction in VAT on fuel and power will mean an average fuel bill saving of 30p per week for single pensioners, and 40p per week for couples.

  The state retirement pension is uprated in April of each year by the annual Retail Prices Index (RPI) inflation rate for the preceding September. Uprating by RPI reflects the prices paid for goods and services. So the real value of the pension is not affected.

  Pensioners (Fuel Costs)
  Mr. Colvin
  To ask the Chancellor of the Exchequer if he will list the average domestic fuel costs of a state retirement pensioner household for the last three years. [7649]

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

  Letter from Tim Holt to Mr Michael Colvin, dated 16 July 1997:
  The Chancellor of the Exchequer has asked me to reply as Director of the Office for National Statistics to your recent question on average domestic fuel costs of a state retirement pensioner household.
  Average weekly expenditure on gas, electricity and other fuels by households all of whose adult members are above minimum state retirement age is estimated, from the Family Expenditure Survey (FES), to have been £10.90 in 1993–94, £10.60 in 1994–95, and £10.50 in 1995–96, and are estimated with an accuracy of plus or minus 35 pence.
  FES figures are in the prices of each survey year and have not been adjusted for inflation. Any comparison between these figures would need to allow for inflation.

  Earnings (Blackpool)
  Mr. Gordon Marsden
  To ask the Chancellor of the Exchequer what estimate he has made of the number of employees in Blackpool currently earning less than(a) £3.50 per hour, (b) £3.75 per hour and (c) £4 per hour. [8747]

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

  Letter from Tim Holt to Mr. Gordon Marsden, dated 16 July 1997:
  The Chancellor of the Exchequer has asked me to reply as Director of the Office for National Statistics to your recent question on earnings in Blackpool.
  The latest information, from the New Earnings Survey (NES) April 1996, is given in the table below for the local authority district of Blackpool.

  Employees on adult rates whose pay for the survey pay-period was not affected by absence, NES April 1996

  Percentage of employees with hourly earnings (excluding overtime) less than:

  Blackpool Local Authority

  £3.50

  £3.75

  £4.00

  Full-time

  10.1

  13.2

  15.9

  Part-time

  18.4

  25.0

  30.3

  All

  12.2

  16.2

  19.5

  Infant Mortality
  Ms Walley
  To ask the Chancellor of the Exchequer if he will list the number of infant mortalities for each of the last five years(a) in Stoke-on-Trent North, (b) by region and (c) nationally. [8878]

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

  Letter from Tim Holt to Ms Joan Walley, dated 16 July 1997:
  The Chancellor of the Exchequer has asked me to reply, as Director of the Office for National Statistics, to your recent parliamentary question on infant mortalities.
  The following table shows infant mortality in Stoke on Trent North, numbers and rates per 1,000 live births, 1992–1996.

  Numbers

  Rates

  1992

  10

  9.6

  1993

  6

  5.6

  1994

  8

  7.5

  1995

  6

  6.1

  1996

  4

  4.0

  National and regional data for 1992 to 1996 are available in ONS Monitor Series DH3 and ONS Annual Reference Volumes Series VS. These publications are available in the House of Commons Library.

  Civil Service Pay
  Mr. Öpik
  To ask the Chancellor of the Exchequer what will be the percentage increase in pay in 1997–98 for each grade of civil servant. [8430]

  Mr. Kilfoyle
  The information you request is not available.

  For the Senior Civil Service, staff will receive increases between 0 per cent. and 10 per cent. depending on performance. The majority will receive increases of between 2.75 per cent. and 5.24 per cent. These awards will be staged, with a maximum of 2 per cent. payable from 1 April 1997 and the balance payable on 1 December 1997.

  Since 1 April 1996, all government departments and agencies have had delegated responsibility for their own pay and grading arrangements for staff outside the Senior Civil Service. Thus it is no longer the case that single rates for individual grades apply across the Civil Service as a whole. Some information on the salaries of civil servants by their responsibility level is published annually in Civil Service Statistics, but this is not yet available for 1997–98.

HOME DEPARTMENT

  Domestic Violence
  Mr. Flynn
  To ask the Secretary of State for the Home Department what new measures he plans to introduce to protect women from domestic violence. [8802]

  Mr. Michael
  Domestic violence is a serious and widespread crime which damages the lives of victims in many respects, including housing, health and education,
  171
  and destroys their freedom to live their lives without fear. The Government are committed to tackling domestic violence on every front.

  We are currently examining the policies operating in this area, with a view to ensuring that we have an effective strategy against domestic and sexual violence. This strategy will take full account of our commitments to tackling crime in general, and to promoting equality and opportunity for women.

  Mr. Flynn
  To ask the Secretary of State for the Home Department if he will conduct a national survey to establish the extent of violence against women in the United Kingdom. [8804]

  Mr. Michael
  The biennial British Crime Survey (BCS), conducted by the Home Office, already provides a regular measure of the extent of violence against both women and men in England and Wales. The next sweep of the BCS will take place in early 1998.

  There is ongoing work by survey designers to improve the measurement of sexual and domestic violence in particular. The most recent sweep, in 1996, contained a particularly detailed component on domestic violence. The data are currently being analysed and findings will be published in due course.

  Some main findings of the extent of violence against women from the 1996 BCS include:
  There were 1,580,000 incidents of contact crime (wounding, common assault, robbery and snatch theft) aimed against women during 1995. In total, 39 per cent. of violent incidents measured by the BCS in 1995 were against women.
  Women are less likely than men to be victims of all types of violence except domestic violence (defined as woundings and common assaults committed by relatives, partners, ex-partners or other household members). In 1995, 1.3 per cent. of women responding to the survey reported one or more such incidents, compared with 0.7 per cent. of men. The risks are greatest for women under thirty: 3.3 per cent. of such respondents reported a domestic violence incident in 1995 to the survey.
  0.7 per cent. of women were victims of mugging (robbery and snatch theft) in 1995. The risks were highest for younger women: 1.3 per cent. of those aged 16 to 29 had been mugged compared with 0.5 per cent. of the older age group.
  Thirty-five per cent. of violent incidents against women measured by the BCS were reported to the police in 1995. Muggings were most likely to be reported (71 per cent.), domestic incidents and other violence from people known to the victim the least likely (32 per cent. and 27 per cent. respectively).

  Mr. Flynn
  To ask the Secretary of State for the Home Department what plans he has for the recording of figures on domestic violence as a separate category within official crime statistics. [8803]

  Mr. Michael
  Domestic violence is not a legally defined offence and the police are not currently required separately to identify domestic violence incidents in their statistical returns to the Home Office or to record the relationship between victim and offender. Crimes of domestic violence, if they reach the courts, could be prosecuted as threatening behaviour, affray, common assault, assault occasioning actual bodily harm, wounding or inflicting grievous bodily harm, indecent assault, rape or attempted rape, threats to kill, attempted murder, manslaughter or murder. For this reason it is difficult to assess centrally exactly how many cases of domestic 172
  violence occur in England and Wales. However, Her Majesty's Inspectorate of Constabulary collects some statistics on domestic violence and many police forces have their own arrangements for doing so. Other sources, such as the British Crime Survey, also provide useful statistical data on domestic violence.

  Along with my colleagues in the Home Office and in other Government Departments, I am currently examining all the policies operating in the area of domestic violence, including the collection of statistics.

  Public Interest Immunity Certificates
  Ms Kingham
  To ask the Secretary of State for the Home Department how many public interest immunity certificates have been issued in(a) 1997 and (b) each of the three previous years; and if he will provide a breakdown of the sources of requests for such certificates over that period. [8755]

  Mr. Straw
  In respect of my Department, six public interest immunity (PII) certificates have been issued in 1997. For each of the three previous years the available figures are:

  Year

  Number of PII certificates

  1994

  7

  1995

  13

  1996

  8

  The certificates in question have been issued to protect information relating to the Security Service, and information relating to the security and operation of prisons. Of the 34 certificates issued since 1994, 19 have related to the Security Service and 15 to the Prison Service.

  Prison and Probation Services
  Dr. Naysmith
  To ask the Secretary of State for the Home Department what plans he has to improve joint working between the prison and probation services. [7159]

  Mr. Straw
  It is very important that the prison and probation services work together closely and effectively. They are both responsible for protecting the public from harm; and where prisoners are released from sentences which are served partly in custody and partly in the community they are subject to probation service supervision. There need to be the best possible arrangements for sharing information about prisoners and co-ordinating effort on risk assessment, resettlement planning and programmes directed to reducing offending and dealing with problems such as drug or alcohol misuse, which get in the way of successful rehabilitation.

  We therefore intend to look at ways in which the better integration of the two services could improve their performance and effectiveness. I have asked my hon. Friend the member for Gateshead, East and Washington, West (Ms Quin) who has ministerial responsibility for both services within the Home Office, to lead this work. This will include looking at the structure and organisation of the probation service, to complement the review of the prison service which is now under way.
  173
  A system of punishment which is effective, credible and commands public confidence requires both community and custodial sentences to work, and to work together. Having considered the options for improving on present arrangements, I shall consult all concerned before deciding on the best way forward.

  The detailed terms of reference of this review are as follows:
  To identify and assess options for closer and more integrated work between the Prison Service and the probation service of England and Wales, including any implications for the structure, organisation, management, working practices, human resources, funding and legislation governing the functions of those services;
  To examine international models reflecting good practice and to identify any lessons concerning the effectiveness and efficiency, organisation and management structures exhibited by those models;
  To provide a preliminary analysis of the options identified, including the estimated costs and benefits, as a basis for consultation.

  This review will in due course form part of the Comprehensive Spending Review.

  Alcopops
  Mr. Grogan
  To ask the Secretary of State for the Home Department what plans he has in relation to under age alcohol misuse, with particular reference to alcopops. [9307]

  Mr. George Howarth
  I am publishing tomorrow the conclusions of the Ministerial Group on alcopops. A copy of the Group's statement will be placed in the Library tomorrow at 10.30 am.

  Animal Experiments
  Mr. Hancock
  To ask the Secretary of State for the Home Department how many applications for project licences have been refused under section 5(5) of the Animals (Scientific Procedures) Act 1986 on the ground that the applicant has failed to give adequate consideration to the feasibility of carrying out the research by means not involving the use of animals. [8328]

  Mr. George Howarth
  Licence applications are rarely formally refused because, when the Animals (Scientific Procedures) Inspectorate indicate that they cannot recommend that a licence be granted, the applicant either amends the application or voluntarily withdraws it. Records which distinguish between refused and withdrawn applications are not collected centrally.

  In considering licence applications, the Inspectorate ensures that adequate consideration has been given to replacement, reduction and refinement alternatives.

  Mr. Hancock
  To ask the Secretary of State for the Home Department when the project licence granted under article (10(3) of the Animals (Scientific Procedures) Act 1986 to allow the use of non-purpose bred greyhounds in a study of osteoarthritis expires. [8456]

  Mr. Howarth
  This project licence is due to expire on 6 December 1997.
  174
  Mr. Hancock
  To ask the Secretary of State for the Home Department how many licences in the(a) moderate and (b) substantial severity category of the Animals (Scientific Procedures) Act 1986 have been applied for in each year. [8749]

  Mr. Howarth
  The number of licences of moderate and substantial severity which were granted in each year is as follows:

  Year

  Moderate

  Substantial

  1989

  449

  14

  1990

  n/a

  n/a

  1991

  303

  11

  1992

  608

  33

  1993

  617

  16

  1994

  436

  8

  1995

  392

  23

  1996

  350

  11

  Figures for the years before 1991 (with the exception of 1989) and for applications (rather than granted licences) are not available centrally.

  Mr. Hancock
  To ask the Secretary of State for the Home Department what plans he has to prohibit the use of animals in cosmetic tests. [8669]

  Mr. Howarth
  There are no immediate plans to prohibit the use of animals in cosmetics tests.

  We will be considering how to take this matter forward within Europe in a way which does not simply export these tests to countries which have less regard for animal welfare and less rigorous controls and does not unnecessarily disadvantage United Kingdom industry.

  We must also ensure that any action we take does not compromise public safety and is legally defensible (both within the United Kingdom and Europe). In this regard, we note that the European Commission has postponed a proposed ban on the marketing of cosmetics tested on animals until June 2000, because alternative safety tests have not been validated and because the proposed ban may have contravened international trade rules.

  Mr. Hancock
  To ask the Secretary of State for the Home Department what investigations are carried out by inspectors, employed under the Animals (Scientific Procedures) Act 1986, into the source of animals used in experimentation. [8671]

  Mr. Howarth
  Unless otherwise authorised, animals listed in Schedule 2 of the Animals (Scientific Procedures) Act 1986 must be obtained from designated breeding or supplying establishments. All such establishments are regularly inspected and are expected to meet the standards set out in the "Code of Practice for the Housing and Care of Animals in Breeding and Supplying Establishments". Where authority is given to acquire Schedule 2 animals from a non-designated source, the Home Office Inspectorate will always ensure its suitability and reliability.

  Approval for the acquisition of primates from overseas sources will be given only if the conditions at the breeding or supplying centre are acceptable to the Home Office. A number of such centres have been visited by a Home Office Inspector.
  175
  Mr. Hancock
  To ask the Secretary of State for the Home Department what breeds of dogs, other than greyhounds and purpose-bred animals, have been used in experiments in laboratories in each of the years since 1986; and from where these dogs were obtained. [8746]

  Mr. Howarth
  Information on the specific breeds used, other than greyhounds or beagles, is not collected centrally.

  Mr. Hancock
  To ask the Secretary of State for the Home Department how many animal experiments have been conducted since 1986 in connection with forensic studies; and what species of animals were used for this purpose. [8670]

  Mr. Howarth
  This information has been collected only since the start of 1995 and was published in table 1 of the "Statistics of Scientific Procedures on Living Animals, Great Britain, 1995". During 1995, 139 procedures were carried out for the purpose of forensic enquiries. The species of animals involved were rats, rabbits, equidae, sheep and cattle.

  Mr. Hancock
  To ask the Secretary of State for the Home Department how many of his Department's inspectors employed since 1986 under the Cruelty to Animals Act 1876 have previously performed experiments on animals in commercial, academic or Government laboratories. [8664]

  Mr. Howarth
  The Cruelty to Animals Act 1876 was repealed by the Animals (Scientific Procedures) Act 1986.

  Information about whether ex-inspectors carried out experiments on animals either under the 1876 Act or the current Act is not kept centrally. However, we believe that 27 inspectors employed under the Animals (Scientific Procedures) Act 1986 had carried out such experiments before joining the Inspectorate.

  Mr. Hancock
  To ask the Secretary of State for the Home Department how many inspections have been made by his Department's inspectors, under the Animals (Scientific Procedures) Act 1986; and what proportion of these visits were unannounced. [8748]

  Mr. Howarth
  The number of visits to establishments carried out by the Animals (Scientific Procedures) Inspectorate from 1989 to 1996 inclusive is 23,005. 19,902 were for the purpose of inspection or the monitoring of research projects; the remainder were for the purpose of maintaining scientific or professional skills, representing the Home Office or furthering Home Office policy. This information is published each year in the "Statistics of Scientific Procedures on Living Animals, Great Britain". The proportion of visits to Departments within establishments which were announced is 71 per cent.

  Prior to 1989, visits to Departments rather than establishments were counted, and details of the purpose of the visit and whether it was announced or unannounced are not available.

  Youth Crime
  Mr. Öpik
  To ask the Secretary of State for the Home Department how much money he has allocated for the prevention of youth crime for 1997–98; and what were the equivalent figures for(a) 1995–96 and (b) 1996–97. [8432]
  176
  Mr. Michael
  Not all the expenditure on youth crime initiatives can be separated out from Home Office programmes. A total of £1,723,000 is committed for 1997–98 for such programmes, much of which will support initiatives of this kind.

  This is divided between the core funding of Crime Concern, which takes particular interest in youth crime prevention, although the Home Office funding is for the organisation's running costs rather than for the direct support of initiatives; the Home Office's Programme Development Unit which supports innovative projects aimed at reducing criminality among young people; the Safer Cities programme and support for two Home Start projects.

  The equivalent figure for (a) 1995–96 was £1,800,000; and for (b) 1996–97 it was £1,695,000.

  Future expenditure plans will be considered in the context of the Comprehensive Spending Review.

  Intrusive Surveillance
  Ms Fiona Jones
  To ask the Secretary of State for the Home Department what plans he has for consultation on the intrusive surveillance code of practice required under Part III of the Police Act 1997. [9290]

  Mr. Michael
  On 14 July, I signed an Order to commence section 101 of the Police Act 1997 on 5 August 1997. This will allow the public consultation exercise to begin on that date. Officials will send copies of the draft code of practice to a number of individuals and organisations, inviting their comments by the end of September. Copies will be placed in the Library and additional copies of the draft code are obtainable from the Home Office.

  Fire Safety
  Mr. Heppell
  To ask the Secretary of State for the Home Department what plans he has to make regulations to satisfy the outstanding fire safety requirements of the EC Framework and Workplace directives. [9165]

  Mr. George Howarth
  Having consulted my right hon. Friend the Secretary of State for Scotland, we intend shortly to make suitable regulations. These will build on those proposals on which consultation was completed last year and will be accompanied by a simple guidance package. We hope to lay the regulations before Parliament rises for the summer recess. I understand from my right hon. Friend the Secretary of State for Northern Ireland that she intends to lay equivalent regulations for Northern Ireland before the end of the year.

  Yugoslavia (Displaced Persons)
  Mr. Cawsey
  To ask the Secretary of State for the Home Department what changes are being made in the handling of applications from refugees and displaced persons from the former Yugoslavia following the Dayton Peace agreement. [9463]

  Mr. Mike O'Brien
  All applications for asylum will continue to be considered on their individual merits within the terms of the 1951 Untied Nations Convention relating to the Status of Refugees.
  177
  Since 1992, exceptional leave to remain has been granted to those who came from Bosnia but did not qualify for refugee status. The situation now, following the Dayton Agreement and subsequent developments, makes that policy unnecessary and the United Nations High Commissioner for Refugees (UNHCR) have recently said that certain categories of persons could reasonably be expected to return to Bosnia.

  The Government share UNHCR's hope that many Bosnians will wish to return home voluntarily. However, leave will not be withdrawn from Bosnians already granted exceptional leave to remain on having been refused refugee status, or from former Yugoslays admitted under the Temporary Protection Programme; and, subject to personal acceptability, extensions of stay will normally be granted.

  From today, applications for asylum from Bosnians will be considered on their merits in the normal way. Exceptional leave will not be granted automatically if the application is unsuccessful, but it will be considered in individual cases where there are genuine humanitarian reasons. Those falling within the categories who UNHCR say may reasonably be expected to return home will no longer, in general, be granted exceptional leave to remain and will be expected to return home.

  Since August 1992, as a concession, the United Kingdom has not normally sought to return asylum seekers from the former Yugoslavia to safe third countries through which they had transited, if they had spent less than a day or two in each country. Asylum applicants from the States of the former Yugoslavia will now be treated in the same way as those from other countries. This will mean that they will be returned to safe third countries where we are satisfied that the applicant is not a national or citizen of the third country concerned; the applicant would be safe in the third country concerned; and the applicant either had an opportunity to claim asylum in the country concerned or was otherwise admissible there. However, we would not normally

  Outcome of cases where leave granted

  Year

  Total number of judicial review applications lodged

  Total number of judicial applications where leave granted

  Applications granted

  Applications dismissed

  Applications withdrawn

  1991

  506

  93

  33

  40

  33

  1992

  544

  104

  14

  27

  58

  1993

  668

  111

  15

  18

  61

  1994

  935

  162

  68

  32

  110

  1995

  1,220

  258

  99

  39

  71

  1996

  1,748

  301

  131

  42

  105

  The figures relate to the number of applications dealt with at each stage during the year concerned. For any given year, the total number of cases decided will not necessarily tally with the number of applications in which leave was granted, since applications may not be dealt with in the year in which they are lodged.

  Ms Hodge
  To ask the Secretary of State for the Home Department on how many occasions since 1991–92 legislation has been introduced by the Department(a) to remove effects of judicial review decisions and (b) to implement them. [7842]

  Mr. Straw
  The information sought is not kept in a readily retrievable form. It could be obtained only at disproportionate cost.
  178
  remove an applicant where there were immediate family members in the United Kingdom, such as a spouse, a minor child or, if the applicant were a minor child, a parent.

  Since December 1992, nationals of the former Yugoslavia have been granted a visa abroad where they could demonstrate that they had a claim to refugee status or had been displaced from their home as a result of the conflict and that they had close family here. In view of the improved situation in the former Yugoslavia, this concession is now being withdrawn and the normal arrangement for obtaining visas to claim refugee status in the United Kingdom will apply.

  We have agreed with UNHCR that the temporary protection programmes announced in 1992 and 1995 are to end, although those people already accepted who can go straight into the community will continue to be allowed to take up their places. A total of 2,660 people have been brought to the United Kingdom and given temporary refuge under the two programmes.

  Judicial Reviews
  Ms Hodge
  To ask the Secretary of State for the Home Department how many decisions by his Department were challenged by way of judicial review in each Parliamentary session since 1991–92; and if he will list in how many cases(a) the Department's decision was upheld, (b) the court found for the applicant, (c) the Department submitted to the judgment and (d) the Department appealed successfully against the judicial review decision. [7841]

  Mr. Straw
  The detailed information requested is not readily available. The Home Office has been involved in several thousand judicial review applications since 1991–92. It is estimated that the Department's decision was upheld in more than 90 per cent. of these applications. The table below gives some information on immigration cases, which form the vast majority of all judicial review applicants brought against the Home Office.

  Murder and Manslaughter
  Mr. Matthew Taylor
  To ask the Secretary of State for the Home Department how many people were convicted of(a) murder and (b) manslaughter in each year since 1967 in (i) England and (ii) Wales; and in each case what proportion this represents of the population. [8125]

  Mr. Michael
  The figures for England and Wales are shown at table A. Figures are not available for England and Wales separately before 1979. Tables B and C show figures for each country for the period 1979–95.
  179

  Table A: Persons found guilty of murder and manslaughter offences and number per 1,000,000 population1

  England and Wales

  Number

  Per 1,000,000 population1

  Year

  Murder

  Manslaughter

  Manslaughter due to diminished responsibility

  Murder

  Manslaughter

  Manslaughter due to diminished responsibility

  1967

  63

  109

  49

  1.6

  2.7

  1.2

  1968

  74

  118

  44

  1.8

  2.9

  1.1

  1969

  75

  117

  47

  1.8

  2.9

  1.2

  1970

  97

  124

  66

  2.4

  3.0

  1.6

  1971

  97

  127

  68

  2.4

  3.1

  1.7

  1972

  79

  141

  76

  1.9

  3.4

  1.8

  1973

  90

  153

  80

  2.2

  3.7

  1.9

  1974

  112

  177

  79

  2.7

  4.2

  1.9

  1975

  107

  196

  66

  2.5

  4.7

  1.6

  1976

  104

  194

  92

  2.5

  4.6

  2.2

  1977

  115

  144

  82

  2.7

  3.4

  1.9

  1978

  105

  143

  79

  2.5

  3.3

  1.8

  1979

  137

  186

  92

  3.2

  4.3

  2.1

  1980

  169

  193

  78

  3.9

  4.5

  1.8

  1981

  126

  167

  84

  2.9

  3.8

  1.9

  1982

  184

  182

  90

  4.2

  4.2

  2.1

  1983

  132

  159

  84

  3.0

  3.6

  1.9

  1984

  156

  167

  72

  3.6

  3.8

  1.6

  1985

  173

  198

  65

  3.9

  4.5

  1.5

  1986

  188

  206

  52

  4.3

  4.7

  1.2

  1987

  166

  214

  50

  3.8

  4.9

  1.1

  1988

  231

  216

  53

  5.3

  4.9

  1.2

  1989

  189

  267

  40

  4.3

  6.1

  0.9

  1990

  180

  182

  22

  4.1

  4.1

  0.5

  1991

  201

  219

  21

  4.5

  4.9

  0.5

  1992

  194

  286

  14

  4.4

  6.4

  0.3

  1993

  211

  219

  30

  4.7

  4.9

  0.7

  1994

  192

  197

  50

  4.3

  4.4

  1.1

  1995

  214

  195

  44

  4.8

  4.3

  1.0

  1 Population aged 10 and over.

  Table B: Persons found guilty of murder and manslaughter offences and number per 1,000,000 population1

  England2

  Number

  Per 1,000,000 population1

  Year

  Murder

  Manslaughter

  Manslaughter due to diminished responsibility

  Murder

  Manslaughter

  Manslaughter due to diminished responsibility

  1979

  127

  176

  89

  3.1

  4.3

  2.2

  1980

  159

  188

  75

  3.9

  4.6

  1.8

  1981

  118

  159

  80

  2.9

  3.9

  2.0

  1982

  177

  173

  84

  4.3

  4.2

  2.0

  1983

  125

  152

  76

  3.0

  3.7

  1.8

  1984

  153

  159

  68

  3.7

  3.9

  1.6

  1985

  163

  194

  62

  3.9

  4.7

  1.5

  1986

  179

  194

  49

  4.3

  4.7

  1.2

  1987

  159

  207

  46

  3.8

  5.0

  1.1

  1988

  218

  212

  50

  5.3

  5.1

  1.2

  1989

  176

  254

  38

  4.2

  6.1

  0.9

  1990

  170

  175

  20

  4.1

  4.2

  0.5

  1991

  188

  206

  20

  4.5

  4.9

  0.5

  1992

  182

  274

  12

  4.3

  6.5

  0.3

  1993

  200

  207

  30

  4.7

  4.9

  0.7

  1994

  175

  180

  46

  4.1

  4.3

  1.1

  1995

  204

  184

  40

  4.8

  4.3

  0.9

  1 Population aged 10 and over.

  2 Figures for earlier years are not available.

  Table C: Persons found guilty of murder and manslaughter offences and number per 1,000,000 population1

  Wales2

  Number

  Per 1,000,000 population1

  Year

  Murder

  Manslaughter

  Manslaughter due to diminished responsibility

  Murder

  Manslaughter

  Manslaughter due to diminished responsibility

  1979

  10

  10

  3

  4.1

  4.1

  1.2

  1980

  10

  5

  3

  4.1

  2.0

  1.2

  1981

  8

  8

  4

  3.3

  3.3

  1.6

  1982

  7

  9

  6

  2.9

  3.7

  2.4

  1983

  7

  7

  8

  2.8

  2.8

  3.3

  180 181

  Table C: Persons found guilty of murder and manslaughter offences and number per 1,000,000 population1

  Wales2

  Number

  Per 1,000,000 population1

  Year

  Murder

  Manslaughter

  Manslaughter due to diminished responsibility

  Murder

  Manslaughter

  Manslaughter due to diminished responsibility

  1984

  3

  8

  4

  1.2

  3.2

  1.6

  1985

  10

  4

  3

  4.1

  1.6

  1.2

  1986

  9

  12

  3

  3.6

  4.9

  1.2

  1987

  7

  7

  4

  2.8

  2.8

  1.6

  1988

  13

  4

  3

  5.2

  1.6

  1.2

  1989

  13

  13

  2

  5.2

  5.2

  0.8

  1990

  10

  7

  2

  4.0

  2.8

  0.8

  1991

  13

  13

  1

  5.2

  5.2

  0.4

  1992

  12

  12

  2

  4.8

  4.8

  0.8

  1993

  11

  12

  —

  4.4

  4.8

  0.0

  1994

  17

  17

  4

  6.7

  6.7

  1.6

  1995

  10

  11

  4

  3.9

  4.3

  1.6

  1 Population aged 10 and over.

  2 Figures for earlier years are not available.

  Perjury
  Mr. Gordon Prentice
  To ask the Secretary of State for the Home Department what plans he has to review the law of perjury. [7918]

  Mr. Michael
  We have no plans to do so at present. Criminal sanctions are already available in appropriate cases. A person knowingly making a false report to the police which tends to show that they have evidence material to police inquiry may be charged with wasting police time and could be liable on conviction to imprisonment up to six months or a fine of £1,000. A person making a statement to a court which is material to the proceedings and which they know to be false may be liable to conviction for perjury and could face a prison sentence for up to seven years. The more serious common law offence of perverting, or attempting to pervert, the course of justice is committed where a person acts or embarks upon a course of conduct which has a tendency to, and is intended to, pervert the course of justice. It is a matter for the prosecuting authorities to decide in any such case whether there is sufficient evidence to mount a prosecution and whether it would be in the public interest. There are around 200 prosecutions for perjury a year, of which a high proportion of cases result in convictions, as indicated in my reply to my hon. Friend on 26 June,Official Report, column 574.

  Wrongful Convictions
  Mr. McNamara
  To ask the Secretary of State for the Home Department, pursuant to his answer of 22 May,Official Report, column 111, how many outstanding claims for financial compensation for individuals found by the Court of Appeal to have been wrongfully convicted have been outstanding for (a) more than 12 months, (b) more than two years, (c) more than three years, (d) more than four years and (e) more than five years. [7395]

  Mr. Michael
  [holding answer 14 July 1997]: There is a total of 149 cases outstanding where, following the reversal of a conviction, a decision to pay compensation has been taken in principle but the claim has yet to be settled. Of these, (a) 11 have been outstanding for more than 12 months; (b) 102 for more than two years; (c) six for more than three years; (d) one for more than four years; and (e) 16 for more than five years. By far the most significant factors in delaying a settlement in these cases
  182
  have been either delay by applicants or by their representatives in submitting final claims, or reluctance on their part to accept the offers made.

  The figure at (b) include 93 claims stemming from the quashing of a high number of drink-driving convictions in Greater Manchester following possible contamination of blood samples.

  I regret that in the answer I gave to my hon. Friend on 22 May, a number of these cases were overlooked: at that time the total number outstanding was in fact not 52, as given in my reply, but 106, in 54 of which representations had yet to be received from the claimants. Of the 93 such cases currently outstanding, representations are awaited from 41 and the remaining 52 are being processed.

DUCHY OF LANCASTER

  Next Steps Agencies
  Dr. Whitehead
  To ask the Chancellor of the Duchy of Lancaster how many next steps executive agencies have regional administrative structures; and, of these, how many have boundaries that coincide with those of the Government Offices for the Regions; and if he will make a statement. [8437]

  Mr. Kilfoyle
  There are 37 executive agencies that have regional administrative structures. Of these, three have boundaries that coincide with the Government Offices for the Regions. They are Social Security Benefits Agency, Social Security Child Support Agency and Social Security Contributions Agency.

  Dr. Whitehead
  To ask the Chancellor of the Duchy of Lancaster what procedures exist concerning the accountability of next steps executive agencies to Ministers for the process of determining the content of next steps agency framework document; and if he will make a statement. [8349]

  Mr. Kilfoyle
  It is the responsibility of the departmental Minister to set the framework within which the department's executive agencies are to operate and therefore to determine which matters are to be assigned to a Chief Executive under the terms of an Agency's framework document.

AGRICULTURE, FISHERIES AND FOOD

  Soil Erosion (Sheep)
  Mrs. Anne Campbell
  To ask the Minister of Agriculture, Fisheries and Food what plans he has to minimise the erosional impact of sheep in the hills. [7839]

  Mr. Morley
  Erosion is a widespread, natural process which may be exacerbated by a range of causes, including land use practice, atmospheric pollution and recreational activities. Earlier this year MAFF commissioned a three year project to identify the precise causes of upland erosion and propose potential solutions. Agri-environment schemes including Environmentally Sensitive Areas, the Moorland Scheme and (in England only) Countryside Stewardship are contributing to the positive maintenance of upland habitats, including through the encouragement of extensive grazing and improved management practices.

  Piglets (Tail Docking)
  Mr. Mullin
  To ask the Minister of Agriculture, Fisheries and Food what steps he is taking to secure compliance with the prohibition on the routine tail docking of piglets in the Welfare of Livestock Regulations 1994; and if he will make a statement. [7857]

  Mr. Morley
  The docking of piglets' tails is not unlawful under the Welfare of Livestock Regulations 1994 where there is evidence on the farm that injuries to animals are otherwise likely to occur. We are currently examining the application of these rules to make sure that the objective of protecting pig welfare is properly met.

  Genetically Modified Food
  Mr. Martyn Jones
  To ask the Minister of Agriculture, Fisheries and Food what research he has commissioned into(a) segregation and (b) labelling of genetically modified food; what estimate he has made of the time scale by which (a) and (b) will be feasible; and if he will make a statement. [8499]

  Mr. Rooker
  The safety of foods produced using genetic modification is assessed by the Advisory Committee on Novel Foods and Processes and is underpinned by scientific research work carried out by the Department. I see no need for the Government to commission research into the segregation or labelling of genetically modified food. The Government is pressing at European level for all foods which may contain genetically modified ingredients to be clearly labelled whether they have been fully segregated or not.

  Mr. Bercow
  To ask the Minister of Agriculture, Fisheries and Food what plans he has to require labelling on all foods that contain genetically modified ingredients, informing potential customers to that effect; and if he will make a statement. [8593]

  Mr. Rooker
  I refer the hon. Member to the reply given to the hon. Member for Lewes (Mr. Baker) on 9 June 1997,Official Report, columns 356–57.

  Beef (Intervention Stores)
  Sir Richard Body
  To ask the Minister of Agriculture, Fisheries and Food how many tons of beef held in United Kingdom intervention stores have been removed and made inedible. [8638]
  184
  Mr. Rooker
  A total of 254 tonnes of intervention beef taken into UK intervention stores prior to 27 March 1996 has been disposed of by incineration.

  Environmentally Sensitive Areas Report
  Mr. Purchase
  To ask the Minister of Agriculture, Fisheries and Food what reply he proposes to make to the Second Report of the Agriculture Committee on Environmentally Sensitive Areas and Other Schemes Under the Agri-Environment Regulation (HC 45 (1996–97)), published on 19 March 1997. [9166]

  Mr. Morley
  The Government has today published its response to the conclusions and recommendations of the Agriculture Select Committee's report on these agri-environment schemes. Copies of the publication have been placed in the Library of the House.

FOREIGN AND COMMONWEALTH AFFAIRS

  Immigration
  Fiona Mactaggart
  To ask the Secretary of State for Foreign and Commonwealth Affairs what instructions have been given to British high commissions and embassies about dealing with appeals and applications for leave to appeal in respect of husbands, wives, fiancés and fiancées who were refused admission under the primary purpose rule; and what assessment he has made of how long such applicants will have to wait. [5526]

  Mr. Fatchett
  [holding answer 7 July 1997]: In cases where an application has been refused solely on primary purpose grounds and an appeal is pending the Home Office will remit the papers to the Entry Clearance Officer for issue of entry clearance, subject to there being no change of circumstances. In cases where no appeal was lodged, posts will issue if further representations are made, subject to no change in circumstances. Where applicants have been refused and an appeal dismissed, applicants may re-apply for entry clearance in the normal way.

  In fairness to those who have already re-applied, any new re-application resulting from the abolition of the Primary Purpose rule which is submitted by an individual who has already completed the appeal process will take its normal place in the queue. The maximum waiting time laid down for considering settlement re-applicants is nine months, although in practice the actual waiting time is significantly less than the maximum allowed. We shall continue to make every effort to process these re-applications quickly.

  Land Mines
  Mr. Coaker
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on the progress being made towards the banning of the trade in anti-personnel mines; and what has been the reaction of foreign Governments to Her Majesty's Government's activities in this area. [8124]
  185
  Mr. Tony Lloyd
  The United Kingdom's ban on export of anti-personnel landmines is in place. We are considering the legislation needed to implement bans on transfer, import, production and trade through the UK. We are also considering the circumstances in which movements of anti-personnel landmines might need to continue and will inform Parliament once we have reached conclusions. Any exceptions will end as necessary in 2005 or according to the provisions of an effective international agreement when it comes into force, whichever comes first.

  Our new policy on anti-personnel landmines had been widely welcomed.

  Russia
  Mr. David Atkinson
  To ask the Secretary of State for Foreign and Commonwealth Affairs what representations he has made to President Yeltsin concerning the law on freedom of conscience and religious associations passed by the Russian Parliament. [8450]

  Mr. Doug Henderson
  The EU Troika Ambassadors in Moscow carried out a demarche on Mr. Sidorov, the Deputy Foreign Minister, on 9 July. The demarche calls upon President Yeltsin not to allow the law to come into effect in its present form, since it appears to contravene both the Russian Constitution and Russia's OSCE and Council of Europe human rights obligations.

  Mr. Sidorov confirmed that the EU demarche would be brought to President Yeltsin's attention.

  Venezuela (British Nationals)
  Mr. Vaz
  To ask the Secretary of State for Foreign and Commonwealth Affairs on what date and at what time the British embassy in Caracas (i) was informed and (ii) informed the Foreign Office in London of the sentence imposed on James Miles and Paul Loseby. [8849]

  Mr. Fatchett
  The British Embassy in Caracas was informed of Mr. Miles and Mr. Loseby's sentence on 8 July at 21.45 hours BST. The Embassy immediately informed this Department by fax.

  Mr. Vaz
  To ask the Secretary of State for Foreign and Commonwealth Affairs what reports he has received concerning James Miles and Paul Loseby from sources other than the Venezuelan authorities. [8780]

  Mr. Fatchett
  Consular staff in Caracas have received reports concerning James Miles and Paul Loseby from their lawyers, representatives of the Anglican church and journalists who have visited them.

  Mr. Vaz
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will obtain a copy of the transcript of the court hearing concerning James Miles and Paul Loseby which took place in Caracas on 2 July. [8850]

  Mr. Fatchett
  The Venezuelan court process does not involve a "hearing". A copy of the written summary of evidence and statements of the Court's decision has been obtained by this Department and can be made available to my hon. Friend if he so wishes.
  186
  Mr. Vaz
  To ask the Secretary of State for Foreign and Commonwealth Affairs on what date in 1997 the British embassy in Caracas made representations to the Venezuelan Government concerning the cases of Paul Loseby and James Miles. [8779]

  Mr. Fatchett
  No representations have been made this year. The British Ambassador in Caracas wrote to the Judge on 10 April and 10 July to request medical checks for Paul Loseby.

  Amsterdam Treaty
  Sir Michael Spicer
  To ask the Secretary of State for Foreign and Commonwealth Affairs what plans he has for the implementation of the provisions of the Amsterdam treaty if it is not ratified by one or more of the member states. [8575]

  Mr. Doug Henderson
  The Treaty must be ratified by all 15 Member States in accordance with their respective constitutional requirements, before it can come into force. Should any Member State fail to ratify the Treaty, it could not be implemented in its current form.

  Mr. David Atkinson
  To ask the Secretary of State for Foreign and Commonwealth Affairs (1) if the definition of human rights, as referred to in the new article F1 of the treaty on European Union as created by the draft Amsterdam treaty, will be the same as that in the European convention on Human Rights; [8852]

  (2) if the definition of human rights, as referred to in the new article F1 of the treaty on European Union as created by the draft Amsterdam treaty, will include (a) freedom of information, (b) rights to welfare, (c) rights for the disabled, (d) rights for gays and lesbians, (e) employment rights, (f) the rights of refugees and asylum seekers, (g) health and safety provisions, (h) the right to strike and (i) social rights; [8854]

  (3) what scope there is for the definition of human rights as referred to in the new article F1 of the treaty on European Union as created by the draft Amsterdam treaty to be widened beyond the scope of the European convention on Human Rights; [8853]

  (4) what is the definition of human rights as referred to in the new article F1 of the treaty on European Union as created by the draft Amsterdam treaty. [8851]

  Mr. Doug Henderson
  The reference to human rights and fundamental freedoms in Article F.1 of the Treaty on European Union (TEU) is clarified by Article F.2 as "fundamental rights, as guaranteed by the European Convention for the Protection of Human Rights (ECHR) and Fundamental Freedoms signed in Rome on 4 November 1950 and as they result from the constitutional traditions common to the Member States, as general principles of Community law." The second part of that definition may differ from or go beyond the rights guaranteed by the ECHR. Article F.2 does not by itself confer such rights as freedom of information, welfare rights, rights for disabled people, rights for gays and lesbians, employment rights, rights of refugees and asylum seekers, health and safety provisions, the right to strike or social rights. It requires EU and Community Acts in any of those areas to respect the relevant requirements of the ECHR or other rules on fundamental rights.

  Indonesia
  Ann Clwyd
  To ask the Secretary of State for Foreign and Commonwealth Affairs what was the outcome of his Department's investigation into the use of British-made equipment by the Indonesian authorities during recent events in Bandung and Jakarta. [8732]

  Mr. Fatchett
  We are studying the information available regarding the alleged use of UK supplied water-cannon in Bandung and Jakarta in June and July 1996. No firm conclusions have yet been drawn.

CULTURE, MEDIA AND SPORT

  Live Performances
  Mrs. Virginia Bottomley
  To ask the Secretary of State for Culture, Media and Sport what plans he has to ensure the greater dissemination of live performances from national lottery-funded venues. [8672]

  Mr. Banks
  We place the highest importance on access to cultural and sporting events. The Government are reviewing all aspects of the National Lottery. A White Paper setting out our proposals in greater depth will be published shortly.

