Sitting of 11 November 1997

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

    National Health Service (Funding)
    Mr. Todd: How much extra money has been made available to the Trent NHS region over the winter period. [13741]
    Jane Griffiths: How much extra money has been made available for the NHS since 1 May. [13809]
    The Secretary of State for Health (Mr. Frank Dobson): Since 1 May, the new Government, as part of their commitment to establishing a reliable and modern health service, have provided an additional £1.5 billion to the national health service—an extra £1.2 billion for next year and an extra £300 million for this winter. In the Trent region, £16 million extra has been provided for this winter to help with emergencies and restrain the rise in waiting lists.
    Mr. Todd: I thank my right hon. Friend for his answer, which will be welcome in my constituency. I hope that it will be possible to provide a breakdown of that expenditure to health authority level in the near future. Is my right hon. Friend aware that I met representatives of my local health authority shortly before his very welcome announcement and that they expressed concern about the mounting crisis this winter? I am sure that the money will be very well spent in our area.
    Mr. Dobson: I can assure my hon. Friend that we will publish a detailed breakdown of the extra £16 million that is being provided to help the health service in the Trent region this winter. It is intended to help with emergencies and to finance local social services in taking steps to prevent old people from having to go into hospital unnecessarily and to take people out of hospital when, from their point of view and everyone else's, they are better off at home.
    Jane Griffiths: Will my right hon. Friend join me in welcoming the announcement of the allocation of £73 million for the consolidation of the Royal Berkshire and Battle hospitals in my constituency—a project that
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    was first discussed 67 years ago and on which almost nothing has been done for the past 18 years because of Tory inaction?
    Mr. Dobson: I entirely agree with my hon. Friend. We very much welcome the commitment to the new hospital for Reading that has just been announced and the new hospital for Sheffield that was announced last week in addition to the 15 new hospital projects that we announced under the private finance initiative that we inherited from the previous Government. All they did was keep announcing that they would build new hospitals, but they never actually got around to it.
    Mr. Hogg: Does the Secretary of State accept that, within the Trent region, there is particular concern about Grantham hospital because of the proposals by Lincolnshire health authority that will have a damaging effect on the paediatric department and other departments in that hospital? My hon. Friend the Member for Grantham and Stamford (Mr. Davies) is particularly concerned about the matter. Does the Secretary of State accept that, should an appeal to him be successful, he may have to make additional funds available to Grantham hospital? Will he please make a reservation in his own mind now against that possibility?
    Mr. Dobson: The right hon. and learned Gentleman has made representations about Grantham hospital, as has the hon. Member for Grantham and Stamford (Mr. Davies). I understand that the proposal will be passed to me by the people whom his Government appointed to run Lincolnshire health authority. I await the opportunity to adjudicate on their ideas.
    Mr. Quentin Davies: The Secretary of State is wrong, because the chief executive of Lincolnshire health authority, whom the previous Government appointed, is now—I am glad to say—leaving his post, and is being replaced by Mr. Jeavons, a new appointee by the present Government.
    May I reinforce the points already made by my right hon. and learned Friend the Member for Sleaford and North Hykeham (Mr. Hogg), because it is important that the future of the Grantham hospital is considered as a whole? We do not want decisions on individual units—in this case, the paediatric unit—to prejudice future decisions about other elements of the hospital. I therefore ask the Secretary of State to turn down the request to close the paediatric ward at Grantham hospital, pending consultation on the future of all the units, including paediatrics, gynaecology, obstetrics and accident and emergency. The future of Grantham as a general hospital is at stake.
    Mr. Dobson: The first requirement is that the interests of the people presently served by Grantham hospital should continue to be served, and that they have a modern and reliable health service to deliver the health care that they want. However, that has to be considered in the light of the other obligations on the rest of the health service in Lincolnshire; as I understand it, that is the proposition that will eventually come to me. I thank the hon. Gentleman for welcoming one of the changes that Labour is making in the membership of health authorities and

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    trusts. In view of some ignorant suggestions, I am always glad to welcome congratulations from the Opposition on the improvement in personnel that we are making.
    Mr. Jim Marshall: I also thank my right hon. Friend for the additional financial resources that will come to Leicestershire this year and next. Will my right hon. Friend guarantee that, in the review of the formulae for distributing the funds nationally, he will ensure that underfunded areas such as Leicestershire receive their due reward in coming years?
    Mr. Dobson: I can make two clear points. First, the allocation that we have recently announced better reflects clinical need and deprivation than did the formulae used by the previous Government. Secondly, and contrary to much scaremongering by Opposition Members, the new formulae involve an element of rurality, so that areas with sparser populations do not suffer. I realise that that does not apply to the city of Leicester, but I expect that Leicester will benefit from the changes that I have mentioned.

    Solihull Hospital
    Mr. John M. Taylor: If he will pay an official visit to Solihull hospital to discuss local health provision. [13810]
    The Parliamentary Under-Secretary of State for Health (Mr. Paul Boateng): I have no plans to visit Solihull hospital, but I will conduct an official visit to Birmingham Heartlands and Solihull NHS Trust in the near future. I am looking forward to it enormously.
    Mr. Taylor: The Minister will be welcome when he comes to Solihull. Contrary to what the Secretary of State had to say, the previous Government gave my constituency a magnificent new state-of-the-art hospital. The Minister of State has recently vouchsafed to me in a written answer the range of services provided by that hospital. I hope that, when the Minister visits Solihull, he will be able to say that that range of services will be sustained for the benefit of my constituents and, perhaps, that other services will be added.
    Mr. Boateng: The NHS in Solihull is certainly safe in our hands: I am not so sure that it was safe in the hands of the previous Government.

    National Health Service (Funding)
    Caroline Flint: What action he is taking to cut waste in the national health service. [13811]
    The Minister of State, Department of Health (Mr. Alan Milburn): On 22 May, we announced a programme of measures to reduce management costs by £100 million this year. Our efficiency task force has identified savings of £40 million. As part of our plans to replace the internal market, we are looking at the scope for further savings from bureaucracy.
    Caroline Flint: I thank my hon. Friend for that response. In Doncaster alone last year, 60,000 people did not turn up for their appointments, thus leaving empty
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    seats in waiting rooms in hospitals. I am sure that that situation is reflected across the country. We all have a responsibility to ensure that we appreciate the resources of the NHS, because the money wasted by people not turning up could fund important projects, such as the breast cancer clinic and Jasmine centre in Doncaster.
    Mr. Milburn: My hon. Friend is quite right to say that with the right that patients have to access to NHS services comes the responsibility to use those services wisely. The Government will be seeking to learn the lessons from best practice, particularly in areas like "did not attends". The efficiency task force will be looking specifically at this area, and we intend to bear down on bureaucracy and waste and to invest more in front-line patient services.
    Mr. Soames: Will the Minister look with care at the programme of savings instituted in the Ministry of Defence by the former Chief Secretary, which was extremely successful in looking at the non-core business and work of the MoD and seeing whether that work could be contracted out or done better by other people? The considerable savings from "Front Line First" were ploughed back into the front line. Will he look at such a programme and not dismiss it out of hand, as there is real scope for substantial savings?
    Mr. Milburn: As the hon. Gentleman knows, what counts for this Government is what works. The efficiency task force will look to ensure that, in future, we will pool together where possible the functions currently provided by NHS trusts. If it is possible to bear down on administration functions and to cut waste, we will do so. I am sure that all hon. Members will back the Government's manifesto commitment to ensure that resources go to front-line patient services.
    Mrs. Anne Campbell: Does my hon. Friend share my concern at recent press reports of waste within the national blood transfusion service, and particularly the waste of blood products donated freely for use by NHS patients?
    Mr. Milburn: As my hon. Friend is aware, a review is taking place of the successes—and some of the failures—of the blood transfusion service. That review will report shortly.
    Mr. Simon Hughes: In the Government's campaign against waste in the health service—which we fully support—will they make sure that NHS trusts and civil servants get the message that projects which are wasteful of taxpayers' money and time and which duplicate perfectly good existing resources will not be approved? When Ministers come to their conclusions about the London review, will they make sure that approval is not given to the spending of between £100 million and £200 million of taxpayers' charitable money on building a new hospital across the river on the St. Thomas's site when £200 million has been spent on building a new hospital on the Guy's site, and when it is proposed that 18 floors of the Guy's hospital buildings will be left empty?
    Mr. Milburn: I would not want to prejudge the outcome of the Turnberg review of London's health

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    services, but I assure the hon. Gentleman that all projects—particularly capital projects—will be judged to ensure that they provide maximum value for money for patients and the taxpayer.

    Child Care
    Ms Rosie Winterton: If he will make a statement about the future regulation of children's day care services and supervised activities under the Children Act 1989. [13813]
    Mr. Boateng: The Under-Secretaries of State for Education and Employment, my hon. Friends the Members for Birmingham, Yardley (Ms Morris) and for Newport, East (Mr. Howarth), and I will be consulting, early in the new year, on our plans to develop an integrated regulation and inspection system that will promote day care and early-years education for young children, provide a quality assurance framework in which parents can have confidence and reduce bureaucracy for providers. That was another commitment in our general election manifesto which we are carrying out.
    Ms Winterton: Is my hon. Friend aware of a case in my constituency where a two-year-old child, Ben Chorlton, walked out of a creche provided by a private gym into a nearby bus station? The creche was not registered because it operated for less than two hours per day. Does he believe that it is acceptable for a creche to operate for one hour and 55 minutes per day solely to avoid registration and inspection? Will he meet me to discuss the implications of the case?
    Mr. Boateng: No, it is thoroughly unacceptable. The two-hour time limit for registration was introduced to ensure that one-off or less formal, unremunerated short-term care arrangements were not unnecessarily burdened by unworkable regulations.
    It was never intended that proper regulation and supervision should be undermined by attempts such as my hon. Friend has described to remove the basis on which they are carried out. I look forward to meeting her to do all that we can to support Doncaster social services in ensuring that the facility puts itself in order.

    NHS Pay
    Mr. Whittingdale: If he will make a statement on the study which he has commissioned on pay rates in the NHS. [13814]
    Mr. Dobson: I have ordered a survey of earnings in the national health service, to make available to the Government information that any employer would want to have. The previous Government stopped collecting that information, presumably on the basis of the motto, "Ignorance is strength".
    Mr. Whittingdale: In conducting his survey, does the Secretary of State intend to take account of the effect of introducing a minimum wage, which is bound to cost the NHS tens of millions of pounds? Can he guarantee that the NHS budget will be increased to cover that cost and that it will not be met at the expense of patient care?
    Mr. Dobson: It is precisely so that we can advise the Treasury and the rest of the Government on the possible
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    impact on the national health service of a national minimum wage that we are collecting the information. It was the hon. Gentleman's own stupid, ignorant Government—for want of a better expression—who, for their own benighted reasons, stopped collecting the information; yet Tory Ministers from the Department of Health came to the Dispatch Box and announced figures of the impact on the national health service of a national minimum wage. As they did not know how many people were earning £2.50, £3, £3.50, £4 or whatever an hour in the national health service, that was pure speculation, like all the rest of the Tory attacks on a national minimum wage.
    Mr. Hinchliffe: On NHS pay rates, may I take my right hon. Friend back to the answer that he gave a few moments ago to my hon. Friend the Member for Leicester, South (Mr. Marshall) about the formula for allocating resources to individual health authorities? What consideration has he given to removing the market forces factor from the current formula, which assumes that NHS wages are low in generally low-waged areas, such as my constituency, and badly penalises those areas?
    Mr. Dobson: We have changed the arrangements for this year and we are considering next year's. To the people who graced—if that is the word—the Treasury Benches for the previous 18 years, all I can say is that I am astonished that they are not ashamed to acknowledge, let alone claim, to the House that a substantial number of the 1 million hard-working people in the national health service are likely to be paid less than what would be a reasonable national minimum wage. They are saying that our national health service depends on paying poverty wages, when they know that poverty makes people ill.
    Rev. Martin Smyth: Will the Secretary of State confirm that the Unison recommendation of £4.42 an hour as the national minimum wage would be more than what is earned by 96.4 per cent. of ancillary workers in the health service; by 5 per cent. of clerical and administrative workers; and by 8 per cent. of professional and technical workers? Does he acknowledge that, if those workers were not paid properly, the health service would suffer?
    Mr. Dobson: Exactly. As the hon. Gentleman knows, the Low Pay Commission is currently considering what the national minimum wage should be. As he points out to Conservative Members, who sit on the same side of the House as him but with whom lie is generally not associated, I am glad to say, a substantial number of badly paid people in the national health service nevertheless provide services that are vital if the highly paid professionals are to be able to do their jobs properly. Once again, it is shameful that Tories should be asking me what the impact on the national health service of a national minimum wage is likely to be, when they are apparently proud of paying poverty wages to people who provide treatment and care for the sick and injured.
    Mr. Skinner: Does my right hon. Friend agree that it is staggering to hear the Tories attacking low-paid workers when a previous Tory Secretary of State for Health, who later became Chancellor of the Exchequer, has now got four extra moonlighting jobs, picking up something approaching £500,000 a year? There are gangs

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    of them on the Tory Benches, all lining their pockets with outside interests, and they have got the cheek to attack low-paid workers in the national health service. Gang of hypocrites!
    Mr. Dobson: As my hon. Friend points out, yet again, the Tories are for the few rather than the many, and we are proud to be for the many rather than the few.

    NHS Waiting Lists
    Mr. Ian Bruce: What has been the trend in NHS waiting lists since May 1997; and what targets he is setting for the next 12 months. [13815]
    Mr. Dobson: In May 1997, the new Government inherited from the Tory Government the longest hospital waiting lists in the history of the national health service after 18 years of Tory rule. Inevitably, those waiting lists have continued to grow. [Interruption.] I am astonished that Tory Members are surprised. We inherited the longest hospital waiting lists in history, and they were rising faster than ever before in the history of the NHS. The extra £300 million that we have made available to the NHS this winter should help restrain the rate of growth but reducing waiting lists will take time. We will shortly announce a package of measures designed to deliver our clear manifesto commitment that waiting lists will be reduced before the end of this Parliament.
    Mr. Bruce: I notice that the Secretary of State, who had a very easy question from me, did not give us the target for the next 12 months. He keeps prevaricating. May I give him an easier question? Dorset never had a problem with waiting lists until this Government came to power. He says that the extra money was given to areas where sparsity was a factor. Dorset must be one of the sparsest counties, so why have we had one of the smallest amounts of money? Why is no attempt being made to keep what the Government said was a top-priority promise?
    Mr. Dobson: I really do not think that I can be reasonably expected to plead guilty to the immediate devastation of South Dorset; nor am I responsible for the hon. Gentleman's majority of 77. Given the sparsity factor, his area will next year get an increase of 4.14 per cent. on its spending this year—an extra £13 million. If he did not have barefaced cheek, he would get up and thank me for it.
    Mr. Gunnell: May I say to my right hon. Friend that the extra money to stop waiting lists rising enormously this winter is welcome? What flexibility will there be in the spending of that money between the health service and social services? Dealing with the problem means tackling bed blocking and putting money into social services. How will that flexibility be applied locally? Who will be involved in the decision making?
    Mr. Dobson: Since we took over, we have emphasised at every stage that the problems faced by the national health and the social services this winter can be dealt with only if they are working together. I have written twice to health service bosses in each area and to local authority bosses. The chief inspector of social services and the chief
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    executive of the NHS have made joint visits to all the areas, to ensure that they are working together. I have made it plain that regional offices should allocate funds only to those areas in which it is clear that social and national health services are working together. Only when they work together will they be able to succeed.
    Mr. Nicholls: The right hon. Gentleman will be aware that waiting lists in Cornwall will rise dramatically if the health authority there carries out its proposal to close four community hospitals. Is he aware that the people of Cornwall regard the so-called public consultation as a complete sham, bearing in mind that the chief executive has said that he would close those four hospitals even if he had unlimited resources? Given that the Secretary of State, to his credit, has on a number of occasions paid due credit to the work done by community and cottage hospitals, will he avoid passing judgment on what the eventual plans may be, but use his residuary powers to quash the present public consultation process and introduce a new one in which the public could have confidence? He acted with commendable speed last week to deal with a crisis in Exeter. Will he act today and intervene to safeguard the position of the people of Cornwall?
    Mr. Dobson: I do not think that that would be sensible. I welcome the hon. Gentleman to the Opposition Front Bench and thank him for his kind remarks about our response to the breast cancer screening crisis in Devon and Exeter. However, it would probably not serve the people of Cornwall to blow the whistle on the existing consultation process and start all over again—that would simply prolong the uncertainty. I give him and the people of Cornwall the assurance that when the proposals come before me, as they certainly will because the community health councils are opposed to them, I shall scrutinise them very carefully indeed.
    Having been belaboured by various people on television, the radio and in newspapers in Cornwall about what was then allegedly the fact that the cottage hospital closures necessarily followed on from a shortage of funds in Cornwall, I was somewhat taken aback to hear the paid public official, the chief executive, announce that he would close them if he had all the money that God sends.

    Smoking
    Mr. Jim Cunningham: If he will make a statement about levels of smoking among young people in England. [13816]
    The Minister for Public Health (Ms Tessa Jowell): In 1996, 13 per cent. of all secondary school children in England were regular smokers, but by the age of 15, 33 per cent. of girls and 28 per cent. of boys were smokers.
    Mr. Cunningham: Can my hon. Friend ensure that the principal aims of the Government's policy to cut the numbers of young people and teenagers smoking will be maintained?
    Ms Jowell: It is a measure of the previous Government's failure that one in three 15-year-old girls are hooked on cigarettes before leaving school. That is why our first priority is to cut smoking among children.
    Mr. Maples: May I remind the hon. Lady, that in a departmental press release on 14 July, she said:
    "Certainly we want to see an end to tobacco advertising in the form of sports sponsorship"?
    In her article in The Daily Telegraph today, she says:
    "The decision to propose an exemption for Formula One is one that has my total support."
    On which occasion was she telling us what she really thought?
    Ms Jowell: Policies to stop children smoking that work have my total support. A ban on advertising will stop children smoking. Negotiating a global ban on advertising with formula one will stop children smoking. That is our overriding priority.
    Mr. Stevenson: Does my hon. Friend agree that the task facing the Government now is to get on with a ban on advertising smoking, where that can be practically and quickly achieved? Would not such a measure of the Government's determination be in stark contrast to the cowardly attitude of the Conservative party, which steadfastly refused to face up to that important issue?
    Ms Jowell: We intend to make progress with a comprehensive range of measures to stop children smoking and to support the seven out of every 10 smokers who want to give up. The mark of success for our Government will be that we make real progress in reducing the needless death and suffering caused by smoking–121,000 people are dying every year and we are determined to stop that.
    Sir Raymond Whitney: Does the Minister accept that, given that thousands of young people are interested in motor sports, there is widespread concern about the impact of the Government's recent decision on advertising in motor sports? Does she also agree that, uniquely, be it rightly or wrongly, the conjunction between the allegations of political contributions and the Government's U-turn causes serious concern throughout the country?
    Ms Jowell: This Government, unlike the last Government, will ban tobacco advertising. This Government, unlike the last Government, will reduce the rate at which people die from cigarette smoking. The only legacy of the last Government was the fact that health Ministers who stood up and tried to do something about smoking were moved very quickly.