  Recreation and Leisure Facilities
  Mr. Fearn
  To ask the Secretary of State for Culture, Media and Sport if he will list the income from recreation and leisure facilities for each local authority in the north-west in the last available year. [8540]

  Mr. Banks
  The following table details the income from recreation and leisure facilities for each local authority in the north-west for 1995–96, the latest figures available. The table is based on data collected annually from local authorities by the Department of Environment, Transport and the Regions through its Revenue Outturn exercise.

  Total income from recreation and leisure facilities 1995–96

  £000

  Local authority1

  Leisure facilities2

  Recreation facilities3

  Total

  Allerdale

  94

  117

  211

  Barrow in Furness

  158

  5

  163

  Blackburn

  323

  27

  350

  Blackpool

  1,345

  13

  1,358

  Bolton

  865

  1,147

  2,012

  Burnley

  565

  547

  1,112

  Bury

  228

  306

  534

  Carlisle

  3,405

  230

  3,635

  Cheshire

  1,033

  2,609

  3,642

  Chester

  306

  293

  599

  Chorley

  351

  27

  378

  Congleton

  1,534

  30

  1,564

  Copeland

  665

  15

  680

  Crewe and Nantwich

  958

  33

  991

  Cumbria

  242

  25

  267

  Eden

  111

  23

  134

  Ellesmere Port and Neston

  1,158

  65

  1,223

  Fylde

  306

  48

  354

  Halton

  1,125

  984

  2,109

  Hyndburn

  258

  149

  407

  Knowsley

  117

  6

  123

  Lancashire

  0

  246

  246

  Lancaster

  63

  35

  98

  Liverpool

  10,024

  5,469

  15,493

  188

  Total income from recreation and leisure facilities 1995–96

  £000

  Local authority1

  Leisure facilities2

  Recreation facilities3

  Total

  Macclesfield

  824

  165

  989

  Manchester

  2,172

  2,101

  4,273

  Oldham

  1,596

  1,491

  3,087

  Pendle

  158

  26

  184

  Preston

  1,374

  136

  1,510

  Ribble Valley

  136

  55

  191

  Rochdale

  1,253

  226

  1,479

  Rossendale

  705

  55

  760

  Salford

  1,414

  267

  1,681

  Sefton

  631

  1,098

  1,729

  South Lakeland

  824

  164

  988

  South Ribble

  202

  41

  243

  St. Helens

  2,567

  167

  2,734

  Stockport

  1,828

  414

  2,242

  Tameside

  617

  229

  846

  Trafford

  788

  210

  998

  Vale Royal

  359

  602

  961

  Warrington

  111

  2,426

  2,537

  West Lancashire

  527

  571

  1,098

  Wigan

  978

  1,266

  2,244

  Wirral

  2,545

  910

  3,455

  Wyre

  93

  198

  291

  1 Local authorities within the area of the Government Office for the North West and the Government Office for Merseyside.

  2 Leisure facilities defined as: sports and physical recreation centres; golf courses; playing fields and sports grounds; swimming pools; and miscellaneous recreation centres.

  3 Recreation facilities defined as: national parks; country parks; and parks and open spaces.

  Broadcasting
  Mr. Sheerman
  To ask the Secretary of State for Culture, Media and Sport what plans he has to ensure diversity, choice and quality in the provision of radio programming in the independent broadcasting sector. [8687]

  Mr. Fisher
  The Radio Authority is statutorily responsible for licensing and regulating independent radio services in the UK. The Radio Authority is already required under the Broadcasting Act 1990 to do all that it can to secure the provision within the United Kingdom of a diversity of national services, each catering for the tastes and interests different from those catered for by others, and to secure a range and diversity of local services. The Authority is also required under the 1990 Act to facilitate the provision of licensed services which (taken as a whole) are of high quality.

  The substantial increase in the number of independent stations presided over by the Authority over the past six years has fostered diversity and choice. In my hon. Friend's constituency, for example, there are now three national and four local independent stations (including the newly awarded small-scale local licence for Huddersfield), compared with none and two respectively. Positive quality is not so readily measured, but worthwhile radio programming is not confined to the BBC; audience figures suggest that the public is satisfied with the output of the independent sector and the Authority actively monitors programming to hold broadcasters to their promises of performance and to maintain standards.

  Film
  Mrs. Virginia Bottomley
  To ask the Secretary of State for Culture, Media and Sport how much money has been announced for film from the national lottery so far; and how much is it expected will be allocated to film by 2002. [8016]

  Mr. Tom Clarke
  Original estimates in 1995 were that around £100 million would be available for film production, distribution and cinema improvements across the UK by 2000. So far almost £90 million has been awarded to film and cinema projects. In addition, over £90 million has been allocated over the next six years to three National Lottery film franchises.

  Mr. Forth
  To ask the Secretary of State for Culture, Media and Sport if he will list for the Review of the British Film Industry(a) the expected completion date and (b) the cost of conducting the review. [8238]

  Mr. Clarke
  The Film Review Group is planning to publish its report early next year, and will continue to meet thereafter to discuss any follow-up. There is no fixed budget or costing for the review; the Review Group will be supported by officials from my Department, and as required, resources from DCMS research and consultancy budgets.

  Hotel Rating
  Mr. Fearn
  To ask the Secretary of State for Culture, Media and Sport what advice he has given organisations introducing hotel ratings systems on the merits of a quality versus a facilities-based system. [8168]

  Mr. Tom Clarke
  [holding answer 14 July 1997]: It is for the organisations concerned to make their own decisions, my view is that facilities, services and quality

  Aid and Trade provision projects

  Project

  Type of agreement

  Allocated expenditure (£000)

  Location

  Sector

  Expected completion date

  Citayam/Cibinong Railway

  Soft loan

  20,105

  Java

  Transport

  1999

  150/500kV Substations

  Mixed credit

  15,516

  Java

  Power

  1998

  Samarinda Power Station

  Soft loan

  12,570

  East Kalimantan

  Power

  1998

  Samarinda Transmission Line

  Soft loan

  1,600

  East Kalimantan

  Power

  1998

  Samarinda Monitoring

  ATP/TC

  1,260

  East Kalimantan

  Power

  1998

  Piston Engine Laboratory Research

  Soft loan

  4,640

  West Java

  Science and technology

  1999

  Science and Technology Equipment

  Soft loan

  4,340

  West and Central Java

  Education

  1998

  Science and Technology Equipment

  ATP/TC

  550

  West and Central Java

  Education

  1999

  Technical co-operation projects

  Project

  Type of Agreement

  Allocated expenditure (£000)

  Location

  Sector

  Expected completion date

  Provincial Forest Management

  Grant

  3,060

  Jakarta

  Forestry

  1997

  Sumatra

  alimantan

  End Use Energy Efficiency

  Grant

  1,350

  Jakarta

  Energy

  1999

  Mini Hydro Project

  Grant

  6,250

  Sulawesi

  Energy

  1997

  Irian Jaya

  Environmental Biotechnology

  Grant

  1,840

  Jakarta

  Environment

  1998

  BAPADEL Groundwater Monitoring

  Grant

  531

  Java

  Environment

  1999

  LAN Communication Skills

  Grant

  1,855

  Java

  Education

  1997

  Education Project Management Training

  Grant

  450

  Jakarta

  Education

  2000

  Curriculum Capacity

  Grant

  800

  Jakarta

  Education

  2000

  Regional Finance

  Grant

  1,652

  Jakarta

  Public Administration

  1998

  190
  are all important and should increase at each level. I therefore welcome the joint ETB/AA/RAC scheme announced in February, which will rate hotels in this way.

INTERNATIONAL DEVELOPMENT

  Indonesia
  Ann Clwyd
  To ask the Secretary of State for International Development, pursuant to her answer of 9 June,Official Report columns 293–96, on aid and trade projects with Indonesia, what is the location of the 150/1500kv substation; what type of substation it is; who are the primary beneficiaries of the project; and what are the mixed credits involved. [8766]

  Clare Short
  The power transmission substations for both 150kV and 500kV supplies are all sited on Java in the following locations:

  New Tangareng, Cenkareng, Bogor Baru, Sentul, Pondok Pinang, Jombang, Rancakasumba, Cikasungka, Bandung Selatan, Margahayu, New Padalarang, Grati, Surabaya Selatan and Surabaya Selatan.

  The primary beneficiaries are domestic, commercial, industrial and public sector electricity consumers. Mixed credit financing for a sum of up to £15,516,493, representing 35 per cent. of the UK content of the project, has been made available in support of a contract awarded to GEC Alsthom-Cegelec Substation Projects Limited.

  Ann Clwyd
  To ask the Secretary of State for International Development if she will list each aid project currently funded by her Department in Indonesia, indicating(a) the type of agreement, (b) the allocated expenditure, (c) the location, (d) the sector involved and (e) the expected completion date. [8762]

  Clare Short
  Details of the projects in Indonesia currently funded by the Department for International Development are set out in the following tables.
  191

  Technical co-operation projects

  Project

  Type of agreement

  Allocated expenditure (£000)

  Location

  Sector

  Expected completion date

  Civil Service Training

  Grant

  670

  Jakarta

  Public Administration

  2000

  Animal Health

  Grant

  862

  Java

  Natural Resources

  1999

  Decentralised Livestock Services

  Grant

  4,393

  Java

  Natural Resources

  1999

  Completed TC projects with expenditure in 1997–98

  Project

  Type of agreement

  Allocated expenditure (£000)

  Location

  Sector

  Completion date

  Forest Sector Review

  Grant

  72

  Jakarta

  Forestry

  November 1996 (residual invoices awaited: £16,000)

  Sumatra

  Kalimantan

  Environmental Monitoring

  Grant

  410

  Jakarta

  Environment

  December 1996 (carry over training costs: £9,000)

  Police Management Training

  Grant

  1,125

  Jakarta

  Public Administration

  March 1996 (carry over training costs: £10,000)

  LEMIGAS

  Grant

  4,951

  Jakarta

  Energy

  May 1997

  Tropical Forest Management

  Grant

  4,143

  Jakarta

  Forestry

  June 1997

  Forest Research

  Grant

  3,100

  Kalimantan

  Forestry

  June 1997

  Forest Training

  Grant

  3,587

  Kalimantan

  Forestry

  June 1997

  Forest Conservation

  Grant

  3,804

  Kalimantan

  Forestry

  June 1997

  Ann Clwyd
  To ask the Secretary of State for International Development, pursuant to her answer of 9 June,Official Report, columns 293–96, on aid and trade projects with Indonesia if she will list the location of each project listed. [8761]

  Clare Short
  The locations of the aid and trade projects listed in my response of 9 June,Official Report, columns 293–96, are set out in the following table.

  The locations by province of the bridges funded under Phase 11 of the Steel Bridging project, were listed in a previous reply (Official Report of 15 June 1995, column 632).

  The power transmission substations for both 150kV and 500kV supplies are all sited on Java in the following locations:

  New Tangareng, Cenkareng, Bogor Baru, Sentul, Pondok Pinang, Jombang, Rancakasumba, Cikasungka, Bandung Selatan, Margahayu, New Padalarang, Grati, Surabaya Selatan and Surabaya Selatan.

  I refer my hon. Friend to the answer that I gave to her earlier question (8766).

  Project

  Location

  Auto Industry Development Study

  Jakarta

  Western Universities Equipment

  Sumatra/Kalimantan

  Steel Bridging II

  Various: See Hansard 15 June 1995, column 632

  Flight Simulator

  Surabaya, Java

  Bali and Medan Airport Security

  Bali/Sumatra

  Jambi Power Station

  Jambi, Sumatra

  Cikampek—Padalarang Toll Road Design study

  West Java

  Western Universities Training Centre

  Sumatra

  Flight Simulator Consultancy

  Surabaya, Java

  Samarinda Power Station

  East Kalimantan

  Samarinda Transmission Line

  East Kalimantan

  150/500KV Substations Project

  Various: See text—above

  Piston Engines Research Laboratory

  West Java

  Science and Technology Project, Java Universities

  West and Central Java

  Cambodia
  Mr. Goodlad
  To ask the Secretary of State for International Development what aid programmes for Cambodia are currently in place; and what are her future plans for aid to Cambodia. [8699]

  Clare Short
  [holding answer 15 July 1997]: Under our bilateral development programme, which will be worth some £3 million in 1997–98, we are supporting projects in health, education, urban poverty and landmine clearance.

  In health, we are financing four projects designed to improve Cambodian capacity to deliver basic health services to poorer people, improve reproductive health especially for women, reduce malaria and slow the spread of HIV and other sexually transmitted diseases. In education, we are helping to improve the teaching of English in secondary schools and funding the preparation of a master plan for teacher training. In urban poverty, we are funding a UN project designed to improve physical and social conditions for poor people in Phnom Penh. We are also contributing with other donors to a UN Trust Fund which finances landmine clearance.

  In addition, under our Joint Funding Scheme, we are helping to finance the programmes of a number of British Non-Governmental Organisations involved in areas such as health, community development, landmine clearance and support for landmine victims.

  We are obviously concerned by recent events in Cambodia and will be monitoring the situation there closely through the British Embassy. The FCO has advised UK nationals to leave Cambodia, but our understanding is that most UK aid staff intend to stay. Given that our programme is designed to help poorer people in Cambodia, we propose to maintain it.

  As the UK delegation at the recent Cambodia Consultative Group meeting in Paris made clear, future commitments of government to government assistance will depend not only on political stability, but also on the Cambodian Government's performance on the rule of law, transparent financial management and forestry policy. A key factor will be progress towards free and fair democratic elections scheduled for 1998.

  Departmental Budgets
  Mr. Malcolm Bruce
  To ask the Secretary of State for International Development what new plans she has to introduce cuts and savings in her Department as a result of the effect on her Department's budgets for 1997–98 and 1998–99 of the upward revisions to the GDP deflators in the Budget on 2 July; and if she will make a statement. [8314]

  Clare Short
  [holding answer 14 July 1997]: All Departments are reallocating spending within their Departmental ceilings as part of the Comprehensive Spending Review.

  Mr. Bruce
  To ask the Secretary of State for International Development if, following the recent Budget, she will give her estimate of the total real level of her Department's budget, in 1995–96 prices, in(a) 1997–98 and (b) 1998–99; if she will estimate what such figures were for (1) 1997–98 and (2) 1998–99 following the November 1996 Budget on the basis of the estimates of the GDP deflator contained in that Budget; and if she will make a statement. [8313]

  Clare Short
  [holding answer 14 July 1997]: The figures requested for my Department's spending plans within the Control Total are as follows: (a) £2,071 million, (b) £2,140 million, (1) £2,120 million, (2) £2,177 million.

  The figures for 1997–98 have not been adjusted to take account of the Summer Supplementary Estimates presented to Parliament on 8 July but not yet approved.

  Commercial Lobbyists
  Mr. Campbell-Savours
  To ask the Secretary of State for International Development (1) on what dates since 1 May(a) Ministers and (b) officials in her Department have attended meetings with organisations representing (i) commercial and (ii) non-commercial interests organised by commercial lobbying firms; and if she will introduce a register of such meetings; [8084]

  (2) on what dates since 1 May (a) Ministers and
  (b) officials in her Department have met commercial lobbyists to discuss matters relating to the business of her Department; and if she will introduce a register of such meetings. [8083]

  Clare Short
  As my right hon. Friend the Prime Minister explained in response to the hon. Member for Newport, West (Mr. Flynn),Official Report, 2 June 1997, column 99, Ministers and officials in the Department receive deputations from many groups who are concerned to press their own interests or those of their clients, which Ministers and officials take due care to consider within the wider public interest and Government policy. The Department keeps normal records of such meetings. It is not practicable to distinguish particular groups as lobbyists, nor is it practicable to keep a register of such meetings.

  Know How Consultancies
  Mr. Alasdair Morgan
  To ask the Secretary of State for International Development what was the value of Know How consultancy contracts in each year since the 194
  scheme was established; and what value of such contracts was awarded in each year to companies headquartered in Scotland. [8286]

  Clare Short
  [holding answer 15 July 1997]: Information on Know How consultancy contracts awarded before 1992–93 is not centrally recorded and could be provided only at disproportionate cost. The value of such contracts let in the United Kingdom from 1992–93 was:

  Financial year

  Total value £

  1992–93

  27,709,426

  1993–94

  55,965,059

  1994–95

  59,220,754

  1995–96

  49,322,326

  1996–97

  85,072,905

  1997–98 (to date)

  16,929,706

  Contracts awarded to companies with headquarters in Scotland are not recorded separately.

  Development Assistance
  Mr. Blunt
  To ask the Secretary of State for International Development if it is the Government's policy that the United Kingdom should continue to give development assistance to Commonwealth countries which are in clear breach of the Harare Declaration. [8581]

  Clare Short
  [holding answer 15 July 1997]: The UK Government's objective is the achievement of human rights for all people. We welcome and support the Commonwealth's commitment to the high standards set out in the Harare Declaration. A government's commitment to human rights will therefore be taken into account when decisions are made on development cooperation. My department will focus in its main efforts on promoting the rights essential for eliminating poverty and for achieving sustainable livelihoods and dignity for disadvantaged people in poor countries. This will frequently include aspects of good government and improved institutions. We will work in partnership with government, NGOs and civil society.

  Kenya
  Mr. Blunt
  To ask the Secretary of State for International Development how much bilateral development assistance her Department plans to spend in the Republic of Kenya in the years 1997–98 and 1998–99. [8580]

  Clare Short
  [holding answer 15 July 1997]: Total bilateral aid expenditure is currently expected to be about £30 million in the 1997–98 financial year. It is not possible to predict the size of the programme for 1998–99 in advance of the annual Resource Allocation Round. But the level of assistance will take account of our current policy review of international development and the extent to which Britain can work in partnership with the Government of Kenya, as well as the private sector and NGOs, to reduce poverty in Kenya.
  195
  Mr. Blunt
  To ask the Secretary of State for International Development what changes she plans in her policy on giving development assistance to the Republic of Kenya following the recent suppression of democracy activists. [8582]

  Clare Short
  [holding answer 15 July 1997]: The Government has made clear its concern about recent events in Kenya and its wish to see free and fair elections.

  We will continue to urge the Government of Kenya to promote policies which demonstrate a clear commitment to the reduction of poverty. Our future policies will reflect the extent to which the Kenya Government is able to demonstrate a willingness to pursue pro-poor economic growth, more accountable government and greater respect of human rights and the rule of law.

  Organic Produce
  Mr. Martyn Jones
  To ask the Secretary of State for International Development what assessment she has made of the role of organic produce in assisting(a) Caribbean countries and (b) other developing countries to increase their international trade; and if she will make a statement. [8735]

  Clare Short
  I am keen to explore the potential for organic production in developing countries. My Department has seconded an agricultural specialist to the Delegation of the European Commission in the Eastern Caribbean to serve as Donor Co-ordinator to the Banana Industry. The Co-ordinator is working with Government and banana industry representatives on how the Windward Islands might best respond to any proposed erosion of the preferential trade agreement for bananas with the European Union. This agreement comes to an end in 2002. A range of options are being considered for improving the quality of Windward Islands' bananas and to identify niche markets.

  Some Caribbean producers are beginning to take an interest in organic exports. The European Commission is helping farmers in the Windward Islands to consider the potential of organic production.

  Disregarding travel-to-work costs in calculating earnings

  Benefit

  All costs

  70 per cent. taper

  50 per cent. taper

  Costs £ million

  Gainers

  Cost £ million

  Gainers

  Costs £ million

  Gainers

  Income support/income-based

  jobseeker's allowance cases

  15

  80,000

  10

  80,000

  1—

  80,000

  Contribution-based jobseeker's allowance only cases

  1—

  10,000

  1—

  10,000

  1—

  10,000

  Housing benefit

  70

  160,000

  50

  160,000

  35

  160,000

  Council tax benefit

  20

  120,000

  15

  120,000

  10

  110,000

  1 Denotes negligible cost i.e. less than £2.5 million.

  1. Modelled on the 1994–95 Family Resources Survey (FRS) uprated to 1997–98 benefit levels and earnings.

  2. Costs are rounded to the nearest £5 million, gainers to the nearest 10,000.

  3. The estimate for income support and jobseeker's allowance (JSA) has been combined due to difficulties in separately identifying the unemployed not in receipt of contributory benefit on the FRS.

  4. This is a deadweight estimate: there is insufficient information on which to estimate possible behavioural responses.

  5. A number of benefit units on family credit would be better off on income support/JSA as a result of this change. It is assumed that they do move onto out of work benefits, and the IS/JSA(Income Based) cost is net of the family credit saving.

  6. No figures are collected directly on the cost of running cars and motorcycles. Instead, costs are estimated using mileage rates (42 pence per mile for cars and nine pence per mile for motorcycles). Outlying cases have been ignored.
  196
  My Department recently commissioned a study from the Henry Doubleday Research Association and Coventry University on the potential for further development of organic agriculture in sub-Saharan Africa. This study concluded that in the short-term there is limited scope for small-scale farmers in Kenya and Ghana to export organic produce. I will place a copy of this report in the Library of the House once it is finalised.

  There is, however, considerable interest in adopting individual organic technologies which conserve resources. But, with the exception of some non-perishable crops such as coffee and tea, it would appear that, without some assistance, few resource-poor farmers will be able, in the short to medium-term, to achieve international standards of organic accreditation.

  Through our Sustainable Agriculture Strategy my Department will work with poor farmers to develop and use technologies which conserve resources and minimise the use of agricultural pesticides. Where this is appropriate we will also help groups of farmers to achieve organic accreditation, thus increasing their incomes by exporting produce or selling to urban centres.

SOCIAL SECURITY

  Travel-to-work Costs
  Mr. Alan Simpson
  To ask the Secretary of State for Social Security what is her estimate of(a) the cost to her Department and (b) the numbers gaining, if the costs of travel-to-work were disregarded in full for claimants of (i) income support, (ii) jobseeker's allowance, (iii) housing benefit and (iv) council tax benefit; and what is her estimate of the costs and numbers gaining if such costs were subject to a taper of (X) 70 per cent. and (Y) 50 per cent. for costs exceeding the level of the disregard. [2967]

  Mr. Keith Bradley
  Our objective is to reduce poverty and welfare dependency and to promote work incentives. One of our first steps will be to help people off welfare and into work.

  The information is in the table.

  Pension Age
  Mr. Nigel Jones
  To ask the Secretary of State for Social Security what proportion of women aged 60 years in each of the last 10 years for which figures are available have ceased working and started to draw their state pension. [3847]

  Mr. Denham
  We will retain the Basic State Pension as the foundation of pension provision, increasing it at least in line with prices and we will review the central areas of insecurity for older people.

  Information on women who were working prior to drawing their State Pension at State Pension Age and who then stopped working, is only available for those who were employed earners paying Class 1 National Insurance contributions (NICs) during the tax year in which they reached 60. This information, which excludes women who were self-employed or earning less than the lower earnings limit for paying NI contributions (currently £62.00), is used to derive the proportions provided in the table.

  Proportion of women aged 60 who have been awarded Retirement
  Pension and have paid Class 1 NICs in the tax year of their 60th birthday prior to that date,
  and whose employers have not subsequently paid any Category C NI contributions in respect of
  them during the remainder of that same year

  Year

  (per cent.)

  1994–95

  9

  1993–94

  9

  1992–93

  8

  1991–92

  8

  1990–91

  7

  1989–90

  8

  1988–89

  7

  1987–88

  8

  1986–87

  7

  1985–86

  8

  1. The figures are for Great Britain and are derived from the 1 per cent. sample of National Insurance Records analysed using the February 1996 version of the Lifetime Labour Market Database.

  2. Category C contributions are paid by employers and are recorded on the P14 End of Year Return when an employee has no liability due to reaching State Pension Age. They may also be paid where people have multiple employments and earnings are expected to exceed the Upper Earnings Limit for National Insurance, thus avoiding a rebate of contributions. It has been assumed that for all women in the tax year of their 60th birthday, Class C contributions arise after that birthday and therefore signal that the woman has not retired reaching State Pension Age.

  3. The percentages in the table are of the estimated resident population for each year supplied by the Population Estimates Unit, OPCS.

  Mr. Nigel Jones
  To ask the Secretary of State for Social Security what estimate she has made of the cost per year of additional(a) income support, (b) housing benefit and (c) council tax relief if the pension age of women were raised to 65 years. [3846]

  Benefit

  Rate at introduction

  Date of introduction

  Current rate

  Value if increased in line with benefit since date introduced

  Income support

  £5

  April 1988

  £5

  £7.35

  £10

  October 1996

  £10

  £10.25

  £15

  April 1988

  £15

  £22.05

  Income-based jobseeker's allowance

  £5

  October 1996

  £5

  £5.15

  £10

  October 1996

  £10

  £10.25

  £15

  October 1996

  £15

  £15.40

  198
  Mr. Bradley
  The policies of the previous administration have created real poverty, growing inequality and widespread insecurity for pensioners. We believe that all pensioners should share fairly in the increasing prosperity of the nation.

  The information is not available in the format requested. Such information as is available is in the table.

  Year

  Income related benefit costs £ million

  2025

  500

  2035

  300

  1. Costs are estimated using the approach discussed in Appendix 1 of the discussion document Options for Equality in State Pension Age CM 1723, adjusted to 1994–95 price levels and a phasing profile beginning in 2010 taking two years to achieve each single year of State Pension Age change.

  2. As in the discussion document Options for Equality in State Pension Age Cm1723, estimates are provided for 2025, when the financial effects are likely to be at their maximum, and 2035 when the estimates should provide a reasonable representative indicator of the scale of the effects up to 2050.

  3. Estimates are subject to considerable uncertainty and are rounded to the nearest £100 million. They should be interpreted as broad indicators rather than precise estimates.

  Income Support and Jobseeker's Allowance
  Mr. Pond
  To ask the Secretary of State for Social Security what estimate she has made of the cost, in the latest year for which figures are available, of introducing an extension period for the payment of income support and jobseeker's allowance mortgage interest, equivalent to the scheme for extended payments of housing benefit and council tax benefit for the newly employed. [5445]

  Mr. Keith Bradley
  The estimated cost of introducing an extension period for the payment of mortgage interest, in line with current provisions available in both housing benefit and council tax benefit for the newly employed, is £4 million a year.

  Earnings Disregards
  Mr. Pond
  To ask the Secretary of State for Social Security what would be the current value of the earnings disregards which apply for housing benefit, income support and income-related benefit for the unemployed if they had been uprated in line with these benefits since 1988. [5443]

  Mr. Keith Bradley
  Our objective is to reduce poverty and welfare dependency and to promote work incentives. We will develop a system that supports work, savings and honesty.

  The information requested is in the table.
  199

  Benefit

  Rate at introduction

  Date of introduction

  Current rate

  Value if increased in line with benefit since date introduced

  Housing benefit

  £5

  April 1988

  £5

  £7.35

  £10

  April 1988

  £10

  £14.75

  £15

  April 1988

  £15

  £22.05

  £15

  April 1988

  £25

  £22.05

  Housing benefit Child Care disregard

  £40

  October 1994

  £60

  £43.05

  1. The Retail Price Index (all items) less rent, local taxes and Mortgage Interest payments as published by the Office of National Statistics, has been used in this table.

  2. Jobseeker's allowance replaced income support and unemployment benefit as the main benefit for the unemployed in October 1996.

  3. The standard disregard is £5 a week, but a higher £15 disregard is available to the following groups:—lone parents entitled to the lone parent premium; disabled people entitled to the disability premium; certain people aged over 60; carers entitled to the carer premium; members of certain specialist groups eg: part-time firefighters and reservists.

  4. Couples have the first £10 of their earnings disregarded.

  5. The £15 disregard in housing benefit was increased for lone parents to £25 in October 1990.

  6. The £40 child care disregard in housing benefit was increased to £60 in April 1996. From April 1998 it will be increased further to a maximum of £100 a week where there are two or more children in the family.

  Housing Benefit
  Mr. Flynn
  To ask the Secretary of State for Social Security what is the maximum amount of housing benefit available to single people under the age of 25 years in each local authority area. [8806]

  Mr. Keith Bradley
  Our objective is to reduce poverty and welfare dependency and to promote work incentives. One of our first steps is to focus on helping 250,000 young people off welfare and into work.

  The information is not available in the format requested. Such information as is available is set out in the table.

  Housing benefit recipients who are single and aged under 25, average weekly housing benefit by region and Great Britain—May 1995

  Average weekly housing benefit (£)

  Great Britain

  45.73

  North

  38.77

  Yorkshire and Humberside

  37.56

  East Midlands

  40.96

  East Anglia

  44.72

  South East (excluding London)

  53.46

  London

  59.46

  South West

  45.91

  West Midlands

  39.28

  North West

  43.91

  Wales

  40.07

  Scotland

  37.38

  Source:

  Housing Benefit Management Information System, annual 1 per cent. sample enquiries taken at the end of May 1995.

  Notes:

  1. Average amounts are rounded to the nearest 1 pence.

  2. Analysis by local authority area is not available from our 1 per cent. sample enquiries.

  Mr. Flynn
  To ask the Secretary of State for Social Security how many people under the age of 25 years have had their housing benefit reduced as a result of the limitation of housing benefit to the single room rent; and what proportion of these have been(a) male and (b) female. [8805]

  Mr. Bradley
  The information is not yet available. However, we are monitoring the impact of the Single Room Rent, by collecting information from a sample of 200
  local authorities on an on-going basis, and data from that exercise are currently being analysed. The number of under 25s who have had their Housing Benefit reduced as a result of the Single Room Rent will be available from the Housing Benefit/Council Tax Benefit Summary Statistics 1997 which is due to be published in August. The summary will be available in the Library, but the split between males and females will not be available.

  Mr. Flynn
  To ask the Secretary of State for Social Security what assessment she has made of the impact of the limitation of housing benefit to single room rent for single people under the age of 25 years; and what plans she has to end the limitation. [8807]

  Mr. Bradley
  These measures were introduced by the previous Government. We have, however, announced our intention to revoke the extension of the single room rent to people aged between 25 and 59. We are gathering evidence on the impact of the single room rent for the under 25s. Information is being collected from a sample of local authorities on an on-going basis and officials are meeting local authorities, advice agencies and rent officers to obtain early, direct information on the impact of the changes. A survey has also been commissioned to obtain information on Housing Benefit and the private rented sector, the results of which are expected next summer.

  We will give the results careful consideration.

  Mr. Flynn
  To ask the Secretary of State for Social Security if she plans to implement the limitation of housing benefit to single room rent for single people aged 25–60 years. [8799]

  Mr. Bradley
  I refer the hon. Member to the reply given by my right hon. Friend the Secretary of State to the hon. Member for Glasgow Pollock (Mr. Davidson) on 18 June,Official Report, columns 215–16.

  Benefits Agency
  Mr. Rooney
  To ask the Secretary of State for Social Security (1) what is her Department's policy on Benefit Agency staff giving their name during telephone calls to(a) hon. Members and (b) claimants; and when this was last revised; [8887]
  201
  (2) what advice is given to Benefit Agency staff for giving information on constituency cases to hon. Members (a) over the telephone and (b) in writing; when this was last revised; and to what grade of staff it is disseminated. [8889]

  Mr. Field
  One of our key aims is to improve the service provided to claimants and other customers. We want a service that is open and accessible. Queries on Benefits Agency operational matters are the responsibility of Peter Mathison, Chief Executive of the Benefits Agency. 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. Terry Rooney, dated 15 July 1997:
  The Secretary of State for Social Security has asked me to provide you with some further details following the answers to your recent Parliamentary Questions asking about the policy on Benefits Agency staff giving their name during telephone calls to honourable Members and claimants and about Benefit Agency staff giving information on constituency cases to honourable members over the telephone and in writing.
  The Benefits Agency (BA) has a clear policy on the giving of names to any customer who contacts us by telephone, in person, or in writing and this is published in the BA Conditions of Service Manual. When dealing with honourable Members and members of the public, staff are required to give their name over the telephone on request. There has been no revision of this policy since its introduction in June 1992. We propose to include this service commitment in our revised BA Customer Charter which is due for publication later this year.
  The BA Parliamentary Guide provides advice to staff on giving information on constituency cases to honourable Members. Copies of the relevant extracts are attached and have been placed in the Library. The Parliamentary Guide was revised in March 1997 and is available to all staff.
  Guidance is also provided to staff on the disclosure of information to representatives acting on behalf of benefit customers, and includes reference to honourable Members. Where enquiries are received by telephone, the enquirer's name and telephone number should be taken so that their identity can be confirmed before any information is disclosed. Written requests for information from customer representatives normally include the customer's written consent, although in constituency cases it should be assumed that the customer has given their consent for information to be disclosed by the Benefits Agency. This guidance was last revised in 1994, and is available to all staff.
  I hope you find this reply helpful.

  Mr. Rooney
  To ask the Secretary of State for Social Security what are the staff numbers for each Benefit Agency local office broken down into(a) temporary staff, (b) permanent staff with less than five years service, (c) permanent staff with five to 10 years service, (d) permanent staff with 10 to 15 years service and (e) permanent staff with over 15 years service. [8890]

  Mr. Field
  An overall aim of the Government is to streamline services to provide better, simpler and more efficient services to clients. As the staffing of the Benefits Agency is a matter for 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. Terry Rooney, dated 15 July 1997:
  The Secretary of State for Social Security has asked me to reply to your recent Parliamentary Question asking for Benefits Agency staff numbers for each Benefits Agency office.
  202
  The information is not available in the format requested and could only be obtained at disproportionate cost. However information is available broken down by Benefits Agency Area Directorate and is shown in the attached tables.
  I hope you find this reply helpful.

  Permanent and temporary staff with less than five years service by Benefits Agency area directorate

  Area directorate

  Temporary staff

  Permanent staff

  1. East London and Anglia

  544

  700

  2. Chilterns

  437

  782

  3. London South (South West)

  743

  1,421

  4. West Country

  420

  651

  5. Mercia

  352

  653

  6. West Midlands

  234

  533

  7. Wales

  308

  496

  8. North-west Coast (Liverpool)

  398

  782

  9. Greater Manchester

  201

  744

  10. Yorkshire

  406

  684

  11.Tyne Tees

  153

  391

  12. West of Scotland

  453

  445

  13. East of Scotland

  401

  471

  Total

  5,050

  8,753

  Figures are provisional and subject to change.

  Permanent staff with five to ten years service by Benefits Agency area directorate

  Area directorate

  Permanent staff

  1. East London and Anglia

  917

  2. Chilterns

  942

  3. London South (South-west)

  1,316

  4. West Country

  597

  5. Mercia

  532

  6. West Midlands

  678

  7. Wales

  425

  8. North-west Coast (Liverpool)

  731

  9. Greater Manchester

  543

  10. Yorkshire

  631

  11.Tyne Tees

  468

  12. West of Scotland

  506

  13. East of Scotland

  336

  Total

  8,622

  Figures are provisional and subject to change.

  Permanent staff with between 10 to 15 years service by Benefits Agency area directorate

  Area directorate

  Permanent staff

  1. East London and Anglia

  1,148

  2. Chilterns

  1,163

  3. London South (South West)

  1,657

  4. West Country

  830

  5. Mercia

  1,029

  6. West Midlands

  1,127

  7. Wales

  802

  8. North-west Coast (Liverpool)

  1,024

  9. Greater Manchester

  860

  10. Yorkshire

  1,298

  11.TyneTees

  790

  12. West of Scotland

  852

  13. East of Scotland

  716

  Total

  13,296

  Figures are provisional and subject to change.
  203

  Staff with over 15 years service by Benefits Agency area directorate

  Area directorate

  Permanent staff

  1. East London and Anglia

  1,573

  2. Chilterns

  1,703

  3. London South (South West)

  2,579

  4. West Country

  1,852

  5. Mercia

  2,281

  6. West Midlands

  2,002

  7. Wales

  1,865

  8. North-west Coast (Liverpool)

  1,957

  9. Greater Manchester

  1,972

  10. Yorkshire

  2,406

  11.Tyne Tees

  1,981

  12. West of Scotland

  1,623

  13. East of Scotland

  1,669

  Total

  25,463

  Figures are provisional and subject to change.

  Total staff in Benefits Agency area directorates

  Total

  Percentage

  Temporary staff

  5,050

  8.3

  Permanent staff with less than 5 years service

  8,753

  14.3

  Permanent staff with 5–10 years service

  8,622

  14.1

  Permanent staff with 10–15 years service

  13,296

  21.7

  Permanent staff with over 15 years service

  25,463

  41.6

  Total

  61,184

  —

  Figures are provisional and subject to change.

  Housing Costs
  Mr. Flynn
  To ask the Secretary of State for Social Security what assessment she has made of the impact of(a) single people's and (b) lone parents' ability to pay their housing costs in their decision to (i) take up work and (ii) increase their hours of work; and what plans she has to take action on this issue. [8808]

  Mr. Bradley
  We recognise that concern about housing costs is a factor which single people and lone parents may take into account in decisions about taking up work or increasing their working hours.

  We believe that work is the best form of welfare for people of working age. Our objective is to reduce poverty and welfare dependency and to promote work incentives. We have appointed Martin Taylor, Chief Executive of Barclays plc, to spearhead a Whitehall task force to consider these issues and make recommendations.

  Jobseeker's Allowance
  Mr. Pickthall
  To ask the Secretary of State for Social Security if he will make a statement about the future of the jobseeker's allowance. [8592]

  Mr. Bradley
  The Government believes that work is the best form of welfare for people of working age. Our Welfare to Work objectives are to provide work incentives, to reduce poverty and welfare dependency and to strike a new balance between responsibilities and rights. A programme of monitoring and evaluation is under way to enable us to ensure that jobseeker's allowance contributes to achieving our objectives.

WALES

  Children (Adult Wards)
  Ms Julie Morgan
  To ask the Secretary of State for Wales how many children aged under 16 years were nursed in adult wards in hospitals in Wales during the last 12 months. [7004]

  Mr. Win Griffiths
  The Welsh Office does not collect this information centrally. However, it is our policy that children should not be nursed on adult wards and health authorities are required to frame policies to ensure that adequate facilities are developed to meet their needs.

  Green Pound
  Mr. Livsey
  To ask the Secretary of State for Wales if he will introduce a compensation package to offset revaluations of the green pound during 1997. [7005]

  Mr. Win Griffiths
  Paying this aid would have very significant implications for UK public expenditure. We are considering very carefully the case made by interested parties for payment, but we do have until 31 January 1998 to decide on the matter.

  Welsh Assembly
  Mr. Prior
  To ask the Secretary of State for Wales what estimate he has made of the additional public expenditure needed each year to fund a Welsh Assembly. [7006]

  Mr. Ron Davies
  The White Paper, which will be published on 22 July, will include costings of our proposals.

  Mr. Burns
  To ask the Secretary of State for Wales what consultation exercise he plans in respect of the establishment of an assembly for Wales. [7007]

  Mr. Davies
  A referendum in September.

  Mr Swayne
  To ask the Secretary of State for Wales what representations he has received from residents in south Wales relating to an assembly for Wales. [7009]

  Mr. Davies
  My hon. Friends and I have received a number of representations from people all over Wales, both in favour and against the establishment of a Welsh Assembly.

  Mr. Llew Smith
  To ask the Secretary of State for Wales what estimate he has made of the total cost to be incurred in the research, preparation, publication and distribution of the summary of the White Paper on a Welsh Assembly. [7011]

  Mr. Davies
  The work has not yet been completed and our estimated budget remains commercially confidential at this stage. However, we estimate that the total costs for information and publicity associated with the Referendum will be £700,000. Parliamentary approval for this expenditure will be sought in a Supplementary Estimate for Class XIV, vote 3. Pending that approval, urgent expenditure estimated at £700,000 is being met by a repayable advance from the Contingencies Fund.
  205
  Dr. Julian Lewis
  To ask the Secretary of State for Wales if he will invite the Prime Minister to accompany him during his campaign in respect of the referendum on a Welsh Assembly. [7013]

  Mr. Davies
  Yes.

  Sir Teddy Taylor
  To ask the Secretary of State for Wales what representations he has received on the annual cost of the proposed Welsh Assembly; and if he will make a statement. [7019]

  Mr. Davies
  My Hon. Friends and I have received representations, both for and against a Welsh Assembly, which have referred to its annual costs.

  Mr. Chope
  To ask the Secretary of State for Wales what plans he has in respect of the number of hon. Members from Wales who will sit at Westminster if an assembly is established. [7021]

  Mr. Davies
  None. Hon. Members representing Welsh constituencies will continue to be involved in considering new legislation that applies to Wales, and to represent their constituents on all matters.

  Miss McIntosh
  To ask the Secretary of State for Wales what estimate he has made of the number of jobs which will be created as a result of the establishment of a Welsh Assembly. [7014]

  Mr. Hain
  It would be unrealistic to attempt to make detailed forecasts but I am confident that a democratically elected and responsive Assembly would give a significant boost to the competitiveness of the Welsh economy.

  Mr. Colvin
  To ask the Secretary of State for Wales for what reasons the Welsh Assembly referendum will be held after the Scottish Parliament referendum; and if he will make a statement. [7575]

  Mr. Davies
  Our proposals for Wales are quite different from those for Scotland. We need to give people a chance to focus on the distinctive Welsh plans without being deflected by the Scottish debate.

  Sustainable Development Strategy
  Mr. Dafis
  To ask the Secretary of State for Wales what proposals he has to draw up a sustainable development strategy for Wales. [7008]

  Mr. Win Griffiths
  The Government will be looking again at the 1994 UK Sustainable Development Strategy in the light of our own objectives. My right hon. Friend and I will consider the need for a separate Welsh strategy in the light of that review.

  Health Authorities (Finance)
  Mr. Denzil Davies
  To ask the Secretary of State for Wales what was the(a) total business from the Welsh Office and (b) the total financial deficits of all health authorities in Wales at the latest available date. [7010]

  Mr. Win Griffiths
  The Welsh Office provides funding to health authorities to purchase health care for their resident population. In 1996–97, the revenue funding provided by the Welsh Office to the five health authorities in Wales totalled £2,134 million.
  206
  The unaudited accounts for 1996–97, presently indicate that the in-year financial deficit in income and expenditure terms for the five health authorities for their first year of operation was £5.255 million.

  Mr. Davies
  To ask the Secretary of State for Wales what factors his Department applies to adjust the crude population share of health authorities in Wales when determining their funding needs. [8412]

  Mr. Griffiths
  The factors included in the capitation model to adjust the crude population share are as follows:Non-psychiatric in-patient services: age and sex structure of population weighted for hospital bed days, Standardised Mortality Ratio;
  Psychiatric in-patient services: age and sex structure of population weighted for average length of hospital stay;
  Non-psychiatric outpatient services: age and sex structure of population weighted for hospital attendances, Standardised Mortality Ratio;
  Community health services: age and sex structure of population weighted for staff contacts, estimated staff travelling distances, Standardised Mortality Ratio; and
  Ambulance services: age and sex structure of population, Standardised Mortality Ratio; road length per head of population.

  Mr. Davies
  To ask the Secretary of State for Wales what would have been the total amount which the Dyfed-Powys health authority could have expected to have received from the Welsh Office for the year 1997–98 by way of discretionary expenditure on the basis of a crude population share. [8433]

  Mr. Griffiths
  On the basis of a crude population share of the total 1997–98 Recurrent Discretionary Allocation made to health authorities, Dyfed Powys would have received £223.6 million.

  Mr. Davies
  To ask the Secretary of State for Wales if he will publish the names of the working party set up in his Department to review the methodology in respect of the distribution of resources to health authorities; and when he expects the review to be completed. [8546]

  Mr. Griffiths
  The membership of the Resources Allocation Working Group is as follows:

  Mr. A. C. Wood: Health Finance Management Division

  Mr. R. T. Kilpatrick: Health Finance Management Division

  Miss B. Jones: Health Finance Management Division

  Dr. B. Fuge: Health Professional Group

  Mr. D. Hobbs: Health Strategy Division

  Ms C. Durnell: Economic Advice Division

  Mr. R. Jones: Health Statistics and Analysis Unit

  Mr. M. Evans: Bro Taf Health Authority

  Mrs. J. Sait: Dyfed Powys Health Authority

  Mr. G. Coomber: Gwent Health Authority

  Dr. P. Donnelly: Iechyd Morgannwg Health Authority

  Mr. N. Morris: North Wales Health Authority

  Mr. P. Davies: University of Wales Healthcare NHS Trust

  Dr. N. Upton: Gowerton Medical Centre, Swansea

  Mrs. C. Theobald: North East Wales Community Health Council

  207
  I expect the group to report later this year and, if possible, to feed the results into the 1998–99 health authority allocation round.

  Mr. Rowlands
  To ask the Secretary of State for Wales if he will make a statement on the current financial position of health authorities in Wales. [7023]

  Mr. Griffiths
  I shall expect all authorities to remain within their notified cash limits.

  Industrial Investments
  Mr. Donald Anderson
  To ask the Secretary of State for Wales if he will make a statement on his plans to encourage industrial investment in areas outside the M4 corridor in south and east Wales and the A55 corridor in north Wales. [7012]

  Mr. Hain
  I am determined to see a more even spread of investment throughout Wales particularly in western areas, north western areas and the South Wales Valleys.

  Pensioners
  Mr. Viggers
  To ask the Secretary of State for Wales what representations he has received from pensioners in Wales in relation to the Budget. [7015]

  Mr. Hain
  None.

  Dental Services
  Mr. Flynn
  To ask the Secretary of State for Wales what new proposals he has to improve dental services in Wales. [7016]

  Mr. Win Griffiths
  The Government is committed to ensuring that a comprehensive NHS dentistry service is available to all who wish to use it. We shall shortly be bringing forward proposals for strengthening and improving primary health care in Wales and we anticipate that these will include measures for developing NHS dentistry.

  Transport
  Mr. Gareth Thomas
  To ask the Secretary of State for Wales what plans he has for promoting sustainable transport schemes in Wales. [7018]

  Mr. Hain
  My right hon. Friend the Deputy Prime Minister announced on 5 June his proposals for a national strategy to develop an integrated transport policy, and explained that this should be set out in a White Paper, probably accompanied by detailed papers on specific subjects. A consultation document on the development of the policy, which will of course embrace Wales, will be issued shortly.

  Referendum
  Mr. Hanson
  To ask the Secretary of State for Wales when he next plans to visit north Wales to discuss the referendum campaign. [7020]

  Mr. Ron Davies
  I discussed the referendum campaign in North Wales on 30 June and 7 July and I expect to make other visits to North Wales to argue for our proposals in the coming weeks.
  208
  Mr. Letwin
  To ask the Secretary of State for Wales if he will make a statement on his role in the referendum debate in Wales. [7024]

  Mr. Davies
  Together with the Prime Minister and other Ministers I shall be arguing the case throughout Wales for the Government's proposals.

  Welfare-to-work Programme
  Ms Lawrence
  To ask the Secretary of State for Wales if he will make a statement on the implementation of the welfare-to-work programme in Wales. [7022]

  Mr. Hain
  I wrote to all Welsh MPs on 3 July providing details of how the New Deal will operate in Wales. Further details in respect of Employment Zones and the Lone Parents Initiative will be made available in due course.

  Family Farms
  Mr. Charles Kennedy
  To ask the Secretary of State for Wales what plans he has to help safeguard the future of viable family farms in Wales; and if he will make a statement. [7017]

  Mr. Win Griffiths
  My right hon. Friend and I will have the future of family farms very much in mind as we participate in developing the UK Government's policy towards reform of the Common Agricultural Policy; and as we design policy initiative such as a new Agri-Environment Scheme for Wales.

  Departmental Budgets
  Mr. Malcolm Bruce
  To ask the Secretary of State for Wales what new plans he has to introduce cuts and savings in his Department as a result of the effect on his Department's budgets for 1997–98 and 1998–99 of the upward revisions to the GDP deflators in the Budget on 2 July; and if he will make a statement. [8312]

  Mr. Ron Davies
  [holding answer 14 July 1997]: All Departments are reallocating spending within their Departmental ceilings as part of the Comprehensive Spending Review.

  Mr. Bruce
  To ask the Secretary of State for Wales if, following the recent Budget, he will give his estimate of the total real level of his Department's budget, in 1995–96 prices, in(a) 1997–98 and (b) 1998–99; if he will estimate what such figures were for (1) 1997–98 and (2) 1998–99 following the November 1996 Budget on the basis of the estimates of the GDP deflator contained in that Budget; and if he will make a statement. [8311]

  Mr. Davies
  [holding answer 14 July 1997]: The figures requested for my Department's spending plans within the Control Total are as follows:
  £6,529 million, £6,440 million, £6,598 million and £6,449 million

  In addition Wales will benefit from part of the expenditure outside the Control Total which was announced in the Budget, for Welfare to Work and spending under the Capital Receipts Initiative.

  EU Regional Development Fund
  Mr. Barry Jones
  To ask the Secretary of State for Wales if he will seek the restoration of Objective 2 status to North-east Wales. [7863]

  Mr. Hain
  Eligible areas for the European Structural Funds will not be changed before the end of 1999. For the period from the year 2000 onwards, the eligibility of areas will depend on the Commission's proposals for future financing of the EU and of the reform of the Structural Funds. These may lead to a substantial change in the current structure, including the system of Objectives. Once the Commission have put forward proposals for the reform of the Funds and these have been negotiated and agreed, the Government will then consider proposing particular areas within the United Kingdom.

  In the meantime, my officials along with local partners, are already seeking to identify those criteria which most closely meet the socio-economic circumstances and difficulties of Wales, including the North East and which can be proposed for inclusion in the Commission's eventual Structural Funds Regulations. It will be against the criteria contained in these Regulations that the merits of North-east Wales will be evaluated.

  Health Trusts
  Mr. Llwyd
  To ask the Secretary of State for Wales (1) what steps his Department plans to address the imbalance in the number of health trusts south of Merthyr Tydfil and north of Merthyr Tydfil; and if he will make a statement; [8330]

  (2) what consultations are planned involving those who represent the general practice, primary care, community nursing, health visiting and mental health professions in the North Wales health authority area in connection with plans for the reconfiguration of health trusts in that area; and if he will make a statement; [8331]

  (3) what mechanism there is for taking into account the views of general practitioners, psychiatrists and public health physicians concerning the reconfiguration of health trusts in Wales; and if he will make a statement; [8333]

  (4) what mechanism there is for taking into account the views of local authorities and other elected representatives concerning the reconfiguration of health trusts in Wales; and if he will make a statement; [8334]

  (5) what plans he has to consider alternative reconfigurations of health trusts in North Wales; [8335]

  (6) if it is his policy that no final decision concerning the reconfiguration of health trusts in Wales will be taken until the completion of the All-Wales Service Review; and if he will make a statement. [8336]

  Mr. Win Griffiths
  I announced on 22 May a wide-ranging review of the number and configuration of NHS Trusts in Wales. I expect the review process to include detailed discussions with representatives of all sections of the NHS, including professional groups, as well as local authorities, Community Health Councils and other interested parties. Any proposals which arise will also be subject to a formal public consultation exercise. The NHS Wales' All-Wales Service Review will be taken into account and it is my aim to have in place a new shape of trust based services by April 1999.

  Brecon Community Hospital
  Mr. Livsey
  To ask the Secretary of State for Wales if he will reject the bid made by Nevill Hall hospital trust to take over Brecon community hospital. [8511]

  Mr. Win Griffiths
  I am not aware of any such proposal.

EDUCATION AND EMPLOYMENT

  Engineering
  Mrs. Curtis-Thomas
  To ask the Secretary of State for Education and Employment what steps he is taking to encourage school leavers of exceptional ability to study engineering at university; and if he will make a statement. [7054]

  Dr. Howells
  In 1994 the Department began the Top Flight Engineering Bursaries scheme to attract high quality A level students to higher education engineering courses. This is a three year pump priming initiative to encourage engineering employers to sponsor students to take engineering courses and consider employment in the engineering sector. Those undergraduates already in receipt of Top Flight Bursaries (at £500 per annum) will continue to receive them until the end of their course in about 2001. So far over 6,300 students have received a Top Flight Engineering Bursary from the Department.

  The Department is also supporting the Year of Engineering Success and pilot summer school for teachers. The latter is a specific outcome from the earlier Action for Engineering initiative and took place in June this year at the University of Manchester Institute of Science and Technology.

  Training and Enterprise Councils
  Mr. MacShane
  To ask the Secretary of State for Education and Employment how many TECs have merged with chambers of commerce. [6947]

  Dr. Howells
  Thirteen TECs have merged with Chambers of Commerce to form Chambers of Commerce, Training and Enterprise.

  Constituency Cases
  Mr. Rooney
  To ask the Secretary of State for Education and Employment what advice is given to Employment Service staff on giving information on constituency cases to hon. Members(a) over the telephone and (b) in writing; when this was last revised; and to what grade of staff it is disseminated. [8888]

  Mr. Alan Howarth
  [holding answer 15 July 1997]: The Department takes a positive and purposeful view on this matter. Responsibility for the specifics and local arrangements has been delegated to the Employment Service agency under its Chief Executive. I have asked him to arrange for a reply to be given.
  211
  Letter from Leigh Lewis to Mr. Terry Rooney, dated July 1997:
  The Secretary of State has asked me to reply to your question about advice given to Employment Service (ES) staff on giving information on constituency cases to Honourable Members. This is something that falls within the responsibilities delegated to me as Chief Executive of the Agency.
  The Employment Service sets clear standards for handling telephone and written correspondence for all enquiries. The guidance is contained within two ES guides, the ES Corporate Style and ES Disclosure Guides, and in a circular on Open Government. The guidance makes clear that every effort should be made to be as helpful as possible in dealing with such enquiries.
  The ES Disclosure Guide refers explicitly to requests from Members of Parliament in outlining the parameters within which Business Managers can comply within the terms of the Data Protection Act 1984. The other guidance does not explicitly refer to MPs, but I would expect all ES staff to meet these standards in contacts with Members of Parliament and others.
  You asked about information on when this guidance was updated. The ES Corporate Style Guide was updated in March 1996, the ES Disclosure Guide in 1992 and the ES Circular on Open Government in 1994. This guidance is available to everyone working in the ES.
  More generally we encourage all Honourable Members to contact their local Jobcentre Business Manager or District Manager, who are best placed to provide a quick and informed reply on local constituency matters, whenever they need to do so.
  I hope this is helpful.

  Universities (Overseas Earnings)
  Mr. Brady
  To ask the Secretary of State for Education and Employment what estimate he has made of the overseas earnings attributed to the British university sector in each of the last three years. [6938]

  Dr. Howells
  The Department does not routinely estimate total overseas earnings attributable to the British university sector. However, the Committee of Vice-Chancellors and Principals has estimated the impact on economic activity in the United Kingdom associated with international students at around £1 billion a year.

  National Disability Council
  Mr. Wills
  To ask the Secretary of State for Education and Employment if the Government will bring in legislation to replace the National Disability Council with a disability rights commission. [8714]

  Mr. Andrew Smith
  I refer my hon. Friend to the reply I gave on 5 June 1997,Official Report, column 247.

  Disability Discrimination
  Mr. Wills
  To ask the Secretary of State for Education and Employment what plans the Government have to propose changes to the provisions of the Disability Discrimination Act 1995 in relation to discrimination in employment. [8710]

  Mr. Andrew Smith
  I refer my hon. Friend to the reply I gave to the hon. Member for Sutton and Cheam (Mr. Burstow) on 26 June 1997,Official Report, column 635.

  Blind and Partially Sighted People
  Mr. Burstow
  To ask the Secretary of State for Education and Employment what plans he has to improve facilities at(a) jobcentres and (b) job clubs for blind and partially sighted people. [7643]
  212
  Mr. Alan Howarth
  The Department takes a positive and purposeful view on this matter. Responsibility for the specifics and local arrangements has been delegated to the Employment Service agency under its Chief Executive. I have asked him to arrange for a reply to be given.

HEALTH

  Hospital Building
  Mr. Campbell-Savours
  To ask the Secretary of State for Health how many hospitals have been constructed in each year since 1979; and what was the cost of each such hospital. [6555]

  Mr. Milburn
  Information is collected centrally only on major capital projects, and not in terms of numbers of hospitals. A table listing the numbers and total works cost by national health service region of capital schemes in excess of £25 million completed between April 1980 and March 1997 has been placed in the Library. Details of the cost of individual capital projects have also been placed in the Library.

  NHS Expenditure
  Mr. Jack
  To ask the Secretary of State for Health if he will list the criteria that each NHS Executive regional office uses to determine which health trusts and authorities are judged to have serious financial problems. [7759]

  Mr. Milburn
  The National Health Service Executive assesses the seriousness of financial problems by initially looking at the scale of the financial problem reported (i.e. over £1 million deficit in health authorities and an adverse operating variance of over £0.5 million in trusts). The NHS Executive will supplement this with an assessment of additional factors such as the robustness of recovery plans.

  Prescription Fraud
  Mr. Jack
  To ask the Secretary of State for Health if he will make a statement on the estimated savings resulting from his Initiative on Prescription Fraud in the current and next four financial years. [7756]

  Mr. Milburn
  The Efficiency Scrutiny report into Prescription Fraud in England and Wales was published on 19 June 1997. We have announced immediate decisions to implement some important recommendations, such as including scrutiny measures in the printing of prescription forms.

  The remaining recommendations are being examined in detail in order to develop a comprehensive programme of action and an estimate of the savings which will arise.

  Road Traffic Accidents
  Mr. Jack
  To ask the Secretary of State for Health if he will list the hospital trusts in England which recover moneys associated with the treatment of road traffic accidents (i) in part and (ii) in full; and which of these have recorded the amounts of money recovered in 1996–97. [7652]
  213
  Ms Jowell
  We have placed in the Library details of Road Traffic Act income for each national health service trust in England for 1995–96, the latest year for which figures are available.

  Private Finance Initiative
  Mr. Forth
  To ask the Secretary of State for Health if he will give for the review of Private Finance Initiative health projects(a) the completion date and (b) the cost of conducting the review. [8259]

  Mr. Milburn
  The review of the private finance initiative (PFI) in the national health service, announced on 15 May 1997, consists of three stages. The first stage, to secure the market for PFI, involved the prioritisation of certain major acute sector PFI schemes. The results of this part of the review were announced on 3 July. The remaining stages of the review are expected to be concluded by the end of the year.

  The review is being carried out by officials and consultants seconded to the NHS as part of their normal duties. No extra costs over and above these normal departmental running costs are envisaged.

  Mr. Jack
  To ask the Secretary of State for Health if he will list the companies involved either as individual companies or in consortia in each of the PFI hospital projects which he has(a) approved and (b) rejected. [8155]

  Mr. Milburn
  [holding answer 11 July 1997]: Two private finance initiative schemes, at Dartford and Gravesham national health service trust and Norfolk and Norwich health care NHS trust, have reached agreement to proceed to financial close. The consortia and constituent companies for these two schemes are as follows:

  Trust

  Consortia

  Constituent companies

  Dartford and Gravesham NHS Trust

  Pentland

  Tarmac PFU Ltd. United Medical Enterprises Ltd.

  Tarmac Service Master

  Tarmac Construction Ltd.

  Norfolk and Norwich Health NHS Trust

  Octagon Healthcare Ltd.

  John Laing Group plc Serco

  A further 14 major hospital PFI schemes have been selected to continue towards financial close under the first prioritisation exercise announced on 3 July. Those 23 schemes not selected had the opportunity to make representations to my right hon. Friend the Secretary of State for Health up to 14 July and all appeals are now being reviewed. However, all schemes not selected will now be eligible for consideration by the NHS Executive's capital prioritisation group to go forward either as part of the next tranche of PFI schemes or for funding from public sector capital. Six schemes are being considered as part of the London review.

  Head Lice
  Dr. Brand
  To ask the Secretary of State for Health (1) what was the level of incidence of head lice in schools in each of the last five years; [8496]

  (2) what guidelines his Department has issued regarding the (a) prevention of and (b) treatment for head lice in schools. [8495]

  Mr. Flynn
  To ask the Secretary of State for Health (1) what guidelines his Department issues to schools concerning the prevention and detection of head lice amongst pupils; and if he will make a statement; [8559]

  (2) how many children contracted head lice in each of the last three years for which figures are available. [8552]

  Ms Jowell
  In April 1996, the Department of Health launched a poster and leaflet campaign—"The Prevention and Treatment of Head Lice"—which advises families and teachers on the options for dealing with this problem. So far, over 1 million copies of the leaflet have been sent to parents, teachers and health professionals. Further guidance was included in the Department's publication, "Child Health in the Community: A Guide to Good Practice" issued in September 1996. National figures on the incidence of head louse infestation are not collected because not all cases are detected. However, the number of prescriptions for lotions to treat infestation quadrupled between 1991 and 1996 from 583,000 to 2,161,000.

  Mr. Flynn
  To ask the Secretary of State for Health what assessment he has made of the health risks associated with the use of malathion in head lice shampoo; and if he will make a statement. [8555]

  Ms Jowell
  Malathion is a licensed human medicinal product which has been subject to the usual processes of assessment of safety, quality and efficacy. As for all medicines marketed in the United Kingdom, its safety has been monitored continuously after marketing. No serious toxicity has been identified in normal conditions.

  Mr. Flynn
  To ask the Secretary of State for Health if he will estimate how many children have suffered side effects after using head lice shampoo containing malathion; and if he will make a statement. [8556]

  Ms Jowell
  The Committee on Safety of Medicines has received 23 suspected adverse reactions reports associated with malathion head louse treatment via the Yellow Card scheme. Of these, 19 occurred in children. However, a report does not necessarily mean that the reaction was caused by the medicine.

  Mr. Flynn
  To ask the Secretary of State for Health what representations he has received concerning the health risks posed by the use of organo-phosphates in head lice shampoos. [8557]

  Ms Jowell
  The Department of Health, through the Medicines Control agency, has received 12 representations on this issue since November 1995.
  215
  Mr. Flynn
  To ask the Secretary of State for Health what guidelines his Department issues to pharmacists selling head lice shampoo containing(a) malathion and (b) other organo-phosphates; what proposals he has to take further action; and if he will make a statement. [8558]

  Mr. Milburn
  Central guidelines have not been issued concerning the sale of Malathion. Health authorities issue guidelines on the rotational policies for treatment of head lice and these may include advice on use of Malathion.

  In November 1995, the Chief Medical, Pharmaceutical and Nursing Officers wrote a joint letter to health professionals, including pharmacists, concerning the restriction for human medicinal use by limiting Carbaryl to prescription only use. Copies of this letter have been placed in the Library. This followed a review of information by the Committee on Carcinogenicity and advice from the Advisory Committee on Pesticides and the Committee of the Safety of Medicines. The insecticide Carbaryl is an active ingredient in a number of shampoos and lotions used to treat headlice.

  Mr. Flynn
  To ask the Secretary of State for Health what percentage of head lice medication currently contains permethrin and no malathion; and if he will make a statement. [8560]

  Ms Jowell
  There are eight products currently marketed which are indicated for the treatment of head lice. One, Lyclear Creme Rinse, contains permethrin but no malathion.

  Mr. Flynn
  To ask the Secretary of State for Health what assessment he has made of the effectiveness of using permethrin in head lice shampoo; and if he will make a statement. [8561]

  Ms Jowell
  The first medicinal product for human use for a shampoo containing permethrin was granted a marketing authorisation in November 1988. This product is indicated for the treatment of head lice. Before any medicinal product can be granted a marketing authorisation, applicants must submit data which demonstrates the efficacy of their product for the indications claimed. The data are fully assessed and scrutinised by experienced clinicians at the Medicines Control Agency. Additionally, all products containing an active ingredient not previously authorised in a medicinal product are further considered by the Committee on Safety of Medicines (CSM). The CSM considered the application and the efficacy of permethrin in 1988. A marketing authorisation can be issued only if the applicant has satisfactorily proved the efficacy of the product to the satisfaction of the Licensing Authority.

  Obesity
  Mr. Martyn Jones
  To ask the Secretary of State for Health what new initiatives his Department is planning in respect of obesity; and if he will make a statement. [8742]

  Ms Jowell
  Tackling obesity is a particularly challenging problem. "The Health of the Nation" target is to reduce the percentages of men and women aged 16–64 who are obese to 6 per cent. for men and 8 per cent. for women by 2005. However in 1995 15 per cent. of men and 16.5 per cent. of women were obese, highlighting the gravity of the problem. Obesity is a long-term problem and needs a long-term strategy. We will continue to 216
  support the action on obesity and obesity-related illness initiated by the Nutrition Task Force and the Physical Activity Task Force which addresses:

  (a) general initiatives offering guidance on correct bodyweight;

  (b) the particular problems of high risk groups e.g. those already overweight; and

  (c) treatment of those who are already obese.

  These activities focus on addressing the major influences on increasing fatness—fat in the diet and physical activity. The nutrition task force programme comprises a number of projects which are continuing after the task force itself has completed its work.

  The role of physical activity in helping to maintain a healthy weight is well recognised. The "Active for Life" campaign, which is funded by the Department and run by the Health Education Authority, promotes the value of increased physical activity. The campaign targeted people aged 16 to 74 in its first year and will continue to run to 1999. As part of this campaign we are also looking at physical activity and young people. To this end, an expert conference was held in June to establish the optimum levels of physical activity for school aged children and young people. A report and consensus statement will be published in the autumn.

  We also recognise how important a balanced diet is for giving young people a healthy start in life. This is why my right hon. Friend the Secretary of State for Education and Employment has recently proposed the introduction of nutrition standards for inclusion in school meals contracts.

  Junior Doctors
  Mr. Martyn Jones
  To ask the Secretary of State for Health what methods his Department is considering for the reduction of junior doctors' hours; what advice it is giving to local medical work force advisory groups and New Deal task forces in this respect; and if he will make a statement. [8741]

  Mr. Milburn
  The National Health Service Executive issued an Executive letter to trusts, health authorities, task forces and local medical workforce advisory groups in January (EL(97)2). The Executive also published a draft consultation document, "A Working Draft to Develop the Quality Framework for Hospital and Community Health Services Medical and Dental Staffing", in April. Both documents (copies of which are available in the Library) contain the current guidance on action to reduce junior doctors' hours. Options for further action will be reviewed over the coming months.

NORTHERN IRELAND

  Traffic (Bangor)
  Mr. Robert McCartney
  To ask the Secretary of State for Northern Ireland what are the daily traffic flows each way on the Bangor dual carriageway ring-road and the Balloo/Rathgael road in Bangor. [7719]

  Mr. 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.
  217
  Letter from W. McCoubrey to Mr. Robert McCartney, dated 11 July 1997:
  The Secretary of State for Northern Ireland has asked me to respond to your recently tabled Parliamentary Question about traffic flows on the West Circular Road (Bangor ring-road) and the Balloo/Rathgael Roads, Bangor.
  Roads Service has traffic monitoring equipment which is used on a rotational basis to collect data at a number of sites throughout Northern Ireland. The most recent information available for each of the roads in question is as follows:

  Location

  Traffic flow (vehicles per day)

  West Circular Road (between Belfast Road and Clandeboye Road)

  10,180

  (east bound)

  11,200

  (west bound)

  Rathgael Road (between Belfast Road and Clandeboye Road)

  12,182

  Each way flows not available for these roads

  Balloo Road (between Newtownards Road and Bloomfield Road South)

  14,449

  I do hope you find this information helpful.

  Child Support Agency
  Mr. Robert McCartney
  To ask the Secretary of State for Northern Ireland, pursuant to her answer of 23 June,Official Report, column 404, if she will ensure that the Child Support Agency specifically sets out in every relevant letter to absent parents that part of the required periodic payment which relates to arrears. [7718]

  Mr. Worthington
  Responsibility for this subject has been delegated to the Northern Ireland Child Support Agency under its Chief Executive, Mr. Patrick Devlin and I have asked him to arrange for a response to be given.

  Letter from Mr. P. Devlin to Mr. Robert McCartney, dated 11 July 1997:
  I am replying to your parliamentary question in which you asked the Secretary of State for Northern Ireland to ensure that the Child Support Agency specifically sets out in every relevant letter to absent parents that part of the required periodic payment which relates to arrears.
  When a maintenance assessment is completed the absent parent is advised of the weekly amount which he is required to pay. He then receives a separate notification telling him of the method and frequency of payment. If any arrears are outstanding for the period between the effective date of the assessment and the date it is made (the initial payment period), he is also advised of this amount. He is asked either to pay this amount in full or to contact the agency to arrange an arrears agreement. If such an agreement is made the absent parent is again advised of the breakdown of his regular payment.
  Should the maintenance assessment change the absent parent is again advised of the new total to be paid and how it is made up.
  In those cases where an absent parent refuses to make an arrears agreement, or fails to keep to an agreement, he is warned that further action will be taken to recover the debt, including, where appropriate, the imposition of a deduction from earnings order. That notification shows the amount which he should have paid to date, the amount he has paid and the arrears. At that stage the amount to be included in a deduction from earnings order for arrears is not known so the notification does not include this information. The absent parent is advised to contact the agency to make an agreement and avoid the necessity of the order.
  I hope you will see from this that the Agency does its best to keep absent parents fully informed. It is also open to any client to request a statement of account at any time.
  I hope you find this information useful.

  Irish Garda (Firearms)
  Mr. Robert McCartney
  To ask the Secretary of State for Northern Ireland what arrangements are made for armed Irish Garda to enter Northern Ireland without firearms licences; and to what extent these arrangements are reciprocal. [7716]

  Mr. Ingram
  The Chief Constable has advised me that any Garda officers entering Northern Ireland do not carry firearms. Any necessary protection is provided by the RUC and this is reciprocated for RUC officers entering the Republic of Ireland.

  Sir David Fell
  Mr. Robert McCartney
  To ask the Secretary of State for Northern Ireland what will be the total cost of the annual compensation payments made to Sir David Fell from his resignation on 1 October 1997 until his 60 birthday; and what are the grounds on which he is receiving compensation. [7720]

  Mr. Murphy
  With the approval of the former Secretary of State, Sir David was offered and accepted early retirement in February 1997, under the provisions of the Northern Ireland Civil Service Pay and Conditions of Service Code. The Code provides for flexible retirement on structural grounds where an officer's departure would assist in easing problems of succession planning. Under the scheme Sir David will receive an annual payment (know as an annual compensation payment) in lieu of pension until normal civil service retirement age.

  The total cost of the annual payments is personal to Sir David, under the terms of the Data Protection Act 1984.

  Anglo-Irish Secretariat
  Mr. Robert McCartney
  To ask the Secretary of State for Northern Ireland if she will list those receptions held or proposed to be held by the Anglo-Irish Secretariat at Maryfield in 1997. [7717]

  Mr. Murphy
  Two receptions have been held co-hosted this year by the Anglo-Irish Secretariat: on 18 March to mark St. Patrick's Day; and on 2 July on the occasion of an academic conference.

  Government Purchasing Agency
  Mr. Robert McCartney
  To ask the Secretary of State for Northern Ireland what assessment she has made of(a) the shortlisting decisions and (b) the criteria used in relation to the Grade 7 posts in the Government Purchasing Agency for which interviews were conducted in May. [7715]

  Mr. Murphy
  It is not usual for either myself or my Ministerial colleagues to become involved in Personnel or other Management issues in the Northern Ireland Civil Service. These are matters for individual Departments and Agencies. I have not therefore made an assessment of the
  219
  shortlisting decision or the criteria used in relation to the Grade 7 posts in the Government Purchasing Agency (GPA).

  I am advised that this competition was arranged by the Department of Finance and Personnel. Shortlisting and subsequent interviews were undertaken on the basis of mandatory criteria as defined in the notice which invited applications for the competition.

  Petrol Bombs
  Mr. Wilshire
  To ask the Secretary of State for Northern Ireland at how many locations in Northern Ireland petrol bombs were thrown at the RUC and the Army on 6 and 7 July. [7804]

  Mr. Ingram
  [holding answer 14 July 1997]: The information is not available in the format requested, however, during the 24 hour period up to 6.00 am on 7 July 1997, there were 683 petrol bombing incidents in 22 Police Sub-divisions and in the following 24 hour period there were 753 incidents in 24 Sub-divisions. Each incident usually involves the throwing of more than one petrol bomb; therefore the number of petrol bombs thrown was substantially higher than the number of incidents.

  Mr. Wilshire
  To ask the Secretary of State for Northern Ireland how many petrol bombs were thrown at the RUC and the Army in Portadown on 6 July. [7803]

  Mr. Ingram
  [holding answer 14 July 1997]: The information is not available in the format requested, however, from 1800 hours on 5 July to 0600 hours on 7 July 1997 there were ten petrol bombing incidents in Portadown. Each incident usually involves the throwing of more than one petrol bomb; therefore the number of petrol bombs thrown was substantially higher than the number of incidents.

SCOTLAND

  Compulsory Competitive Tendering
  Mr. Forth
  To ask the Secretary of State for Scotland if he will give for the review of compulsory competitive tendering in Scotland(a) the expected completion date and (b) the cost of conducting the review. [8243]

  Mr. Chisholm
  My right hon. Friend announced on 27 May and to the House on 2 June,Official Report, columns 67–68, that he was suspending Compulsory Competitive Tendering (CCT) for a further year in Scotland while the essential elements of the new Best Value arrangements in local government were being developed. Together with the Convention of Scottish Local Authorities, he established a Task Force to develop these. The Task force presented their draft first report to my right hon. Friend and COSLA on 4 July. By the autumn, councils will be required to assess themselves to see how far they meet these essential elements, if they wish to apply for further exemption from CCT. My right hon. Friend will then consider whether to grant further exemptions from CCT. Costs of the Task Force work have been met from The Scottish Office budget in the usual way.

  Private Finance Initiative
  Mr. Forth
  To ask the Secretary of State for Scotland if he will give for the review of Private Finance Initiative health projects in Scotland(a) the expected completion date and (b) the cost of conducting the review. [8260]

  Mr. Galbraith
  My review of PFI health projects in Scotland was completed on 23 June. I refer the hon. Member to the reply given to the hon. Member, for Glasgow, Shettleston (Mr. Marshall) on 23 June.

  The review was carried out by officials in The Scottish Office as part of their normal duties.

  School Leavers (Illiteracy)
  Mr. Davidson
  To ask the Secretary of State for Scotland if he will estimate the number of young people who have left school in each of the last five years and who now require remedial literacy or numeracy assistance, expressed as a total and a percentage of the cohort for each year. [7928]

  Mr. Wilson
  This information is not held centrally. However, in 1996 the Scottish Office participated in an International Adult Literacy Survey. Results of this study will be published in September and will include data on literacy levels of 16 to 24 year olds in Scotland.

  Lockerbie
  Mr. Dalyell
  To ask the Secretary of State for Scotland what assessment he has made of the role of the Office for Islamic propaganda in respect of its response to the Lockerbie bombing; and what inquiries he has instigated in respect of documents relating to their role. [7936]

  Mr. McLeish
  [holding answer 11 July 1997]: The Government view with considerable distaste any statement which welcomes the murder of 270 innocent victims. While the prosecuting and investigating authorities in any criminal case will not comment on the investigative steps they take, the appropriate action is being taken to look into these matters.

  Departmental Expenditure
  Mr. Swinney
  To ask the Secretary of State for Scotland if he will itemise the planned Scottish Office expenditure for years 1996–97 to 1999–2000 in cash and real (1996–97) prices by category of expenditure as expressed in Table 1.4 of "Serving Scotland's Needs, The Government's Expenditure Plans 1996–97 to 1998–99", deflating the real terms figures using the estimates for the GDP deflator provided in the Financial Statement and Budget report of July 1997. [7743]

  Mr. Dewar
  [holding answer 14 July 1997]: The tables are compiled from material published in "Serving Scotland's Needs: The Government's Expenditure Plans 1997–98 to 1999–2000". They cover 1996–97 outturn, and 1997–98 to 1999–2000 plans in both cash terms and real terms.
  221

  The Scottish block, cash terms

  £ million

  1996–97 Estimated outturn

  1997–98 Planned provision

  1998–99 Planned provision

  1999–2000 Planned provision

  Central government expenditure (including public corporations other than nationalised)

  Industry, enterprise and training

  606

  591

  584

  582

  Roads and transport

  216

  176

  194

  189

  Housing

  248

  279

  283

  275

  Scottish Homes loan book sale

  —

  —

  —

  —

  Scottish Homes debt repayment

  —

  -150

  -70

  -48

  Other environmental services

  358

  325

  321

  324

  Law, order and protective services

  472

  479

  476

  477

  Education

  1,319

  1,220

  1,247

  1,266

  Arts and libraries

  77

  80

  76

  74

  Health

  4,232

  4,376

  4,475

  4,568

  Social work services

  62

  61

  61

  61

  Other public services

  172

  158

  156

  155

  Total central government expenditure

  7,762

  7,597

  7,803

  7,923

  Local authority capital expenditure (excluding water) of which:

  591

  569

  554

  533

  HRA

  191

  180

  180

  180

  Police

  18

  20

  20

  15

  Fire services

  13

  16

  16

  12

  Provision to match receipts from European Social Fund and European Regional

  219

  160

  179

  174

  Central government support to local authorities' current expenditure

  5,443

  5,361

  5,274

  5,268

  Total Scottish block

  14,015

  13,688

  13,810

  13,899

  The Scottish block, real terms 1996–97 prices

  £ million

  1996–97 Estimated outturn

  1997–98 Planned provision

  1998–99 Planned provision

  1999–00 Planned provision

  Central government expenditure (including public corporations other than nationalised)

  Industry, enterprise and training

  606

  575

  553

  538

  Roads and transport

  216

  171

  184

  175

  Housing

  248

  272

  268

  254

  Scottish Homes loan book sale

  0

  0

  0

  0

  Scottish Homes debt repayment

  0

  -146

  -66

  -44

  Other environmental services

  358

  316

  304

  299

  Law, order and protective services

  472

  466

  451

  441

  Education

  1,319

  1,187

  1,181

  1,170

  Arts and libraries

  77

  78

  72

  68

  Health

  4,232

  4,259

  4,239

  4,221

  Social work services

  62

  59

  58

  56

  Other public services

  172

  154

  148

  143

  Total central government expenditure

  7,762

  7,394

  7,391

  7,322

  Local authority capital expenditure (excluding water) of which:

  591

  554

  525

  493

  0

  0

  0

  0

  HRA

  191

  175

  170

  166

  Police

  18

  19

  19

  14

  Fire Services

  13

  16

  15

  11

  Provision to match receipts from European Social Fund and European Regional

  219

  156

  170

  161

  Central government support to local authorities' current expenditure

  5,443

  5,218

  4,995

  4,868

  Total Scottish block

  14,015

  13,322

  13,081

  12,844

  222

  Occupational Therapists
  Mr. Alasdair Morgan
  To ask the Secretary of State for Scotland how many occupational therapists are employed by each Scottish local authority; and what is the figure per head of population in each authority area. [8284]

  Mr. Galbraith
  [holding answer 15 July 1997]: The information is set out in the table below:

  Number of full-time equivalent staff employed as occupational therapists/aides as at 31 December 1996

  Local authority

  Population of authority

  Total full-time equivalent occupational therapists/aides

  Total full-time equivalent occupational therapists/aides per 100,000 population

  Scotland

  5,128,000

  533.5

  10.4

  Aberdeen City

  217,260

  27.6

  12.7

  Aberdeenshire

  227,430

  0.0

  0.0

  Angus

  110,780

  19.1

  17.3

  Argyll and Bute

  90,840

  13.0

  14.3

  Clackmannanshire

  48,810

  2.5

  5.1

  Dumfries and Galloway

  147,600

  15.2

  10.3

  Dundee City

  150,250

  11.5

  7.7

  East Ayrshire

  122,350

  16.8

  13.7

  East Dunbartonshire

  110,750

  11.0

  9.9

  East Lothian

  88,140

  8.3

  9.4

  East Renfrewshire

  88,080

  8.0

  9.1

  Edinburgh, City of

  448,850

  49.1

  10.9

  Falkirk

  143,040

  21.0

  14.7

  Fife

  349,300

  40.0

  11.5

  Glasgow City

  616,430

  81.4

  13.2

  Highland

  208,700

  11.5

  5.5

  Inverclyde

  87,100

  14.4

  16.5

  Midlothian

  80,040

  5.0

  6.2

  Moray

  86,510

  10.0

  11.5

  North Ayrshire

  139,520

  16.1

  11.5

  North Lanarkshire

  325,940

  39.9

  12.2

  Orkney Islands

  19,800

  4.6

  23.2

  Perth and Kinross

  132,570

  13.0

  9.8

  Renfrewshire

  178,550

  20.4

  11.4

  Scottish Borders

  106,100

  16.7

  15.7

  Shetland Islands

  23,020

  0.0

  0.0

  South Ayrshire

  114,630

  10.0

  8.7

  South Lanarkshire

  307,450

  18.5

  6.0

  Stirling

  82,750

  0.0

  0.0

  West Dunbartonshire

  95,760

  15.0

  15.7

  West Lothian

  150,770

  14.0

  9.3

  Western Isles

  28,880

  0.0

  0.0

  Source:

  Full-time equivalent number of occupational therapists/aides as reported by authorities' to the December 1996 Annual staffing survey.

  Nurses
  Mrs. Ewing
  To ask the Secretary of State for Scotland what has been the percentage change in numbers of NHS nurses(a) in total and (b) in each NHS trust between 1991 and the latest year for which figures are available. [6383]
  224
  Mr. Galbraith
  [holding answer Monday 7 July 1997]: The whole time equivalent number of nurses fell in Scotland by one per cent. between 1991 and 1996.