    "The Health of the Nation"
    Mr. Pike: What changes he proposes to make to the "Health of the Nation" strategy. [13817]
    Ms Jowell: We shall publish our Green Paper on "Our Healthier Nation" this winter and we shall take careful note of all the responses we receive to the consultation that follows. We shall use them to inform the new health strategy which we plan to publish in summer 1998.
    Mr. Pike: Is it not important that, in that exercise, the Government have recognised that health inequalities exist in this country? Doctors and nurses throughout the country welcome the fact that we not only recognise but
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    are prepared to tackle those health inequalities. Will my hon. Friend confirm that the Department of Health has now removed the ban on its civil servants talking about health inequalities, which will mean that we shall be able to deal with them in a positive way?
    Ms Jowell: My hon. Friend is correct to say that we now have the basis for a public health policy that will work, because we are prepared to confront the fact that, the poorer people are, the worse their health is likely to be. We intend to take action to tackle that. In my hon. Friend's constituency, that action would include reducing the levels of coronary heart disease and lung cancer, where Burnley is among the worst 10 per cent. in the country; and reducing the number of girls under 16 who get pregnant, where Burnley is still well above the national average.
    Mr. Maples: Given that one of the "Health of the Nation" targets was a reduction in teenage smoking, and given that the Minister refused to tell us what she really thought about that issue in answer to my previous question, perhaps she will try to answer this one. Last week, when she was in some difficulty on the issue, she said that she had acted on the advice of the Secretary of State. He was conspicuous by his silence. Does it ever occur to her that perhaps he set her up?
    Ms Jowell: I think that the House will judge that with the contempt that it deserves. The hon. Gentleman's behaviour throughout this matter has been below the standards that people in this country think they deserve. The Conservatives have used nasty smear and innuendo as a way of masking the complete failure of their policies to stop children smoking.

    Healthy Living Centres
    Dr. Palmer: What action he is taking to develop healthy living centres. [13818]
    Ms Jowell: Work is under way to ensure that healthy living centres, which will be funded from national lottery money, contribute to the success of the Government's health strategy and complement existing provision. They will provide a focus for local, community action to improve health, which is one of the pillars of the Government's health strategy.
    Dr. Palmer: Is not the priority that the Government are giving to health spending for lottery money not vastly preferable to the priority of the previous Government, who were even willing to give one of their own Members of Parliament lottery money for his grandfather's diaries?
    Ms Jowell: We attach very high priority to tackling inequality in health, and the spending of that lottery money to develop healthy living centres is one way in which we intend to do so.
    Mrs. Roe: Can the Minister confirm that healthy living centres will not offer services currently provided by the NHS from the taxpayers' money?
    Ms Jowell: As the hon. Lady is aware, the principle that determines the spending of lottery money is what is

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    called additionality. No, the healthy living centres will not replace the services of the national health service, but will be additional to them, and will be a very important way of our ensuring that people have access to exercise and to advice about health. The centres will help us to promote better health and reduce avoidable illness.
    Dr. Brand: Does the Minister agree that the extraordinary decision to exempt formula one racing advertising will undermine the efforts made by those healthy living centres?
    Mr. Bermingham rose—
    Dr. Brand: Does not the Minister now need to advise the Prime Minister that that extraordinary decision will undermine the campaign to achieve the aim, which we are all trying to achieve, of deglamorising smoking among young people?
    Ms Jowell: Since the object of exempting formula one is to ensure that there is less tobacco advertising, not more, it is part of a policy that is entirely consistent with our development of healthy living centres as part of our public health strategy.

    Prescription Charges
    Mr. Peter Bottomley: What is his policy in respect of future prescription charges for pensioners. [13819]
    Mr. Milburn: My right hon. Friend the Chief Secretary to the Treasury announced on 11 June that prescription charges were to be one element of the Department of Health's comprehensive spending review. We aim to complete the review by next spring.
    Mr. Bottomley: Will the hon. Gentleman pass on to his right hon. Friend the message that I am sorry that the Secretary of State was not chosen to answer this question, as, the day after the Treasury Minister made that comment, the right hon. Gentleman was quoted, presumably accurately, as saying that prescription charges for the elderly are "politically unacceptable" and will be brought in only over his "dead body"?
    As, a few days later, on 18 June, the Prime Minister used three columns of Hansard, columns 303-05, to say that prescription charges were being considered, what exactly is the policy of the Department of Health, and how does it square with what is in the Labour manifesto?
    Mr. Milburn: The policy of the Health Department is that we are conducting a review, and the review will report in due course. I would take the hon. Gentleman's concerns more seriously and they would be more convincing if the Conservatives, when they were in power, had not increased prescription charges fourfold in real terms. The outcome of the comprehensive spending review will be judged by one yardstick: the Government's commitment to the historic principle of the NHS that services should be available according to need and need alone.
    Mr. Llew Smith: As the Minister is aware, this week, in my constituency and throughout the land, we are
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    celebrating the 100th anniversary of the birth of Nye Bevan. What does the Minister feel Nye's attitude would have been after 18 years not just of Tory government but of prescription charge increases?
    Mr. Milburn: Only one party in the House is addicted to charges in the national health service. It is the party that introduced prescription charges, dental check charges and eye test charges into the national health service: the Conservative party.
    Mr. Nicholas Winterton: While the prospect of any future charges for prescriptions is immensely important to pensioners and to all elderly people in this country, has the Minister given any thought to another related matter: the ability of people to fund their retirement, and particularly their need for residential or nursing care? The previous Government advanced proposals in that area: are the new Government considering the matter as part of the review?
    Mr. Milburn: I know that the hon. Gentleman takes this issue, and health issues in general, very seriously. I assure him that, before too long, we shall announce details of a royal commission that will examine those issues properly. We shall ensure that, in future, older people receive the sort of treatment and services that they deserve.

    Scottish Devolution
    Mr. Dalyell: What consultation he has had with the Scottish Office since the referendum on the transfer of responsibilities which are currently his to the Scottish Parliament. [13821]
    Mr. Dobson: Our proposals for devolution are set out in the White Paper "Scotland's Parliament". There are no plans to transfer any of my responsibilities to the Scottish Parliament.
    Mr. Dalyell: May I assume that fertility treatment and abortion will remain reserved powers?
    Mr. Dobson: That is correct.

    NHS Staff (Attacks)
    Mrs. Ellman: What guidance has been issued by his Department to protect NHS staff from attacks at work. [13822]
    Mr. Dobson: As my hon. Friend knows, I think it is disgraceful that our society has descended so low that people who work in accident and emergency departments or who go out with ambulances or are district nurses or GPs cannot perform their duties without fear of assault and abuse. Since coming to my present office, I have made it a major priority that national service managers must do whatever they can to reduce the impact of violent assaults on national health service staff.

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    We issued a circular on the effective management of security in accident and emergency departments—which was prepared in part by the previous Government—and, since then, we have issued further health and safety guidance on minimising the risk of violence to staff. I return to my initial point: it is, and must remain, a major target of national health service management to ensure that staff are not assaulted and abused. It is the duty of the whole criminal justice system to make sure that anyone who assaults a national health service staff member is punished severely.
    Mrs. Ellman: I thank the Secretary of State for taking such decisive action in an important area that the previous Government neglected so badly. Can my right hon. Friend inform the House how we might improve the patients charter so that we can move from the empty rhetoric of the charter introduced by the Conservative Government and towards a charter with real rights and responsibilities for both patients and staff?
    Mr. Dobson: National health service staff at all levels and in all disciplines tell me that certain aspects of the patients charter have led to an increase in the number of assaults on and abuses of staff, particularly in accident and emergency departments. That is one reason why we intend to change the patients charter and make it an NHS charter in which patients have responsibilities as well as rights.
    Mrs. Virginia Bottomley: The right hon. Gentleman may be aware that many NHS non-executives fear that they are being attacked by the Secretary of State. There is a large number of outstanding appointments. The system was essentially endorsed after exhaustive examination by Lord Nolan. If the right hon. Gentleman discusses the matter with his noble Friends Baronesses Dean, Jay and Hayman—and many others in this place who served on trusts—he will discover that they are very worried that he will exceed the actions of one of his predecessors who vindictively dismissed 150 appointees when he came to power. Will the right hon. Gentleman state that he has no intention of attacking those NHS non-executives who have done so much for the health service?
    Mr. Dobson: I do not propose to demean the House by answering that stupid question about the former Secretary of State's Tory friends losing their places on national health service trusts, when my hon. Friend the Member for Liverpool, Riverside (Mrs. Ellman) was referring to the physical assault and abuse of nurses, doctors and ambulance staff. If the right hon. Lady thinks that there are parallels between the two cases, no wonder she made such a mess of this job.

    Tobacco Advertising
    Mr. Lock: What action the Government are taking to reduce tobacco advertising. [13823]
    Ms Jowell: The Government are fully committed to banning tobacco advertising and are currently taking an active part in discussions with European Union member states on the draft directive on tobacco advertising.
    Mr. Lock: I thank my hon. Friend for that statement. Does she accept that about one in six of my constituents
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    who die, die as a result of tobacco-related illnesses, and that the vast majority of them began smoking before they reached the age of 20? Does she further accept that the tobacco companies know that, and target their billboard and magazine advertising at young people? Will she join me in condemning the Conservatives, who for 18 years knew the statistics and failed to take any effective action to protect our young people?
    Ms Jowell: As my hon. Friend makes clear, the record of the previous Government is shameful. As a result of their negligence, there has been an increase in the rate at which young people smoke. That is why we are committed to implementing a wide range of measures, which will be set out in our White Paper next year and which are designed particularly to tackle the increasing problem of young people taking up smoking. Most people start smoking before they are 20. That is why it is important to focus on efforts to stop young people taking up smoking in the first place.
    Dr. Julian Lewis: Can the Minister come up with even one formula to explain away the Government's U-turn on their manifesto commitment to ban tobacco advertising?
    Ms Jowell: There is no U-turn on any manifesto commitment: we will ban tobacco advertising, because we are determined to reduce the rate at which people die through smoking.
    Fiona Mactaggart: My hon. Friend the Minister mentioned in earlier answers the increase in smoking among young people that occurred under the previous Government. Has she any particular plans to tackle the increase in smoking among young women, as smoking has increased more quickly among them than among young men? Can she give us a preview of the actions she plans to take to target that group, who are extremely vulnerable and at risk of dying in future from their smoking now?
    Ms Jowell: My hon. Friend makes an important point. There is no single measure that will enable us to be successful in reducing the rate at which people die through smoking. The case of young women is a good example. We will have to work with women's magazines and women's organisations to tackle the glamorising of smoking, which persuades so many women, young and older, to take up smoking. For many poor women, the reason they smoke is that their lives feel hopeless. That is why a range of other Government policies—such as getting young lone mothers back to work and raising educational standards—will all help in our battle to reduce smoking.