  Information at Trust level is not available for the requested year 1991. A comparison by Trust between 1994 and 1996 is given in the table:

  Qualified nursing staff1 by Provider Percentage change between 1994 and 1996(p)

  1994

  1996(p)

  Percentage change 1994 to 19962

  Aberdeen Royal Hospital NHS Trust

  1,328

  1,398

  5.3

  Angus NHS Trust

  627

  624

  -0.4

  Argyll and Bute NHS Trust

  431

  420

  -2.7

  Ayrshire and Arran Community Health Care NHS Trust

  758

  763

  0.8

  Borders Community Health Services NHS Trust

  367

  364

  -0.9

  Borders General Hospital NHS Trust

  347

  365

  5.1

  Caithness and Sutherland NHS Trust

  203

  225

  10.9

  Central Scotland Healthcare NHS Trust

  1,052

  973

  -7.5

  Dumfries and Galloway Acute and Maternity Hospitals NHS Trust

  506

  536

  6.0

  Dumfries and Galloway Community Health NHS Trust

  599

  590

  -1.4

  Dundee Healthcare NHS Trust

  861

  864

  0.3

  Dundee Teaching Hospitals NHS Trust

  1,223

  1,254

  2.5

  East and Midlothian NHS Trust

  717

  698

  -2.6

  Edinburgh Healthcare NHS Trust

  1,128

  1,174

  4.0

  Edinburgh Sick Children's NHS Trust

  245

  283

  15.3

  Falkirk and District Royal Infirmary NHS Trust

  389

  395

  1.5

  Fife Healthcare NHS Trust

  1,160

  1,098

  -5.3

  Glasgow Community and Mental Health Services NHS Trust

  2,479

  2,034

  -17.9

  Glasgow Dental Hospital and School NHS Trust

  10

  10

  -0.0

  Glasgow Royal Infirmary University NHS Trust

  1,204

  1,258

  4.5

  Grampian Healthcare NHS Trust

  1,727

  1,602

  -7.2

  Hairmyres and Stonehouse Hospitals NHS Trust

  569

  542

  -4.8

  Highland Communities NHS Trust

  724

  714

  -1.4

  Inverclyde Royal NHS Trust

  352

  363

  3.0

  Kirkcaldy Acute Hospitals NHS Trust

  527

  535

  1.5

  Lanarkshire Healthcare NHS Trust

  1,289

  1,376

  6.8

  Law Hospital NHS Trust

  547

  556

  1.7

  Lomond Healthcare NHS Trust

  394

  381

  -3.5

  Monklands and Bellshill Hospitals NHS Trust

  694

  691

  -0.4

  Moray Health Services NHS Trust

  352

  450

  27.9

  North Ayrshire and Arran NHS Trust

  812

  852

  4.9

  Perth and Kinross Healthcare NHS Trust

  827

  830

  0.4

  Queen Margaret Hospital NHS Trust

  479

  524

  9.4

  Raigmore Hospital NHS Trust

  569

  572

  0.5

  Renfrewshire Healthcare NHS Trust

  874

  814

  -6.9

  Royal Alexandra Hospital NHS Trust

  525

  526

  0.3

  Royal Infirmary of Edinburgh NHS Trust

  1,641

  1,548

  -5.6

  South Ayrshire Hospitals NHS Trust

  523

  483

  -7.7

  Southern General Hospital NHS Trust

  796

  891

  12.0

  Stirling Royal Infirmary NHS Trust

  409

  427

  4.5

  Stobhill NHS Trust

  507

  496

  -2.1

  The Victoria Infirmary NHS Trust

  625

  654

  4.6

  The Yorkhill NHS Trust

  620

  668

  7.8

  West Glasgow Hospitals University NHS Trust

  911

  1,082

  18.7

  West Lothian NHS Trust

  791

  789

  -0.2

  Western General Hospitals NHS Trust

  638

  649

  1.6

  Total for Trusts

  34,355

  34,342

  -0.0

  225

  Qualified nursing staff1 by Provider Percentage change between 1994 and 1996(p)

  1994

  1996(p)

  Percentage change 1994 to 19962

  Qualified nursing staff employed outwith Trusts3

  1,026

  892

  -13.1

  Scotland

  35,381

  35,234

  -0.4

  Notes:

  1 Excludes nurse teachers, nurses in training and students on P2000 courses in nursing and midwifery.

  2 Provisional.

  3 Includes qualified nursing staff employed by Health Board HQs, State Hospital Unit, CSA, Western Isles Health Unit and Shetland Hospitals and Community Services Unit.

  Source:

  National Manpower Statistics from payroll ISD Scotland.

  Adhoc ref: 97/7906.

ENVIRONMENT, TRANSPORT AND THE REGIONS

  Rail Services (Cycles)
  Mr. Colvin
  To ask the Secretary of State for the Environment, Transport and the Regions what representations he has received in respect of the provision of carriage of cycles on trains; and if he will make a statement. [8502]

  Ms Glenda Jackson
  I have received 36 representations about the carriage of bicycles on trains.

  The Government are encouraging operators to improve provision for the carriage of cycles on trains. Some operators have implemented or propose improvements in respect of their services. The Government welcome these initiatives.

  Mr. Colvin
  To ask the Secretary of State for the Environment, Transport and the Regions what progress he is making in encouraging rail operators to adopt the code of practice, "Providing for Cyclists"; and if he will make a statement. [8534]

  Ms Jackson
  The Government are continuing to encourage rail operators to adopt the voluntary code of practice, "Providing for Cyclists", which has been developed by the cyclists' Public Affairs Group, the Cyclists' Touring Club and Sustrans, which I was delighted to have the opportunity to launch in June. Anglia Railways has been awarded the Cycle Mark under the code of practice for its Bikes on Trains initiative. A number of other operators are also making improvements in facilities for cyclists who wish to take their cycle on the train or park it at the station. We welcome these developments.

  Sea Empress Incident
  Mr. Ainger
  To ask the Secretary of State for the Environment, Transport and the Regions when he will publish the report of the Chief Inspector of Marine Accidents into the grounding and subsequent salvage of the tanker 'Sea Empress' at Milford Haven in February 1996. [9308]
  226
  Mr. John Prescott
  I am publishing the report by the Marine Accident Investigation Branch on the grounding and subsequent salvage of the tanker Sea Empress at Milford Haven between 15 and 21 February 1996 today. A copy has been placed in the Library and will be distributed by the Stationery Office. The report is open for public comment for a period of six weeks. Thereafter, the Government will issue a detailed response to the report. In the meantime, I have asked my officials to begin a review of the 1987 Pilotage Act. I have also asked Lord Donaldson of Lymington to conduct an independent review of salvage and intervention operations and their command and control, having satisfied himself that the Marine Accident Investigation Branch's report provides a reasonable basis for his review. Lord Donaldson's review will form part of the Government's ongoing review of the National Contingency Plan for Marine Pollution. The detailed terms of reference of these reviews will be announced later.

  Lavatory Cisterns
  Mr. Fabricant
  To ask the Secretary of State for the Environment, Transport and the Regions what assessment he has made of the annual water leakage rate likely to arise from permitting the importation of non-syphonic lavatory cisterns; and if he will make a statement. [7897]

  Angela Eagle
  I understand that the Water Regulations Advisory Committee is proposing that the use of non-siphonic flushing systems should be allowed in order to encourage the development of WCs with lower flush volumes. The committee is also proposing that such devices, whether manufactured in the United Kingdom or abroad, should be required to meet stringent performance specifications so that any possible leakage will be greatly outweighed by water savings from the considerable lower flush volumes that can be achieved.

  The committee is currently consulting on these and other proposals to reduce the use and waste of water.

  Organophosphates
  Mr. Flynn
  To ask the Secretary of State for the Environment, Transport and the Regions what assessment he has made of the health risks posed to farmers of exposure to organophosphate in sheep dip; and if he will make a statement. [8554]

  Angela Eagle
  All applications for marketing authorisations for veterinary medicine products must be supported by data relating to their safety, quality and efficacy. Assessments of the data are scrutinised by the Veterinary Products Committee (VPC), which advises Ministers and has twice reviewed OP sheep dips in the last five years. On both occasions the VPC advised that, provided they are used safely and in accordance with the manufacturer's instructions, there is no scientific justification for withdrawing them from the market. Any reports of human suspected adverse reactions to veterinary medicines (including sheep dips) are monitored through a surveillance scheme run by the Government's Veterinary Medicines Directorate.

  In assessing the risk from the use of a product, the potential exposure must be taken into account as well as the inherent toxicity of the substance being considered. Studies have shown the principal sources of exposure

  227
  during dipping and the steps that can be taken to control it and are described in leaflet AS29 "Sheep dipping". The Government have also commissioned both epidemiological and toxicological research, which continues. From the information available, it is clear that taking a large dose of OP sheep dip into the body will almost certainly result in immediate ill-health, but that it can be avoided if the proper control measures are adopted. It has also been suggested that prolonged, low-level exposure without immediate symptoms can cause chronic ill-health but scientific studies have so far revealed scant evidence for this. A major research project is however underway to investigate effects of this kind.

  Rural Business Use
  Mrs. Ellman
  To ask the Secretary of State for the Environment, Transport and the Regions what proposals he is considering to introduce a new rural business use class. [8922]

  Mr. Caborn
  A consultation paper was issued in July 1996 seeking views on the possible introduction of a new rural business use class. There were 291 responses, copies of which have now been placed in the Department's library. The majority of those responding felt that the new class would be very difficult to operate in practice. In particular, a wide range of concerns were expressed about the feasibility of using traffic levels to assess business intensification. Doubts were also expressed about the need for the new use class and a majority of respondents expressed support for existing planning mechanisms such as planning conditions in balancing the needs of rural businesses with environmental considerations. In the light of these comments, the Under-Secretary of State for Wales and I have decided not to proceed with this proposal or with the working group set up in February to take it forward.

  In England, PPG7 explains how the existing provisions of the planning system can assist rural businesses. In Wales, equivalent guidance is provided in the first revision of "Planning Guidance (Wales): Planning Policy", which is being finalised for publication. Our manifesto outlines a range of wider measures which we will be taking to promote both rural and urban enterprise. The Government attach particular importance to the encouragement of sustainable development in rural areas. We want a healthy rural economy that creates employment opportunities but also respects the countryside.

  Genetically Modified Organisms
  Mr. Tyler
  To ask the Secretary of State for the Environment, Transport and the Regions what projections have been made by his Department of the long-term effects of the interaction of genetically modified organisms with their environment. [8040]

  Angela Eagle
  [holding answer 14 July 1997]: The purpose of part VI of the Environmental Protection Act 1990 is to prevent or minimise damage to the environment from the release of genetically modified organisms (GMOs). In considering applications for consent to release GMOs, the risks to human health and the environment, including long term effects, are assessed before a decision is made. A consent is granted only if the risks of the proposed release are low or effectively zero.
  228
  The Department funds a research programme to identify potential risks, to monitor particular existing releases to confirm that the risk assessment is correct, and to support decision making in granting consents.

  EU Object 2 Funding
  Mr. Gale
  To ask the Secretary of State for the Environment, Transport and the Regions what steps Her Majesty's Government are taking to ensure the continuation of EU Objective 2 funding(a) for the United Kingdom and (b) for Thanet at its current levels in real terms after 1999; and if he will make a statement. [8583]

  Mrs. Roche
  [holding answer 15 July 1997]: The European Commission's proposals for reform of the European Structural and Cohesion Funds after 1999 are due to be published on 16 July. Detailed proposals for amending the regulations will come at a later date and will be the basis for negotiation. This may lead to substantial changes to the current structure, including the system of objectives. It will be a Government priority to secure reform which delivers a system that is affordable, efficient, durable and fair. It is too early to estimate the likely effect on specific regions.

TRADE AND INDUSTRY

  Regional Assistance and Investment
  Mrs. Gillan
  To ask the President of the Board of Trade what discussions she has had with the Deputy Prime Minister over responsibility for regional assistance and investment; and if she will make a statement. [6884]

  Mrs. Beckett
  I have ministerial responsibility for regional selective assistance which supports investment in the Assisted Areas of Great Britain. My Department and DETR are in regular contact about the carrying forward of the Government's policies for RDAs.

  Minister for Trade and Competiveness in Europe
  Mr. Redwood
  To ask the President of the Board of Trade if the Minister for Trade and Competitiveness in Europe has any remaining interests in BP through the long-term performance plan described in Note 36 to the BP 1996 report and accounts. [8329]

  Mrs. Beckett
  Lord Simon is no longer an active member of BP's long-term performance plan. In accordance with the rules of the scheme, he gave up his active membership when he took over as Chairman in 1995. The plan continues to hold shares in trust for Lord Simon which relate to the period prior to his Chairmanship. He cannot influence these holdings in any way. These shares cannot be released under the terms of the plan before 7 May 1998 and 1 January 1999. These trigger dates relate to the required retention period in the rules for performance plans entered into before 1995.

  Mr. Redwood
  To ask the President of the Board of Trade on what date the Minister for Trade and Competitiveness in Europe complied with the procedures set down in "Questions of Procedure for Ministers" relating to(a) his shareholding and (b) other requirements relating to financial interests. [7551]
  229
  Mrs. Beckett
  The Minster for Trade and Competitiveness in Europe put in hand arrangements to do so from the day of his appointment.

  Post Office
  Mr. Fallon
  To ask the President of the Board of Trade if she will set out the Post Office's external financing limit for 1997–98 together with (i) the returns on capital employed by Royal Mail and Parcelforce, (ii) the returns on finance for Post Office Counters and (iii) the real unit cost reductions for Royal Mail. [8769]

  Mr. Ian McCartney
  The 1997–98 external financing limit for the Post Office is minus £313 million; the 1997–98 return on capital employed targets for Royal Mail and Parcelforce are respectively 20 per cent. and 3.5 per cent.; the 1997–98 return on turnover target for Post Office Counters Ltd. is 2.5 per cent. and the real unit cost reduction target for Royal Mail is a 6.2 per cent. reduction by 1998–99 over 1995–96. These targets are, however, under review.

  Low Pay Commission
  Mr. Fallon
  To ask the President of the Board of Trade how many applications for membership of the Low Pay Commission had been received by the closing date. [7697]

  Mr. Ian McCartney
  [holding answer 14 July 1997]: By the closing date of 10 July 1997, some 475 applications for membership of the Low Pay Commission had been returned.

  Territorial Employment Pacts
  Mr. Ieuan Wyn Jones
  To ask the President of the Board of Trade what assessment her Department has made of the potential contribution of European Territorial Employment Pacts to the creation of new jobs; and if she will make a statement. [8680]

  Mrs. Roche
  The Government is committed to new partnerships which will attack long-term joblessness. Territorial Employment Pacts are a potentially innovative mechanism for bringing together the relevant partners in a local area to focus and co-ordinate their job-creation efforts. The pilot projects which the Government intends to nominate the European Commission, together with others in the United Kingdom and those going forward in other parts of Europe, will provide useful experience for future partnerships.

  Mr. Bennett
  To ask the President of the Board of Trade how much notice Stockport Metropolitan Borough Council was given of the request to bid for a pilot territorial employment pact by the Government Office for the North West. [8578]

  Mrs. Roche
  A letter, with written guidance, inviting regional partners including Stockport Metropolitan Borough Council to submit proposals for pilot projects to set up Territorial Employment Pacts was sent out by the Government Office for the North West on 4 July. Responses were requested by 9 July to meet DTI's deadline of 11 July. Stockport's response was the first of 13 proposals which the Government Office for the North West received. The short amount of time resulted from 230
  the new Government's desire to meet the European Commission's timetable for nominating up to 10 pilot projects from the UK.

  Human Genome Project
  Mr. Lansley
  To ask the President of the Board of Trade if she will make an assessment of the potential for misuse through biological warfare of the Human Genome Project; if she will assess the national and international legislative framework for the output of this project; and if she will make a statement. [7210]

  Mr. Battle
  [holding answer 8 July 1997]: There is no potential misuse, through biological or other warfare, directly from the Human Genome Mapping Project (HGMP) whose purpose is strictly the mapping and sequencing of the entire complement of human genes.

  However, the British Medical Association have recently announced that they have commissioned an investigation into whether there could be any threat of genetic weapons being developed capable of biological ethnic cleansing. These forms of weapons do not exist but the BMA fears that developments in genetic therapy to cure disease could in principle, in future, be turned to attack certain body sites. The report is expected in 12 months.

  There is no legislative framework, national or international, specifically relating to this project.

  Sector Challenge
  Mrs. Gillan
  To ask the President of the Board of Trade what factors led her to exclude overseas trade fairs from future rounds of the Sector Challenge; and if she will put copies of all representations she received from industry recommending that Sector Challenge should be abolished for export promotion programmes in the Library. [7680]

  Mrs. Roche
  [holding answer 10 July 1997]: As my right hon. Friend the President of the Board of Trade said in her answer on 21 May, Official Report, column 67, "industry has told us that it believes that a separate scheme is more appropriate for trade fairs than a challenge approach". There were over 350 individual letters from or on behalf of industry following the previous administration's announcement on 17 January 1997, Official Report, columns 392–93. In every case the correspondent was objecting to the inclusion of trade fairs support in Sector Challenge. Extracting and copying all those letters would cost over £450. I will place in the Library a list of the organisations and individuals who wrote in.

  Aid and Trade Provision Projects
  Mrs. Gillan
  To ask the President of the Board of Trade how many UK jobs are supported by the ATP projects in Chile, China, Ghana, Indonesia, Lesotho, Pakistan, the Philippines, Sri Lanka, Thailand and Zimbabwe. [8144]
  231
  Mrs. Roche
  [holding answer 11 July 1997]: As over the past three years 21 ATP projects have started in these markets it will take a little time to collate the information requested. When it is available I will write to the hon. Member and place a copy of my letter in the Library of the House.

  Trade Fairs
  Mrs. Gillan
  To ask the President of the Board of Trade what budget has been allocated to trade fair services support in 1998–99 [7681]

  Mrs. Roche
  [holding answer 10 July 1997]: In a move which has been widely praised by businesses the Government removed the trade fair services support from the Sector Challenge Scheme.

  The Government is committed to maintaining existing Departmental spending ceilings until March 1999. A comprehensive spending review is being carried out. It will review all aspects of public expenditure, including export promotion. As the hon. Member will appreciate, I cannot discuss individual items within the spending review prior to its conclusions. I can confirm however that industry has been invited to bid for trade fairs and seminars to be supported in 1998–99.

  Mrs. Gillan
  To ask the President of the Board of Trade what are the terms and conditions, including the price, of the contract with Metra Martech Ltd. for analysing responses to the Support for Overseas Trade Fairs and Seminars consultation paper. [8143]

  Mrs. Roche
  [holding answer 11 July 1997]: The terms and conditions for this contract with Metra Martech Ltd. are the standard DTI contract terms and conditions for service contracts. Details of these terms and conditions can be found in the DTI Procurement Manual, copies of which are held by the Libraries of both Houses. Other details of the contract with Metra Martech Ltd. are commercially confidential. Paragraph 13 of the Code of Practice on Open Government permits the withholding of such information.

  UK Exports Database
  Mrs. Gillan
  To ask the President of the Board of Trade when the database of United Kingdoms exports accessible on line by all overseas posts will be completed; and at what cost. [7685]

  Mrs. Roche
  [holding answer 10 July 1997]: There is no single database of UK exporters but a customised CD-ROM directory of British business is being made available to UK overseas posts by the FCO. This has been developed by Reed Business Information following an open tender procedure managed by the FCO. The contractual arrangements are commercial-in-confidence. Overseas posts are also being equipped with facilities to access the Internet enabling them to utilise the increasing range of commercially available directory products now appearing on the world wide web. In addition my department is supporting a project under the Information Society Initiative Programme for Business called TradeUK which aims to help UK exporters gain profile on the Internet. Further use of electronic databases in support of UK exporters will be considered by the Export Forum.

  Small Firms
  Mrs. Gillan
  To ask the President of the Board of Trade which Government-funded services responsible for supporting small firms do not have representation from small firms; and if she will take steps to ensure that such businesses are represented. [7684]

  Mrs. Roche
  [holding answer 10 July 1997]: We are very keen that all Government-funded services and bodies responsible for supporting small businesses have adequate representation from the small business sector. My Department is looking at the current position and at how adequate representation can be achieved.

  Disability Discrimination Act 1995
  Mr. Wills
  To ask the President of the Board of Trade (1) how many claims to industrial tribunals under the employment provisions of the Disability Discrimination Act 1995 have been(a) settled through ACAS and (b) withdrawn since the date of implementation; [8711]

  (2) how many claims have been heard by industrial tribunals under the employment provisions of the Disability Discrimination Act 1995 since the date of implementation; and how many of these claims have succeeded; [8712]

  (3) how many applications have been issued to industrial tribunals under the employment provisions of the Disability Discrimination Act 1995 since the date of implementation. [8713]

  Mr. Ian McCartney
  Since the Disability Discrimination Act 1995 came into force on 2 December 1996, 483 applications have been made to the Industrial Tribunals under the employment provisions of the Act.

  Thirteen of these applications have been settled through ACAS, 10 applications were withdrawn and a further six settled privately without hearing.

  Twelve applications have been heard by a tribunal, of which one was successful.

DEFENCE

  Northern Ireland
  Mr. Keith Simpson
  To ask the Secretary of State for Defence what the cumulative cost is of this Department's support for the civil power in Northern Ireland since 1969. [8133]

  Dr. Reid
  The information is not available in the precise form requested because the necessary departmental records are no longer extant and the adoption in 1991–92 of the New Management Strategy (NMS) means that comparable costs across the period cannot he calculated.

  Estimates prepared in response to previous parliamentary questions are available for the additional costs of conducting military operations in Northern Ireland between 1969–70 and 1987–88. Insofar as can

  233
  now be determined, these contrasted the estimated cost at contemporary prices of maintaining a garrison of the size established in 1969 with the actual cost of the garrison and all its associated expenditure in the year in question. The figures are:

  Financial year

  Additional cost of military operations £ million

  1969–70

  1.5

  1970–71

  6.5

  1971–72

  14

  1972–73

  29

  1973–74

  33

  1974–75

  45

  1975–76

  60

  1976–77

  65

  1977–78

  69

  1978–79

  81

  1979–80

  96

  1980–81

  100

  1981–82

  149

  1982–83

  143

  1983–84

  141

  1984–85

  121

  1985–86

  135

  1986–87

  144

  1987–88

  168

  Sources:

  House of Commons Official Report for: 16 May 1977, Column 77; 26 March 1980, Column 593; and 16 June 1988, Columns 225–26.

  I regret that I have been unable to trace any equivalent estimates for financial years 1989–90 to 1990–91.

  The overall budgets held by the General Officer Commanding (Northern Ireland) for 1991–92 and subsequent financial years, for personnel, stores, services, lands and, except for 1991–92, works costs, are as follows:

  Financial year1

  General officer commanding (Northern Ireland's) budget (final outturn)

  1991–92

  £355 million

  1992–93

  £436 million

  1993–94

  £489 million

  1994–95

  £510 million

  1995–96

  £475 million

  1996–97

  2£514 million

  1997–98

  3£508 million

  Notes:

  1 The General Officer Commanding (Northern Ireland) was vested as a Top Level Budget Holder on 1 April 1994., The figures for 1992–93 and 1993–94 are estimates of outturn prepared as comparators for the Class 1 Supply Estimates for 1994–95 (HC276— I) and 1995–96 (C271 -I).

  2 This figure represents the estimated outturn given in Vote 1, section B of the 1997–98 Class I Supply Estimates (HC 335).

  3 This figure represents the provision made in Vote 1, section B of the 1997–98 Class I Supply Estimates (HC 335).

  A more detailed explanation of these figures can be found in my predecessor's letter of 11 November 1996 to my right hon. Friend the Member for Redcar (Marjorie Mowlam), a copy of which is in the Library of the House.

  Portsmouth Naval Base
  Mr. Hancock
  To ask the Secretary of State for Defence what plans he has to harmonise the conditions of employment of casual and permanent employees at Portsmouth Naval Base. [7451]

  Mr. Spellar
  This is a matter for the Chief Executive of the Naval Bases and Supply Agency. I have asked the Chief Executive to write to the hon. Member.

  Letter from J. A. Trewby to Mr. Mike Hancock, dated 16 July 1997:
  I am replying to your question to the Secretary of State for Defence about harmonisation of conditions of employment of casual and permanent employees at Portsmouth Naval Base as this falls within my area of responsibility.
  All civilian staff at Portsmouth Naval Base are employed in accordance with the Civil Service Recruitment Code and terms and conditions of employment are in keeping with National Agreements and as laid out in the Ministry of Defence Personnel Manual. There are no plans to harmonise conditions of employment of casual and permanent employees.

  Territorial Army
  Mr. Keith Simpson
  To ask the Secretary of State for Defence how much money is allocated to maintaining the Territorial Army in the current financial year; what this sum is as a percentage of the defence budget; and what the allocation will be in(a) cash and (b) as a percentage of the defence budget in the next three financial years. [8183]

  Dr. Reid
  Identifiable costs for the TA for 1997–98 are £334 million which is approximately 1.6 per cent. of the Defence Budget. This figure excludes provision for those items which are not readily separable from the rest of the Army, including the TA's share of equipment costs, fuel, ammunition and transport.

  The allocation of funds to the TA for the next three years will be determined as part of the MOD's long-term costing which is the process by which the Department re-costs and adjusts its internal plans. The Department's internal plans represent projections and assumptions, which inform advice to Ministers on the affordability of particular elements of the Defence programme and it has been the policy of successive Governments not to publish detailed information arising from this. Accordingly, I am withholding the information requested in the second part of the question which constitutes internal discussion and advice, under exemption 2 of the "Code of Practice on Access to Government Information".

  Judicial Reviews
  Ms Hodge
  To ask the Secretary of State for Defence how many decisions by his Department were challenged by way of judicial review in each Parliamentary session since 1994–95; and in how many cases(a) the Department's decision was upheld, (b) the court found for the applicant, (c) the Department submitted to the judgment and (d) the Department appealed successfully against the judicial review decision. [7843]

  Dr. Reid
  Information for 1994–95 is not held centrally.

  Eight decisions were challenged through judicial review in the sessions 1995–96 and 1996–97.
  235
  The Department's decision was upheld by the courts in one case. In another case leave to apply for judicial review was at first refused; when later the application for leave was renewed, the case was settled without the court making any order on the application for leave. In a third case an applicant withdrew the application after being given leave. Five cases have yet to be considered by the courts. In three cases the application for leave has not yet been heard (or the Department has not yet been informed of the result). In two other cases leave has been granted and a substantive hearing is awaited. But in one of these cases this will need to await the conclusion of a reference by the court to the European Court of Justice.

  There were no cases in which the courts found for the applicant. There were, therefore, no cases in which the question of an appeal by the Department arose.

  Ms Hodge
  To ask the Secretary of State for Defence on how many occasions since 1994–95 legislation has been introduced by the Department(a) to remove effects of judicial review decisions and (b) to implement them. [7835]

  Dr. Reid
  None.

  Joint Service Command and Staff College
  Mr. Keith Simpson
  To ask the Secretary of State for Defence if he will list the number of military and civilian students at the Joint Service Command and Staff College(a) under the proposals in the defence costs study, Front Line First and (b) currently attending. [8193]

  Dr. Reid
  The current year is unrepresentative because a number of courses were cancelled or truncated to facilitate the closure of single service colleges and moves to interim JSCSC accommodation. Figures are therefore also provided for 1998.

  All figures exclude students on ISSC distance learning courses, which are non-residential, as well as other regular and occasional courses, e.g. for Reserves. Civilian students attend the Higher Command and Staff Course (HCSC), the Advanced Command and Staff Course (ACSC) and the RN Initial Staff Course (RNISC).

  Front Line First

  1997–98

  1998–99

  Military students at JSCSC

  1 21,625

  31,452

  31,587

  Civilian students

  9 (and see2)

  18

  20

  Total

  1,634

  1,470

  1,607

  1 Includes underlying assumptions for Junior Division numbers, on which no specific recommendations for change were made in Front Line First.

  2 Includes 60 places for "officers from overseas and selected civil servants" on the ACSC as well as around 40 places for overseas officers on Junior courses. The precise number of civilians on the ACSC was agreed after the publication of Front Line First.

  3 Includes 130 places for overseas students.

  Mission Statement
  Mr. Keith Simpson
  To ask the Secretary of State for Defence what the exact date is when he intends publishing his Department's mission statement. [8190]

  Dr. Reid
  I have nothing at this stage to add to the reply I gave to the hon. Member on 16 June,Official Report, column 14.

  National Service
  Mr. Walter
  To ask the Secretary of State for Defence if he will introduce a medal to recognise the service given by National Service men during peacetime. [8323]

  Mr. Spellar
  I refer the hon. Member to the reply I gave on 5 June,Official Report, column 222.

  Strategic Defence Review
  Mr. Forth
  To ask the Secretary of State for Defence if he will list for the Strategic Defence Review(a) the expected completion date and (b) the cost of conducting the review. [8234]

  Dr. Reid
  We expect the work of Strategic Defence Review to be completed around the turn of the year. Although maximum use will be made of existing structures to conduct the review, extra costs will be incurred, including in the process of outside consultation. It is too early to predict the total additional cost.

  Mr. Keith Simpson
  To ask the Secretary for Defence if he will list the names and appointments of those military and civilian personnel in his Department working in the Strategic Defence Review section. [8191]

  Dr. Reid
  The Strategic Defence Review is making maximum use of existing structures. It is being co-ordinated by the Directorate of Defence Policy, but a large number of military and civilian personnel across the Department are involved in work relating to the review.

  Department for International Development
  Mr. Keith Simpson
  To ask the Secretary of State for Defence which departmental assets and funds he will in future be allocating to support the work of the Department for International Development. [8187]

  Dr. Reid
  It is my Department's policy to assist the work of the Department for International Development (DFID) whenever it is practicable to do so. My Department is not voted funds for this purpose and any extra costs involved are recovered from DFID. The military assets involved depend on the nature of the task; no element of our Armed Forces is specifically maintained to provide this support.

  RAF 14 MU
  Mr. Maclean
  To ask the Secretary of State for Defence if he has completed his review of all aspects of the disposal of RAF 14 MU. [8127]

  Mr. Spellar
  I have examined the progress of the disposal of 14 MU RAF Carlisle and am satisfied that the MOD should negotiate with the local councils over how the future use and ownership of the site can be determined to the benefit of both the taxpayer and the local economy. I believe in the special circumstances of this case that the councils should be given the option of acquiring the core of the site with the remaining outlying areas being sold on the open market.

  Defence Budget (Germany)
  Mr. Keith Simpson
  To ask the Secretary of State for Defence what proportion of the defence budget in(a) cash

  237
  and (b) percentage terms is taken up by the cost of maintaining the Army and RAF in Germany in the current financial year. [8134]

  Dr. Reid
  The estimated operating costs of the Army and RAF in Germany for the current financial year are £1,163 million and £184 million respectively. These costs represent about 5.3 per cent. of the Defence budget in the case of the Army and 0.8 per cent. for the RAF.

  Ethnic Minorities
  Mr. Keith Simpson
  To ask the Secretary of State for Defence how many members of the ethnic minorities are currently serving in the Civil Service in his Department at grade 5 and above. [7828]

  Mr. Spellar
  The number of permanent civilian staff in my Department and its agencies at grade 5 level and above who have indicated that they are of ethnic minority origin in the MOD's ethnic origin survey is 10.

  Homosexuality
  Mr. Keith Simpson
  To ask the Secretary of State for Defence how many military personnel have been administratively discharged in each year since 1990 for reasons of homosexuality or lesbianism. [7830]

  Dr. Reid
  The number of Armed Forces personnel who have been administratively discharged each year since 1990 is as follows:

  Male

  Female

  Total

  1990

  39

  26

  65

  1991

  23

  19

  42

  1992

  30

  23

  53

  1993

  32

  21

  53

  1994

  29

  21

  50

  1995

  53

  9

  62

  1996

  43

  22

  65

  19971

  20

  7

  27

  Total

  417

  1 Figures as at 30 June 1997.

  Joint Rapid Deployment Force
  Mr. Keith Simpson
  To ask the Secretary of State for Defence what sum is allocated to maintaining the Joint Rapid Deployment Force in the current financial year; and what it is as a percentage of the defence budget. [8184]

  Dr. Reid
  The Joint Rapid Deployment Force (JRDF) is not a standing force. Rather, it brings together existing forces and equipment from the Royal Navy, Army and Royal Air Force to form the most appropriate joint force for the circumstances. It is not however possible to determine what proportion of their costs might be attributable to JRDF roles, since this fluctuates over time.

  The Chief of Joint Rapid Deployment Force Operations is the peacetime focus for the JRDF and as such is separately identifiable. He and his staff, who are embedded within the Permanent Joint Headquarters and would form the core of a deployed headquarters, together cost some £1.5 million per year. As this represents only a
  238
  single, small element of the JRDF concept, it is not sensible to compare their costs to the overall Defence Budget.

  Millennium Celebrations
  Mr. Keith Simpson
  To ask the Secretary of State for Defence if he will make a statement on his Department's contribution to the Millennium celebrations; and what the cost to his Department will be. [8186]

  Dr. Reid
  My Department intends to give the Millennium celebrations its fullest support both in the United Kingdom and, where possible, overseas. It is represented on the Millennium Co-ordinating Group chaired by the Department for Culture, Media and Sport and has tabled a number of alternative proposals for consideration.

  Until a choice has been made on the options offered, it is not possible to provide a meaningful estimate of cost to the Department.

  Ex-Service Affairs Ministry
  Mr. Sanders
  To ask the Secretary of State for Defence if he will assess the advantages of introducing a United Kingdom equivalent of the American Ministry for ex-Service Affairs; and if he will make a statement. [7495]

  Dr. Reid
  The Government are giving very careful and detailed consideration to the proposals for an ex-Service Affairs Unit and will be looking into the matter in some detail.

  In doing so, we will have regard for the fact that many of the benefits offered by the United States Department of Veterans Affairs are already available to ex-Servicemen in this country under the National Health Service, the War Pensions Agency and other elements of our social security system.

  Radioactive Materials (Transportation)
  Mr. Baker
  To ask the Secretary of State for Defence how many crashes have occurred in each year since 1967 in which(a) United Kingdom military aircraft and (b) United States military aircraft have been involved while carrying radioactive materials within United Kingdom airspace; and (a) what volume and (b) level of radioactivity was involved in each case. [7606]

  Dr. Reid
  [holding answer 14 July 1997]: There have been no crashes in UK airspace involving either UK or US military aircraft carrying radioactive materials.

  Chemical Weapons
  Mr. Llew Smith
  To ask the Secretary of State for Defence what environmental and safety information has been provided to his Department by those contracted to destroy outstanding British chemical weapon grenades, 9140-M6-CN-DM, held at RAF base Bad Wulfen. [4302]

  Mr. Spellar
  Pursuant to my recent answer of 25 June regarding chemical weapon grenades(Official Report, column 547), it should have been pointed out that the grenades at BAD Wulfen were of US origin, not British, and are believed to have been abandoned at the base during a brief period of US occupation in June 1945. The British Army had no grenades of that type.

Preamble
The House met at half-past two of the clock: The LORD CHANCELLOR on the Woolsack.
Prayers—Read by the Lord Bishop of Southwark.
Lord Windlesham—Took the Oath.
The Earl of Cromartie—Took the Oath.

The Windfall Tax and Unemployment
Lord Lucas of Chilworthasked Her Majesty's Government:
What impact, if any, the proposed windfall tax will have on the level of unemployment.
Lord McIntosh of Haringey: My Lords, the money raised by the windfall levy will be used to finance welfare to work and the new deal: £3.5 billion will be spent on improving the skills and ability to compete in the labour market of the young and long-term unemployed. A further £1.3 billion will be spent on equipping schools in order to improve the employability of school-leavers.
Lord Lucas of Chilworth: My Lords, I thank the noble Lord for that optimistic response, but does he agree that a better way might be to encourage a return to the craft apprenticeship scheme of yesteryear, with perhaps a training period of, say, 30 months? That would enable any subsidy paid to an employer to be reduced during the term of the apprenticeship, at the end of which one would have skilled craftsmen or technicians. The scheme would also provide a link between the employer and the employee.
Lord McIntosh of Haringey: My Lords, I have much sympathy with what the noble Lord suggests, but that is not the specific objective of the welfare-to-work programme which is designed generally for up to six months. We cannot promise that that programme will accommodate craft apprenticeships such as the noble Lord has in mind. However, we agree that one of the aims of the programme is to help young people to gain a long-lasting commitment from their employers to avoid the "revolving door". There will be an exit strategy with measures to help people to maintain employment when the subsidised period ends. I am sure that the noble Lord will agree that it is important to have an individualised approach to help people to choose the best option for their own needs.
Lord Tebbit: My Lords, does the noble Lord recollect that he recently gave me a half-answer to a Question that I had tabled on the matter of the windfall tax in which he ignored three of the points of the Question and did not answer them at all? On the question of whether the windfall tax would make any
996
difference to the number of people employed by the companies to which the tax was applied, the noble Lord, in a curious grammatical construction, added at the end of his reply that it would not in his view make any difference to employment. Does that mean employment in the companies concerned or employment in the economy overall?
Lord McIntosh of Haringey: My Lords, I was trying to follow the noble Lord's Question which I understood to be about employment in the companies concerned. I think that he will find that I answered two questions, which is all that I am supposed to answer when more than two questions are posed. There is no justification for any reduction in employment in those companies affected by the windfall tax. The tax is a one-off and if the companies are claiming that they need to reduce employment in order to pay it, there must be something inefficient about the way in which they are operating.
Lord Evans of Parkside: My Lords, is my noble friend aware that as a time-served craftsman who served his apprenticeship in a shipyard in Tyneside I would welcome wholeheartedly a return to the old craft apprenticeship scheme? However, is my noble friend further aware that if we were to be in a position to return to that scheme, the first thing that we would have to do would be to reopen the shipyards, factories and steelworks that were closed under the last Tory Government?
Lord McIntosh of Haringey: My Lords, I have sympathy with my noble friend's point of view, but I must point out that the welfare-to-work programme which will be financed from the windfall tax will not be the only training programme undertaken by the Government. It is an additional programme, designed to re-establish contact with the labour market among those who have lost it and to update their skills. That should make the labour market more efficient.
Lord Mackay of Ardbrecknish: My Lords, does the noble Lord agree that the impact on unemployment of the windfall tax is likely to be pretty small? Would it not be far better to continue the last government's policy of having a stable and healthy economy, which has meant that today we have once again seen the monthly unemployment figures fall by about 36,500? Does the noble Lord agree that that may not last as interest rates increase and the pound goes over three deutschmarks in value?
Lord McIntosh of Haringey: My Lords, as is proper, I shall answer the noble Lord's first two questions. His first question involves the same degree of imprecision as that of the noble Lord, Lord Tebbit. I agree that the windfall tax will have little or no impact on employment in those companies affected by the tax, but for the reasons that I have given I believe that the programme on which the windfall money is to be spent should improve employment by making the labour markets more flexible. As to the noble Lord's second question, I welcome the further drop in unemployment levels both

997
on the standard procedure and on the ILO figures this year. I acknowledge that those drops have continued for a considerable time under more than one government.
Viscount Ullswater: My Lords, the Government have announced a review of how the unemployment figures should be calculated. When in opposition they accused the then Government of fudging the figures. Can the noble Lord inform the House whether those who take part in make-work schemes like the environment task force will still be included in the unemployment figures or will they be fudged into the employment figures?
Lord McIntosh of Haringey: My Lords, pending the review by the Office of National Statistics, to which I have already referred, no changes have taken place. However, the noble Viscount will have observed that the British figures announced this morning show a reduction to 1.6 million and the ILO figures produced from the Labour Force Survey show a reduction to 2 million.
Lord Pearson of Rannoch: My Lords, further to the third supplementary question of my noble friend Lord Mackay of Ardbrecknish, does the noble Lord agree that were the Government to rule out monetary union for ever, the billions of deutschmarks that have poured into pounds might return to their natural home and the pound might find an altogether more convenient level?
Lord McIntosh of Haringey: My Lords, I thought that the noble Lord had found a quite legitimate device for dividing supplementary questions among different members of the Opposition. However, he has asked quite a different question, to which the answer is no.
Lord Barnett: My Lords, in order to try to elucidate the comments of the noble Lord, Lord Mackay of Ardbrecknish, about interest rates, will my noble friend ask the noble Lord—I am sure that he can do that—by how much the Opposition would have increased personal taxation to prevent interest rates rising?
Lord McIntosh of Haringey: My Lords, I would love to oblige my noble friend but I do not believe that the House would permit it.
Lord Swinfen: My Lords, over the past 18 years the party opposite has stressed the importance of manufacturing industries. What will the Government do to improve the position of apprentices and ensure that there are more of them so that the manufacturing industries of this country are far more efficient?
Lord McIntosh of Haringey: My Lords, I have already spoken about apprenticeships. I do not accept that the welfare-to-work proposals which will be financed from the windfall tax will fail to benefit manufacturing industry. Young people and the long-term unemployed are as free to seek help from
998
welfare to work in manufacturing industries as in any other industries. I hope that it will be a positive benefit to manufacturing industries.
Lord Tebbit: My Lords—
The Lord Privy Seal (Lord Richard): My Lords, with great respect to the noble Lord, he has already had one go and another go not by default but by representation, if I may put it in that way. I believe that we should move on.