    Cosmetic Surgery
    Ann Clwyd: If he will make a statement on the regulation of cosmetic surgery. [13824]
    Mr. Milburn: Statutory control of clinics offering cosmetic surgery in the private sector is provided through a system of registration and inspection delegated to health authorities under the Registered Homes Act 1984.
    Ann Clwyd: I am grateful to my hon. Friend for that answer. I know that the Government have already set up

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    a review into silicone implants. Will he look again at regulations for private cosmetic clinics? I gave the previous Government a great deal of evidence about hundreds of women who have been scarred and injured as a result of treatment by cowboy operators in some private cosmetic clinics. Is my hon. Friend aware that a previous president of the Royal College of Surgeons said that animals are better protected in Britain than are people? Will he re-examine the matter?
    Mr. Milburn: I commend my hon. Friend's work on behalf of patients who have suffered through cosmetic surgery in the private sector. All patients, regardless of whether they receive their treatment and operations in the private sector or the national health service, should expect the highest possible standards of medical care. My hon. Friend will be aware that there are certain safeguards for patients within the current regulatory framework. Ministers are considering how better to safeguard patients' interests when they use private sector medical treatment.

    National Blood Transfusion Service
    Dr. Harris: If he will publish performance indicators for all regions of the national blood transfusion service. [13827]
    Mr. Dobson: A range of performance indicators for the national blood service's operations are being developed. Some of them should be published later this month. I want to ensure that any indicators of performance make sense and are acceptable to the clinicians who receive the services from the national blood transfusion service. I am not wildly impressed by the senior management of that outfit.
    Dr. Harris: Given the recently announced £3.5 million cost of redundancies in the national blood transfusion service since 1 April 1995 and that the interim Cash report on the move of services from Liverpool to Manchester stated that the national blood authority's plans were not proven and that it was too late to reconsider them, may I ask why the Secretary of State announced the setting up of the review only in August, given that it was an issue that the Labour party had campaigned on hard and effectively while in opposition and given also that the Labour Government prided themselves on hitting the ground reviewing in May?
    Mr. Dobson: On getting into office, I immediately asked for reports on the state of the proposals for the transfer from Liverpool to Manchester of bulk processing of blood. Had I been in a position to take the initial decision, I would never have agreed to the transfer. I asked Professor Cash, the president of the Royal College of Physicians of Edinburgh and the former head of the Scottish blood transfusion service, to advise me. His advice was, reluctantly, that the Liverpool service was so run down that, in the interests of the safety and security of blood supplies, it was, sadly, necessary to go ahead with the transfer.
    I expect Professor Cash to report to me shortly on the future of blood services in the north-west as a whole. On the basis of the reports which he has submitted to me, I expect that his views will have an impact on the
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    provision of blood services throughout the country. That is one of the reasons why I am not very happy with the way in which the blood service has been run over the past few years.
    Mr. Bermingham: Does my right hon. Friend agree that the mistake having been made—we all know that it was made in the transfer—steps should now be taken to review the north-west and the supply within it so that there might be adequate services in that area? Will he give me an undertaking that such a review will take place? I know that this appalling mistake is not my right hon. Friend's but his predecessor's, but will steps be taken to rectify it in due course?
    Mr. Dobson: I have asked Professor Cash to produce a report that contains proposals on how best to secure the interests of the people of Merseyside and the needs of clinicians working in the area who are trying to provide top-quality treatment and care, and then to put in place machinery to make that possible.
    I return to the basic point: that the blood service must be adequate and safe for the people of Merseyside and for people in every other part of the country. People throughout the United Kingdom should have sufficient confidence in the service to ensure that they are willing to continue as blood donors. I urge people to do so, because blood is always desperately needed and good use is made of it.

    General Practitioner Fundholding
    Ms Drown: How much money his Department saved by not approving the eighth wave of applications for GP fundholding status. [13829]
    Mr. Milburn: The deferment of the eighth wave of the general practitioner fundholding scheme led to £20 million from the inherited budget for general practitioner fundholders' management costs being immediately redeployed into patient care.
    An additional £9 million has subsequently been released from further management efficiency savings nationally in the fundholding scheme.
    Ms Drown: In the light of that answer, will my hon. Friend review the potential administrative savings that could be made from previous waves of GP fundholding, so that money could be redirected into basic NHS services, such as dentistry, in my constituency? Not only are no new adults in my constituency being accepted on NHS dentist lists, but a recent poll showed that one in three dentists were not accepting new children on NHS lists.
    Mr. Milburn: I am aware of the concerns in the Swindon area about the availability of dental services. I shall see my right hon. Friend before long to discuss these. I can give my hon. Friend an assurance that the Government will do everything that we can to bear down on unnecessary bureaucracy costs wherever they arise in the national health service to ensure that there is adequate investment in front-line patient care.

Points of Order
3.30 pm
Mr. Geoffrey Clifton-Brown: On a point of order, Madam Speaker. You will be aware that many millions of people this morning marked the Armistice day two-minute silence, to commemorate those who have fallen in trying to defeat some of the worst tyrannies that the world has ever seen. They did it to defeat tyranny and uphold democracy. The House is the fount of democracy.
Although I am aware that many Committees and many staff of the House marked the two-minute silence, it seems wholly appropriate that there should be a more official way of marking it in future. Will it be possible for hon. Members, on a purely voluntary basis, to come to the Chamber at 11 o'clock on the 11th hour of the 11th day to mark the silence? If that is not considered appropriate, perhaps there should be a two-minute silence in our normal 2.30 prayers in the House.
If you consider that appropriate, Madam Speaker, I ask you to refer it to the appropriate Committee.
Madam Speaker: I should be glad to give consideration to the hon. Gentleman's suggestion. I do not know whether he was in the House last Thursday when we had an exchange on this matter. I am pleased to tell hon. Members who are interested that all Committees that sat this morning observed the two-minute silence. As the hon. Gentleman will probably know, I sent suggestions to all the Departments of the House asking them to observe the silence, and I know that very many of them did. I looked through my kitchen window when I was observing the two-minute silence and was pleased to see that traffic on Westminster bridge came to a standstill, as did the pedestrians. The House has done an honour to the dead of two world wars, but I will be glad to look at suggestions for next year.
Mr. Gerald Bermingham: On a point of order, Madam Speaker. I apologise for trying to raise a point of order during Question Time. I should have known better.
We have a new Opposition, who are clearly young in their task of learning. Perhaps it could be pointed out to them that questions supplementary to those on the Order Paper are supposed to be relevant to the subject of the main question. We had example after example today where that did not happen. I noticed with considerable interest—this may be something that my own party will take on board—that even Liberal Democrats tried to join in that badly behaved, orchestrated insult to a very honourable Member of the House.
Madam Speaker: That is not a very complimentary comment to me, if I may say so, Mr. Bermingham. I watch the Order Paper very carefully, and I find that many hon. Members on both sides of the House do not follow substantive questions. I had to call to order Members on the Government side yesterday for not following the question. This is an opportunity for me to
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remind all hon. Members that the substantive question has to be followed in the supplementary. Thank you for raising that.
Mr. Ian Bruce: On a point of order, Madam Speaker. Some months ago, I tried to find out from the Registrar of Members' Interests—I have written to the people concerned, as you would wish—whether the use of a blind trust for financing the Leader of the Opposition's office would be acceptable. It was made very clear to me that that would not be acceptable under the existing rules. Therefore, I wrote to the Prime Minister's office, pointing out to him that Sir Trevor Chinn, Sir Emanuel Kay, Sir Alex Bernstein and Bob Gaveron were all named, known and admitted contributors to the Prime Minister's blind trust. This morning, it was suggested that Mr. Max Mosley and Mr. Bernie Ecclestone were also contributors to the blind trust.
My point of order is that I have written to the Parliamentary Commissioner for Standards, pointing out that all that information is available. I have had a letter from the Prime Minister's office saying' that it knows about the information and that it had passed to the political honours scrutiny committee the names of those who had given money to the blind trust. Yet all that information—
Madam Speaker: Order. What is the point of order for me?
Mr. Bruce: The point of order concerns how we can get the Select Committee on Standards and Privileges to investigate what is clearly a breach of our rules. It brings the House into disrepute, because it is alleged that money is changing hands to gain the Prime Minister's influence.
Mr. Dennis Skinner: Further to that point of order, Madam Speaker. Whatever you do in response to the request from the hon. Member for South Dorset (Mr. Bruce), do not send the matter to the committee that I wanted to set up when the Tory party took £440,000 from that crook Asil Nadir. You know, Madam Speaker, that I raised that issue in the House 20 times. I wanted committees; I wanted investigations; I wanted the Tory Government to send the money back to all the shareholders in Mr. Nadir's company—but what happened? The Tories kept the money and used it in the general election campaign. The British people said, "That money stinks and we are going to kick the Tories out." My party sent the money back.
Madam Speaker: Order. These are not points of order. I recognise them only too well as political point scoring, and I will have no more of them. The hon. Member for South Dorset (Mr. Bruce) knows that we have procedures to deal with the matter he raised. He should raise it with the Parliamentary Commissioner for Standards and not on the Floor of the House.
Mr. Ian Bruce: But Madam Speaker—
Madam Speaker: Order. I have had enough.

Regulation of Wet Bikes
3.36 pm
Mr. Gareth Thomas: I beg to move,
That leave be given to bring in a Bill to regulate the use of wet bikes; and for connected purposes.
I shall begin by defining the term "wet bikes", which has caused some confusion, and then refer to the nature and scale of the problem caused by these machines and the mischief that the Bill is intended to address. I shall also outline how my Bill will achieve its objectives.
I shall relieve the suspense of many hon. Members and explain that the term wet bikes is interchangeable with jet skis and personal water craft. Jet skis are a proprietary name for a well-known brand of wet bike. Suffice it to say that these craft—we all know what they are because they are an increasingly visible and, I am afraid, audible feature of our coasts—are equipped with very powerful petrol-driven engines. They suck in water and blow it out in the form of a jet at the rear; hence the name jet skis. They are capable of generating up to 135 brake horsepower and great acceleration up to 65 mph. They also generate a great deal of noise.
A particular feature of wet bikes, of which there are about 15,000 in this country, is the ease with which they can be used, which means that many users do not always acquire a sense of the danger inherent in the machines. Kawasaki's top-selling bike costs £7,500, and there is a significant and increasing market in used machines.
It is a surprising fact that, at present, there is no age restriction for the use of the machines. There is nothing to stop a five-year-old using one; there is no national requirement for insurance; there is no national proficiency test; and there is no system of national registration, either of the machines or of their users. In short, there is a glaring absence of consistent and rational regulation, and the danger posed by these machines calls for such regulation.
Wet bikes are a potential danger to all other water users—bathers, yachtsmen, water skiers, surfers, canoeists and children at play—in both coastal and inland waters. The bikes are also a danger to their riders.
Accidents have occurred across the country. This summer, there were two tragic fatal accidents. On the weekend of 10 August, Fay Grundy, aged 17, was fatally injured at Queensford lake, Oxfordshire. She was riding as the pillion passenger on a wet bike that strayed into the path of a boat pulling a water skier. Two weeks later—off the north Wales coast, in the constituency of the right hon. Member for Caernarfon (Mr. Wigley)—a 25-year-old nurse from Rochdale died after her Kawasaki wet bike was involved in a head-on collision with another bike.
Wet bikes are very noisy, and they can ruin people's enjoyment of our coastline and inland waters. In the wrong hands, they pose a threat also to the balanced environment of our estuaries and to the feeding grounds of rare birds.
Furthermore, a significant delinquent element uses the bikes. A police constable from the Essex police force marine unit was recently quoted as saying:
"Sometimes there are 50 or 60 in one area, like yobs teeming round on motor bikes. They buzz swimmers, buzz boats and zip in and out of moorings. It is a catastrophe looking for somewhere to happen."
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There is an increasing body of opinion among local authorities, police forces and those involved in the activity that the public interest now demands that there should be national regulation of wet bikes. My hon. Friend the Member for Hampstead and Highgate (Ms Jackson), the Parliamentary Under-Secretary of State for the Environment, Transport and the Regions, is in the Chamber, and I am very grateful to her for coming to hear my speech. Although I know that her Department is working on solutions, it is time to grasp the nettle and to regulate.
In the United Kingdom—as a reflection of our long nautical history—there is a tradition of minimal regulation of private pleasure craft. Nevertheless, under the various public health Acts, harbourmasters and local authorities can introduce byelaws to prevent danger, obstruction and annoyance of bathers. Moreover, the approach of the Government, and of their predecessor, has been to be sceptical of national regulation; Governments generally have tended to rely on byelaws. There are, however, problems with byelaws.
As those who have been involved in local government well know, the process of enacting byelaws is lengthy, complicated and expensive. Byelaws are difficult to enforce and, significantly, they will do nothing to deal with the real problem of non-registration, making it very difficult to ascertain the identity of culprits or transgressors when they misbehave on bikes.
The byelaw system has produced an inconsistent pattern of regulation in an area where consistent statutory standards are essential. Despite the lightness of the legislative approach in this sphere, 1 propose that a special case should be made for wet bikes—because of their speed, the ease with which they can be used and the injury and damage that they can cause.
I propose, first, establishing a national registration system and requiring that every machine prominently displays its registration number, thereby dealing with the problem of locating the delinquent element.
Secondly, there should be a compulsory system of third-party insurance. Thirdly, there should be a compulsory national training scheme and a licence system for users, which I hope would be self-financing. Fourthly, there needs to be a minimum age requirement of 16. Fifthly, there should be a ban on the use of wet bikes on environmentally sensitive areas of our coast and on beaches traditionally used for bathing, as well as on rivers, reservoirs and lakes within our national parks that are subject to the right of navigation.
I commend the Bill to the House. It would make a modest but much-needed change to the law and would be manifestly in the public interest.
Question put and agreed to.
Bill ordered to be brought in by Mr. Gareth Thomas, Mr. Dafydd Wigley, Mr. Martin Caton, Dr. Peter Brand, Mr. Gordon Marsden, Mr. Gwyn Prosser, Mr. Ronnie Fearn, Mrs. Betty Williams, Mr. Chris Ruane, Mr. John Gummer, Mr. David Hanson and Mr. Andrew Mackinlay.

Regulation of Wet Bikes
  REGULATION OF WET BIKES
  Mr. Gareth Thomas accordingly presented a Bill to regulate the use of wet bikes; and for connected purposes: And the same was read the First time; and ordered to be read a Second time on Friday 6 February, and to be printed [Bill 79].
Orders of the Day

  Bank of England Bill
  [Relevant documents: First Report from the Treasury Committee on accountability of the Bank of England (HC 282) and the minutes of evidence taken before the Treasury Committee on Wednesday 5th November (HC 309).]
  Order for Second Reading read.
  Mr. Tim Loughton: On a point of order, Madam Speaker. I should be grateful for some clarification. When, in May, the Chancellor made the statement that gave rise to today's debate, the proposal was billed as one of the most important economic measures since the war. As the measure purports to occasion the abdication of such a major responsibility from the Treasury to the Bank of England, is it in order for the debate to be led not by the Chancellor himself but by the Chief Secretary? Is it not customary for holders of high office at least to be in at their own abdication, even if Opposition Members believe that it is a case of premature abdication?
  Madam Speaker: It is not a matter for me which Minister handles the legislation. There is collective responsibility.
  3.46 pm
  The Chief Secretary to the Treasury (Mr. Alistair Darling): I am not sure who the hon. Gentleman is, but when 1 find out I might perhaps deal with the matter.
  I beg to move, That the Bill be now read a Second time.
  The Bill is a further step in our determination to modernise the British economy and to equip this country for the new global economy of the future. First, it gives the Bank of England operational independence to set interest rates to meet the Government's inflation target. It will do so through the most open, accountable set of procedures of any central bank in the world.
  The Bill implements the first stage in our promise to modernise and reform the supervision and regulation of the United Kingdom's financial services industry—it spells the end of self-regulation and sets up the new Financial Services Authority, which will enjoy the confidence of consumers and the industry alike. That will give London and the UK industry as a whole a huge competitive advantage.
  Ms Diane Abbott: Will my right hon. Friend explain how one can modernise the British economy by going back to arrangements that we last saw under Montagu Norman in the 1930s?
  Mr. Darling: If my hon. Friend will bear with me, I shall set out exactly how we do that and how the various parts of the Bill will modernise our procedures and institutions.
  The Bill underpins our economic approach, which is to secure long-term stability and the promotion of high and stable levels of growth and employment. It enshrines our
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  commitment to increased openness and accountability, which, in turn, will lead to the enhanced credibility in monetary policy that the world now demands.
  Mr. Llew Smith rose—
  Mr. Dafydd Wigley rose—
  Mr. Darling: I shall give way in a moment.
  The Bill will provide the stable platform that business and the country need, and it will increase confidence in this country's commitment to low inflation in the future.
  I have to give way to one hon. Member at a time, and I think that my hon. Friend the Member for Blaenau Gwent (Mr. Smith) is first.
  Mr. Llew Smith: As we have now passed responsibility for interest rates to the Bank of England, if the rate that the Monetary Policy Committee sets brings about stable prices but creates unemployment, what powers will the Government have? If we join a single currency and hand over even more powers to the European central bank, what powers will the Government have if unemployment rises?
  Mr. Darling: There are two points there. First, we are not joining the single currency this afternoon. That is for another day. Secondly, my hon. Friend must accept that, in the long term, the only way to achieve high and sustainable levels of growth is to ensure price stability and low inflation. I know that some people believe that it is possible to have high inflation and high levels of employment, but I do not accept that.
  Our proposals will give us the necessary long-term stability that has eluded us in the past to enable us to have the high levels of growth and the job opportunities that we all want. I think that the right hon. Member for Caernarfon (Mr. Wigley) would like to intervene on the same point.
  Mr. Wigley: I would indeed. The Bill gives overriding priority to maintaining price stability. Growth and employment are subject to that. That differs from the approach in the United States, where the Federal Reserve has inflation, growth and employment as targets of equal importance. The Government should not make employment subsidiary to the control of inflation, which appears to be the god on all occasions.
  Mr. Darling: The right hon. Gentleman is mistaken. Clause 11 shows that the Government's objectives are high levels of growth and employment.
  Mr. Wigley: The Bill says, "subject to that".
  Mr. Darling: The right hon. Gentleman is reading it the wrong way round. The Bank's objective is to maintain price stability, but that is in support of the Government's objectives of growth and employment. It is not possible to have high and sustainable levels of growth, together with the levels of employment that we all want, without ensuring price stability in the first place. We have had to pay a high premium over the years because of the political