Northern Irelandn: Inward Investment
2.47.m.
Lord Skelmersdaleasked Her Majesty's Government:
What support is given to firms intending to invest in Northern Ireland.
The Parliamentary Under-Secretary of State, Northern Ireland Office (Lord Dubs): My Lords, the Department of Economic Development, through the Industrial Development Board, provides selective financial assistance towards manufacturing and internationally tradeable service projects which offer new employment opportunities and are likely to enhance economic development. Additional support available includes training grants and R&D assistance.
Lord Skelmersdale: My Lords, I thank the Minister for that answer. Does he agree that, on further reflection, an inhibition to inward investment in Northern Ireland as in other parts of the United Kingdom is a fair and efficient planning service? Would the noble Lord describe the Northern Ireland planning service in those terms when, in a recent answer to me, the chief executive said that in 1996 it had taken 1,716 days to reach a conclusion on one particular matter?
Lord Dubs: My Lords, I agree that industrial investment is helped by an efficient planning system. I am not aware of the particular planning application to which the noble Lord refers. However, some of the delays have been due to the complexity of the decision, the need for full consultation and an appeal. Some of the delays have also resulted from further information being required from the applicant for the planning permission. Nevertheless, I agree that long delays are unacceptable and it is one of the matters that I am looking into.
The Earl of Erne: My Lords, can the Minister inform the House how much investment has been lost to Northern Ireland because of the troubles?
Lord Dubs: My Lords, looking back over the many years of the troubles, it is very difficult to answer the question. However, all the evidence that we have suggests that difficulties over the past year or so have not held back an enormous surge in inward investment. For example, for the year ending March 1997, which was the most

999
successful period in terms of winning overseas investment, inward investment of £490 million covering 35 projects from American, Asian and European companies was achieved. When those investments are completed they will lead to the creation of 4,600 new jobs. I am confident that this surge of investment in Northern Ireland will continue provided that the incident at Drumcree the weekend before last is viewed as an isolated matter.
Baroness O'Cathain: My Lords, is it possible for the Minister to ask his colleagues in the DTI whether they, in turn, could ask companies which invest in Great Britain whether they have the same or different problems when investing in Northern Ireland? The suspicion is abroad that it is much more difficult for companies to obtain planning permission in Northern Ireland than on the mainland. It would help investment in both places if that could be put to rest once and for all.
Lord Dubs: My Lords, I shall look into whether obtaining planning permission for industrial projects is harder or takes longer in Northern Ireland than in other parts of the UK. Whether I shall be tempted to do that through the DTI or whether it is better that I investigate for myself, I shall decide when I see what comes back from my own department.
Lord Stallard: My Lords, given the Government's welcome emphasis on the need to improve long-term unemployment and to create jobs, what positive direction is given to potential investors in Northern Ireland to move into areas of high unemployment? What is being done to make training facilities and promotional opportunities available and accessible to both communities?
Lord Dubs: My Lords, of course we want to encourage investment to the benefit of all communities in Northern Ireland. For example, a couple of years or longer ago few companies considered investing in West Belfast, an area which has suffered more than most from the difficulties in recent years. However, since then we have encouraged a number of American, Korean and Japanese investors to set up plants there. Those companies include Fujitsu, and Emerson Caterpillar. They will provide hundreds of jobs in the area. We want inward investment to help all people in Northern Ireland and not just a section of the community.
Lord Tebbit: My Lords, will the Minister read out a list of the policies which have led to that enormous and most successful surge of investment in the UK to which he referred earlier? Will he say whether it is proposed to change any of them?
Lord Dubs: My Lords, I have a list of the elements of the investment package offered in Northern Ireland, which is one of the most attractive in Europe. Every assistance package is tailored to meet the needs of specific projects. The level of the grant will vary
1000
according to the location of the project, and will contain one of a number of elements. I shall he brief, but the noble Lord did ask for a list. There are capital grants, revenue grants—for example, employment grants relating to the number of newly created jobs—interest relief grants, rent grants, research and development grants, depreciation allowances on tax, 100 per cent. derating for industrial buildings, help with loans, and so forth. I could expand the list, but I am sure that the noble Lord has had enough.
Baroness Denton of Wakefield: My Lords, perhaps I may modestly claim some ownership of the "we" the Minister mentioned in attracting Fujitsu, Emerson and other investors to West Belfast? We must be grateful to all those who continue to invest in Northern Ireland despite the men of violence. Retailers are some of the most valuable investors. They bring jobs and training to those with a minimum of qualifications, competition for the consumer, and attractions for tourists. Is not the Minister therefore surprised that road services should take 15 months to pronounce on road improvements which would allow a major retailer to expand, to offer more jobs, and to offer more markets for goods produced in Northern Ireland? Is it not important that there should be not just one department focused on inward investment but that every part of government should be focused on bringing more investment to Northern Ireland.
Lord Dubs: My Lords, when I said "we", I meant "we" in the sense of this Government and the previous government. In case there was any doubt about that, let me make it clear that the attractive investment incentives were those for which the noble Baroness had responsibility when she was the Minister in Northern Ireland. Clearly her efforts were successful. We shall want to continue to ensure that inward investment goes on being attractive. With regard to planning delays, a couple of minutes before I came into the Chamber, the noble Baroness mentioned to me that she wanted to ask a question about them. If I am right in interpreting her question as relating to a particular development, my quick answer is that further information is being awaited from the applicant for the planning permission. It is such a large planning application that there will almost certainly have to be a planning inquiry to deal with it. I assure the noble Baroness that I shall look into it further and let her have a full answer by letter.
Lord Mackie of Benshie: My Lords—
Noble Lords: Next Question!
Lord Mackie of Benshie: My Lords, I shall be quick.
Lord Richard: My Lords, I am reluctant to interrupt the noble Lord, but 17 minutes have passed and we are only on the second Question. I think that we should move on.

Mineworkers' Pension Scheme
2.56 p.m.
Lord Dormand of Easingtonasked Her Majesty's Government:
Whether they will reconsider the position relating to the surplus payment they received from the Mineworkers' Pension Scheme.
The Minister of State, Department of Trade and Industry (Lord Clinton-Davis): No, my Lords. The arrangements whereby the Government receive a share of any surplus in the Mineworkers' Pension Scheme are part of a wider agreement reached with the schemes' trustees in 1994. Under this agreement, the Government guarantee that pension entitlements at privatisation will rise at least in line with inflation; and in return for this the Government share equally with the beneficiaries in any surplus. The trustees supported this agreement in 1994 and we believe that they still support it.
Lord Dormand of Easington: My Lords, I accept the general principles of the scheme as stated by my noble friend, but does he agree that with £1.5 billion now in the fund there is room for improvement in the pensions for those thousands of miners who lost their jobs because of the destruction of the mining industry by the previous government, and who are still unemployed? Secondly, does my noble friend remember that the 100 miners who were sacked—it was a case of victimisation—during the dispute in 1984–85 were deprived of their pension rights? Does he agree that it would take just a tiny part of the funds that now exist to restore those rights?
Lord Clinton-Davis: My Lords, I am well aware of my noble friend's concern for the welfare of the mining community and those who were deprived of their jobs as a result of events in the past. As regards victimised miners, the case has been considered, and he will be glad to know that it is for the trustees, of course, to consider the possibility of their reinstatement. It remains an open issue. However, it is not a matter for me as a Minister, however sympathetic I might be, to revisit the fund's purposes. It is outside my legal competence so to do.
Lord Ezra: My Lords, as the Minister is probably aware, there are two pension funds relating to the coal industry. One is for mineworkers, and is the one to which the Question relates, and the other is for the staff members, of which I happen to be a beneficiary, so I declare that interest. Is the Minister aware that as a result of the latest valuation of those two schemes the Government will be paid £150 million per annum for 10 years? That is a substantial amount of money. If a further valuation should lead to an even larger amount of money, is there not something to be said for a review of the situation in the light of the point made by the noble Lord, Lord Dormand?
Lord Clinton-Davis: My Lords, the difficulty is that there is a risk of fluctuations, which no one realises more than the noble Lord. Although benefits have been
1002
accruing in the way he described in recent years, in previous years the Government were required to enlarge the possibilities of support for at least one of the funds. I am not sure about both. It is not possible for me at the Dispatch Box to take over the trustees' responsibilities. This was an agreement which was approved by Parliament and by the trustees. For that reason, as I say, it is extremely difficult to revisit the issue.
Lord Molloy: My Lords, will my noble friend consider discussing this very important issue with the National Coal Board?
Lord Clinton-Davis: My Lords, no, because the matter falls within the remit of the trustees.
Lord Mackay of Ardbrecknish: My Lords, at the risk of embarrassing the Minister, perhaps I may say that I agree with his original Answer that a bargain was made in 1994 to the effect that the Government would pick up any deficit in the fund and honour the commitment and that any surplus would be shared between the pensioners and the Government. Is that not a far better bargain for the pensioners and potential pensioners than the decision made by his right honourable friend the Chancellor to remove £5.4 billion in a Maxwellian grab in the form of the abolition of advance corporation tax?
Lord Clinton-Davis: My Lords, the noble Lord has had a go on this issue on several fronts. His appetite seems to be insatiable. However, I believe that he ought to table a specific Question on this matter rather than try to enlarge on a Question that has nothing to do with it.
Lord Dormand of Easington: My Lords, I appreciate the general principles of the fund which my noble friend has enunciated. However, that is not to say that the situation should remain as it is, in particular as the amount of money in the fund is much greater than was expected. I appreciate the difficulties, but will he agree to assist the National Union of Mineworkers in any discussions it might have with the Government or the trustees?
Lord Clinton-Davis: My Lords, the National Union of Mineworkers and the trustees will enter into a dialogue about the matters if they wish to do so. However, it is not helpful for me to seek to intervene when I have no legal competence so to do.

Pathology and Radiology Services
3.2 p.m.
Lord Walton of Detchantasked Her Majesty's Government:
Whether they will reaffirm the long-accepted definition of pathology and radiology as clinical services in the NHS and that these will not be included under the private finance initiative.
The Minister of State, Department of Health (Baroness Jay of Paddington): My Lords, I am happy to reaffirm that the Government have given an undertaking that pathology and radiology services should not be included in private finance initiative schemes. Work is now being undertaken to draw up a definitive list of those activities which will be considered clinical and excluded from PFI projects. That will he completed by the end of the year. Interested parties will be consulted and the Government have given a commitment that the interests of employees will be properly taken into account.
Lord Walton of Detchant: My Lords, I thank the Minister for that reassuring Answer. It is important to have her reaffirmation of these specialties as clinical disciplines, as they have been since the establishment of the NHS, more particularly as pathologists, immunologists, microbiologists and others and interventional radiologists are increasingly involved in the personal care of patients.
However, does she accept that a distinction must be drawn between the services to be provided in a clinical setting by such specialists and the infrastructure in which and with which those services can be provided? I accept, as she said, that the clinical services will not be included in the private finance initiative, but does she agree that it would be appropriate for the infrastructure in the form of buildings and highly expensive equipment from time to time to be provided through such an initiative?
Baroness Jay of Paddington: My Lords, that is precisely the basis on which the Government are proceeding with the private finance initiative within the health service. We are happy to see the design and building of particular installations funded under the initiative, but we are not happy to include clinical services.
Lord Glenarthur: My Lords, will the noble Baroness answer the second point which the noble Lord, Lord Walton, mentioned? It was whether equipment as opposed to the infrastructural elements can be included under the PFI.
Baroness Jay of Paddington: My Lords, that depends entirely on the degree to which those pieces of equipment are integral to the clinical services. That is precisely the kind of detailed question at which we shall he looking when we consider the detail of potential PFI contracts and whether services need to be excluded from individual schemes.
Baroness Robson of Kiddington: My Lords, does the Minister agree that it is a pity that the Bill was rushed through the House before anyone had considered the meaning of the main services as they appeared in it? The noble Baroness agreed that pathology and radiology should be excluded in response to an amendment which I tabled. What will happen when the list is drawn up?
1004
Are we to have an additional Bill? What assurances shall we have that the provision will he as sure as though it were on the face of the Bill?
Baroness Jay of Paddington: My Lords, the noble Baroness rightly recalls the amendment which she and her colleagues on the Liberal Democrat Benches proposed. It was the basis on which I agreed that pathology and the other services should be excluded from the private finance initiative.
The Bill was rushed through this House and another place, as she described it—I would say that it was taken with due speed—simply because the Government were anxious to achieve the primary purpose of the Bill, which was that the original 14 new hospitals should be built. We believe that the importance of giving 14 communities the opportunity to have new hospitals which have been denied to them for several years has been the most important objective of the Bill, and that has been achieved. We shall certainly not have another Bill to include the matters relating to clinical services, but they will be considered as a list of exclusions when individual contracts are considered.
Lord McColl of Dulwich: My Lords, does the Minister regret that for years the Labour Party condemned the PFI as privatisation by the back door? Are the Labour Party happier now that they have admitted that the PFI is the best way to build hospitals? Is the Minister happy with NHS trusts using the private sector to provide haemodialysis, routine operations, pathology and radiological services, and will the Minister encourage that?
Baroness Jay of Paddington: My Lords, I am not entirely clear about the overall philosophy behind the noble Lord's question. If he is asking whether the Government accept the role of public/private partnerships within the health service, that is certainly the case. I can quote to him from Hansard my contributions on previous Bills on this subject. I believe that he was personally involved in the residual liabilities Bill, which we discussed when the principle was supported from my position, which was then where he is sitting.
As I mentioned in answer to previous questions today, individual specialties will be considered when individual contracts are examined. Obviously, as would be the understanding with any new government we shall not overturn any commercial contracts which have previously been negotiated.
Lord Winston: My Lords, those on this side of the House will be grateful for my noble friend's reassurance about clinical services. Does she agree that there are certain circumstances in which clinical services might appropriately be part of a private finance initiative? I am thinking, for example, of private practice within the health service, which could be of great benefit to the health service, and often may be better practice within

1005
the health service—within the public sector—where there can be maximum benefit both to the public sector and to the patients concerned.
Baroness Jay of Paddington: My Lords, I am afraid that I cannot accept the principle that clinical services are in general better served in any way other than under the NHS arrangements. However, I look forward to my noble friend's contribution to the discussion on the details of the PFI arrangements under individual contracts as this process continues.

Business
Lord McIntosh of Haringey: My Lords, at a convenient moment after 3.30 p.m., my noble friend Lady Jay of Paddington will, with the leave of the House, repeat in the form of a Statement an Answer to a Private Notice Question in another place on plans for GP fundholding.

Schools and Preparation for Adult Life
3.10 p.m.
Lord Northbournerose to call attention to the role of schools in preparing young people for the responsibilities and challenges of adult life, including parenthood; and to move for Papers.
The noble Lord said: My Lords, I am grateful for the opportunity which the ballot gives me to raise this important subject. It is topical because the Government have just produced a White Paper for consultation which refers to life skills education and to preparation for parenthood. It is topical also because the moratorium on the national curriculum will end in 1999 and it is not too soon to begin to consider possible changes.
The 1988 Education Reform Act requires schools:
"to prepare pupils for the opportunities, responsibilities and experiences of adult life".
I ask myself whether the present national curriculum is achieving those objectives. I think that the answer must be "not to the full". Let us look at the 1988 Act. It provides for a national curriculum with compulsory foundation subjects. I shall list them, although it is rather boring—English or Welsh, maths, science, a foreign language, history, geography, IT, physical education, technology, music and art. Religious education, sex education and careers education are also compulsory.
Sir Ron Dearing, in his report of December 1993, managed, with difficulty, to prise 20 per cent. of the curriculum time from those compulsory subjects so that some of the curriculum subjects could be chosen by the school. But still, in effect, at least 80 per cent. of curriculum time is taken up by the compulsory subjects of the foundation curriculum.
I argue that the compulsory curriculum does not include some of the most important life skills which young people will need in the 21st century. For
1006
example, it does not include important aspects of preparation for the world of work, self-knowledge, self-confidence, the ability to relate to others, the ability to communicate well, the ability to make decisions, to solve problems, to cope with change and to retrain when necessary. It does not include preparation for citizenship or parenthood, and I shall return to that in a few moments. It does not include health education or money management.
Of course, in the best schools those subjects are delivered either as cross-curricular themes or as part of a personal, social and health education syllabus—PSHE. But PSHE has to be squeezed into the free 20 per cent. of the curriculum. It is not part of the compulsory curriculum; it is not examined; and it is only partly inspected by Ofsted.
Therefore, in many schools PSHE has been marginalised. In some schools, it has been squeezed out altogether. In others, it is badly taught. In 1994, the last year for which I can find statistics, Ofsted inspectors found that only 40 per cent. of PSHE lessons in the secondary schools which they inspected qualified as "good" or "very good".
At present, initial teacher training does not cover PSHE and there is very little in-service training available. Teachers feel uncomfortable delivering a subject which involves exploring values and dealing with pupils' questions on sensitive issues such as sex, morality and family values without proper training.
Incidentally, I believe that the name PSHE should be changed. What a switch-off it is. Why do we not refer to it as life skills or skills for life or perhaps adult life skills, which I favour? The word "adult" tends to have a certain fascination for children. I hope that other noble Lords in this debate will focus on some of the aspects of life skills to which I have referred. I have time to deal with only one; that is, parenting education—education for parenthood.
Why is education for parenthood necessary today? It is necessary for two reason: first, because so many children today are no longer learning what they need to know about parenting from their own families or extended families or neighbours; and, secondly, because today's world is such a complex place in which to bring up children. Traditional moral values are no longer accepted. Many changes are taking place in family structures. I quote from the National Children's Home "Factfile" which states:
"Almost 1 child in 3 is born outside marriage today. One in 5 families with a dependent child are single parent families. Divorce rates have doubled since 1971. More than 1 in 3 marriages are re-marriages".
I continue to quote:
"The implications of these trends are profound. It is important not only that social policy adapts to take account of this, but also that Young People understand the implications for themselves and for their children".
I repeat,
"that Young People understand the implications for themselves and for their children".
Parenting really matters. Children who do not receive the parental love and care which they need, even if it is given by another adult and not by their birth parents,

1007
will have much more difficulty in growing up emotionally secure and confident. An infant who is loved learns to love. An infant who is secure will grow up confident. A child who is taught that there are boundaries to acceptable behaviour will grow up responsible and self-disciplined. Children need appropriate role models.
Children who do not receive that basic support often fail to settle into primary school, fall behind and become disruptive. Others play truant and get themselves excluded. When young people are half educated or emotionally and behaviourally disturbed, they are difficult to train and employ. However good the schools are, the foundations of education are laid in the home. In passing, I should say that I fear that that may be the rock on which the Government's welfare-to-work programme may founder.
Nevertheless, unemployed and unemployable young people will breed and there is clear evidence that children from a background of poor parenting tend themselves to repeat the pattern of poor parenting. That has been called the cycle of poor parenting. It was the late Lord Joseph who, in 1972, first drew attention to that problem. He called it the cycle of deprivation.
In 1991 in a lecture to the Centre for Policy Studies, he said:
"For children to become self disciplined adults, capable of loving and being loved and of consideration for others, they need from their parents consistent love and discipline: unqualified love but firm guidance in values and behaviour.
Most people experience this and, when they become parents, they pass it on. But some have had no such upbringing or fail to benefit from it. And parenting that is not good enough can lead to misery for the children and, as they grow up, failure at school, crying, violence, disregard for others and unhappiness for themselves".
It is a sad fact that we still have cycles of poor parenting today. There are many causes. We must all work to break those cycles, and schools have an important role to play.
Your Lordships may wonder whether it is possible to teach children about parenting in school and whether they will be interested. There is growing evidence that the answer is "Yes" on both counts. Yes, provided that the subject is delivered by teachers who are well trained and enthusiastic, and provided that it is taught interactively, giving pupils the opportunity to explore and to discuss.
Some schools are already successfully delivering parenting education. The most recent and compelling evidence comes from a report Tomorrow's Parents of which I have placed a copy in the Library of the House. It is published by the Gulbenkian Foundation together with the Children's Society. The report, which is written by Philip Hope, who has subsequently been elected the honourable Member for Corby in another place, records and evaluates an experiment in five Manchester schools during the academic year 1995–96. It used the Children's Society programme Education for Parenthood. It was taught in the schools and the outcomes were evaluated.
1008
The report's key finding was,
"that inclusion of parenthood education in the curriculum of a school, particularly if it is taught alongside other personal and social issues, can have a positive influence on young people's thinking about their roles and responsibilities as future parents…There is a measurable positive impact on students' knowledge and understanding of parenthood".
Indeed, some of the children's own comments give a flavour of their experience. One said, "It changed my views a lot, because nobody ever tells you what it's all about"; another said, "We learnt how much time and love children need"; again, one said, "It has taught me how children behave, and how to handle it without using force—that it takes understanding, love and patience"; and, finally, one said, "It has shown me that parenting is not a piece of cake".
One of the objects of parenting education must be to present young people with a more realistic and less romanticised picture of parenthood. One school nurse believes that some young girls have babies on the basis of what she describes as the "3 Rs"—that is to say, "Ahh, isn't it lovely! Ahh, I would like one of them! Ahh, how soon can I have one!". There is no thought there for the sleepless nights, the mess, the smell, the cost, the loneliness and the sacrificed youth.
An interesting American experiment included the objective of delaying teenage parenthood: each child—that is, both boys and girls—was given a raw egg to look after for a week. They were told that they were responsible for its safety, never to leave it unattended and, above all, not to break it, but to return it at the end of the week intact. History does not relate whether they were allowed to scramble it in revenge.
Becoming a parent should not be an enterprise which is undertaken by accident, or as a whim. Again, the late Lord Joseph said:
"Casual procreation is unacceptable both for the child and for society".
Once again, I should like to give your Lordships one or two quotations from the children in the report of the Children's Society about their parenting course. One girl said, "It's made a difference to whether I get pregnant or not, you're stopping to think". Another said, "It made me think about all the compromises that I would have to make, and all the changes that a child could make to my life". Further, a boy said, "I have set my heart on being a father; however I need to give myself time to enjoy myself and live a little first". Indeed, education for parenthood is also very important for boys.
When she responds to the debate, I should like to ask the Minister to give the House an assurance that the Government will very seriously consider making adult life skills education, including education for parenthood, a compulsory subject in the national curriculum in the year 2000 and that, in the meantime, the Government will prepare a national syllabus for the subject and ensure that appropriate teacher training is available so that it can be delivered effectively. My Lords, I beg to move for Papers.
3.23 p.m.
Lord Plant of Highfield: My Lords, the whole House will be grateful to the noble Lord, Lord Northbourne, for initiating today's debate on a series of very important

1009
issues. The Motion refers to challenges and responsibilities facing children as they grow into adult life. To my mind those challenges and responsibilities, as far as they relate to possible elements of the curriculum, fall into four areas. The noble Lord has already dwelt on the first area to some extent; namely, those issues to do with personal life and parenting and the fostering and nurturing of children. Some of those parenting skills are indeed skills and there is no reason why, in principle, they cannot be taught. Certainly the report to which the noble Lord referred gives much detail about how they might be taught and disseminated to schoolchildren with very beneficial effect.
Nevertheless, we should recognise that there are aspects of parenting, to which the noble Lord referred, which are not a matter of skill and which cannot in fact be transmitted through education in a very direct way, largely because it is a matter of values. Parenting ideally takes place in a context of loyalty, love, commitment and trust which are not skills and which cannot be taught in any straightforward way and are best learnt by example.
Those values are indispensable in family life. But, nevertheless, they run up against a number of other aspects in our own moral culture which make them peculiarly difficult to follow and implement in our lives today. After all, so much of what goes on in society places a premium upon choice, upon self-interest and upon following one's own inclinations. Yet the very values that characterise family life and parenting stand in opposition to those aspects to a great extent. Having children, nurturing them, and so on, cannot be understood in the terms that characterise so many of the ways in which we speak about our lives today; for example, choice, self-interest and contract. Indeed, those notions are just wholly inappropriate.
If we are to stress the importance of parenting skills and parenting values, it is important in family life, in schools and in society generally, that we should keep affirming the fact that there are things in human life which are more important than choice and self-interest. We should stress that these have a totally ineliminable role to play in family life and in human nurturing and that, against that background, society as a whole has a right to be interested in what goes on in the family. Given the problems about breakdown, and so on, to which the noble Lord referred, it seems to me that that can no longer be seen as entirely a private matter. Indeed, there are other aspects to it which are of social concern. Therefore, schools should certainly play a role in awakening children to such adult needs and responsibilities.
The second area of challenge and responsibility which I believe to be most important relates to individual employability which, again, the noble Lord mentioned. Gone are the days when the labour market or government intervention could produce a sense of security for the whole of one's life in which families could be confident. Any sense of security derived from being in the global market has to come much more through the individual's own skills, the transferability of those skills, and so on. In other words, the individual
1010
has to be able to do not just one job but many jobs during the course of his or her working life. It seems to me that this Government have that very much at the top of their agenda—as was the case with the previous government—in trying to work out exactly what kind of skills people will need to have in order to retain employability throughout their careers. As I said, it has become much more of an individual concept as problems of state intervention in the economy in the context of a global market have made other forms of security much more difficult to achieve. Again, welfare into work requires that those who are being put into work also have employable skills. That is the second area where life skills, as the noble Lord put it, have an importance in the school curriculum.
My third area relates to the fact that more and more responsibility is being pushed on to the individual; for example, self-assessment for taxation, buying one's own pension and buying one's own unemployment insurance—what the noble Lord called money management. I believe that most of us find such tasks extremely difficult and, therefore, those who are not, so to speak, on top of such things are very vulnerable as we saw through the mis-selling of pensions. Yet if, because of agreed views about the limits of government, individuals increasingly have to take control of their own arrangements in terms of investment, pensions and insurance, it is very important for them to have some kind of training and thus some ability to manage their affairs.
The final area that I should like to mention is what one might call "civil engagement—that is to say, along with pushing down responsibility to individuals, we are now trying to attract people to serve on school governing boards. Parents will be expected to interpret league tables and understand them properly, whether they relate to schools or hospitals. Indeed, trying to understand how the public sector works against the background of much greater information is a new concept. Therefore, as they grow up, children will need to be able to understand how to make sense of that information and translate it into good judgments about how to deal with matters which will be quite crucial to their own children's lives. As regards those four areas, the noble Lord is quite right at least to ask whether there should be room in the curriculum for those kinds of topics.
3.30 p.m.
Baroness Young: My Lords, 1, too, thank the noble Lord, Lord Northbourne, for introducing this most important debate this afternoon. The issues that he has raised are fundamental to society. In the time available I wish to make just two points. First, this Motion is similar to the terms of an amendment that I moved in the course of the debates on the education legislation. Section 351 of the Education Act 1996 states,
"The curriculum for a school satisfies the requirements of this section … prepares pupils at the school for the opportunities. responsibilities and experiences of adult life".
My amendment, which was debated, would have added the words, "including marriage and parenthood".

1011
The first part of this Motion is similar to the terms of the Act. When the noble Baroness, Lady Blackstone, replies to the debate perhaps she will tell us how that part of the Act is being implemented in schools. I entirely agree with what the noble Lords, Lord Plant and Lord Northbourne, said about responsibilities, the teaching of life skills and the importance of being able to work together, to work co-operatively and to give a commitment to a job that is being undertaken. I have heard myself mentioning those points on many occasions when I was a Minister for education, but they need constantly to be repeated.
However, children need more than that. They need the firm guidance to which the noble Lord, Lord Northbourne, referred. In my view they need a set of ideals by which to live. We all need these even if each one of us knows that we shall never be able to live up to those ideals. One of the tragedies today is that children do not have these ideals because we seem to be totally unable to agree on any of them. I believe that there are three points on which we can agree; namely, that bullying is wrong, that stealing is wrong; and that cheating is wrong. Why not build on those points in other areas?
I now turn to the final part of the Motion which is before the House. In referring to parenthood in the Motion the noble Lord, Lord Northbourne, has not included marriage, which seems to me to be fundamental. I find it extraordinary that the report Tomorrow's Parents, to which he referred, said nothing at all on that matter. I rang the authors to check whether had failed to spot that but they confirmed that they had not written anything about it. I refer to opinion polls in the hope that that will appeal to new Labour who I think set great store by them. An opinion poll conducted in the past six months has shown that 75 per cent. of the public believe that schools should teach children that marriage is a good thing while 73 per cent. believe that moral teaching in schools should focus on marriage and the traditional family. It is interesting to note that no less a person than President Clinton has said, as quoted in the New York Times in January,
"It is wrong to be pregnant or father a child unless you are married and ready to take on the responsibilities of parenthood".
Nothing could be clearer. That is why in my opinion it is so unfortunate that the SCAA report which examined values in schools is so disappointing. Some 150 people were consulted and only five did not think that marriage should have been included in the values and that it deserved to be supported in the statements that were set out.
I am glad that some of the children who have taken part in the courses we are discussing have found them valuable. Tomorrow's Parents argues that as families come,
"in all shapes and sizes there is no 'ideal' parent or an ideal model for a family structure in a society with different cultural, social, religious and ethnic traditions. The values and beliefs about parenting and families which underpinned the project included the pluralism of family structures in our multicultural society without generalising about parenting in different cultures".
These are the central values of the project. Yet the facts show that these values are based on an entirely false premise. Only 6 per cent. of the population is part of a
1012
minority ethnic culture according to Social Trends.However, many of the minority cultures, particularly the Asian population, are strongly committed to the married family. Only 3.1 per cent. of the population adhere to a non-Christian faith and of these many tend to believe strongly in the married family. Although 40 per cent. of marriages end in divorce, where children are concerned married families are still overwhelmingly the norm.
Even if British society was as pluralistic as the Gulbenkian report makes out, it is an astonishing claim to imply that all family structures are just as good as one another. It will be unfortunate if the age for consenting homosexuals is lowered to 16. Just because there are lone parents who do a tremendously good job does not negate the fact that in general children in married families do better than children in broken homes or single parent families. Any teaching about parenting must be teaching about parenting within marriage for the sake of children and the whole of society.
3.36 p.m.
Lord Jakobovits: My Lords, I learnt only on arriving here this afternoon that we were allocated on average no more than six minutes in which to speak. I had prepared myself to speak for rather longer because I attribute such importance to this subject. However, I now learn that the speaker who was to speak before me, the right reverend Prelate the Bishop of Ripon, has not been able to be with us this afternoon. I deeply regret that as I was looking forward to his speech. Therefore I now have an extra six minutes in which to speak⁁with your Lordships' leave. However, I cannot promise to say what the right reverend Prelate might have said.
This is not the first time that we owe a significant debt to my noble friend Lord Northbourne for raising our collective concern with the stability of the family. Seven months ago he drew attention to the importance of the family in general. This time the Motion is more specific and mentions the role of schools in preparing citizens for the responsibilities and challenges of adult life, including parenthood. Schoolchildren will not be the only beneficiaries of this discussion. If we are successful and our deliberations help to introduce some pre-marital training in our schools, any number of marriages might eventually be saved from collapse for lack of proper preparation.
More than that, your Lordships' House may itself be a primary beneficiary. I need not remind the House that we are under scrutiny and under increasing pressure either to justify ourselves or to disband. If through proper training in schools we could save even a fraction of the marriages that are currently coming to grief, we would have contributed more to stable marriages and to a decent society than through much of the other legislation that we debate. As of now, we do not even have properly trained personnel to teach such subjects. We have not brought any into existence.
Let no one argue that we do not have the resources to produce them. Much lesser causes benefit from substantial public and private funding. What could be

1013
more wonderful to herald our entry into the new millennium than helping to eliminate the ravages of broken homes, broken hearts and broken promises?
Also, let no one argue that enduring marriages are no longer fashionable. What a beautiful demonstration to the contrary we witnessed only yesterday when the Queen invited to a royal garden party some 4,000 guests who celebrated with her their golden wedding this year. They were only a fraction of those who had applied to be invited. Such stability of marriage should be highlighted in the media, and taught our children at school.
Let me give your Lordships a few illustrations drawn from the Jewish experience to demonstrate the type of teaching to which our children should be exposed, notably at school. An ancient Jewish source has it that when a young marriage breaks up "even the altar sheds tears". Why the altar, my Lords? The altar is the vessel reserved for sacrifices. If a young marriage fails, we feel that the primary reason is that the couple were not prepared to make sacrifices for each other; and therefore the altar weeps. The altar has failed to teach its message.
I give a further illustration. No doubt the bulk of marriage breakdowns is due to selfishness, and to an unwillingness by each partner to give up something for the sake of the other. We all know the biblical proverb which says, "stolen waters are sweet", or illicit pleasures are more exciting than legitimate joys. Once young people have tasted the temptation of illegitimate experiences before marriage, marriage becomes an anticlimax and starts on a note of disillusionment. It would be sensible to convey that, too, to our children.
Through wise instruction our schools must counterbalance the hedonistic doctrine that all that matters is to have a good time. Our youth must learn that what you get for nothing is worth nothing and that what you do not put into life you will never get out of it.
In conclusion, I do not wish to become involved here in current debates on basic moral issues concerning marriage. But suffice it to say in general that it would be churlish to leave the teaching at schools in general to those who themselves do not accept a moral discipline or do not have the moral courage to stand by their convictions. Nothing can be as morally debilitating, especially for children, than an ambivalence and moral neutrality, where conflicting doctrines can all be equally valid, when generating human life inside or outside marriage.
I hope that our debate will help to stir our determination that no child will leave school without some key to unlock the mystery of how to maintain the stability, happiness and creativeness of marriages they enter full of hope—hope that we share with them for a better society in the millennium to come.

GP Fundholding
3.45 p.m.
Baroness Jay of Paddington: My Lords, with the leave of the House, I shall now repeat in the form of a Statement the Answer to a Private Notice Question which
1014
is being asked in another place on GP fundholding. My right honourable friend the Secretary of State for Health said:
"My announcement today of fair waiting lists for the patients of all GPs is an attack on unfairness. It is not an attack on GP fundholding.
"The previous government introduced the internal market into the National Health Service. This created a two tier system where patient was set against patient and GP was set against GP. That was unfair to patients, repugnant to the doctors and nurses who had to apply it and cost a fortune in extra paper-work.
"At the general election we promised to restore fairness to the health service, end the two tier system and ensure that access to treatment is based on need and need alone. We pledged to change the system so that no patients and no GP practices suffered any longer from the unfairness introduced by the Conservatives.
"We are keeping that election promise. All NHS trusts must operate a fair waiting list for urgent admissions regardless of who is commissioning the care. With effect from April next year, when current contracts run out, all health authorities must establish common waiting time standards for all the people living in their area. From the same date, health trusts must not offer preferential treatment to any particular group of patients from a health authority whether those of GP fundholders or not. Faster treatment must be provided only on accepted clinical or social grounds. This change will be fair for every patient and will be more comfortable and acceptable for doctors and nurses to operate.
"My announcement has been welcomed by the British Medical Association, the Royal College of Nursing and the NHS Confederation. The National Association of Fundholding Practices has made it clear that it fully accepts the principle and that if properly implemented the new policy will benefit all patients.
"In two thirds of all health authorities the patients of non-fundholding practices have to wait longer for hospital treatment. What is not so well known is that in the other one third, it is the patients of GP fundholders who lose out.
"We are determined to have a National Health Service which is fair to all patients. That fairness will be achieved through co-operation, in place of the competition and division of recent years. That fairness will be achieved by levelling up towards the best that is already being achieved and not by levelling down.
"In our general election manifesto we recognised that the development of fundholding has brought advantages as well as disadvantages. We promised to remove the disadvantages. A month ago we set out to bring fairness into the financing of non-fundholder practices. Today we are bringing fairness for their patients.
"We are now consulting the professions and patient organisations on how best to develop a new primary care system in which doctors and nurses can play a leading part in planning local health services more effectively for all the patients in their area.

1015
"In this way we hope to reconcile the better aspects of fundholding with fairness for all patients and all the professionals involved. We are discussing this with them and will test out our new proposals through pilot schemes in different parts of the country.
"The new system will be based on the principle that access to health care will be based on need and need alone. That is the principle of quality and equality on which the Labour Party founded the health service. That is the principle on which we will run the National Health Service—so that it is fair to every patient. And who can possibly quarrel with that?".
My Lords, that concludes the Statement.
3.50 p.m.
Lord McColl of Dulwich: My Lords, the Statement says that this is not an attack on GP fundholding; it is an attack on unfairness. This new Labour policy is an attack on freedom. The Labour Party simply cannot bear to give people the freedom to choose. Fifty-four per cent. of GPs chose to be fundholders, and, of the remainder, half want to be fundholders.
The late Brian Abel-Smith, that highly intelligent socialist who advised the Labour Party for many years on the NHS, strongly recommended that all GPs should become fundholders. If the Labour Government were really interested in fairness, they would encourage all GPs to be fundholders. Then, the so-called two-tier system would disappear.
This new Labour policy will have two effects. First, waiting times and waiting lists will inevitably increase. What the Labour Government have failed to understand is that fundholding gave GPs much more influence over hospitals. It was a shift of power. It enabled them to goad the hospitals into providing a better service. The GP fundholders were made into better advocates on the patients' behalf.
The second effect of this new Labour policy is one that the Labour Government have completely failed to understand; that is, it will completely deprive many patients of operations altogether. Some health authorities have stopped treating varicose veins, lumps and bumps, lipomas and so on. But patients of GP fundholders were able to have those operations. Now they will not. I should like to know what the Minister has to say about that. This is old Labour again. It is a fatal mistake for many people.
Baroness Robson of Kiddington: My Lords, unlike the noble Lord on the main Opposition Benches, I welcome the Statement that has just been made in another place because it will create a fairer system. It will not solve the problems of the NHS. It might mean that patients of GP fundholders will have to wait slightly longer for treatment. But it will make very little difference to the length of time that all patients have to wait. That will be solved only when the Government agree that the NHS needs more funding—and only the Liberal Democrats have costed plans for increasing that funding. I know what the Minister will say about extra funding. The proposal will not come into effect until next year. What are the Government doing about it in the meantime?
1016
I am pleased that the Minister in another place referred to the fact that fundholding has also brought advantages to the health service. One is that the fundholding GPs were much more closely involved in the planning of hospital services through their influence because they had money behind them. I hope that any change will ensure that all the GPs in a health area will have an increased input into the planning of services. They are the people on the ground who know what the general public need in the way of health services; they see them every day in their surgeries.
I also welcome the fact that we are not about to rush into some wonderful new system. The Minister says that he is discussing with all the professions involved what should happen, and that they should test out the new proposals and pilot schemes in different parts of the country. I welcome that.
Baroness Jay of Paddington: My Lords, I am grateful to the noble Baroness for her welcome for the Statement, which certainly accords with that of the professional bodies outside this House, which responded so favourably to what my right honourable friend said.
I confess to being slightly surprised at the tone of the response from the noble Lord, Lord McColl. He seemed to suggest that what I had described, in repeating the Statement in answer to a Private Notice Question in another place, was that the Government were about to abolish GP fundholding. That was certainly not included in the Statement, and it was certainly not the intention of my right honourable friend. The noble Lord may be interested to know that changes are already in hand to examine the next wave of fundholding—the eighth wave—which, as the noble Lord will know, was suspended at the beginning of May in order to free up some much-needed immediate resources for our plans for this year. The NHS Executive is even now working on guidance on budget setting for 1998–99. That will reflect the advantages that we have discovered in some of the aspects of fundholding referred to in the Statement and indeed in our general election manifesto.
As the noble Baroness, Lady Robson, said, the object of the Statement and of the policy decisions reached by the Government today are to establish a fairer system of waiting lists. As she said, they reflect a determination to approach the matter on a long-term basis. That is why I am satisfied, even though the noble Baroness suggested that she was not, with the additional funding mentioned by my right honourable friend the Chancellor of the Exchequer in his Budget Statement, which will enable us (over a longer period) to deal with the long-term problems which the waiting list division has created. I remind the House that the problem at the moment is that not only do we have a whole series of local trusts, created under the internal market—under the unfair system that we are seeking to redress—a record number of local trusts at a record level of debt, but there are also record numbers of people on the waiting lists. This initiative today is, as the Statement said, designed to return equality of treatment based on need to all those people who are waiting.
Lord McColl of Dulwich: My Lords, will the Minister answer my question? As some health authorities have withdrawn treatment for operations for varicose veins, lipomas, lumps and bumps and so on, GP fundholders were able, under the old regime, to request that the hospitals carried out those operations, and they did so. If that part of the system is abolished, what will happen to the patients who cannot have those operations? At the moment they are having to use the private sector. Is that what the Government want?
Baroness Jay of Paddington: My Lords, with respect, I think that the noble Lord has perhaps not understood the basic purpose of the Statement; namely, to create a common waiting list for all patients waiting for elective care. Under the previous system it was indeed the case that GP fundholders could, if there was excess capacity within a hospital trust to carry out operations, etc., use that time to "fast-track" people who were their patients. Under the new system everyone will be treated equally on the basis of clinical need.
3.59 p.m.
Baroness Carnegy of Lour: My Lords, might I ask the Minister a rather simple question? If the noble Baroness, Lady Robson, is right about the comparative effect on the length of the waiting list for the growing number of patients of hospital trusts, and the reduction in time for other patients, what does the Minister believe will be the effect on the average waiting list for patients? A growing number will come from hospital trusts, and they will have to wait longer. What will be the overall effect?
Baroness Jay of Paddington: My Lords, perhaps the noble Baroness has misunderstood when she said that patients would come from NHS trusts. Does she mean that they will come from non GP fundholders? I do not understand the question.
Baroness Carnegy of Lour: My Lords, I beg the Minister's pardon, I am not entirely familiar with the subject and get my phraseology wrong. However, it seems to me from what the noble Baroness, Lady Robson, said, that the overall time that patients will have to wait under the new Labour plan where everyone is treated exactly the same but where GP fundholders have less power over the hospitals, is longer. The overall effect will be that the waiting lists will be longer. Is that correct?
Baroness Jay of Paddington: My Lords, I do not believe that that is what the noble Baroness, Lady Robson, said. However, perhaps I could try to unwind this immensely complicated NHS jargon—and I share the noble Baroness's problems with it. My point is that what will happen under the system is the following. At the moment all NHS trusts must admit every kind of emergency that comes for treatment on the basis of need. Anyone who comes to the hospital trust with an emergency must be treated on the basis of their arrival time or whatever may be appropriate, whether or not that person comes from a GP fundholder practice. The system that will be developed from
1018
next April is that everyone will be treated on the same basis for elective treatment. That is, for ailments which are not emergency admissions, such as the varicose veins to which the noble Lord, Lord McColl, referred. So it does not matter whether you are on a GP fundholder's list or a non GP fundholder's list, you will be treated on the basis of your referral and your clinical need.
I cannot see that that would lead to a lengthening of the waiting lists. It will mean that, for example, as I described in repeating the Statement, people who come from GP fundholders' lists—and at the moment in two-thirds of health authorities they have an advantage—will be treated in the same way as others. As I also mentioned, in one-third of health authorities, people from GP fundholders' lists are disadvantaged. They are the ones who tend to go to the back of the queue.
Thus the object of the exercise is to achieve equality on the basis of clinical need, as is already done for emergency treatment. If the noble Baroness, Lady Robson, is saying something different, then I am sure she will intervene.
Baroness Robson of Kiddington: My Lords, I was not saying anything different. I was just saying that the GP fundholder's patients may have to wait longer. The patients of other GPs would perhaps have a slightly shorter wait, but it would not be much shorter.
Baroness Carnegy of Lour: My Lords, I am sorry to pursue this but, having confused the issue at the beginning, I wish to get it quite clear. Will the effect of what the Minister has just said be that the average length of time that all patients will have to wait will be longer, shorter or the same?
Baroness Jay of Paddington: My Lords, I cannot imagine why it should be longer. We are talking about finite resources and a finite number of patients. There is one set of hospital theatres and one set patients waiting for treatment. Presumably, if you divide those resources between the two sets of patients there is no reason why the average wait for a combined set of patients should be any different from the average wait at the moment. I am sorry, I am not putting that very clearly. You are dividing like and like; you are not making a preference towards one group of people. That is the object of the exercise.
Lord McColl of Dulwich: My Lords, I am sorry to go on about it, but I should like the matter cleared up. Some purchasing authorities have stopped purchasing certain types of operations from hospitals. If the patient happens to be under the care of a GP fundholder, he can purchase them.
I should like to know what will happen to those people. Will they be able to get their operations on the NHS? In other words, will the Minister instruct the

1019
purchasing authorities to purchase the treatment for people with varicose veins, lipomas and lumps and bumps?
Baroness Jay of Paddington: My Lords, we seem to have the same problem as we did on the previous question. Perhaps I may try to make the matter clearer. If there are X number of slots for treatment of varicose veins, for example, and you are a health authority purchasing on behalf of a hospital X number of varicose vein treatments, then you continue to do that. The point is that the people who come from GP fundholders do not gain an advantage in getting the treatment. They will not get their treatment if there is no slot for them to be treated anywhere.
Lord McColl of Dulwich: My Lords, I am sorry but the Minister fails to understand what I am talking about and it is an important issue. Very many patients are worried about it. At the moment there are patients who cannot have those operations. What I want to know is whether the Minister will instruct the purchasing authorities to start purchasing the operations for the patients who have been deprived of them.
Baroness Jay of Paddington: My Lords, we shall ask the purchasing authorities—we shall not instruct anyone—to admit all patients, whether they are for elective surgery such as varicose veins or for emergency surgery, as is the present system, on the basis of clinical need. No one will be disadvantaged by the process and some people will be advantaged.

Schools and Preparation for Adult Life
4.5 p.m.
Debate resumed.
Baroness Brigstocke: My Lords, I too am most grateful to the noble Lord, Lord Northbourne, for initiating the debate. It is particularly timely in this week when the Government are sending such confusing messages to our teenagers. In the words of the Evening Standard:
"It's OK to be gay at 16 but don't smoke".
After four moving and uplifting speeches in the debate, I shall limit myself to practicalities. What is the best way of preparing adolescents? The very word means "in the process of growing up". I would say: a good, rigorous, demanding, balanced education. There is no doubt that in an ideal world the best people to train children for life after school would be the parents and those parents would be married. But we do not live in an ideal world.
Recently, the Health Education Authority, of which I am a non-executive director, initiated some useful research through its European network for health promoting schools. Together with the National Foundation for Education Research, it compiled a report on Parents' Views of Health Education. Clearly, parents of secondary school children want attention paid in the
1020
curriculum to health education: drugs, healthy eating, sex education, smoking and exercise. In other words, schools have a strong and necessary role in preparing students for adult life. As noble Lords may recall, I argued that information about AIDS should fall naturally within the core science curriculum at key stage 4; that is, for children aged 14 to 16. The report of the Health Education Authority also emphasises the importance of the school environment: clean lavatories, walls regularly painted, and desks and furniture kept in good repair.
The Children's Society has devised, as we heard, a pack to fit into key stage 4. It is called Parenting in Education. The suggestion is that it could be used in the weekly classes on personal and social health that take place in many schools. I am sure that the pack contains much sensible and useful material. I question, however, the value of tackling a subject like parenting in an isolated lesson which is neither examined nor tested. The best way of dealing with personal, social and indeed moral issues for the young is in the natural context throughout the curriculum. For example, it should be in the context of science, particularly biology and chemistry, human geography, history, English—especially poetry, drama and the performing arts—and, of course, religious education.
As chairman of governors of a large inner-city comprehensive, I have been able to see cross-curricular projects working superbly. For example, at the beginning of their very first year in the secondary school, the 11 year-olds take part in a special cross-curricular course. It is run by the science and religious education departments which collaborate to devise a special programme spanning the whole range of relationships, including sexual behaviour, all within a moral framework with an emphasis on caring relationships.
From my experience, I am afraid that most teenagers are not too concerned about being parents. They have much more on their minds. It is essential that parents and schools should imbue children from the very start, and in all subjects at school, with a sense of responsibility for themselves and a responsiveness to the needs of others. The secondary school curriculum is already overloaded and fragmented. We do not need an extra subject put into it.
I conclude with a quotation from Professor John Abbott, director of Education 2000:
"The pressures of modern life make it so much harder to find time for our children', honest people confess, while others fail to accept that the pressures they put on themselves do irreparable damage to their children. The average father of a 14 year-old boy now spends, on average, no more than five minutes a day in solo contact with his son".
We cannot ask more from our over-stressed teachers. This is a problem not just for schools; it is a problem for parents and the community at large.
4.12 p.m.
Baroness Macleod of Borve: My Lords, I am, like other noble Lords, very grateful to the noble Lord, Lord Northbourne, for initiating the debate this afternoon, following, as it does, so closely after the

1021
debate that my noble friend Lord Elton introduced on young people and crime. I was not able to be present during that debate but it was very interesting and illuminating.
The implications of parenting and parenthood are taken by some people as a fact of life, but I suggest that they are far more complicated. For that reason I warmly welcome the Motion before us today. It brings our attention to a few problems that children and parents will encounter in life.
Like other contributors this afternoon, I have received a quantity of well thought out and informative literature from the Children's Society, the Gulbenkian Foundation and others. But I also draw on my own experience of parenthood, grandparenthood, step-greatgrandparenthood and many years of coping with the results of school and parenthood throughout my years as chairman of a youth bench.
Parenthood is a privilege, not a right. Parenthood includes fathers—some of us tend to forget that fact. I ask the Minister to use her considerable interest and expertise in trying to persuade young men—but not necessarily young—to go in for teaching in the middle schools. So many children are brought up without a father; without a father's discipline, without a father's example and without a father's love. In my view, that has greatly impaired the future of the children's lives. I hope that my noble friend the Minister will consider that matter. Wherever I go, there are practically no men teachers.
One is encouraged to be sorry for single mothers bringing up children. I am sorry for the children of single mothers. They are often deprived of true love and are also, to my certain knowledge, very lonely children.
Children learn by example, which does not always fit in with classroom teaching. But teachers must be encouraged and should be encouraged from the debate in your Lordships' House this afternoon. They should be made aware of the enormous responsibility that they have for the future generations. Being a teacher and being a parent both involve very hard work and are mentally and physically exhausting. However, one's children are worth their weight in gold throughout their lives.
I have a voice that is giving way and some noble Lords who have known me for very many years may say, "Thank goodness!". My throat is becoming very sore. But, in conclusion, I should like to quote from Libby Purves in the Children's Society publication Education for Parenthood:
"You can't be a professional parent: all parents are amateurs, working out of love and interest. They use their instincts, and their own best childhood memories, to pass on love and security, sense and kindness and courage to the next generation".
How vitally important that statement is.
4.18 p.m.
Lord Quirk: My Lords, I am indebted to the noble Lord, Lord Northbourne, for an opportunity to reflect not just on the role of schools but on Excellence in Schools, the recent White Paper.
1022
The ambitious targets and plans that are set out for every classroom will play a major part in equipping our youngsters for the challenges of adult life, as mentioned in the Motion before us. I applaud the White Paper's resolve to build upon the structures and institutions established over the past decade, such as SCAA, Ofsted, TTA and the Technology Colleges Trust. While further efforts must indeed be made to root out poor performance in whatever quarter, I welcome the proposals to celebrate the excellence that already exists and to stimulate still more.
Good teachers—beyond doubt, the vast majority—have suffered from the adverse publicity deservedly and necessarily aimed at the bad minority. Now we are promised a system of rewards and hence a teaching profession that will be held in higher regard and attract the best recruits to its numbers.
I welcome too the linking of school and home. Closer involvement of parents with their children's schools, schooling and teachers will be of greatest advantage to families of least advantage. The initiative on homework is a good example. Apparently, 90 per cent. of parents believe that homework is valuable. Yet, in their first year of secondary school, 25 per cent. of children are set homework that takes half an hour or less; and, in their last year of primary school, 43 per cent. of children are set no homework at all. But throughout those two crucial years a dismaying 50 per cent. of youngsters watch television for a dismaying three hours or more every evening. What a missed opportunity for parents to be involved at home with their children and their children's learning.
Naturally, the White Paper could not be expected to cover all aspects of the school as the training ground for life's responsibilities. It has little to say, for example, on the problems encountered by the 10 per cent. of ethnic minority children. It has still less to say on the issue of school-leaving exams and the present GCSE system. It has only a little to say on parenthood education. But not so the recently published Gulbenkian Foundation's report, whose content has been alluded to by several noble Lords.
Its findings provide no basis whatever for the recommendations that emerge. Indeed, the recommendations do not emerge; they were there from the start as the fundamental premise. The report insists that the teaching of parenthood must,
"specifically avoid overtly or covertly promoting any one model of the ideal family".
This is a premise which is wholly eccentric to the ethical norms of British society and indeed of any society on earth with which I have had any acquaintance.
A telling confirmation that this ideology is pervasive in the report is the remarkable fact that a document on parenthood for children can stretch to over 100 pages without a single sentence on the possible relevance of marriage. Quite a tour de force. Even the word "marriage" occurs only once in the document, and that in a dismissive, passing reference to,
"different contracts, including marriage, between parents in different religions and cultures".

1023
No mention is made of civil marriage or the fact that the vows thus taken are scarcely less solemn or binding or, not least, less public than those in a Jewish, Moslem or Christian marriage.
There is no indication either that, among those religions, Christianity is not all that uncommon in Britain, though the only reference—in relation to one teacher who was said to have "an overtly Christian perspective"—gives the impression of a field anthropologist stumbling upon an exotic sect. Nor would one guess from the report, which studiously (and subversively in my view), marginalises one of the more obvious models of family life, that in 1995—the latest year for which we have figures—two-thirds of all children in this country were born within marriage. While there are indeed over 1 million unmarried cohabiting couples in England, there are well over 10 million married couples, according to the Department of the Environment which projects broadly that ratio for some 20 years into the next century.
One is not unfamiliar with cautious evasion of leadership in the alleged interest of protecting minority sensibilities. But the Gulbenkian report takes cravenness to the point of perverse mystery. Approval of any one type of family structure,
"could lead to accusations of discrimination",
on the grounds of "racism and sexism". Racism and sexism? Which are the races in our midst who are ideologically opposed to marriage? And if marriage is sexist, what are the unmentioned alternatives that would be free of such a stigma?
I would not have dwelt so long on this report were it not for its sharp recommendations directed explicitly at SCAA, and particularly the first recommendation, that programmes on parenting aimed at 11 to 13 year-olds must,
"avoid promoting a single model of family structures or cultures".
It must be our hope that SCAA will resolutely reject that and stick to the position that it set out in its "Statement of Values" published in May this year. Those values included explicit support for "the institution of marriage" with the equally explicit rider that this is to be interpreted as the,
"positive promotion of marriage as an ideal".
This is surely a robust assertion of commonsense consensus that matches the equally robust assertions of common sense in the education White Paper. Our schools will play their proper part in preparing children for the responsibilities ahead only when our entire education system acknowledges that the permissive cringe of yesteryear is not only outmoded, but totally unacceptable.
4.25 p.m.
Baroness Seccombe: My Lords, I wish to add my congratulations to the noble Lord, Lord Northbourne, on initiating this important debate. I speak as an individual and not on behalf of my party and therefore the views that I share with the House today are personal. I must also admit at this stage that I do not speak as an expert, but very much as a mother who just tried to do her best. I wish to address my remarks to parenthood training.
1024
There is a saying that children grow up in spite of their parents. That may or may not be true, but one thing is certain: most parents do try by example, discipline, encouragement and advice to give their children as good a start as possible so that they may develop into responsible citizens with an ability to establish loving relationships. Creating such an environment includes the choice of school. I believe that the school should share the same philosophy, allowing the child to develop, flourish and cope with the many and often difficult challenges that adult life can bring.
Success in education is not merely training pupils to pass examinations; it is assisting with the development of the whole being. That enables the pupil to reach his or her full potential and so contribute in a variety of ways to enrich both the community and him or herself.
I too was pleased to receive a briefing from the Children's Society drawing attention to the project that it is pursuing in developing parenthood education in schools. The pilot scheme in five schools appears to have been well received by the schools and enthusiastically supported by most parents and children. It has not yet been fully assessed and I look forward to reading the full report in due course.
I was brought up in a single parent family as my father died. I do not believe that I suffered because I had a very special mother. But just as many children today do, I missed the stability and warmth of a two-parent family. I am sure that such a family is the natural and best atmosphere in which to raise children, where both parents, living under one roof, are able to share the thrills and spills of their children's upbringing at first hand.
I awoke on Monday to listen to the seven o'clock news. I could not believe my ears. The first item concerned the Government's wish to lower the age of consent for homosexuals from 18 to 16, and the second concerned the age at which young people could purchase cigarettes, that to be raised from 16 to 18. What a topsy-turvy world in which we live! Peter Brooke's cartoon in yesterday's The Times summed up the whole matter brilliantly and showed the silliness of a party's propaganda machine in overdrive, spinning out of control.
However, I find both those points disturbing and I hope that they will not be the subject of Bills in your Lordships' House without further consideration. In relation to the first matter, I have adult friends who are homosexual and understand their situation. But that subject was debated fully only three years ago and, on a free vote, the age of consent was reduced from 21 to 18. There were many impassioned speeches in both Houses. But the decision was made and the law changed. I therefore find it appalling that the Government now feel unable to uphold British law in the European Court of Human Rights. I worry about the message it sends to young people. There are many, aged between 16 and 18, who are immature, vulnerable and learning about life. My concern is that evil and perverted older men may prey on such people and lead them into a different way of life. I know it may not be politically correct to voice such views but I feel that I would not be true to myself if I did not do so.

1025
I believe the second issue—raising the age for the purchase of cigarettes to 18—will not stop the practice of smoking but will hit retailers who have the difficult task of guessing the age of the customer. Sometimes it must be impossible to make the right judgment. It smacks of the nanny state and will only make unlawful smoking even more exciting.
We should think long and hard before making changes in legislation. If that is necessary due to changing circumstances then a major factor should be the effect on family life. The family is the basic unit in society and has served us well for countless generations. The best is within marriage, where a commitment has been made by two people. Sadly, we know that things can go wrong, but the ideal was right.
We expect much from our schools. Teachers have a huge responsibility but they cannot tackle this subject alone. There is no more important task than the training of our young people for parenthood. But we must all share in this work. I am thrilled that this initiative has become high profile. I wish everyone involved the greatest success and I thank them most sincerely for accepting the challenge.
4.31 p.m.
Baroness Cox: My Lords, I join other noble Lords in thanking the noble Lord, Lord Northbourne, for initiating this debate and for the opportunity it provides to welcome initiatives which the Government have already taken, especially those to promote literacy and numeracy as essential for adulthood, and also to ask some questions concerning the spiritual dimension of education.
Many of the Government's proposals in the consultation paper Excellence in Schools are to be warmly welcomed, including the emphasis on standards, support for schools providing good education, "zero tolerance" of under-performance and a
"great improvement in achievements in maths and English at the end of primary education, to meet national targets".
The need for these commitments is underpinned by research which has shown that although there are many good schools there are also those which are failing to give pupils essential knowledge in literacy and maths. Research has also shown that children who can read well by the age of seven achieve much better by the age of 16 than those who cannot. But many children have not attained basic reading and writing skills not only by the age of seven, but by the age of entering secondary school at 11; and many even leave school at 16 functionally illiterate and innumerate. Clearly, literacy and numeracy are essential for adulthood and parenthood, and a failure to ensure that all young people are equipped with these skills is a betrayal by some schools of their responsibilities to pupils. I therefore welcome the Government's determination to ensure that this failure will not be tolerated.
Declaring an interest—not pecuniary—as a member of the board of the Teacher Training Agency, I also warmly welcome proposals to ensure that teachers will be enabled to teach effectively, including core
1026
requirements for all initial teacher training courses, new requirements and standards for all trainee teachers, the emphasis on literacy and numeracy for primary teachers and proposals for effective appraisal. But other proposals are a cause for some concern, especially those which might reduce the proven success of grant-maintained and grammar schools. And there seems to be a lack of proposals to promote the spiritual dimension of education through religious education and worship, which were reaffirmed in the Education Act 1988. It is this to which I now turn.
Schools inherently have a deep and pervasive influence on the beliefs, values and attitudes of their pupils. They thus play a major role in shaping the society of the future, including the next generation's moral values, attitudes to family life and parenthood and knowledge and understanding of their religious heritage. As the Chief Rabbi, Jonathan Sacks, emphasises in his profoundly important book Faith in the Future,
"Faith, family and community are, I suspect, mutually linked. When one breaks down, the others are weakened. When families disintegrate, so too does the sense of neighbourhood and the continuity of our great religious traditions. When localities become anonymous, families lose the support of neighbours … when religious belief begins to wane, the moral bonds of marriage and neighbourhood duty lose their transcendental value and begin to shift and crumble in the high winds of change. This is precisely what has happened in our time and the loss, though subtle, is immense".
He sees a significant part of the solution in education which is explicitly and deliberately designed to preserve moral values and is rooted in the great spiritual traditions. Perhaps I may quote a few more words:
"The answer lies in a particular concept of education, one sharply at odds with prevailing moral fashion but which can be found in Aristotle and until relatively recently might even have been described as self-evident. On this view education is not simply a matter of imparting information, inculcating skills and training the individual to make autonomous choices. Instead, it is a matter of inducting successive generations into the society in which they will become participants. It involves transmitting a particular society's history, norms and 'habits of the heart'. Education is an apprenticeship in being a citizen. It is a process of learning certain roles and then internalising them so that the law is no longer an external constraint but becomes, in Jeremiah's phrase, a law 'written in our inmost being and inscribed upon our hearts'".
It is with this affirmation of the crucial importance of moral and spiritual education for family life, for parenthood and for a stable, moral and just society that I conclude by welcoming the recent publication by Ofsted on The Impact of New Agreed Syllabuses on the Teaching and Learning of Religious Education and with a plea to the Government to give a substantial commitment to the preservation and promotion of the moral and religious dimension of education.
I welcome the improvements noted in the Ofsted report in the extent of compliance with the law in teaching RE; in knowledge, attainment and attitudes of many pupils, especially in primary schools, and in teachers' subject knowledge, facilitated by agreed syllabuses. But there are still areas of concern. I finish by asking the Minister whether she can give an assurance that this Government will give a commitment to encourage the teaching of RE for all pupils, consistent with their religious heritage and recognising, of course, the right of parents to withdraw their children if they so wish. In the great majority of cases the spiritual heritage

1027
will be the Judaeo-Christian tradition, and those of other faiths also have the right to RE and worship which respects the integrity of their faiths.
To teach in ways which preserve knowledge and understanding of the spiritual traditions of our country is not to be dismissed as indoctrination but to be appreciated as providing a fundamental freedom for all children: the freedom to make an informed choice as to whether and how they wish to develop as they grow up, the fundamental spiritual dimension not only of education but of life itself.
4.36 p.m.
Baroness Masham of Mon: My Lords, I thank my noble friend Lord Northbourne for giving your Lordships the opportunity of debating this most important subject.
Some years ago one of my nephews said, "The most important thing in life is not taught to us in school; that is, to be a good parent". Many of your Lordships might say, "But that is the job of parents, not the school". But, sadly, I have to say, that nephew was a boy typical of many young people. His parents divorced when he was aged seven. He was torn between them. He ran away from his prep school, confused and unhappy.
Homes with love, security and good routines are what children need, with parents who give them good healthy examples to follow. But so many young people do not have such homes. Many children have to contend with parents who have an alcohol problem. They can feel ashamed and insecure. Many come from violent homes, from the homes with the stresses and strains when parents are unemployed. Some come from homes where there is serious illness or a single parent.
I feel that all children should have life skills and health education taught as part of the school curriculum to prepare them for the challenges of adult life. In 1988 I moved an amendment, with all-party support, on this subject. We all live in a very complex world which for many years has put such emphasis on material things. Many young people cannot cope with the endless pressures put on them by their parents, who only want successful children, or from advertisements on television which show lifestyles beyond their means, and the very strong peer pressures which often lead young people into drug taking and crime.
With so much pressure on the National Health Service all children, both boys and girls, ought to learn basic home nursing and first aid. That would help society as a whole and make young people more responsible for their own and their families' health care. They should learn basic food hygiene and nutrition and about the dangers of HIV, drugs, alcohol and smoking, as well as basic health and safety issues. They should also learn about money matters, such as banks, mortgages, pensions and budgeting. They should learn about child care and what it means to be a responsible parent.
Since abortion became so available and 5 million babies have been aborted, the value of life seems to have been trivialised. We now have convenience food and convenience babies. I am sure young people need to have the opportunity of learning the values of life. When
1028
you have very nearly lost your life, as I did, you realise what life is all about. You value what you have and what you wish you had.
I agree with the report Tomorrow's Parents when it states:
"Parenthood education must be valued and given priority as a core part of the school curriculum".
That sensitive subject needs to become part of teacher training.
In the United Kingdom today there are enough children and young people out of school, education and training to fill the whole of Wembley Stadium twice over. I should like to congratulate Cities in Schools, which is the only national charity working solely with children and young people who are excluded from mainstream education, on tackling that problem.
Many of those young people have multiple needs. They may have special educational needs, be living in children's homes or with foster parents. They may have been involved with the police and may feel that they no longer can cope with their school or their problems.
At any time 55,000 children and young people are in the care system, of whom three-quarters will leave without any educational qualifications. Young people living in children's homes are up to 80 times more likely to be excluded from school than those living with their own families. Those at-risk young people need more not less preparation for the responsibilities and challenges of adult life. May I ask the Minister to give this matter urgent consideration?
4.43 p.m.
Viscount Chelmsford: My Lords, I am a great admirer of the single-minded way in which the noble Lord, Lord Northbourne, pursues better parenting. I am not an expert in this area, but I hope to offer one or two separate, disparate strands which may help us to improve the general way in which children are brought up to become adults.
My noble friend Lady Brigstocke mentioned John Abbott. When he returned from the USA some 15 or 20 years ago, he carried with him a set of principles which became Education 2000. Perhaps I may refer to one of the principles which he advocated and which has actually happened. He said that schools should at all times have some of their teachers away from school, either retraining or in the local community trying to find out what the schools should be doing with regard to jobs.
That is the theme of my first strand, because the key to moving children into adulthood is to get them jobs. I well recollect that in my own children's schooldays—now some time ago—the careers room was almost a joke. I am not sufficiently qualified to know how far the position has advanced, but anything that we can do to improve the careers aspect of school life should be considered. The Government have recently said that they intend to try to make school league tables more sophisticated. Perhaps I may therefore ask the Minister whether there are any plans to measure jobs for school leavers to try to get a feel for how schools are doing in a particular area.

1029
The Education 2000 theory about having teachers out of school suggests that that might be possible through the proper use of computers as fewer teachers may be needed in school at any one time. Clearly, computers offer teenagers an excellent opportunity to learn at their own speed, in their own time, choosing their own subject, using menu-driven courses. But I have learned recently of research which suggests that computers are even more important for toddlers than for school children. That surprised me a great deal.
This brings me to my second strand, because we now know that the first two years from birth are the most formative in a child's experience. That is why we now attach such importance to learning to play before a child learns how to work. I am told that three year-olds are experts with mouses and that as long as they have a PC with sound they can gain a great deal of knowledge from speaking story books; identifying words; having small amounts of texts to read; hot buttons to press so that birds fly out of trees or other forms of animation; matching objects; placing items in order on the screen; recognising numbers; or identifying shapes, such as circles and triangles. All of those things can improve concentration. Toddlers learn with short attention spans and by moving from subject to subject and back again. Researchers were surprised to find that without any pressure on anybody's part, three year-olds could concentrate on computers for up to 10 minutes at a time.
That is just one of the activities that is available to a toddler if it is handled correctly. The software is now very much more generally available than people realise. I suggest that the returns from improved development prior to playschool are much more important than the returns later, although computers will obviously be important later. I hope that well loved, well developed toddlers will get off to a flying start in school, find learning easier, and make better adults.
I come now to my third strand. I should like to tell your Lordships a very quick story from a charity that I support, West London Action for Children. A single mother was desperate because her hyperactive two year-old would never leave her alone. She could not even do the housework without being pestered all the time. At her wits' end, she called for help. A social worker arrived with a bag of toys, sat down in the middle of the room and put out the toys. At the end of 10 minutes, the mother was gasping because the child had concentrated on the toys—and on nothing else—for 10 minutes. That had never been seen before. The point was that the social worker had to teach the mother—a young unmarried mother who herself had never experienced a proper childhood—that as long as she had a pact with the child that there would be a "children's hour" and some time that would always be devoted 100 per cent. to the mother and the child, everything would gradually get better. The mother had been failing ever to give the child its own time. That was a consequence of the mother never having had that sort of childhood herself. Other noble Lords have already made similar points, but it is worth asking the Minister whether she thinks that enough is being done in the way
1030
of training to help parents, particularly single mothers who may not themselves have had a reasonable childhood, to achieve better parenting.
Finally—and again on computers—I am told that it is now customary for computers to be removed from school children some six months before their exams because computers are not allowed to be used during exams. That is understandable, but this is the age of the Internet and the web. It is the age when children can, with great ease, access data bases from home. I wonder, therefore, whether such a prohibition is sensible in today's world. As we now know that the reform of teacher training is being postponed for a year, I wonder whether the Government might use that delay to consider how they could further improve ICT teacher training—that is, teacher training for information and communications technologies—so that the teachers will feel confident with the technology. Perhaps we could also use the period to consider whether we might change to an exam system which does not have to consider whether children will cheat if they can access something through a computer.
It is said that a stitch in time saves nine. I have offered four small suggestions. I hope that they are four stitches and that the savings will come from special education needs, less unemployment, less mental illness and less crime if we can promote children towards a better adulthood.
4.50 p.m.
The Earl of Sandwich: My Lords, I too warmly thank the noble Lord, Lord Northbourne, for giving me this opportunity to speak about world citizenship in education. I also speak as someone who has had to learn the difficulties of parenting all over again by taking on the care of my late sister's 15 year-old son. By gum, it is difficult to get world citizenship over to 15 year-olds. He is a budding geographer and zoologist and I have high hopes for him.
For those of us who are concerned about global perspectives as a moral force in education, a good deal of comfort can be drawn from recent statements by Ministers representing the education and the international development departments. There appears to be a genuine new official enthusiasm for awareness of world affairs in the classroom such as did not seem possible when I initiated a debate on this theme just over a year ago. For example, the new DfEE document Excellence in Schools frequently mentions the wider world and the global economy. In section 6 of the document, under the heading "Helping pupils achieve", there is an important passage on skills for life which mentions citizenship and work-related training alongside parenting.
There are also some encouraging signs from the Department for International Development whose Minister has a strong personal commitment to development education and has promoted the importance of global and environmental education, for example through fair trade in the supermarket which is attracting the interests of a good number of young people. Her department is already reviewing its support

1031
for development education initiatives in schools and colleges, and a good deal is expected of the forthcoming White Paper.
Enthusiasm at a high level is all very well but we must make global education attractive as a subject. As to the curriculum, everyone welcomes the new emphasis on life skills and the spiritual and moral dimension. I am increasingly convinced that the present curriculum contains all of the elements that make up the spiritual and moral dimension, specifically in world citizenship education, and that we should not waste time endlessly searching for new definitions and cross-curricular themes. Let us make the best of what we have and what we have worked upon.
I also believe that the gradual strengthening of geography, which I discovered at a recent RGS seminar had to fight its own corner, will provide further encouragement. However, teachers who try to bring a global dimension into schools without much guidance have a problem. Certainly, Ofsted will help them through the core subjects and can identify life skills or cross-cultural exchanges by highlighting them in reports. There is some promise that that will happen. The Institute of Education is to hold a conference on this theme in October with the aim of drawing up a charter for initial teaching education and reinforcing the urgent need for a curriculum specifically for teacher training in this area.
The Development Education Association is another body that has become highly experienced in this field. For example, it has analysed key stages 3 and 4 of the curriculum for the benefit of teachers. It has emphasised the value to education of ethnic minorities in our society and has brought together various specialised non-governmental organisations—Christian Aid, Save the Children and so on—to promote activities in education. These are important resources alongside the new Government's policy. There is a high expectation of lottery money and the Cyberspace, some of which will certainly not be fulfilled.
Professor Michael Barber has put the question: if the ethics of teachers do not promote world understanding, whose will? If the Government have said that they intend to halve the number of people in the world who live in extreme poverty by the year 2015 they must waste no time in spreading awareness of the world's problems in the schools and in the minds of our young people.
4.55 p.m.
Viscount Brentford: My Lords, I too am very grateful to the noble Lord, Lord Northbourne, for initiating this debate. It seems to me that education is paramountly meant to be a preparation for adult life, particularly for employment but for a number of other purposes as well. I was very interested in the parenting report, which has been mentioned frequently. I do not propose to talk much about parenting itself; many noble Lords have already done so. However, I do not believe that parenting will be an abstruse item in the future for all our pupils. Many of them are aware of 15 year-old girls who already have babies. Such a girl, with or
1032
without a boyfriend, will have to act as a parent to that child. It is therefore highly relevant for teenagers to be taught about parenting, although I fully agree with my noble friend Lady Young that parenting should be taught in the context of marriage.
I make one comment on marriage that a number of noble Lords have amply covered. I believe it is important that there should be teaching on marriage in schools to stress the difference between marriage where there is a commitment to live with another person for life as opposed to the all-too-common boy and girl who live together just so long as they both so wish. I believe that there is a place in school, probably in personal and social education classes, for dealing with matters like commitment, trust and loyalty. I believe that the noble Lord, Lord Plant, said that he did not consider that that was appropriate. However, because the parenting report speaks about the participative and facilitative teaching of this subject, I believe that this could very well be covered in that way in schools.
The main point on which I wish to speak—it has already been obliquely referred to—is relationships. Perhaps I should admit that I am chairman of an advisory group of a charity called Relationships Foundation. The whole teaching of relationships might provide a framework for a good deal of the other subjects that could be taught in PSE to teenagers. I was interested that pages 57 to 58 of the parenting report showed that relationships between teenagers and their parents, their peer group and teachers all improved by parenting teaching. I believe that teenagers could be helped in this participative and facilitative style in all manner of relationships.
Relationships are not always easy for teenagers. They may be much easier for the extrovert. I believe that relationships could be taught beneficially on a much wider scale. I give an example. For the teenager as for the adult, there is a fundamental difference between being an assertive personality which is perfectly acceptable and a good thing and being an aggressive personality which is unacceptable. The latter will lead to a good number of other things like bullying. I believe that relationship teaching in PSE can help to clarify the issue.
The other aspect of relationships is how families relate together. That has value. When one of my children brought a friend to stay with the family for a couple of days I found that the visiting child was amazed because we all sat down together for meals and talked. One or two visiting friends say that in their families they go to the fridge, get the food that they want and take it to their own rooms to eat, probably in front of the television. A family that sits down to a meal and talks together—that is a real way to build relationships within the family. It is something which could usefully be brought out in that same style of teaching.
I turn to finance. It needs to be taught in this series as part of adult lifeskills. The Micawber principle is income £1—and to modernise the jargon—expenditure £1.05p, result misery; income £1, expenditure 95p, result happiness. I have always tried to teach my

1033
children that principle. Finance, incorporating such matters as how to handle a chequebook or loan and how to use cards, could usefully be taught in PSE as part of lifeskills. It is a parental duty, but many parents fail. Let us have a long-stop and have lifeskills taught in schools.
5.1 p.m.
Lord Paul: My Lords, I first add my appreciation to the noble Lord, Lord Northbourne, for introducing this Motion. It is timely as the scope of education has expanded: freedom, prosperity, competitiveness, and the ability to shape events are all linked to education.
Education is not just an economic priority, it is a social priority. Education is an essential link between the individual and society: it is the cement that holds us together. Therefore the boundaries of education must be increasingly stretched to embrace all in our society. Perhaps this is because modern life has given rise to a central paradox—that is, the way we live today erodes the cohesion of society; yet only by working together as a community can humanity sustain civilisation and progress.
That contradiction is aggravated by the dramatic growth in single-parent and two wage earner families, and the general decline of family life almost everywhere.Such circumstances thrust an enormous task upon our schools. They have to be more in loco parentis than ever before. Schools not only have to teach the academic curricula, they have also to help students to prepare for, and function in, the contemporary world. Many schools are ill-prepared for this. The case for modernisation and reform of the educational system, especially primary and secondary schools, is clear and urgent.
I am not a proponent of state intervention. However, I do believe that a state-supported programme for educational development is a necessity. The needs are pressing. Let me mention a few. We need to upgrade teacher training, and interest more professionally qualified individuals in teaching. We need to revise and upgrade pay scales so that teaching is seen to be an attractive form of long-term employment and a permanent commitment. We need to consult teachers to improve the ways in which teaching is perceived and restore the levels of professionalism. I believe also that we should devise ways in which to invigorate parent-teacher groups. In too many instances, PTAs have become a formality.
I was raised and received my early education in India. The values which were encouraged in those days had three special elements: the importance of family, the significance of duty and obligation, and the worth of experience. Underlying all was an effort to instill a sense of civic responsibility in young people. I would advocate some kind of value education, especially some kind of training in social and professional ethics at school. For example, while the majority of children receive lessons in sex education, much of this relates purely to the biological. It seems that they receive little help or moral guidance on what will be the most important decision they ever make: parenthood.
1034
I shall say a word about another facet of education—the virtue of experience. In our haste to keep pace with what is going on, we often forget that education is balance. Because our society discounts the importance of experience, schools also reflect this attitude. Experience is an essential counter-weight to the dangers inherent in narrowly focused and highly specialised modern pedantry. It is what humanises the learning of technological communities. Sixty years ago, T.S. Eliot addressed this concern in words that have special resonance for our time: I quote:
"Where is life we have lost in living?.
Where is the wisdom we have lost in knowledge?
Where is the knowledge we have lost in information?".
Education does not come cheap. But there is no other social investment which has a better long-term pay off. We have to find the funding - and the sooner the better. We must build a society where education is recognised and valued as being primarily about human development, about the realisation of human potential and about the promotion of human values.
5.7 p.m.
Lord Ashbourne: My Lords, first, I want to thank the noble Lord, Lord Northbourne, for raising this important subject. We have been privileged in the House in recent months to debate important issues facing young people, whether they be the impact of family policies or education, and therefore this debate is indeed timely. We know that the new Government have placed education firmly at the centre of their agenda. Their proposals for change have been laid out in the White Paper Excellence in Schools. It is a good White Paper. I congratulate the Secretary of State on it. It is not the normal bland, stupefyingly boring White Paper to which we have all become used to grinding through. I pay a compliment to the Government for producing it.
I hope noble Lords will agree that it is not enough for our education system just to be producing competent scientists, entrepreneurial businessmen and the like. Of course those skills are important for the nation as a whole and for the individual as he or she seeks work. It is also important for schools to be producing pupils with a deep sense of citizenship who are prepared to be part of a caring community.
In the previous Parliament we debated the work of SCAA and its consultation with the National Forum for Values in Education and the Community. One of the purposes of that consultation was to make recommendations on ways in which schools might be supported in making their contribution to pupils' spiritual, moral, social and cultural development. I suspect that noble Lords would agree that pupils need such values when they leave school and face the outside world of work, relationships and home life with all its responsibilities and rewards.
I understand that SCAA will be running some pilot projects on those values from September. I look forward to finding out how they are received. I was glad to read in the White Paper that the Government are continuing to support SCAA's work. In the later years of school there is an emphasis on careers, job interviews and CVs. I would like to propose that there should be an equal

1035
emphasis on marriage and parenthood, which are decisions as important to the pupils' future as their careers. In this day and age, people are expected to change careers during their working life, but, ideally, marriage should be for life. Parenthood certainly is a lifelong vocation and yet there is no training within the curriculum for this most vital and demanding of jobs that has so much impact on another life and the very future well being of our society as a whole.
The White Paper acknowledged that parenting should become part of the programme of education given the title Skills for Life. I hope that the noble Baroness the Minister will agree that this subject should become an important part of our national curriculum. The Government are consulting on the question, "What should parenting education programmes contain?". Perhaps I may suggest that parenting education should contain some guidance about marriage, too, as I and many others believe that that gives children the most secure start to life. I look forward with interest to hearing how the Minister will respond.
I wish to raise one further issue, which is the latest UN convention on the rights of the child, whereby the local authorities are to be given the mandate to usurp parental authority when the child is not satisfied with his or her treatment. Is that not completely unbalanced? I assume that we can rely on the good sense and sound judgment of Her Majesty's Government to resist this half-baked, anti-family UN convention. If the Minister in winding up can confirm that the Government will stand firm against this insidious undermining of family values I am sure that the House will be much in her debt.
5.12 p.m.
Lord Tope: My Lords, I am sure that all noble Lords are deeply grateful to the noble Lord, Lord Northbourne, for initiating today's debate. It is a testament to him that it has generated so much interest in your Lordships' House and that we have no fewer than 15 other speakers. The result is that they have had to be limited to six minutes, a frustration which I am sure they have all felt because much more could be said. I am the first to be allowed an additional four minutes, which will be insufficient to cover all the points that I would wish to cover, let alone respond to the many points that have been made.
Many noble Lords have spoken about marriage. I do not believe that it is appropriate for me to comment on that from the Front Bench, save to say that in a week's time my wife and I will celebrate our silver wedding anniversary and this weekend we will have a family occasion as a joint celebration to celebrate her parents' golden wedding anniversary. Perhaps that is the most eloquent comment I can make on the subject.
More neutrally, I am sure that we all recognise the importance of stable, long-term, loving relationships to good family life. I recognise that some noble Lords went further than that, but I am sure that it is the basis with which all of us can agree. Several noble Lords made reference to the Children's Society report, which I, too, received and read with great interest. I do not have time to develop upon it, except to say there was a great deal
1036
with which I agreed, particularly its introductory comment that now was the time to talk about how parent education is incorporated in the school curriculum and not whether it should be.
I am pleased that much of today's debate has been about parenthood. That is not surprising as it is referred to specifically in the Motion before us. That is recognised in the White Paper, which begins its section on helping pupils achieve by stating:
Parents are a child's first and enduring teachers. They play a crucial role in helping their children learn.
That is a sentiment with which I wholeheartedly agree and I am sure it is a view shared in your Lordships' House.
I am pleased that today we have been talking about the responsibilities of parents. I believe that for many years, until comparatively recently, too much emphasis was placed on parents' rights and schools' responsibilities and not enough the other way around. Therefore, I welcome the shift towards talking more about parents' responsibilities and helping and enabling them to understand those responsibilities and to meet them.
Teachers play a vitally important role in shaping the society of the future, but they must do so working in the context of the society of today. I speak with teachers often and therefore I know that sometimes they feel that they are, in a sense, working against a tide. They feel that society as a whole does not always support them as it should in their work to try to instil such values and to teach parental skills in schools. It is important that the Government have recognised that in the White Paper. There is a section devoted to it and I hope that it receives the response that it deserves. I hope, too, that the Government will be able to act upon it.
As I have mentioned in almost every education debate in your Lordships' House, I continue to be the leader of a London borough council which is a local education authority, and I thought that on this occasion I should take advantage of it by seeking advice from what perhaps no longer should be called "the chalk face"—although I still use that term. I spoke to two headteachers at two of our excellent secondary schools in the London Borough of Sutton. The first was Greenshaw High School, a mixed school, which my two sons attended. In every year of the school it teaches issues about adult life and parenthood through the tutorial programme. I was told that children explore a range of issues relating to topics of parenthood and so forth.
I also spoke to the headmaster at Carlshalton High School for Boys, which is obviously a single sex school. It runs parentcraft lessons in years 10 and 11 which look at the role of parenthood. They teach boys about washing babies and changing nappies—lessons I could have done with some years ago—as well as more usually first aid, ironing, washing and so forth, together with health and sex education. The headteacher told me that those classes have been extremely successful, in particular due to the strong personal commitment of the staff involved in running them. I venture to suggest that that is usually the reason for successful teaching.