  713
  risks that the markets attach to this country. That is why we have suffered instability and boom and bust, undermining the platform that we all want.
  Mr. Peter Bottomley rose—
  Mr. Darling: I should like to make some progress and then I shall give way. 1 shall come back to that point. If the hon. Gentleman can contain himself, I should be happy to let him in shortly.
  Low inflation is an essential precondition to achieving the Government's objectives of high and sustainable levels of economic growth and employment. Inflation hits business, discourages investment and, therefore, hits jobs. It is also bad for savers and pensioners. This country has paid a heavy price for successive booms and busts. The previous Government delivered two of the deepest recessions since the war, partly because of their misjudgments. Because of that legacy, our long-term interest rates are higher than they should have been, and higher than those in many of our competitor countries. We know that, business knows that, the whole country knows that.
  Mr. Malcolm Bruce: The Government have now agreed in principle on the policy of preparing for entry to monetary union. Given that the Bank can operate short-term interest rates only on the terms that the Chief Secretary has already outlined, what will the Government do to bring about convergence on short-term interest rates before preparing the ground for possible entry?
  Mr. Darling: The thrust of the Government's policy is to achieve stability so that we can have long-term growth and low inflation. That will allow us to compete and converge with other European economies. Regardless of monetary union, the policies outlined by my right hon. Friend the Chancellor in his Budget, coupled with the Bill, will be good for the country and good for business. It happens that it is in the country's long-term interests to ensure stability between ourselves and our competitor countries. The Bill will achieve that.
  Mr. Peter Bottomley rose
  Mr. Darling: To stop the hon. Gentleman, I shall certainly give way.
  Mr. Bottomley: I am grateful to the Minister for allowing me to ask a question, rather than to stop me. During the next two or three years—to the middle of this Parliament—does the right hon. Gentleman expect that the major gap between interest rates in the United Kingdom and those in countries planning to be in the first wave of economic and monetary union will stay the same, increase or reduce? Is it simply a matter for the Bank of England, or do the Government estimate that economic and financial considerations will come together to produce a reduction in the interest rate gap?
  Mr. Darling: I am not sure that I follow what the hon. Gentleman is saying. The Government's objective is to ensure that interest rates are as low as possible, but we cannot do that until we take the necessary action to get
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  inflation out of the system. The new framework in the Bill will not only deliver low inflation, but generate greater confidence in long-term decision making in Britain, which will lead to lower interest rates still.
  We have already seen some of the benefits. Britain's long-term interest rates fell immediately following the Chancellor's announcement of 6 May. Since then, they have remained nearly a full percentage point lower, so we have already seen the gain.
  In the modern economy, markets will demand increasing openness and transparency in decision making, and that is one of the purposes of the Bill. They will want to know that the Government—and any future British Government—are fully signed up to low inflation and have the determination and the institutions to see that commitment through. Most people will recognise that there can be no return to the old ways of monetary targets announced and abandoned—sometimes quietly and sometimes not so quietly—of nods and winks, and of decisions taken behind closed doors that characterised much of the past 18 years.
  Instead, there is a new way. The responsibilities of the Chancellor and the Bank are clearly set out, and no one is in any doubt about the Government's policy and our commitment to low inflation. The Bill will enable us to deliver that objective. We have an opportunity to usher in a new era of stability and a platform on which to build for the future. That will be good for the country and for business.
  Mr. Christopher Gill: As the House knows, the Government are committed in principle to entering a single currency. Has he not observed that, on previous occasions when Britain has been part of fixed exchange rates—during our membership of the exchange rate mechanism in 1990-92 and during our membership of the gold standard in 1925-31—interest rates rose to an inappropriate level? It was only when we left those fixed exchange rate mechanisms that interest rates fell away and economic activity recommenced. Would it not be rash to take us back into fixed exchange rates with the risk that, once again, interest rates will rise to a wholly inappropriate level?
  Mr. Darling: I know that the hon. Gentleman and some of his hon. Friends are obsessed with all matters European, but it is worth reminding him that, during much of the 1980s, when we were not part of a fixed exchange rate, interest rates were extremely high. In 1979, the rate of interest reached 17 per cent., in 1981, it was 16 per cent. and in 1985, it was 14 per cent. Inflation was also high. In 1980, it reached 21 per cent. That had nothing to do with the fixed exchange rate. It had rather more to do with the way in which—
  Mr. Eric Forth: It was a Labour Government.
  Mr. Darling: If I am not mistaken, Lady Thatcher was Prime Minister in 1981 and in 1985, but perhaps Opposition Members would prefer to forget that.
  The hon. Member for Ludlow (Mr. Gill) mentioned our economic policy. Let me remind the House of what we have done in the six months since we won the election. We have begun to deliver the key measures that we believe will build prosperity in future.

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  First, we are committed to economic stability and low inflation. In our manifesto, we said that we would reform the Bank of England to ensure that decision making on monetary policy was more effective, open and accountable, and free from scope for political manipulation. We are delivering that promise with the Bill.
  Secondly, my right hon. Friend the Chancellor announced in his Budget the deficit reduction plan, cutting the high borrowing requirement left by the previous Government from —22.75 billion last year. We need to achieve stability in public finances so that we can meet our priorities for education, higher investment, health and long-term fiscal stability.
  Thirdly, in the comprehensive spending review that I announced in the House on 11 June, we will deliver sustainable public finances and we will be able to reshape and set the Government's spending priorities.
  Fourthly, we are removing barriers to growth and removing inflationary pressure. We are expanding our economic capacity, and thus generating the right climate for high levels of investment. That is why we cut corporation tax in the Budget—to the lowest level ever. We are modernising the welfare state, and investing in skills and education so that we can expand the capacity of the economy.
  Fifthly, we are committed to open markets and to constructive engagement in Europe, as the Chancellor and the Prime Minister have made clear. We are preparing the country for the future because we put our national economic interests first. Business knows what is good for business, even if the Tories do not.
  The Bill marks another milestone in our determination to modernise Britain's economy. We are creating a modern Bank which will meet the new requirements of the 21st century in a global economy in which clarity of purpose is essential.
  Mr. Kenneth Clarke: A few moments ago, the right hon. Gentleman seemed to imply that he did not expect that conflict would ever occur between the objectives of low inflation, growth and higher employment. Does not the Bill contemplate that such conflict might arise? It states that the pursuit of growth and employment can be followed by the Bank of England, but subject to the overriding requirement to hit the inflation target.
  I agree that low inflation normally goes with high employment, the creation of jobs and low unemployment, but we all know that economic shocks can hit countries. Circumstances can arise in which, in the short to medium term, hitting the inflation target can be damaging to the levels of unemployment and of growth. Why is responsibility handed to the Bank with a legal injunction that the inflation target should always be pre-eminent—in all circumstances and at all times in the future?
  Mr. Darling: I appreciate that all former Chancellors of the Exchequer have to defend their position, especially those from the recent past, but I am sure that the right hon. and learned Gentleman agrees that, in the long run, it is not possible to achieve high levels of employment if we have high levels of inflation. We are agreed on that. I shall return shortly to the provision in the Bill to which he refers, but it is clear that, if the inflation target will
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  not be met—for example, because of a shock—and the Monetary Policy Committee has to take the necessary steps to reduce inflation, it has to have regard to the Government's policy for growth and employment to temper what it might otherwise be tempted to do.
  The formulation, as I am sure the right hon. and learned Gentleman knows, is common in most independent central banks. The objective is clear—the Bank has to maintain price stability and meet the inflation target set by the Chancellor of the day. In fixing its interest rate structure, the Bank also has to have regard to the Government's overall economic policy. As the right hon. and learned Gentleman said, there is sometimes a tension between the two in the short term, but—in the long term—unless we have low inflation we will not have the high levels of growth that we all want.
  I shall move on to the responsibility of the Government, as opposed to that of the Bank, because the Bill sets in place a clear division of responsibility. The Chancellor sets the target for price stability and he will do so every year. The target announced by the Chancellor earlier this year provides a more rigorous, open and precise definition—a target of 2.5 per cent., which is a constant target. The Bank, for its part, has the responsibility for achieving that target and maintaining the long-term price stability that I mentioned. It must also support the economic policy of the Government, including their objectives for growth and employment. Therefore, the Bank and the world at large will be clear about its objective of stability in support of the objectives of growth and employment.
  The composition of the Monetary Policy Committee itself will ensure a broader base of decision making than in the past. No one individual can dominate. It will be a blend of experience from the Bank and outsiders appointed by the Governor and the Chancellor for their knowledge and experience. The decisions will also be free from party political manipulation. The interests of the country will come before the interests of the party of government, especially one about to face an election. Decisions will be made with the long-term interests of the economy in mind.
  The Bill ensures that there will be a level of accountability that we have not seen in practice before, not just to the Chancellor, but to Parliament. The Bill proposes three elements that will achieve increased accountability.
  First, the MPC must meet rigorous reporting requirements. It is required to announce all its interest rate decisions immediately. Minutes of each meeting will be published and, if there is a vote, the voting record of each member will be recorded.
  The Bank's quarterly inflation report will be put on a statutory basis for the first time. That is another instrument of accountability and one of the principal ways in which the explanations of the MPC can be assessed and be subject to scrutiny outside the Bank. The House will have ample opportunity to scrutinise the Bank through the Treasury Select Committee, which now has far greater responsibility. The Bank will be held to account, and the Committee has already made it clear that it will expect MPC members to appear before it.
  Mr. Forth: The right hon. Gentleman is introducing the element of accountability, and it is at least arguable