1037
Another school will open in my borough in September. It is a purpose-built comprehensive school which I recently visited with the headteacher. He, too, told me of his determination that all pupils who leave the school—the first will start in September—will know how to lead responsible adult lives and be able to look after themselves in all the necessary basic skills such as cooking, sewing and so forth.
Those are important issues. Many schools are undertaking excellent work and I asked the teachers to whom I spoke what it was they wanted. Although they had different ways of expressing themselves, there was astonishing commonality in their responses. I spoke to the teachers separately and the first thing they said they wanted was recognition from government and others that schools are achieving a great deal against all the odds. They meant resources—they were, of course, talking to the leader of their council—the national curriculum and all that that imposes and, sadly, too many disinterested parents.
I asked them about the national curriculum. The noble Lord, Lord Northbourne, suggested that teaching parenthood should be part of the national curriculum. The headteachers to whom I spoke believed that it should not and I am inclined to agree with them. The fear was that if it were, it would be too prescriptive and the problem is that the national curriculum is already too crowded. They also considered that it might stifle different initiatives in carrying out this essential work.
They suggested that government should collect and promote good practice and that they should encourage schools to adopt schemes to develop children's skills in these particular areas. It was suggested that a manual of good practice could be drawn together and given a high profile launch. In other words, they want encouragement, the dissemination of good practice, a higher profile and the reward that recognition brings, but they do not want the prescription which inevitably follows with the national curriculum. That is extremely important and I am sure that that will come in the response to the White Paper, which I welcomed when it was published and welcome again today. In the context of today's debate, I look in particular at the relevant section. We very much support the proposals in the White Paper in relation to work-related learning. We recognise with interest and support the points that are made about parenting. The White Paper states:
We want all secondary schools to help teach young people the skills of good parenting, both formally and through contact with good adult role models.
We heartily endorse that.
The final area on which I should like to touch has been touched upon briefly in the debate, particularly by the noble Earl, Lord Sandwich, with whom I agreed in particular; that is, citizenship. There is a section in the White Paper on citizenship. The White Paper recognises that a good democracy needs to be a healthy democracy which means that it needs to be active. It is a matter of particular concern to me and, I hope, to all your Lordships that disillusionment with our political system is at its greatest among young people. Two-fifths of
1038
young people eligible to vote do not do so. Indeed, in the European elections, only 11 per cent. of young people eligible to vote actually did so.
As regards choosing role models, it is interesting that when young people were asked whom they would ask for advice on managing their finances, one in five said Chris Evans or Gary Lineker. Only one in 100 said Kenneth Clarke at the time that he was Chancellor of the Exchequer. He was at the bottom of the table with Mystic Meg. I make no comment on the late lamented Chancellor of the Exchequer but that is a sad comment on whom young people choose as their role models.
There are some things that the Government can do. For example, of those appointed to quangos, only 5 per cent. are under 40. I doubt very much whether young people think that under 40 is young but to many of us, it is. The average age of those appointed to quangos is 57. All those important issues need to be addressed and I am pleased that the Government, in their White Paper, are trying to address them and are to set up an advisory group to discuss citizenship. In doing so, I hope that they will draw on the valuable work done by many voluntary organisations, in particular the British Youth Council, which does excellent work on a very small grant from central government.
This has been a useful debate on a very important subject to us all. I think that we have learnt from it. I hope that the Government will receive a good response to that section in the White Paper and I look forward to being able to take those matters further.
5.22 p.m.
Baroness Byford: My Lords, I too welcome being able to take part in this debate today. I thank the noble Lord, Lord Northbourne, for making that possible.
The phraseology that we have heard expressed by other speakers has included marriage—and I stress marriage—stable relationships, caring relationships, parenthooding and the linking of schools and homes. I was pleased to hear from the noble Lord, Lord Paul, about the importance of family, duty and experience.
There is no doubt that we all share a common concern for the problems facing parents and families at the present time. None of us doubts that schools have a role to play in the promoting of stability in those areas of society. However, the problem is that we live in a community without an agreed system of values, as my noble friend Lady Young implied earlier. Marriage—and I declare my own interest, I believe in marriage—is an acknowledged important part of life but we recognise also that it is an individual choice of people.
I have been appalled, as I am sure have other noble Lords, by the age at which children are being expelled from schools. A case reported in the newspapers only last week involved a boy of five being excluded from his school. I understand that six children per week of primary school age are being excluded. That highlights the growing problems faced by teachers in our primary schools.
Schools share in some of the moral confusion and teachers themselves reflect the diversity of lifestyles within our society. I fear that it can be said that in some

1039
senses they reflect rather than mould society. When issues like the family are discussed in schools, the atmosphere is one of moral relativism—that is, all relationships are seen as equal. I do not wish to pile on the pessimism but we must consider the difficulties facing us. This country has never had an atmosphere of secular or civil morality such as exists in France and, to a lesser extent, in America. Traditionally, the teaching of morality has been left to our churches. And yet I feel that with only 8 per cent. of the population attending church on a regular basis, the time has come to look at other ways in which to promote parenting. The debate this afternoon suggests—and it is true—that schools have their part to play.
Development in helping families with parenting should not be undertaken in isolation. Many voluntary organizations—and noble Lords have mentioned some—traditionally give support to families. I should like to speak of the work undertaken by two such organisations in Leicestershire; namely, Homestart and Connections.
Homestart began some time ago with the aim of befriending and helping families under stress. I know that it is well known to your Lordships' House. Its work has been extended to other centres throughout the country.
The other organisation is Connections. That started only some 10 years ago. It offers support to families in a different way. Instead of the volunteer giving home support to people in their own homes, children from the ages of five to 10 are given the opportunity to meet once a week in a hall after school for two hours in the early evening. The helpers, all volunteers, are given training and practical support.
The children learn right from wrong; learn to play organised games; learn to sit down and have a meal. The importance of that was mentioned earlier by my noble friend Lord Brentford. They receive encouragement. They gain in confidence. They are taught about food and nutrition. They learn to swim and also take walks in the countryside.
It is a wide range of learning but it is always with the aim to encourage individual children. Respect for themselves and for others is key to the work. Mrs. Murray is the organiser whose idea and inspiration Connections is. She said that if she does not have the children by the time they are aged five, her task is that much greater when she is helping children who come from families under stress. All the children that she receives are recommended from social services. Her team of volunteers, which numbers about 40, works with a ratio of 3:1. The children are helped and encouraged.
In her contribution today, the noble Baroness, Lady Macleod, highlighted also the contribution which men make to giving a balance to family life. Elizabeth Murray, of Connections, is very keen that men, and in particular young men, should play an important part in the work in which she is involved.
Therefore, I welcome the contributions made to this debate today. Perhaps I may return to the importance of marriage. I was not aware that as a Front Bench spokesperson, I should not give a preferred choice.
1040
However, I should like so to do and if I am wrong, I apologise. I am lucky enough to have been married for many years. I have two children and now three grandchildren who bring enormous joy. And yes, marriage brings its problems with it. It brings challenges for each and every one of us. But there is no other way in which to make sure that our future generations get off to a good start without the importance that parents make to the debate.
After all, it is parents who have the children in the first place. Some noble Lords have spoken about responsibilities and rights. It is extremely important that we bring up the next generation to appreciate the importance of marriage.
Perhaps I may now pose one or two questions to the Minister who is to respond to the debate. First, is the noble Baroness able to accept that schools have a responsibility to include parenthood in the curriculum? I am sure that she will have no difficulty with that. Moreover, perhaps that could be considered as regards the younger age group rather than just concentrating on secondary school level, bearing in mind that the biggest influence one has on children is at the younger age. Secondly, can the Minister tell us the Government's view on the traditional family and family values? Thirdly, how does the Minister see the promotion of parenthood when, within our communities, as has been mentioned in today's debate, there is such wide diversity? I believe we all face that challenge.
In welcoming all the contributions made in the debate this afternoon, it is clear to me that we recognise that there are no easy solutions. I have approached the problem pragmatically. I feel that the interaction among families, schools and the community, as I highlighted with my examples from Leicestershire, is essential. We have great expertise whether it is within schools, within parents, or within voluntary organisations. We must not expect our teachers to take on the sole role of solving our moral problems. It is parents who are responsible for their children and it is indeed they who should set the standard.
5.31 p.m.
The Minister of State, Department for Education and Employment (Baroness Blackstone): My Lords, like other speakers, I should like to thank the noble Lord, Lord Northbourne, for calling attention to the important role of schools in preparing young people for adult life. The noble Lord spoke eloquently, knowledgeably, and from a position of experience as chairman of the Parenting Forum. I should also like to thank all those who contributed to today's interesting debate. The terms of the debate relate to preparing young people for the responsibilities of adult life, including parenthood. I want to try to address the issue raised in the terms of the debate as broadly as possible. I do not believe it would be appropriate for me to debate the merits or otherwise of the independent Gulbenkian report; instead, I should like to focus on government policies.
As the noble Lord, Lord Northbourne, said in his opening speech, and as other speakers have endorsed, parents are, and should be, the main formative influence

1041
on their children's development. The foundations for adult life are laid early in childhood. So we aim to provide good quality early years education, alongside childcare and family learning where that is appropriate. But when a child moves on to school, schools also have a key role to play. A crucial aspect of a school's role in preparing its pupils for adult life is to give them a good general education and to ensure that they achieve the best they are capable of achieving.
I was immensely grateful for what was said by the noble Baroness, Lady Cox, and the noble Lords, Lord Ashbourne and Lord Tope, about the White Paper. The measures in the White Paper, Excellence in Schools, which I announced in this House last Monday, will equip young people with the knowledge and skills which are required for today's complex world of work, skills and knowledge which are very necessary to our future if we are to compete successfully in the next century. They will be complemented by the opportunities for education and training that we will provide through our welfare to work programme.
Like the noble Baroness, Lady Cox, we recognise that literacy and numeracy are the basics for successful learning at school and in adult life, and that is why we are placing great emphasis on getting them right in schools as early as possible and setting ambitious and achievable targets for 11 year-olds. But learning does not stop with the final bell of the school day. Many schools are already doing a great deal through homework clubs, study support, outdoor and other extra-curricular activities. We will make available funding from the new midweek good causes lottery to extend or establish regular programmes of out-of-school-hours activities in at least half of all secondary and a quarter of all primary schools.
Raising standards in the basics is right. Talk of equality of opportunity and engaging with society is hollow if young people leave school not able to read and write properly, or handle numbers well. We need to have other goals in order to prepare young people for adulthood. Schools play a vital role in helping young people to develop into well balanced individuals with confidence and respect for themselves and for others, and in developing skills in the fourth R to which my colleague in another place, Estelle Morris, referred recently—relationships. Schools can give young people an appreciation of the different backgrounds and cultures in out multi-race, multi-faith society. They can help them to develop the attitudes to life and work needed to be full and active citizens and lead purposeful and fulfilled lives. Those wider goals are central to personal, social and health education. I noted what the noble Lord, Lord Northbourne, said about the nomenclature here. I accept that it is a bit of a mouthful; indeed, it is something which I shall certainly take away with a view to considering his alternative of "life skills".
The noble Lord asked three questions about the area which I believe it would be helpful for me to address at this point. The noble Lord asked, first, whether the Government would make personal, social and health education compulsory from the year 2000 in all schools. In answer, I can say that we will take decisions about the
1042
need for, and the nature of, any changes in the National Curriculum when we have considered advice from the Qualifications and Curriculum Authority next year. We shall also take into account reactions to our White Paper, Excellence in Schools. In that respect, I should tell the noble Baroness, Lady Byford, that the White Paper contains proposals for all secondary schools to provide parenting education. However, whether or not that is appropriate for primary schools is a matter which needs a little more consideration.
The noble Lord, Lord Northbourne, also asked whether it would be right to produce a national syllabus in the area. I believe that the answer is no. It will still be the responsibility of each school's governing body to decide what best fits the needs of its own pupils. I believe that to be consistent with the views expressed by the noble Baroness, Lady Brigstocke, in her contribution. Finally, the noble Lord asked about teacher training. The recently announced new curriculum for teacher training states that newly qualified teachers must be able to address pupils' personal, moral and social development. Indeed, that is something we shall want to implement.
Most speakers who contributed to today's debate have made it clear that they are aware of the fact that schools have a legal duty to provide a curriculum which promotes the spiritual, moral, social, cultural, physical and mental development of pupils and society and to prepare pupils for the opportunities and responsibilities of adult life. The noble Baroness, Lady Cox, asked about religious education. I can tell her that the Government are committed to the continuing provision of RE and have no plans to change existing provisions.
Secondary schools must also provide sex education and careers education. Elements of sex and drugs education are part of the science national curriculum. In answer to a question of the noble Baroness, Lady Young, Ofsted reports on how the Act is being implemented and it has reported favourably recently on how these legal duties are being catered for in schools. Schools take their legal responsibilities concerning the curriculum seriously. Many schools choose to meet their responsibilities through programmes of personal, social and health education which can encompass a broad range of topics including sex and relationships, drugs education, nutrition, physical activity and broader health education, safety education, and careers, work-related and community based education. I want to say a little more about some of those now to give your Lordships' House a flavour of the current range of provision in schools which contributes to preparing young people for adult life, and some of the work which my department is supporting.
Young people face considerable pressure from their peers and in the media in the area of sexual relationships. In answer to my noble friend Lord Paul, schools work with parents, health and other services to give young people access, through sex education, to good information and help in developing the communication and negotiation skills needed to make responsible decisions about their personal and sexual behaviour as they enter adulthood. Schools have a key role in developing similar skills in young people to

1043
reject drugs, and that includes tobacco. I hope the noble Baroness, Lady Seccombe, does not really think that discouraging young people from smoking is to be condemned as an example of the nanny state. My Government's proposals for reducing smoking, particularly among the young, and the proposed appointment of a "drugs czar", signal a vigorous new strategy bringing agencies together in a coherent programme to deal with the problems of drug misuse. Schools, of course, cover broader health topics within health education.
There is much good work going on in schools to prepare young people for the world of work. The noble Viscount, Lord Chelmsford, asked about careers education and said that it was a joke in his school. I hope that that is no longer the case in schools today. Through careers education and guidance schools equip young people with the skills they need to make the important decisions they have to make about the transition between school and work and help them to put these decisions into practice. Of course standards of provision in schools and colleges are not perfect and they must continue to improve. Most now have a written policy statement, careers co-ordinators and partnership agreements with careers services. Those are the cornerstone of good overall provision. We are committed to improving careers education in schools and colleges. The Education Act 1997 will raise its status, making it compulsory for pupils in years 9 to 11.
Much of the debate about the role of schools in preparing young people for adult life tends to centre on the curriculum. There are always calls for changes to the national curriculum to include particular topics. We have considered whether in the short term we should aim to change the present statutory framework. We know that the national curriculum is not perfect but we have consistently made it clear that we do not want to make any statutory changes to key stages 1, 2 and 3 until the year 2000. In the short term it is essential for teachers to have some stability to allow them to concentrate their efforts on improving their teaching rather than relearning what they have to teach. But we do want to see our priorities of literacy and numeracy better reflected in the way the current curriculum is being delivered. We also expect advice next year on the need for and nature of changes to the national curriculum after the year 2000. However, I do not want to suggest that this is shutting down development. Preparing young people for adult life is about much more than legal obligations concerning the curriculum, extremely important though these may be. It is about how young people relate to one another and interact with others at school and in their communities, and how they develop into adults. These are areas within personal, social and health education where we can start to consider changes now. Our White Paper highlights a number of life skills.
I want in particular to focus now on parenting and then to say something about citizenship. The noble Viscount, Lord Chelmsford, asked about the training of parents. However, that is outside the scope of this debate, which is about pupils at school. As the noble Lord, Lord Northbourne, has argued, it is difficult to
1044
overstate the importance of good parenting to the well-being of individuals and society. I know myself that being a parent has never been easy as I am one. It is no easier today. Some of the problems are the same, but many are different. Of course our society has undergone many sweeping changes, for example, changes in the role of women and the extent to which they are at work.
If we can help the parents of tomorrow to gain a better understanding of the responsibilities and skills required to become good parents we can make a real difference to the health and success of our communities and help tackle some of the more pressing problems they face, including pregnancies among young teenage girls. Many young people leave school without ever having thought through whether or when they will have children. A number of speakers in this debate have already indicated their concern about this. Certainly many embark upon this major change without properly considering the potential impact on their lives. Schools cannot and should not take the place of parents, but with parents they can play an important role in teaching young people what it means to be a parent; namely, the emotional, financial and practical responsibilities and the lifelong nature of the commitment it brings. Some very good work is already taking place in schools, particularly those with well developed personal, social and health education programmes. The Tomorrow's Parents report, which has been mentioned earlier, illustrates what can be achieved. I have already said that our White Paper makes clear that we want all secondary schools to have a role in teaching young people about good parenting.
We shall also encourage schools to develop links with other agencies, particularly voluntary and community groups, adult education centres and family nurturing schemes which are supporting parents in bringing up their children. This will provide support for schools and practical help to today's parents. The noble Baroness, Lady Macleod, asked whether there could be more men teachers to provide role models, especially in middle schools. I think I am right in saying that more than half of teachers in secondary schools are men. However, I accept that in primary schools the proportion is much lower and is only about 20 per cent. There is a case for trying to encourage more young men to enter primary school teaching.
The subject of citizenship was referred to by my noble friend Lord Plant, the noble Earl, Lord Sandwich, and the noble Lord, Lord Tope. The Government recognise that young people can feel disconnected from society. It is vital for them and indeed for all of us that young people believe they have a stake in the communities in which they live, that their voices are heard and that their views and actions can make a difference to society. I noted what the noble Lord, Lord Tope, said about trying to bring more younger people into quangos. I entirely endorse that. Citizenship education is already a feature in some primary and secondary schools. We intend to give greater prominence to this work in schools. Again, we are consulting widely and will work with all those who have an expertise in this area.

1045
I noted with particular interest what the noble Earl, Lord Sandwich, said about development education. The Government agree with what he said about its importance and about the importance of education for world citizenship. We will also be working with voluntary organisations, the business community and others, to develop a nationwide programme of Citizens Service—Millennium Volunteers—to provide young people with opportunities to do useful voluntary work in the community. For some it will increase their prospects of employment, but the aim is much wider: to restore a sense of belonging and identity to communities and to promote social responsibility.
I turn now to values in adult life. As the noble Baroness. Lady Young, said, values are important in preparing young people for adult life. It is not sufficient simply for young people to acquire knowledge and skills. They must also develop and apply values such as respect for others and for the law.
As many noble Lords will know, we have given approval to the School Curriculum and Assessment Authority—shortly to become the Qualifications and Curriculum Authority—to produce guidance to schools based on the statement of core values drawn up by its National Forum on Values in Education and the Community. It will extend across the curriculum and beyond it, to embrace the wider work of schools. It will be supported by case studies, a directory of resources and guidelines for community service. There will be a SCAA pilot later this year.
In reply to the noble Baroness, Lady Young, the SCAA statement from the forum on values did not omit any reference to marriage. Moreover, the statement reflected very wide consultation about common values in this area. I think that the SCAA advice was accepted by the last Government.
I agree with the noble Lord, Lord Tope, about the importance of stable, long term and loving relationships as a context for all children.
In conclusion, I hope that I have convinced your Lordships of this Government's commitment to strengthening the role of schools in preparing young people for adult life. I have sought to answer as many questions as possible posed by speakers in the debate. Where I have failed to do so, I shall of course write to noble lords.
There is already a great deal of good practice. As I have indicated, we shall seek to build on that by raising general standards in schools to ensure that young people have the skills for work. We will also assist schools to help young people develop into confident and responsible adults and caring and active members of society—in short, to have the broader skills for life. I accept what the noble Baroness, Lady Byford, said about the need for a pragmatic approach.
It is important that we do not see these two elements as separate and unconnected. They are geared toward common central purposes: well balanced individuals and a well balanced society. In the work we have set out to do, we must secure a firm place and proper status for personal, social and health education in schools to help
1046
ensure coherence in the provision for preparing young people for adult life. We must also be careful to ensure that this coherence is reflected in any decisions about the shape of the curriculum and the role of schools in the new millennium.
5.54 p.m.
Lord Northbourne: My Lords, I am grateful to all noble Lords for being so grateful to me for tabling the subject. I thank your Lordships for the many thoughtful and valuable contributions. I was particularly glad that a number of noble Lords raised the question of citizenship. Even more noble Lords gave a great welcome to the Government's White Paper. The Government should be delighted by that support.
Many noble Lords mentioned the Gulbenkian Foundation's report, Tomorrow's Parents. Everyone broadly welcomed it. However, anxiety was expressed about the treatment of marriage. The policy of the Children's Society and the Gulbenkian Foundation on this issue is set out on page 12 of the report. Whether or not that policy implies that all family structures are equally good, I am not entirely sure. It is a question that needs to be addressed. My own prejudice is that all family structures are not equally good although we have to accept that they exist.
I believe that there should be more research on the subject; more consideration should be given to it. Any such research or consideration of whether family structures are equally good should be measured against these three criteria: the welfare and outcomes for children; the shared values of our society; and the religious values which many of us hold.
The noble Baroness, Lady Brigstocke, drew attention to the dichotomy of responsibility between parents and teachers, and implied that teachers already had enough on their plate and that parents should accept responsibility on this matter. I merely refer to what happens when parents fail to accept their responsibility.
Finally, I thank the Minister for the extraordinarily constructive and helpful things she said, in particular the good news about teacher training. Like all education, the success of life skills education ultimately depends on the skill and enthusiasm of teachers. Structures help. In the end good teachers are the key. I beg leave to withdraw the Motion.
Motion for Papers, by leave, withdrawn.

The Probation Service
5.56 p.m.
The Earl of Longfordrose to call attention to proposed cuts in the Probation Service; and to move for Papers.
The noble Earl said: My Lords, we can all agree that this is an excellent and opportune moment to discuss these issues. Not long ago I put down a Written Question to the Minister who will reply asking what funds would be available to the Probation Service in the years to come. He said that the whole matter was

1047
undergoing prolonged and thorough consideration. I understand that there is an Answer to a Written Question today. I have been unable to see it. It announces something still more fundamental. However, the door is ajar so far as concerns government support for the Probation Service in the years to come. I understand that no final settlement has been reached. I am glad that the door is ajar. I hope that the debate plays its small part, and will be the beginning of pressure to push the door further open.
I am not one of those—and I am sure that there are not many on these Benches—who believe that any legacy left by our predecessors in government is bound to be unhelpful or possibly malignant. Certainly, my dear friend sitting at my side, my noble friend Lord Graham, is not one of those. For example, I believe that the economy is in rather better shape than usual at present. But we are not concerned with those matters today.
If, by some strange good fortune, we had won the election in 1992—I have no right to speak for my party except as a humble Back-Bencher—the Labour Party would have inherited an excellent and promising legacy in the penal field. The 1991 Act would have been recently passed—a culmination of rather slow but steady progress towards more humane treatment of prisoners and a more enlightened approach to prison sentencing.
That was not to be. However, I shall always remember with gratitude the efforts made by some Conservative Ministers. I think in particular of the constructive efforts in the penal field over a crucial period of the noble Lords, Lord Hurd and Lord Patten. But in 1993 something untoward happened. Mr. Michael Howard became Home Secretary. I do not think that one can ever blame one man for government policy. Nevertheless, that policy will always be associated with his name, and I daresay he is proud of it. I have called him the Prince of Darkness many times. However, I do not believe I have done any damage to his career. He is now, I understand, shadow minister for foreign affairs; so I am glad to say I have not done him any lasting injury. As I have said previously, his great talents will find alternative uses, and that seems to be in prospect.
Leaving aside personalities, let us examine the policy. It was based on the theory that "prison works", and that it works better if it is made nastier for prisoners. That policy was duly carried out, in total contradiction to the policies of the noble Lords, Lord Hurd and Lord Patten, and other Conservative leaders. The result has been a steady increase in the prison population. It has increased more than 50 per cent. in the past four years; and, if matters continue as now, an increase of some 20,000 in the next seven or eight years seems likely. That is the result, not of accident, but of policy—all the more so because, as I ventured to imply in a Question I asked the Minister yesterday, according to the late government (we do not want to dispute everything they say) crime has not been increasing in recent years. Nevertheless, not only has there been a remorseless increase in the prison population up to the present time, but such an increase is also in prospect. That is the result of that policy.
1048
On the other hand, the Probation Service is to be cut. I shall not argue about figures; everyone agrees that it is to be cut. According to official figures the cut is not very severe; but it is definite and pronounced. According to the leaders of the Probation Service, the National Association of Probation Officers and the Association of Chief Officers of Probation, it is much more serious than it appears and is cumulative in its effect. People like Mr. Harry Fletcher of the National Association of Probation Officers and leading representatives of the Association of Chief Officers of Probation would say that if this policy of steadily and remorselessly cutting the Probation Service were to be continued, the lasting effect would be overwhelming.
I shall give only one small example of the kind of thing that is happening. At present I happen to be visiting Wandsworth Prison twice a week. There were 14 probation officers at the prison; the number is being reduced to five. Those responsible for welfare are to be reduced to two. That sort of thing cannot be done without causing very serious damage to any idea of rehabilitation.
I give one other small personal example. A very remarkable gentleman, Mr. Bob Tierney, whom I have mentioned before, was in prison for 17 years and has now become a probation officer. That is a rather wonderful achievement in the circumstances. But what are his prospects? He has a one-year contract, and after that, who knows? That is what members of the Probation Service face today. Anyone who adopts such a policy will be doing lasting damage, not only to the Probation Service itself but to the whole future of social work in this country.
Since I prepared these remarks, there have been one or two announcements in the newspapers. The Lord Chief Justice has made a powerful speech. I shall not attempt to summarise it here, but we all ought to study it very carefully. I hope that he will not mind my referring to his remarks, as summarised on the front page of the Daily Mail. The article stated that the Lord Chief Justice says we send too many people to prison, and that prison does not work. The Daily Mail went on, of course, to denounce him. The Sun newspaper denounced him even more strenuously in a leading article under the heading, "Lock 'em up". That is the alternative. The Sun puts these matters a little more plainly than Mr. Michael Howard ever did. But "lock 'em up" is the alternative to the kind of policy pursued by the leaders of all parties, including, for example, the noble Lord, Lord Hurd, who has become the chairman of a prison reform trust. If you "lock 'em up", you do not need a Probation Service.
We cannot duck the issue. There can he alternatives to prison. That is what is in the mind of the Lord Chief Justice. I was also glad to read in the Daily Mail a leading article headed, "Mr. Straw's U-turn". I suppose that if someone is praised for making a U-turn, it implies that he was not on quite the right lines before. However, I do not want to labour the point. I am delighted to hear that he has made a U-turn—although, again, the Daily Mail denounces him for making it. Either we associate with everybody who has ever been concerned with penal reform in any party, or we fall back on the policy of

1049
Michael Howard and say that prison works and to hell with a Probation Service. That is the issue. It cannot be ducked. I hope that everyone in the House will agree that there should be a larger role for the Probation Service and that the idea of cutting it is quite detestable.
My Lords, I beg to move for Papers.
6.5 p.m.
Baroness Thomas of Walliswood: My Lords, it is always extremely difficult to follow the noble Earl, Lord Longford. Not only do I not have his lengthy experience; I am afraid that I do not have his wit either. Nevertheless, he has done us a service by raising this subject today.
The context for the cut in probation finance is a Home Office three-year plan which assumes declining expenditure and that the service will,
continue to respond to the challenge of improving operating efficiency without compromising standards of service.
In other words, more has to be achieved for every pound. The current grant—excluding capital grants and credit approvals, grants for probation hostels and the money which comes direct from the Prison Service—which is the main support for funding probation, is to be cut by £11 million, from £331 million to £323 million between 1996–97 and 1999–2000.
The noble Earl, Lord Longford, suggested that the degree of that cut is being described differently in different places. The baseline suggests savings, year on year, of something around 4 per cent. over the next three years. That target has to be achieved against a background of already substantially improved performance in 1995–96, during which efficiency savings of 5.2 per cent. were achieved; a reduction in real unit costs since 1991–92, of 12 per cent.; and staffing cuts, which have also already begun, of around 100 per annum in the next three years.
The Central Probation Council claims that in real terms, bearing in mind inflation, the overall resources will have declined by nearly 30 per cent. between 1994–95 and 1999–2000. If we take the probation committee which I have just joined, that equates to three years of cuts, in this year and two subsequent years, of £400,000—a total of £1.2 million in a budget related to that basic Home Office grant of around £6 million. So however we look at the issue, something is being done to constrain and reduce the amount of resources that are available to the Probation Service.
Yet the workload with which that service is having to deal is increasing all the time. Again, the Central Probation Council estimates that that increase is likely to be over 12 per cent. in the years 1994–95/1999–2000. It is true that the increase in community sentences is levelling off. But money payment supervision orders are on the increase; and perhaps that reflects a wish not to send people to gaol for debt default, as we discussed in response to a Question yesterday in this House. Combination orders are also increasing and that increase is likely to continue as the complexity of cases resulting in a community sentence increases.
1050
The increased prison population also increases the potential caseload in the through and aftercare area. The noble Earl, Lord Longford, described the situation where the number of probation officers in Wandsworth is declining. In my own area, the contracted amount of probation work within prisons declined last year, no doubt reflecting prison governors' own budgetary pressures, but it is increasing again this year. In other words, it is a rather unpredictable element of the Probation Service's work. The Home Office exerts downward pressure on costs per case via its three-year plan. But, as one of my local Probation Service officers said the other day, it is hardly necessary as costs per case are bound to decrease if the number of cases rises and the amount of money available to deal with them decreases. One hardly needs a programme, when in itself it is a programme for reduced costs per case. Whether the quality of the work can be maintained as the cost per case declines is what most people are worried about.
Recently there was some pretty unhelpful publicity with respect to the Probation Service. On 2nd July there was a series of dramatic headlines. The Daily Mail stated:
Killing and raping whilst on probation.
The Daily Express said:
Stop this scandal of prisoners being freed to commit murder.
I do not believe that anyone actually frees prisoners in order that they may commit murder. Nevertheless that was the way the Daily Express put it. Even the Independent, which one thought might know better, had the headline:
Probationers commit 'a murder a week.
Again, that is not exactly accurate. Some probationers re-offend, particularly those who have recently come out of prison and are among the most dangerous people in the care of the Probation Service.
At any one moment there may be up to 200,000 people in the care of the Probation Service. If 100 of those re-offend during the year, committing serious crimes, it is extremely unfortunate for the people who are the victims of the crimes. However, in terms of risk assessment, it may not be quite as serious as the figures suggest when dealt with in the way that they were in the press. That material was released, I understand, by the Home Office in order to show not how unsuccessful the Probation Service was, but how successful it was. The way in which it was released was so unfortunate as to attract those remarks.
Again, if people who are dangerous are released into the care of the Probation Service—and about 15,000 of the 200,000 fall into the very dangerous category—under such circumstances, it emphasises the need to have a Probation Service which is fully equipped and able to deal with that level of care and responsibility.
A problem which attracts public attention is sex offenders released after they finish their term of imprisonment. I do not speak in this House or anywhere else on behalf of my party on these matters, but it seems to me that it might well be more sensible to think of a totally different regime for those kinds of offenders. It would take into account the fact that many are mentally

1051
ill and should perhaps be treated in a totally different way. They could be held in safekeeping until it is thought that they are safe to be released, rather than being kept in prison where they receive virtually no treatment and are then released after the term of their sentence.
The noble Earl, Lord Longford, rightly pointed us in the direction of the alternatives to probation. I was lucky enough over the weekend to listen to a lecture given by a senior and respected retired judge. He pointed out a number of interesting things about the prison population which everyone may know, but I shall trespass on your Lordships' good will and repeat them. The numbers in prison in the last 40 years have risen from 21,000 to 62,000. The cost of keeping each prisoner in prison has risen from £5,000 per annum to £24,000 per annum. The re-conviction rate has risen, on average, from 16 per cent. to 40 per cent. within two years. The re-conviction rate for teenage boys is 80 per cent., but it is much less for other categories of prisoner.
Who goes to prison? Overwhelmingly it is young men who have a low educational achievement and a poor family background. The single biggest predictor of offending behaviour is the fact of having been in care. That amounts to the same thing since a youngster is not in care normally unless he has a dysfunctional family. People who go to prison are usually unemployed. In other words, they are precisely the people who have not received or not been able to take on board the education for parenthood and relationships which were the subject of the previous debate.
What happens to those people when they are in gaol? Education has been cut in many prisons. There is a lack of person-to-person contact and of encouragement and support for most prisoners. You and I, my Lords, can no doubt remember when our children or perhaps even ourselves (talking about some of our younger Members) would come home during our early adult life for restoration and support, with the general feeling that we could be where we wanted to be and behave as we wanted to behave. That is precisely the support which the young adult who offends does not have. Where can he—it is largely he—best get that support? Does it come to him in prison? I suggest not. But in community service, community punishment or community treatment, the offender is in contact with a supportive probation officer. He may receive very good training or work experience. He may be able to attend a day centre where he receives help with his psychological, emotional and personal problems. Such help is not always available in most prisons. Speaking personally, I would have supposed that it is more cost effective, in terms of the total overall cost to the community of a continuous offender, to do as the noble Earl suggested; that is, to encourage the increased use of community sentencing and to discourage the irrational increase in the number of prisoners who currently serve at Her Majesty's pleasure.
6.19 p.m.
Lord Graham of Edmonton: My Lords, yet again the House and the nation are grateful to the noble Earl, Lord Longford, for providing a platform for dialogue
1052
with Ministers. It is timely, urgent and crucial to the penal estate and to the nation. Normally we spend time trying to convince the Minister that there is a case to be answered, but I do not believe it is so today. It is certain that this Minister understands very well the case that was made by previous speakers. I want to appeal to him and his ministerial colleagues on hard headed, pragmatic, value-for-money grounds.
We are talking about an underestimated, under-appreciated aspect of public service. Although we are talking of the Probation Service, I include the Prison Service. Prison officers and probation officers do not get the credit that they deserve for what they do. It is one of the dirty jobs in society and in the main they do it without complaining and without blaming anyone else. One of the purposes of tonight's debate is to give them some encouragement and support that in the House of Lords they have friends who understand the problems.
Perhaps I may tell the Minister what I have been advised in briefing. There are very significant statistics. I am told that a prison place costs £24,500 a year to maintain; a probation order £2,270; and a community service order £1,700. So, the cost of prison is 11 times that of a probation order. I realise that the gravity of the offence, the nature of the individual and the sentencing policy all play their part in those statistics. But I hope that the Minister would take the line of trying to move toward reducing that disparity. Currently, it seems that all too easily people who commit offences and deserve to be punished are sent to prison, rather than not being sent to prison and other means being used to punish them. I was delighted to hear from the noble Earl, Lord Longford, that there has today been a broad announcement to the effect that a review will be carried out—a not unfamiliar phrase from this Government over the past three months. I hope very much indeed that that review will produce something realistic which will he of benefit.
This debate takes place against the background of a horrific rise in the prison population. The noble Baroness, Lady Thomas, mentioned that increase. My statistics indicate that on 17th January this year the prison population stood at 57,000. That was the level of the projected average prison population for the financial year 1996–97. By the year 2000, the average prison population is projected to be 66,000. That is horrendous. I remember the noble Lord, Lord Jenkins, when he held the position of Home Secretary, saying that a prison population of 42,000 was intolerable.
We have sought to solve the problems of an increasing prison population by creating more places in which to put offenders rather than by trying to find means and methods of reducing the number of those who deserve to be incarcerated. I believe that that is a very sad reflection on us all.
I sought advice on that puzzling situation and the first thing I was told was that, although it was a dramatic rise, to be fair it could not have been foreseen precisely. When I asked to what it was thought the increase was due, I was told that it was the greater use of custodial sentences by the courts, particularly the Crown Court, and an increase in the average length of sentence

1053
from 19.8 months in the period from October 1994 to September 1995 to 21.6 months in the period October 1995 to September 1996. So, that is the action of the courts.
The consequence of the previous Government's policies has meant an intolerable strain and pressure being put on prison officers and probation officers. The noble Baroness, Lady Thomas, referred to those consequences. Less money, more work to be done and fewer people to do that work mean that the people doing the job have heavier case loads. Let me repeat some of the noble Baroness's statistics. It is estimated that between 1994 and 1999 2,750 probation officers will have been lost from the probation service. That represents 19 per cent. of the workforce and is an enormous number. So, 80 per cent. of those who were doing the job now have a workload not of 100 per cent. but of 120 per cent. That is quite intolerable. The workload has increased by 12.4 per cent. As for resources—we all know that ultimately it is resources and their deployment which are the answer—they have fallen as well. Those policies have had a severe consequence on the workload within the probation service.
What has been the consequence on probation officers, especially those whose service is in prisons? Probation staff in prisons carry higher case loads and are expected to produce more court reports. Again, that is reference to what the noble Baroness said. Caseloads are expected to rise by four to five on average but in some areas they could rise by more. Early retirement and redundancy schemes will be introduced in at least 60 per cent. of probation services. That is almost a cop out. It is understandable that people under such pressure find it intolerable and seek a way out by means of redundancy and early retirement. We cannot blame them. But that is not a solution to the problem of the penal estate. Let me say again that prison officers and probation officers are much maligned. They deserve our support.
What does all that mean in practical terms? I have been sent a note from the publication Probation Staffing, Home Office, April 1997, which states:
There is growing evidence of job substitution. Probation officers are being replaced in courts with non-trained or administrative staff and in some areas court cover is severely restricted.
Many noble Lords have experience in this field. When I had the proud privilege of representing the interests of prison officers I went into about 32 prisons in five years, in order to familiarise myself with the nature of prison officers' problems. At that time—I give full credit to the previous government—there were three prisoners being held in one cell. Officers were faced with the slopping-out procedure; and police cells were used for prisoners. It was a horrendous situation. Conditions improved vastly over a period, which I cannot define, but there are now signs that we are slipping back. A great effort was made to make sure that only one person occupied a cell but we are now told increasingly that there is doubling up (that is the term used) and trebling up. We shall never return to the slopping-out
1054
procedure and I pay tribute to the noble Baroness, Lady Blatch, and her colleagues for taking up that matter as a top priority.
In up to a quarter of the area offices have been merged or closed in order to save on revenue or capital costs. As a result, those on supervision have to travel greater distances and many will find it harder to keep appointments. That is the fall-out from taking neat accountancy and Treasury-driven decisions which produce as an answer a bottom line that balances. But the consequence is a poorer quality of service and rehabilitation.
During the time that I used to visit prisons, it was a great sadness to find that, because of a shortage of officers, the education service had been restricted and employment opportunities reduced because of the lack of supervision. Prisoners who are incarcerated are entitled to receive the best that can be provided to rehabilitate them into the outside world and of that they were being denied.
All that has had a disastrous effect on the probation service in prisons. During the past financial year, over 80 of the 650 seconded probation officer posts in prisons have been lost. In the past year, 12 per cent. have disappeared. The need for those posts has not diminished; indeed, it has increased. There were 15 per cent. fewer probation officers seconded to prisons at the end of 1996 compared with the end of 1995. As a result, fewer courses aimed at preventing reoffending are run and the quality of through-care and rehabilitation will deteriorate. That situation is patent and obvious.
In conclusion, I hope that the Minister, from his vast experience in and around the penal estate, will understand the reasons for our concern. It is our good fortune that he is there to carry those concerns into high ministerial discussions in order to bring sanity into the dangerous world described so graphically and compassionately by my noble friend Lord Longford, to whom we continue to be beholden for this opportunity to debate the issue.
I hope that the Minister will recognise that this is what I call a benign debate rather than a malignant one. It recognises the problems, though we do not have real solutions to them. However, if we can encourage the Minister, when he discusses these matters with his ministerial colleagues, to take from this House and this debate steps that can be taken—hints of which have appeared in the press over the past few days—to reduce the prison population and, above all else, to increase and maintain the quality of the service of the probation officers for those unfortunates who need it, he will do this House and those who need that improved service a great benefit. We shall all be grateful to him for that.
6.30 p.m.
Baroness Masham of liton: My Lords, I congratulate and thank the noble Earl on having this timely debate. There is real concern that the Probation Service is to be cut when its workload is at an all-time peak. The demand is clear. The Probation Service can supply the expertise to reduce crime if government funding allows it to do so. Will the economics balance out?