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  that his definition is correct and valid—that merely reporting to another body involves accountability. Some might say that true accountability would involve the ability of another body to remove those who make the wrong decisions. Is he prepared to take the risk that, if those making the crucial decisions get them wrong—not just once, but repeatedly—nothing can be done to affect their position or to remove them, particularly by the House of Commons?
  Mr. Darling: The right hon. Gentleman has been a Member longer than I have and he might agree—when he is in a less partisan mode—that there have been many occasions when Members of all parties have wondered whether the doctrine of accountability has fallen by the wayside. In the previous Parliament and the one before, I cannot remember any Minister resigning because of policy failure. They might have resigned for other, extraneous reasons, but not very often for policy failure.
  The Chancellor is accountable to the House, which can express its displeasure with him or her on any appropriate occasion. The MPC will, in practice, be more accountable and answerable than ever before. The MPC must account for its decisions, and it will appear before the Select Committee, which is able to pass any judgment it thinks fit. The House will have an opportunity through a debate—certainly once a year, but also in other economic debates—to make clear its views. Until now, we may have had theoretical accountability in relation to the policy of price stability and interest rates, but it has not always been so. Through the Bill and other measures, we are setting in place a system of accountability that, frankly, has not existed until now.
  Ms Abbott: On the question of accountability and the use of the Treasury Select Committee as a medium, the Bank already gives evidence to the Select Committee several times a year, and it is not expected that it will appear more often. If the Government were serious about making the MPC accountable to Parliament, would they not have made it possible for the Treasury Select Committee to hold confirmatory hearings of the MPC?
  Mr. Darling: My hon. Friend will know that the Select Committee has made that recommendation. When I appeared before it last week, I made it clear that the Government have an open mind on the matter, but I also made it clear that I thought that the Committee could discharge its obligations and responsibilities to hold the MPC to account whether or not it had those powers. I do not regard the Committee's having those powers as an essential precondition to its holding the MPC to account.
  For the sake of completeness, I said also that, were the House to decide to go down that road, I would find it difficult to see how it could confine confirmatory hearings to simply the MPC. After all, Ministers appoint many people who have influence not only in economic fields, such as the regulators, but in other, sometimes controversial, areas—the head of the Prison Service, for one. We have an open mind on the matter, and the House will need to consider it in due course.
  Mr. Giles Radice: I thank my right hon. Friend for his favourable response to the Select
  718
  Committee report in which we envisage seeing the Governor of the Bank of Englanda—nd members of the MPC—a great deal more.
  Mr. Austin Mitchell: Terrorise them.
  Mr. Radice: Terrorism is not necessarily the best way of enhancing accountability.
  My right hon. Friend says that it is a question of considering the issue of confirmatory hearings across the board, so would he be prepared to refer it to the Select Committee on Modernisation of the House of Commons?
  Mr. Darling: As my hon. Friend knows, I do not have the power to refer the matter to the Modernisation Select Committee, but I undertake to discuss it with my right hon. Friend the Leader of the House.
  Sir Michael Spicer: Can the Chief Secretary confirm that his definition of an open mind was to say that in Committee he would reject any amendment to provide for a measure such as we have been discussing?
  Mr. Darling: I said that I thought that it would be difficult for the Government and the House to come to a concluded view on whether confirmatory hearings would be desirable, not only here but across the board, by the time that the Bill goes to Committee, which, if it achieves Second Reading at 10 pm tonight—I would not want to anticipate anything—will be fairly shortly. I think that my open mind is maintained.
  Several hon. Members rose—
  Mr. Darling: I shall give way again shortly, but I should like to make some progress.
  Before we leave the subject of the Select Committee, the point should be made that the very fact that all the information is published and the discussions are open will in itself create far greater accountability. There is far more interest in these matters than ever before, and that is a direct result of our determination to modernise the decision-making process.
  Secondly, I want to spell out the procedure to be followed when the Bank misses its inflation target, because hon. Members have asked me about it.
  Mr. Nick Gibb: Will the Chief Secretary give way?
  Mr. Darling: I want to develop the theme just a little, and then I will let the hon. Gentleman intervene.
  The Chancellor has laid down a new procedure whereby, when the Monetary Policy Committee believes that inflation is more than 1 per cent. higher or lower than the target, the Bank will be required to publish an open letter explaining why the inflation target has failed to be met and what action it intends to take to get back on target. Again, there is a new clarity and transparency.
  The Bank must set out why, in its view, the target was missed; what action it has taken; how long it will take to get back on target; and, importantly, how the measures that it proposes are consistent with its monetary policy

  719
  objective of price stability and its duty to support the Government's growth and employment objectives. The Monetary Policy Committee will be forced to reveal in public the action that it proposes to take to get back on target. The procedure is open and, therefore, accountable.
  Thirdly, there will be increased accountability through reform of the Bank's constitution.
  Mr. Peter Lilley rose—
  Mr. Darling: I am looking forward to this, because perhaps, for the first time in six months, the Opposition will tell us whether they oppose the principle of the Bill.
  Mr. Lilley: I shall certainly tell the Chief Secretary about that in my speech.
  How would the House exercise accountability if we thought that the Bank was proposing to reach its target either too rapidly or too slowly, and how would the Government, if they reached the same conclusion, influence the Bank's decisions?
  Mr. Darling: It is nice to know that, if nothing else, the Conservatives are now the champions of the House, which is something that I had not noticed in the past 10 years. The Bank will explain its position in its letter and can be held to account. The Chancellor can respond to what the Bank says, as indeed can the House, through the Treasury Select Committee or, if appropriate, a debate on the Floor of the House.
  The very fact that so many people have the opportunity to comment, inside the House and out, brings to bear far greater pressure and influence than have ever existed before. Fundamentally, as the right hon. Gentleman knows, the Chancellor is accountable to the House. If the House believes that the Chancellor is failing, it can make its views known.
  Part I gives an enhanced role to the non-executive directors of the Bank, who will ensure that the Bank performs its functions effectively and manages its resources efficiently. There will be a new post for a senior member who will lead the non-executive directors. They will review the Bank's performance, including, under clause 16, the procedures of the Monetary Policy Committee, and publish a report each year.
  There are three measures, all new, that add up to far greater accountability than we have ever had before in practice.
  Mr. William Cash: The right hon. Gentleman made much play of accountability and mentioned that we could have a debate on any failings in the system as and when they occur. Given that the Government will ultimately control the questions that lie at the heart of the Bill, does he agree that there is a strong case, if things go awry, for having a free vote in the House?
  Mr. Darling: I understand why the hon. Gentleman wants free votes. I was under the impression that he has always exercised the right to a free vote, especially on European matters. He should take the matter up with his Whips, if he is on speaking terms with them.
  Part I also makes provision for the Bank's finances, to ensure that they are on a secure foundation for the future. The House is probably aware that the Bank has long been
  720
  funded by a voluntary arrangement from the banking sector. We are putting the main features of the existing scheme on a permanent statutory basis. It is therefore appropriate that all those who benefit from price stability and the Bank's role in the financial system should pay—building societies as well as banks.
  With the transfer of banking supervision to the new Financial Services Authority, there is an opportunity to look at the overall impact on the financial sector of charges. We want to ensure not only that regulation is effective but that the costs are fully justified. For that reason, we are consulting on the cash ratio deposit scheme during the passage of the Bill. I want to make it clear that the intention is that the overall cost to the financial sector should be no greater than before, and preferably less. Both the Bank of England and the Financial Services Authority will bear down on the costs to the industry, and therefore on the costs that have to be borne by the public.
  Part III transfers banking supervision from the Bank of England to the new single regulator, the Financial Services Authority.
  Mr. Gibb: Before moving to part III, can the right hon. Gentleman point out where in the Bill there is any mention of the Treasury Select Committee? Are we to rely on its existing powers and the letter from the Chancellor to its Chairman of 6 May?
  Mr. Darling: The hon. Gentleman is new to the House. The powers and constitution of Select Committees are a matter for the House, and, quite rightly, not for the Government of the day. The House decides what powers the Treasury Select Committee or any other Select Committee should have.
  Part III is the first step of a much wider reform that we promised and is the result of four years of consultation when we were in opposition. As the House knows, the Government are drafting a financial services reform Bill that will finally lay to rest the discredited system of self-regulation and put in place a regulator with clout and with respect at home and throughout the world.
  Two weeks ago, we launched the Financial Services Authority, which has taken over from the Securities and Investments Board. Nine existing regulators will be replaced by only one. Yet again, we are delivering on our promises. The previous Government talked about cutting red tape; we are doing it.
  Mr. Lilley: Does the right hon. Gentleman agree with these comments about that approach:
  "A blanket approach, the creation of a 'super-regulator', won't do. I know that it makes for convenient shorthand but the idea that if all the regulators are rounded up and put into one building then we will have a system that will solve all our problems simply won't wash"?
  Mr. Darling: The right hon. Gentleman should be wary of quoting selectively from my speeches. I recognise the passage. If he cared to quote the entire speech—I do not expect him to do so this afternoon, but perhaps he could if he is on the Standing Committee—he would find that I was talking about a sudden and immediate change. We propose a gradual change.
  The first stage is in the Bill—the banking supervisory functions discharged by the Bank of England are being transferred to the Financial Services Authority. It will