1055
I too have a few figures and I am sure the Minister will correct me if I am not right. Over the five years—1994–95 to 1999–2000, the probation situation is: workload increase, plus 12.4 per cent.; real terms cut, minus 29.4 per cent., which equals £114 million; loss of staff, minus 19 per cent. Probation areas offer excellent value for money in the fight against crime. The average cost per prison place, per year, was £24,500 in 1995–96. The annual unit cost of a probation order at that time was £2,270; that of a community service order—the Probation Service's most commonly used order—was just £1,700 in the same year. That means custody costs were 11 to 14 times those of probation intervention. Probation intervention is extremely economical and effective in reducing crime.
A consultant who works with many of the 54 probation services nationally stated recently that he had never seen the service under so much pressure, with staff dealing with increasing numbers and cases of increasing seriousness. In North Yorkshire, where I live, they are undertaking a root and branch review of all their business processes to seek to fund efficiency savings. They remain one of the most underfunded services against the cash limit formula. The formula has been in place for several years but the correction factor between the better and worse funded services has been slow to correct the imbalances.
The five probation services—Gwent, North Wales, Derbyshire, Cleveland and North Yorkshire—are now in discussion with the probation associations about speeding up the correction process. The 17 per cent. by which North Yorkshire is short in its budget amounts to around £3 million to £4 million in revenue budget terms and would purchase over 30 additional members of staff to assist with the enormous demand of supervising offenders to national standards and working with couples in dispute over their children.
North Yorkshire operates a detailed risk management policy whereby every offender and family court client is screened for risk to the public. Where serious concerns are identified, risk management meetings involving the police, social services and others are called which have, on occasion, resulted in the recall of the offender to court or to prison. In that context, it was not helpful for the Home Office recently—if it did—to pass to the press a circular outlining the collection of "serious incident reports" from the 54 probation services. That revealed that around 180 offenders nationally had committed serious or grave crimes while under formal supervision to the Probation Service last year. Those statistics demonstrate the kind of difficult and demanding people who are involved and ask questions about how far the service can be expected to manage risk in the community.
There is a link with the ever-increasing prison population and the workload of the Probation Service, since everyone serving over 12 months leaves prison under the supervision of a probation officer. That supervision of prisoners returning to the community offers a number of safeguards to the public. Now that the Prison Service and the Probation Service are linked
1056
under one Minister—Joyce Quin—there will be a more automatic triggering of probation resources when the prison population changes?
I have the honour at the moment of chairing an inquiry into girls in prison. The inquiry visited nine adult women's prisons where girls aged under 18 are also held. We found in every prison that the probation department was struggling to provide a service at all, let alone something resembling what was required. Most departments had suffered recent cuts, reducing the number of probation officers available in prison. For instance, in one prison they had just lost their senior probation officer, resulting in there being no probation line manager within the prison.
On average, we found that there was one probation officer for every 100 women. They often have to deal with a whole range of different groups with widely varying needs—lifers, sentenced prisoners, remand prisoners, vulnerable prisoners, deportees, mothers and babies and young offenders. With such a low ratio of probation officers to inmates it is impossible for them to cater for all those different needs. In addition, overcrowding is putting the uniformed staff under enormous pressure which has meant, among other things, that the personal officer scheme is not operating properly in most prisons.
Personal officers are supposed to deal with practical problems faced by the prisoners; for instance, sorting out problems relating to their housing on the outside or issues to do with children. In reality they often do not have time to do that and the job falls to the probation officers, leaving them with little time to work with the prisoners as they are trained to do. Most probation officers we spoke to rarely did individual work with the prisoners and, if they did, they could not commit to regular sessions. That was not good for morale. The most they could do was to organise group personal development courses. However, even those were not always possible. One probation department was only able to offer one course for lifers and nothing else.
In another prison, where 50 per cent. of its population were young offenders, there were no courses for young offenders because the probation officers—two officers for 250 women—simply did not have the time. The upshot of that situation is that regimes in prisons are becoming less and less rehabilitative. Prisons are becoming places where prisoners are simply contained and controlled until they are released. This means that re-offending rates will increase. If no meaningful work is done with people while they are in prison there is an increased chance that they will offend again, resulting in more victims, more expense for the public purse and another person wasting more life in gaol.
I read recently that the Home Secretary intends there to be more work in prison. That is excellent news. On one visit to a prison some time ago the inmates told me that when they made things they were then broken up in order to re-use the materials. That must have been soul-destroying. On a visit to Italy once I saw an excellent prison shop. Perhaps I may ask the Minister: will there be prison shops here? That would give prisoners a challenge. I have always felt it to be a

1057
dangerous situation when prisoners are locked in their cells for many hours. The devil finds work for idle hands.
I hope the Minister will be able to tell us tonight that there is a good future for the Probation Service. We in North Yorkshire would not want to see reduced the skilled staff who are working with offending behaviour, sex offending, conflict and violence, vehicle crime and the drug action teams.
6.41 p.m.
The Earl of Mar and Kellie: My Lords, I welcome the opportunity given to us by the noble Earl, Lord Longford, to debate the effect of a reduction in funding for Probation Service activities.
While I never worked in a probation service I have worked in the Scottish criminal justice social work service and as a prison social worker. The integration of offender services within the social work departments was a keystone of the Kilbrandon Report. The single door approach has been maintained over the past 28 years. The generic caseload has comparatively recently been altered into the form of specialist teams within the 32 social work departments. Indeed, that was an inevitable adjustment. Funding of qualifying offender services is 100 per cent. by the Scottish Office. This variation is, for me, an example of the inappropriateness of trying to pretend that the United Kingdom can be run as a unitary state. Clearly, we have here, in Hong Kong parlance, one country, three systems.
Moving on from the constitutional argument and returning to the world of probation, I wish to focus on the nature of the work and the effect that a reduction in the service must have on the professional task. The main thrust of the probation officer's work ought to be seen as behaviour modification. That work will he effective if, and only if, the probationer has built up a working relationship with the probation supervisor. In most cases, "working relationship" is an inappropriate description. For most probation clients, nothing really happens until they have transcended the professional or compulsory nature of the working relationship and moved it on to more personal terms. They need to have accepted their supervisor as a person in spite of the professional relationship. That is, of course, not true of the probation worker's position. The relationship must remain professional for the supervisor, though it is bound to have the appearance of a more personal relationship.
At this point it may be helpful to recall a description of my humble efforts to build a professional relationship with a prisoner I shall call Robert, which is not his real name. He was about to come out on licence, at two-thirds of an eight-year sentence at a young offenders institution in Scotland. His faith in social workers and YOI licensed supervision was less than nil. He had spent five-and-a-half years fearing licence and expecting to be recalled as soon as sufficient evidence had been "manufactured". He blamed his previous social worker for recommending a substantial sentence in the pre-sentence social inquiry report. The initial meeting at
1058
the prison looked like a waste of time. Social workers were not just "unhelpful" and "useless"; they were worse. However, some store was set by my promise to see him again before his liberation. The second visit was pretty much the same. But the fact that I had come back as promised was credited to me. When he was liberated I believe that the licensed supervision grew to be positive. Certainly, it was not the negative experience that Robert had feared.
The point of the last few sentences has to be this. Building a working relationship with probationer clients is not something that can be rushed. Unless it is achieved, very little else can be achieved. Certainly, the terms of the various orders can be explained and supervised administratively. But the relationship is the basic foundation building block. It is as fundamental as the three Rs in education.
As the probation services are asked, rightly, to take on ever more complex work, so the funding ought to be expanding to provide the opportunity for this new work actually to happen. But that is not the case. Budgets are contracting and caseloads are increasing. Opportunities to intervene meaningfully are therefore contracting. Each case is a new and unique entity. Building that relationship cannot be rushed or treated as a timed process, just to be shortened by a wee bit.
I conclude my remarks by asking how long the public will continue to be persuaded that better public services can be provided for ever lower taxes. Public intellectual resistance to taxation decreases in the light of publicised targeted spending. The public will come round to see that quality services can be delivered only for the full price. Discounted schemes are bound to be less effective and ultimately seen as a deception.
I realise that the noble Lord, Lord Williams of Mostyn, did not plead with the Treasury for less money. I do, however, regard the fiscal strategy adopted by his Government as being unhelpful. I must hope that the probation services can survive this cutback in their socially useful operation.
6.48 p.m.
Lord Williams of Elvel: My Lords, I have almost no credentials for taking part in this debate other than that my wife is a trained probation officer and worked as a probation officer for many years in Peckham and Camberwell, two rather difficult areas, if I may put it like that, of London. I congratulate my noble friend Lord Longford on, first, winning the ballot and, secondly, on winning it at a particularly important time. Over the past few days we have heard about the rise in the prison population and about the need to consider disposals other than custodial sentences. We know that court orders for probation are rising. As my noble friend pointed out, this does not seem to be the right time even to consider cuts in the Probation Service.
I mentioned that my wife was a probation officer. She emphasised to me even this morning the point mentioned by the noble Baroness, Lady Thomas, about youth crime. It is all very well to say to a young tearaway that he should go to prison, Borstal or have a custodial sentence, but as the noble Baroness rightly

1059
said, there may be a parental problem. There may be a relationship that needs to be established. Unless such a young tearaway is sensitively handled by a probation officer, he or she can easily become a hardened criminal, particularly if he or she is sent to one of those great schools of crime, Her Majesty's Prisons. This is not the moment to consider cuts in the Probation Service.
Leaving aside the importance of coaching young tearaways away from serious crime—I do so with some reluctance because I agree with the noble Baroness, Lady Thomas—the truth is that virtually all high-risk offenders who are already known to the courts, the police, the prisons, and the psychiatric services come to the Probation Service at some time. Whether or not they get parole, they are released on licence from prison and those who do not get parole (on the grounds that they are too much of a risk or are too dangerous) will be released and go immediately to the Probation Service. Even severely mentally disordered offenders are still put on probation by the courts as are, for instance, offenders addicted to drugs. In the light of that, this is not the time to cut the Probation Service.
So, what is happening? The noble Baroness, Lady Thomas, described it very well. If the Home Office three-year plan is not modified by the new Government, by the year 2000 the budget for the service will have been cut, as the noble Baroness, Lady Masham, said, by well over 20 per cent. in real terms compared with 1994. The total caseload, on the other hand, is estimated to rise by some 10 per cent. during the same period. It does not take much imagination to realise what the result will be. The result will be that the higher caseloads will mean lower quality and hence more danger to the public. Higher caseloads will mean loss of morale among officers, overwork and the consequent breakup of their own family situations. Higher caseloads will mean more re-offenders. All that is against the background that was described by my noble friend Lord Graham and by the noble Baroness, Lady Masham, of a cost of something over £24,000 per annum for a place in prison as opposed to a cost of about £2,500 to supervise somebody on probation. It really does not seem to make sense.
I do not think that we should forget that probation officers work without any protection and often, as your Lordships will appreciate, in circumstances of great physical danger. We hear a great deal about the risks of service in the Armed Forces and the police—and rightly so—but in many cases, more numerous than is realised, probation officers are the unsung heroes of our society, using their training and skills to keep offenders from committing ever more crime and at substantial personal risk. They deserve our thanks and our support but, above all, they deserve a fair deal. I hope that my noble friend the Minister will assure the House that they are going to get it.
6.54 p.m.
Lord Rodgers of Quarry Bank: My Lords, I join other Members of your Lordships' House in saying how greatly we are indebted to the noble Earl, Lord Longford, for giving us this opportunity to discuss the Probation Service. As noble Lords will recall, we
1060
are returning to a subject that we have discussed previously in your Lordships' House—in fact, twice in the past two years. Today, as on previous occasions, Cross-Bench concern has been expressed about the present situation. Today we have focused, as was the intention of the noble Earl, Lord Longford, on the further cuts, but I believe that we could take the debate a little wider and consider the future of the Probation Service as a whole.
In the debate on the Address on 19th May, I said—I hope that I may be allowed the vanity of quoting myself—
"I hope also that the Government will spare a thought for the future of the Probation Service".—[Official Report, 19/5/97; col. 160.]
I also said that the changes made in recruitment and training had been strongly opposed in your Lordships' House and that they could easily be reversed and quite soon.
It would be unreasonable to ask today for a major statement of government policy—and, if I asked, I certainly would not get one—but perhaps I may cast a small pebble on to the Government Front Bench. Whatever review has been announced today, we must be careful that such reviews do not become an excuse for a difficult decision postponed. There are some welcome signs of a more open, sympathetic and realistic approach to prisons policy. Ms Joyce Quin, the Minister of State in another place, has started well and is rightly earning good opinions. As has been said, it is a comfort that the Probation Service comes under her. However, we must remember that it is often possible to make a preliminary decision and not to postpone a decision indefinitely for a full review.
Perhaps I may make a suggestion to the Minister with regard to the recruitment and training of probation officers. On coming into office, Ministers could immediately have asked their officials for an assessment of the objectives and validity of the changes introduced by the previous government, taking account of the views expressed by the then Opposition, and for a statement about how far the process of change had gone and how best it could be reversed. A summary report could easily be in ministerial hands within two or three weeks. There would be no need to go to Cabinet. It would enable Ministers to give us an indication at least of the way in which their minds were moving. Therefore, I hope that the Minister will not simply rest on a review as a justification for saying nothing of substance today.
My second small pebble is the hope that policy changes will not be announced or made by means of extra-parliamentary winks and nods. Policy changes should not be announced elsewhere. I noticed, for example, in the Observer last Sunday (13th July) that a front page headline read:
"Stop filling jails, Straw tells judges".
In what was an obvious briefing, there was a reference to,
"a reversal of the hardline 'prison works' rhetoric he [Mr. Straw] adopted before the election".
If that was indeed a briefing and if we have to draw the conclusion which the Observer suggested—and that would be sustained by an interview given by the

1061
Home Secretary on "World at One"—I hope that we shall have a plain Statement to Parliament on prison policy and, if not today then very soon, a plain Statement to Parliament on the future of the Probation Service.
On 7th July in the other place, the Minister of State, Joyce Quin, answered a Question from Miss Widdecombe on what discussions the Home Secretary had had with Her Majesty's Chief Inspector of Prisons about a possible merger between the Prison and Probation Services. The Minister of State who replied, Ms. Joyce Quin, said:
"None about a merger".
Later she said:
"We have made no decision about a merger".—[Official Report, Commons, 7/7/96; cols. 603–604.]
Can the Minister clarify precisely what that means? Is a merger an option that is being considered by Ministers within the Home Office? Currently, I am an agnostic on the issue. There is no catch in my question. It would be consistent with the Government's wish for more open government if one knew that at least the possibility of a merger was currently being looked at.
The noble Lord, Lord Graham of Edmonton, my noble friend Lady Thomas and the noble Baroness, Lady Masham, referred to the figures available in the three-year survey of Home Office expenditure. I make a simple summary of those figures. I refer to the last year for which outturn figures are available, 1995–96. In that year the Prison Service cost £1,329 million. There were then only 50,000 inmates—happy days. The Probation Service cost £400 million, with a total caseload of 183,500. I render those figures in the following simple way. For less than one third of the cost the Probation Service takes care of more than three times as many offenders. If that was true on the basis of the 1995–96 outturn figures I believe that it is true today for the figures anticipated in the last financial year and also the current year.
I do not make too much of such a comparison because I am aware that I do not compare like with like. Nevertheless, there is a great deal of evidence in those figures that the Probation Service is good value for money. If the Home Secretary really means what he says and that we should stop filling our gaols, then, as noble Lords have said, there will be a much larger role for the Probation Service and it will need more resources. I understand that in the current financial year it would be difficult, consistent with the declared policy of the Government, to reverse the cuts. Although they may appear to be small in real terms—I believe that they amount to £10 million between two successive years—I hope that the Minister will give some indication that possibly those cuts will be reversed, at least for the financial year 1998–99.
I found the review of the Probation Service published in the Home Office annual report profoundly disappointing. It had none of the humanity which I believe such a document should contain. Ten achievements were listed in paragraph 9.10 for the year covered by the report (1996), of which four were
1062
concerned entirely with financial and administrative achievements: extended activity sampling; investigation of unit cost variations; continued implementation of the computerised case record administration and management system; and the Home Office had pursued the possible use of private finance for the provision of Probation Service accommodation. I do not minimise the need for good financial control and administration, but I wish that among the achievements of the service in 1996 something more positive had been said about what the Probation Service exists for and how far its objectives had been fulfilled.
I looked for greater enlightenment at The Three-Year Plan for the Probation Service. I was very disappointed. At times I found it incomprehensible. It is full of aims, priorities, standards, goals, targets and KPIs. I was sufficiently unfamiliar with the buzzwords of current management jargon that I had to reflect awhile on the meaning of KPIs. I now understand that they refer to key performance indicators. It was a difficult report to follow, and certainly not reassuring. It was very difficult to find the word "rehabilitation", to which the noble Baroness, Lady Masham, has referred. It contained no flavour of what the Probation Service did and why it existed. I could find only one short sentence in 49 glossy pages dealing with what were called new qualifying training arrangements for probation officers. That was the only reference that I could find to the matters that we have discussed twice in your Lordships' House to which we attach the greatest possible importance.
I recognise that the Probation Service will require the careful attention of the new Government, but I agree with the noble Lord, Lord Williams of Elvel, who said that probation officers were the unsung heroes of the penal system. In the words of the noble Lord, Lord Graham of Edmonton, it is an underestimated service. It is unglamorous but very important. I believe that if we do not give it the resources that it needs we shall come to regret it.
7.6 p.m.
Baroness Blatch: My Lords, I also join other noble Lords in thanking the noble Earl for initiating the debate. I was given the name of one of the maidens of darkness during Michael Howard's period of office at the Home Office. During that time the noble Earl and I had many happy times together.
As a result of time constraints the debate must concentrate solely on the Probation Service. This means that the interesting debate about early intervention, crime prevention programmes and the importance of parents, schools and partnerships within communities to address pre-offending and diversionary programmes cannot be addressed. Indeed, these issues were discussed recently in another debate in your Lordships' House, which remains on the record. The Probation Service was established to pick up the pieces after all else had failed and people had offended. I agree with the noble Lord, Lord Graham of Edmonton. There is often unfair criticism of the Probation Service and a lack of appreciation of probation officers and their work when they are the people who are called upon to deal with some of the community's most difficult problems.

1063
I therefore place on record both my appreciation and acceptance of the centrality of the Probation Service and its work and of community sentences in the criminal justice service.
The question implied by the Motion—the future funding of the Probation Service—is a matter for the Government. As is publicly known, the Government have agreed to continue with the planned spending totals of the previous government and not vary departmental totals for at least two years in this Parliament. It is also publicly known that areas of additional spending already planned by this Government as and when money is found have not so far included the Probation Service. Funding of the Probation Service is set out in the Government's expenditure plans and The Three-Year Plan for the Probation Service. More money has been devolved to the area committees and there has been, and continues to be, heavy investment in new technology. That factor should not be overlooked when considering the scope for efficiency savings in the search for better value for money. Officials in the Home Office—a number of whom I recognise from where I stand—will be aware of my frustration at the speed of progress. I hope that the new technology for the service in both equipment and training is almost complete.
In this debate there has been much exaggeration of the statistics. I leave the Minister to use the official Home Office statistics when he comes to reply to the debate. I was privileged to have had the responsibility for the Probation Service during my time at the Home Office. Contrary to common perception, we regarded the Probation Service as an important part of the criminal justice system. Effective community sentencing and supervision of offenders following release from prison is essential.
The Probation Service is expected to ensure that community sentences provide a tough, demanding punishment which is effective in reducing crime. In carrying out that work, it must have regard for the safety of the public, which involves effective risk assessment, enforcement and the management of offenders and their programmes. The Probation Service is also charged with improving the quality of service and making the best possible use of resources. National standards were introduced in 1992, and revised and republished in 1995 in order to strengthen the supervision of offenders.
The standards required of community sentences are that they are demanding as punishments; that supervision is rigorous; and that offenders are returned to court promptly if they fail to comply with the requirements of the sentence. We believe also that, wherever possible, parents should be involved in the process of reforming young offenders. Where the courts, Probation Service, parents and families work together the chances of success are that much greater. I have seen some pretty impressive work done by the Probation Service in co-operation with those groups in the community. They have worked well in diverting people away from crime.
Of course, where parents do not co-operate, the courts have the powers to bind them over; to require them to attend court; and to order them to pay fines or
1064
compensation arising out of their children's behaviour. A novel community sentence has been undergoing, and continues to undergo, what appear to be, on the evidence to date, successful trials. It has the potential to make a substantial contribution to sentencing, and could have the effect of helping the Probation Service. I refer to the curfew order by electronic tagging. I am pleased to say that the Government have dropped their opposition to that policy. I believe that they are now convinced that the technology is working and that it could make a contribution to community sentencing.
The Conservative Government Green Paper Strengthening Punishment in the Community was widely circulated for consultation. For a long time community sentences have been a secret garden—known and understood by the courts and the Probation Service, but not by the general public. There is a range of orders: probation orders; community service orders; a combination order; a curfew order; an attendance order; a supervision order, all of which address the varying degrees of seriousness of offending, suitability, and degree of restriction of liberty, plus of course the age of the offender.
The Green Paper introduced the proposition of a single integrated sentence to replace the range of sentences. It would then be a matter for the courts in open court—it is important to emphasise open court—to address the sentencing needs appropriate to the offence committed. The main elements to be addressed included punishment in the community, restriction of liberty, reparation, and the prevention of re-offending, which of course includes rehabilitation. In that way, the offender before the court, instead of having a sentence meted out in terms of hours, weeks, or years, and then awaiting a visit to the probation officer to find out what it meant, would know the length of the sentence and what was expected of him or her at the time of being sentenced. That would result in a more transparent system and would go some way towards enabling the public to know the effect of the sentence. The hope was that it would dispel the perception that a community sentence is a soft option.
It is true that much of what the Probation Service does is effective, but it must be said that programmes exist where it is hard to see the challenge to the offender, physical or mental. There are some programmes which fall short of the best. It must therefore be in the interests of the Probation Service itself that public attitudes and perceptions of the service are improved and that the serious work of the service is more publicly appreciated.
In my view to some extent the Probation Service has always been its own enemy. That is a point I shared with it on many occasions. Happily the service is opening up. It is subject to rigorous standards and systematic inspection, both on performance and across the whole service on a thematic basis. I am sorry that the noble Lord, Lord Rodgers, was so scathing and indulged in some scoffing about being concerned about monitoring the standards of the Probation Service. The public want to know about the quality of the service. It has to be measured. He does not like the jargon words "key performance indicators", but they are important. They are set out in some detail in the document. Without

1065
some understanding of where the best practice lies, and learning from best practice, the service will not improve. As a result of the national standards and introduction of key performance indicators much improvement has been wrought in the service.
The inspectorate performs a great service. The reports on the performance of the Probation Service which have been produced by the inspectorate over recent years have been material to the improvements in service delivery. Having said that, there remains considerable scope for further progress to be made. The Green Paper to which I referred, and the consultation which followed, resulted in some interesting pilot demonstration projects. They were designed to show how far changes in approach by the courts and the Probation Service, acting in accordance with the principles set out in the Green Paper, but within the current law, might increase public and sentencer confidence in community sentences. It was the previous government's intention to keep any possible new legislation which might be needed as a result of those projects under review. So anything the Minister can say about those projects, and the future of the service on the basis of those projects, will be helpful.
A statistic which continues to concern many of us is the reconviction rate for those who serve prison sentences compared with those who serve community sentences. I am afraid that the noble Baroness, Lady Thomas, underestimated the figures on reconviction rates. Over half of all those who are sentenced to prison or community sentences re-offend within two years. Over recent years, the reconviction rate for community sentences has been slightly higher than that for those who serve prison sentences. I make nothing of the slight difference. It is so slight—something between 1 per cent. and 2 per cent.—that one could almost say that the reconviction rates are about the same, whether offenders serve prison sentences or community sentences.
I wish to make a number of points. First, the reconviction rate is too high both for prison and community sentences; and, secondly, the community sentence reconviction rate should be much, much lower. Those sentences deal with a lower category of crime and prisoner. That will continue to be a great challenge. We all look forward to progress being made in that direction.
A "what works" approach to evaluation was introduced while I was at the Home Office. The key to improvement will lie in the degree to which effective practice is identified, properly evaluated, properly recorded, and learned from. Results from changing to more effective programmes as a consequence of that information, will be important and critical to improvements in the service.
One reads in the press of a possible merger between probation and prison service officers. Until one knows the detail, I shall refrain from commenting on hearsay, but that is how we usually hear about the Government's policies. I agree with the noble Lord, Lord Rodgers, the contempt the Government have so far shown for
1066
Parliament is regrettable. We hope that such statements will be made to Parliament and not by Mandelson's PR machine to journalists.
I do not comment in detail on any merger, but there are territorial difficulties between the two services, particularly in the area of shared responsibility for prisoners before release. Some of the reduction in numbers of probation officers in prisons, which has been referred to by a number of noble Lords, is not just a matter of finance, it is a territorial dispute between the Prison Service and the Probation Service. I know that Home Office officials are looking at and monitoring that carefully. I left the Home Office before we had any results of that monitoring, but no doubt the Minister will have more information about it. But this area needs to be addressed and I know that Home Office officials are aware of that fact.
The through-care work that is done by the Probation Service is among the most onerous and dangerous and, I must say, it is also the most effective work. Whatever changes are envisaged, that work must not be neglected. Indeed, it must be nurtured. I find it difficult to see how the two services could merge' without the utmost difficulty, not least to address the issues of education and training and the cultural differences between them.
As regards the vast sums of money which it is said can be saved, as recently claimed in the media by a Government Minister, that will cause great consternation in both services. I shall be most interested to hear about the vast sums of money which can be saved from such a merger. However, like the noble Lord, Lord Rodgers of Quarry Bank, at this stage I shall keep an open mind.
As regards training, I personally invested time and energy developing for probation officers a system of training of the highest quality. Progress was frustratingly slow and at times I was concerned about what appeared to be a reluctance on the part of those involved in developing the project to address the fact that the Probation Service deals predominantly with offenders. Although there is an element of preventing re-offending and of rehabilitation, which is essential to the work of the probation officer in effective supervision and management of punishment programmes, the fact that it is dealing predominantly with offenders must be reflected in the training schedules. I have no wish to disregard family court welfare work, which the service carries out so well. However, the basic training for entry into the service must prepare probation officers for the core work, which is the effective management of community sentences and the post-supervision of prisoners.
Ministers and noble Lords opposite spent much of the past 18 years exhorting the previous government to spend more on almost every service. Day in and day out, they were critical of levels of expenditure by the previous government, as is the noble Earl, Lord Longford, today. In government, as the Minister has learnt quickly, life is very different. Resources available for expenditure on services will always be limited. How the money is spent, the effectiveness of services, the quality of the output information rather

1067
than an obsession only with the input of resources are all important factors. However successful prevention programmes are, there will be a major role well into the future both for prison places and effective community service.
The dramatic change in the Labour Party during the past two years in accepting more and more of my party's law and order policies is to be welcomed and will command our support. The noble Lord finds that amusing. Almost on a daily basis he is concurring—
Lord Williams of Mostyn: My Lords, I find nothing amusing. Someone was whispering in my ear.
Baroness Blatch: My Lords, perhaps I misread the body language. I shall pose only one question to the Minister. If he responds to the thrust of tonight's debate in a way that panders to what I believe was being asked by most of those who have spoken in the debate, can he tell us this? Of those who would be sentenced to prison, who would he diverted to community programmes and what category of offender or offence would qualify for such a diversionary programme?
7.23 p.m.
The Parliamentary Under-Secretary of State, Home Office (Lord Williams of Mostyn): My Lords, I thank the noble Earl and all those who have contributed to our discussions tonight. The Probation Service has developed significantly during the past decade. Savings have had to be made and they have not been comfortable ones. I wish to say at the beginning of my short remarks that I endorse what was said so graphically by the noble Lord, Lord Williams of Elvel, and reiterated and reinforced by other noble Lords.
The Probation Service and the work that it does is valued and appreciated. I can say that having had long experience of it both in practice prosecuting and defending in criminal cases and, not without significance and of great value in terms of experience, in sentencing as a trial judge, I know the valuable work that it does and I know the difficulties under which it labours. It is vital that if community sentences are to be available to the courts they and the public are confident that those sentences are effectively carried out.
The noble Baroness, Lady Blatch, asked a question, saying that if I were to pander—a curious word—to what had been demanded I should be obliged to say of those prisoners who now go to prison, in which detailed category, which would be dealt with by alternatives. I believe that in our country sentencing is a matter for the courts. The Government's duty through legislation in Parliament is to provide alternatives. It is not possible to answer that question in a considered way because it does not focus on the point. The Government are determined to provide that the courts have at their disposal a range of effective sentences in which there will be public confidence.
I believe that the probation service will have a good future because it is essential as a component of our penal and criminal justice system. It is certainly true that community sentences have in the past been regarded as
1068
a soft option. One must recognise the proposition that sometimes they were a soft option, often because of delays built into the system, so that a community service sanction ultimately seemed of no effective matter to the offender. That is a situation which the Home Secretary promised to attack almost from his first day in Queen Anne's Gate.
It has been said by a number of your Lordships that one needs to have resources properly allocated and properly considered. I understand the slight tease from the noble Lord, Lord Rodgers of Quarry Bank, about KPIs. One cannot spend millions of pounds of public money without having some testing. I am hound to say, both of us probably coming from a similarly philistine background, that when I first encountered KPIs before going to Queen Anne's Gate I thought that they were management mumbo jumbo. In fact, when one examines them one sees that they are not, because one must discover what is the most effective use of public resources.
The noble Lord, Lord Graham of Edmonton, said that this is intended to be a benign debate. I take it as such. I cannot repeat too often that these debates ought not to be the occasion on which to try to score party political points and I hope your Lordships will hear none of that from me tonight.
The noble Lord, Lord Rodgers of Quarry Bank, said that announcements should be made to Parliament where at all possible and I entirely agree. That is why I am happy to say that today my right honourable friend the Home Secretary made an announcement to Parliament in another place in the form, I believe, of a Written Answer when he announced the review which is to take place. It is to take place on the following basis. All noble Lords know that there is on hand a comprehensive review of all Government spending. The Home Office review, which my right honourable friend announced, is looking at other options for integrating the work of the Prison and Probation Services in England and Wales. I regard that as an entirely prudent, sensible approach.
As has rightly been observed, the two services have grown in different ways. They have a different history and they had different purposes to attend to when they respectively came into being. The Home Secretary believes, and I am sure that he is right, that it is time to have a review into how they interrelate. They have different management and organisational structures, as the noble Baroness, Lady Blatch, pointed out. But the point underlying the philosophy of the review is that they deal often in turn with the same individual offenders. They have the same aims of protecting the public from harm and of bringing about the rehabilitation of offenders.
I thought that the noble Lord, Lord Rodgers, was a little unkind to the three-year plan because if one looks at Goal A in paragraph 2.2 and then casts an eye through pages 11 to 13, there is a good deal of material which can, as the noble Baroness said, be read only in the context of rehabilitation—the critical success factors identified, crime reduction on release, post-release licences, employment and training work and physical

1069
and mental health problems. I think that the noble Baroness made a good point that that is all in the context of rehabilitation and can mean nothing else.
Therefore, the review will attend to various options. I was gratified to hear what the noble Lord, Lord Rodgers, said about my honourable friend the Minister responsible for prisons and probation. I think what he said is generally recognised and it is a benefit to have my honourable friend looking after prisons and probation in that way, not simply because of her quality as a Minister but because it is more appropriate that it be done that way.
We do not wish to waste time. I shall specify the parameters of the review in a moment. It is intended originally to be an internal review which will provide options for the Home Secretary's consideration by the end of November. I do not believe that to be an unreasonable timetable. The initial part of the review will be internal to government with a view then to wide consultation when credible options for improvement have been identified. It is not the case of one service taking over the other. The question is what areas of work they have in common; how they can better help each other; and how they can better serve the wider community, which both wish to do.
The terms of reference are: first, to identify and assess options for closer and more integrated work between the Prison Service and the Probation Service in England and Wales, including any implications for the structure, organisation, management, working practices, human resources, funding and legislation governing the functions of those services. Further, it is to examine international models reflecting good practice and to identify any lessons concerning the effectiveness and efficiency, organisation and management structures exhibited by those models. Perhaps I may say that in the past, I think we have tended, in that area and others, to be rather too insular and to believe that there are no lessons to be learnt from overseas experience. We wish to put that right. Thirdly, we also intend the review to provide a preliminary analysis of the options identified, including estimated costs and benefits as a basis for consultation.
That is a step of practical utility. It is time limited to the end of November for the Home Secretary and thereafter open to the widest possible consultation. I recognise readily that we shall get nowhere in these difficult areas without consultation with those most intimately affected; namely, as the noble Lord, Lord Graham, said, the Prison Service and Probation Service.
As regards money, it is well-known that our policy is to stick to the overall base lines set when we came into office. That means that the amounts envisaged for the Probation Service are £428 million in the present year going down to £425 million next year and £417 million in 1999–2000.
I hope to offer this crumb of comfort. That does not rule out adjustments to the level of funding given to the Probation Service. But it would mean that since there are no extra resources overall, any extra given in that
1070
area would have to be funded by a cutback elsewhere. Of course, that is one of the purposes of having a review.
Qualifying training was a distinct question raised by a number of your Lordships. At the moment, there is no legal requirement for any specific qualification for appointment as a probation officer since the change in the regulations. We have had a presentation from ACOPS, CPC and NAPO. We understand their concerns. We are giving careful consideration to their proposals. I hope that the Government's position, in its definitive state, will be announced before too long. I hope that that may be of assistance.
The noble Baroness asked me specifically about two projects. With her great knowledge, I believe that she was referring to Teesside and Shropshire. I am grateful to the noble Baroness for providing me with the opportunity to tell the House that those projects are continuing. We support their continuation. The Home Office is carefully evaluating the projects and when we have got the lessons, we shall consider them with great care, including possible implications for legislation. I hope that that is a satisfactory answer to what I may describe fairly as a most helpful question which illuminates part of our debate.
The noble Baroness, Lady Masham, asked about prison shops. I should like to give careful thought to that and I undertake to transmit it to my right honourable friend the Home Secretary for his careful consideration.
The noble Lord, Lord Rodgers, said that we are looking for a fair deal. I agree, within the limits of what we can deal with. He said that we must assess objectives. I agree. I am bound to say that I think the Home Office has, in the past, assessed objectives even though different conclusions have been reached. I do not think it to be a legitimate complaint that the Home Office had not put its mind to the point, even if we may have reached different conclusions.
The question was raised about information as regards serious offences committed while under probation supervision. The public has rights. One of those rights is the right to information. There was no intention at all to undermine the Probation Service when that material was provided: quite the reverse. The intention in releasing the relevant probation circular to the press was to set the information in context. As the noble Baroness pointed out, the proper context was—and I happily repeat it—that the Probation Service has about 200,000 offenders under supervision at any one time. Many of them present real risks. No one overlooks the gravity of the offences which were mentioned but in the context of 200,000, it may be that that should have received a rather more careful reflection in some newspapers.
That is the problem about information. Either one clutches it to one's sweaty bosom and lets it out to no one or one distributes it into the public domain. We thought that it was right to distribute it. It is unfortunate that a counterspin—I use the vogue word—was given to it on this occasion because it seems to have been rather unfair and perhaps rather ill considered.
Baroness Thomas of Walliswood: My Lords, perhaps I may make matters absolutely clear. I agree entirely with every word that the Minister has just said. I was attempting, perhaps not as cleverly, to make the same point.
Lord Williams of Mostyn: My Lords, I am most grateful for that. I believe that we have a duty to reassure and reinforce people who are carrying out very difficult jobs. They are vulnerable not only in the way described by the noble Lord, Lord Williams, which I recognise well, but sometimes they are vulnerable to criticism which might have been a little better considered and informed.
The trite observation, which I make despite its triteness, is that no one can say in how many cases skilled, dedicated intervention and work by the Probation Service prevented further offending. Of course, that news, which is good news, is never attractive because there is no headline which can be drawn from it.
Baroness Masham of Ilton: My Lords, does that point not illustrate very well that probation officers need extremely good training?
Lord Williams of Mostyn: My Lords, probation officers need very good training but I would not derive that moral from that story. The moral I derive from that story is that information is disseminated. One needs to put the good part of the story in the same context as the bad. I agree entirely with the noble Baroness that it is such difficult, skilful and stressful work that it obviously needs careful training. Indeed, prison officers' work is strained and stressful. It is very easy for those of us who go home after our day's work to forget that doing that sort of work, it is not easy to dissociate the rest of one's day or one's evening from that difficult work.
I hope that I have been helpful to your Lordships in this short debate. Nobody can pretend that it is an easy situation. The causes of that unease are not as relevant as the present remedies to which we must try to look. I believe, not simply because I stand here delivering the Government's view, that this review is of critical importance. It has the possibility of bringing about a sea change in how we deal with offenders.
Prison for some is bound to be the sanction that public safety requires and the public interest demands. It is not an appropriate sanction for all those who commit crime at every stage of their development. I believe that all speakers have agreed that if one catches potential offenders when they are young, one saves them the loss of wasted life, to use the phrase of the noble Baroness on another occasion when we discussed the matter. It saves enormous amounts of money; and, not least, it saves the anguish and heartache of so many victims whose interests also need to be carefully attended to. Sometimes those interests seem perhaps to be marginalised because we focus so much on how we deal with offenders. I respectfully suggest to your Lordships—I know that the noble Baroness and I are entirely at one on this—that while we must remember
1072
that criminals are victims of crime in a deeper sense, the innocent victim and his or her interests should never be overlooked.
I believe that I have trespassed a little on your Lordships' patience. However, in conclusion, I make the observation that in American rodeos a bur is sometimes placed under the saddle of the horse to make it restive. My noble friend Lord Longford never needs that because—and I mean this in all seriousness and sincerity—he has been absolutely indefatigable in the pursuit of what he believes to be right and just. I have never pretended that I agree with him on everything, but I salute the way that he never lets go and continually seeks the improvement of conditions within our society.
7.42 p.m.
The Earl of Longford: My Lords, I am most grateful to all speakers who have taken part in tonight's debate. I often tell people that we have the best debates in the world and the worst voting system. However, I shall leave the latter point on its own and stick to the first one; namely, that we have very high quality debates.
First, I should like to thank those who have spoken from all parts of the House. We have heard the chairman of the Labour Peers and their representative on the advisory committee; in other words, the two most representative Labour Peers available, apart from the Front Bench. They have spoken very strongly as liberal champions. The noble Baroness, Lady Masham, also took part. She has surpassed all of us in visiting nine women's prisons. I have visited more than nine prisons but not more than nine women's prisons, so that is a record.
All parts of the House were strongly represented and all speakers said roughly the same as I submitted in my convictions at the beginning of the debate: that there is no possible justification for the cuts in the Probation Service when this country is richer than it has ever been, and in view of the large increase in the prison population. I repeat: there is no possible justification for those cuts. No such justification has been provided, not even from the Front Bench. I did not exactly expect my revered friend the Minister (who spoke so kindly of me a moment ago) to do so. I realise that he is tied by his office. He is in a position where he has to say, to use the Irish phrase, "Mind you, I have said nothing". He is not in a position to commit the Government.
So far as concerns the noble Baroness, Lady Blatch, I feel a great deal of sympathy for her. She referred to the fact that I called her "the maiden of darkness" in the past; but I have also called her "the angel of light" on other occasions. I listened to her speaking with such deep feeling, expressing such care for the Probation Service and wondered how someone who cares so much could share a large part of the responsibility for imposing such outrageous cuts. I have only one explanation: the noble Baroness did her best to resign, but her resignation was not accepted. That has happened to other people. When I was Minister for Germany 50 years ago I tried to resign but Clem Attlee knew the answer to that one. He wrote me a letter saying, "Dear Frank, I have received your note and will try to

1073
look into it later". So I am sure that that is the position of the noble Baroness, Lady Blatch. However, she is now approaching freedom because she will be joined by the noble Lords, Lord Hurd and Lord Patten, who are great penal reformers. Therefore, she will no doubt astonish us all very shortly.
1074
In conclusion, I should like again to thank all speakers who took part in the debate. I only hope and believe that this debate will have had a good effect. I beg leave to withdraw the Motion.
Motion for Papers, by leave, withdrawn.
House adjourned at fifteen minutes before eight o'clock.

  Gibraltar
  Gibraltar
  Tunisia
  Tunisia
  Department for International Development: Funding
  Department for International Development: Funding
  Landmines
  Landmines
  Water Services
  Water Services
  "Sea Empress": Report
  "Sea Empress": Report
  Middlesbrough and Redcar and Cleveland
  Middlesbrough and Redcar and Cleveland
  Relief of Distress
  Relief of Distress
  Asylum Seekers: Local Authority Obligations
  Asylum Seekers: Local Authority Obligations
  Fire Safety Regulations
  Fire Safety Regulations
  Intrusive Surveillance: Code of Practice
  Intrusive Surveillance: Code of Practice
  Refugees from Former Yugoslavia
  Refugees from Former Yugoslavia
  Prison and Probation Services: Joint Working
  Prison and Probation Services: Joint Working
  Alcopops
  Alcopops
  Child Support Agency
  Child Support Agency
  Child Support Scheme
  Child Support Scheme