  721
  gradually take over the work of the existing self-regulatory bodies and, ultimately, that of the Department of Trade and Industry's insurance division which is at present the responsibility of the Treasury on an interim basis. Ultimately, those will all come together.
  If the right hon. Gentleman reads that and other speeches that I have made on the subject in the past four years, he will realise that we always had it in mind that we wanted to bring together the regulators in a manageable way as the distinctions between the areas in which they work became increasingly blurred. Interestingly, although I have been speaking for about 25 minutes, we have yet to hear whether the Opposition are for or against the Bill.
  Mr. Keith Vaz: I welcome my right hon. Friend's proposals for the independent supervision of banks. He will not be aware of this, but in another part of the House today a meeting was taking place of the former depositors with the Bank of Credit and Commerce International. He knows that in 1991, when that bank closed, our right hon. Friend the Chancellor of the Exchequer, who was then in opposition, made a strong and impassioned plea for an independent supervisory system. Does he hope that, as a result of these moves by the Government, there will be greater scrutiny of banks to prevent a repeat of the sort of tragedy that occurred for the victims of BCCI?
  Mr. Darling: I have great sympathy with what my hon. Friend says. Part of the problem with the self-regulatory system that existed in the 1980s was that, in many cases, the regulators turned a blind eye to what was going on. Certainly, in the case of pensions mis-selling, the industry knew that it was going on, but the regulators chose to do nothing about it.
  On banking supervision, my hon. Friend will know that we have made a number of suggestions over the years to improve the situation following the collapse of BCCI and then Barings. As I shall shortly outline, we have taken further steps to ensure that one of the problems that emerged with both BCCI and Barings—that each regulator did not know what the other was doing—will be dealt with. He is right to say that bringing the regulators together will not merely have the advantage of getting rid of a cumbersome and expensive system that is fundamentally flawed in concept, but will ensure that regulation is complementary to the business process and not a hindrance. That will give consumers and the public alike the confidence in the integrity of the system that is lacking.
  In the week in which the new FSA came into existence, recognising the fact that the industry transcends political and geographic boundaries, it signed a memorandum of understanding with the Securities and Exchange Commission and the Commodity Futures Trading Commission in the United States.
  As my hon. Friend will know, the collapse of both Barings and BCCI showed that it is necessary to have a domestic regulator that has sufficient clout and reputation to deal with its international counterparts. That will now be possible with the new FSA.
  As with the second part of the Bill, the objective of the reform is to enhance transparency and improve accountability, through a simpler framework for the
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  industry, and to have a new system that recognises that the industry is changing fast. As I said, the traditional boundaries between banks, insurance companies and building societies have become increasingly blurred and, with most institutions offering a wide range of financial services, the world has moved on. Regulatory reform was inevitable and, indeed, it is what the industry and the public want.
  The old system was far too fragmented and it was very costly, whereas the new system will deliver better regulation. The unprecedented scope of the powers of the FSA will, of course, ensure a better co-ordinated approach. It will also have a specific duty to root out bad practice and financial crime—something which is necessary if we are to ensure that the United Kingdom continues to enjoy its international reputation in financial business for clean markets and fair dealings. Our standard of living and the long-term future of this country depend on that market. The FSA will be at the cutting edge of improving regulation and supervision here and throughout the world.
  Of course, the Bank of England retains responsibility for the stability of the financial system, as my right hon. Friend the Chancellor made clear, but the Bill transfers the supervisory functions to the FSA and, in due course, the Department of Trade and Industry staff responsible for insurance regulation will join the FSA, along with the other self-regulating bodies. That process is already under way, thanks to a great deal of hard work by the staff of the various regulators. The change will be manageable and, at all times, the staff of the FSA will ensure that they keep their eye on the ball and retain a firm grip on day-to-day events in the marketplace.
  As I told my hon. Friend the Member for Leicester, East (Mr. Vaz), we have announced a further step in the modernisation of the system of regulation. We believe that there must be clear divisions of responsibility between the Treasury, the Bank and the FSA, and we have set those out in a new memorandum of understanding that was signed by the Governor, by the chairman of the FSA and by my right hon. Friend the Chancellor two weeks ago. A copy is in the Library. The memorandum is based on principles of clarity, transparency, elimination of duplication and regular exchange of information between the three institutions. It also establishes a standing committee which will meet regularly to ensure an appropriate and co-ordinated response to any future failure or collapse.
  Finally, part IV contains two additional measures. First, the Bill makes provision to improve the efficiency of the gilts market, so that we can cut costs; secondly, it provides for the modernisation of the central money markets office to allow the market to work with computer records alone. Those measures will not only reduce costs, but strengthen London's position as an international financial centre.
  As I move toward the conclusion of my speech, the official Opposition have yet to let us know where they stand. They did not tell us when my right hon. Friend the Chancellor made his statement to the House in May. At least on the question of Europe, we know where they stand—or at least where some of them stand—and we know that they have a policy that has put them on a collision course with business, which knows that the

  723
  national economic interest must come first. Indeed, I noticed in The Sunday Telegraph that the shadow Chief Secretary to the Treasury said:
  "The CBI is bad news for British industry".
  There we have it: the Conservative party does not think much of what business thinks.
  What is the Opposition policy on the Bank of England? I have searched long and hard over the past few weeks to find a single word from the shadow Chancellor, but I have found nothing. We might have hoped that there would be an amendment before us today that spelled out the Conservative party's position, but there is nothing.
  When the shadow Chancellor replies to the debate, perhaps he will answer the two central questions relating to this issue that any respectable Opposition must answer. First, does he support the decision to give operational responsibility to the Bank of England—yes or no? [Interruption.] Secondly, if he does not—as some Opposition Members are mumbling—will he follow the logic of that position and pledge that, at the next election, the Conservative party will campaign to repeal this Act, as the Bill will be by then? Can he answer that, yes or no? We would like to know and business wants to know the answer to those fundamental questions. The whole world—or perhaps only the Conservative party—awaits his reply.
  In just a few short months, the Government have made significant reforms to the institutions and practice of economic policy in this country. We have new fiscal rules and a five-year deficit reduction plan and we have introduced major corporate tax reform, a windfall tax on the privatised utilities and a new deal for young people and the long-term unemployed. We reformed the financing of higher education, and we have a new £1.3 billion capital fund to rebuild schools. We have a UK action plan for employment and flexibility in Europe, and we introduced tough legislation on competition policy. We have a new structure for financial regulation and we have given operational independence to a reformed Bank of England.
  That is just the start—there is more to come, including the pre-Budget report later this month; capital gains tax reform; consultation on the new individual savings account; the Taylor review of taxes and benefits; the Low Pay Commission report on the minimum wage, and more. The Government are committed to reform and modernisation, and we are delivering. We have taken those decisions because we know that they are right for this country. We have demonstrated our clarity of purpose and our commitment to stability with an open and accountable central bank. Yet again, we have shown that we are preparing this country for the future, at home and in Europe. We are making the tough decisions and putting in place the institutions to deliver economic stability and growth, so that everyone can share in higher living standards and greater job opportunities in future. I commend the Bill to the House.
  4.28 pm
  Mr. Peter Lilley: The handling and contents of the Bill reflect four of the Government's most worrying characteristics. The first is their contempt for the parliamentary process. The Chancellor could not be bothered to wait to inform the House of what the Prime Minister described as
  "the biggest step in economic policy-making since world war two",
  724
  and instead announced it when the House was not sitting. Nor does he even deign to introduce the Bill himself—a Bill that hands away his most important responsibility. He will not even speak at his own abdication.
  Secondly, the principal components of the Bill show a cavalier disregard for assurances given a few months before the election. On 7 February 1997, the Chancellor said the following about giving the bank independence:
  "I believe that any consideration of whether to give the Bank operational responsibility for setting interest rates must be preceded by two steps",
  one of which is that
  "the Bank must demonstrate a successful track record in its advice and build greater credibility."
  Mr. Ross Cranston: Will the right hon. Gentleman give way?
  Mr. Lilley: I will in a second, but I thought that the Chancellor might want to intervene and explain what track record was established in the first four days of this Parliament that enabled him to set aside an assurance given authoritatively to the British people not long before the general election, but perhaps the hon. Gentleman can give me information that the Chancellor seems reluctant to give the House.
  Mr. Cranston: Can the right hon. Gentleman tell the House what the Conservative party, if returned to government, would do about the Bill? Would it repeal it?
  Mr. Lilley: I can tell the hon. Gentleman in detail my position on the principle, and I will tell him my response to that and all such questions, which I have given previously: we will never give a knee-jerk commitment from the Dispatch Box to repeal decisions taken by the Government until we prepare our manifesto. We shall not get into the position that the Labour party did by endlessly promising to repeal things and then not doing so.
  Mr. Geraint Davies: Does the right hon. Gentleman agree with the former Chancellor, Norman Lamont, that the Conservative party should agree with its principle, and should go ahead and support the Government?
  Mr. Lilley: I shall explain that in two minutes with great clarity, if the hon. Gentleman will allow me to complete my point.
  Mr. Darling: Will the right hon. Gentleman give way?
  Mr. Lilley: All right.
  Mr. Darling: It would help the House if the right hon. Gentleman would confirm a point. Do I take it from his answer a moment ago that he is saying that the Conservative party will not, therefore, campaign to repeal the Bill if it is enacted?
  Mr. Lilley: The hon. Gentleman has heard me say before, and will hear me say again, that we will give no knee-jerk commitments to repeal Bills passed by the House, even if we oppose them. Shortly before the next general election, we shall consider which measures the

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  Government have undertaken that we can afford to repeal, amend or retain, and we shall do so then, not piecemeal during this Parliament. That is the sensible and responsible thing to do.
  The other aspect of the Bill is the establishment of a "super-SIB", and that too is in flat contradiction of statements by the Chief Secretary, as I exposed earlier. He had previously said that the creation of a super-regulator would not do, and he actually had the cheek to say that he was fulfilling a promise by bringing all the regulators together in one.
  The third weakness of the Government exemplified by the Bill is their penchant for making glib, headline-grabbing statements and announcements without thinking through the substance first. They announced the Bank's quasi-independence, then decided to deprive it of responsibility for banking regulation, nearly precipitating the Governor's resignation. They have also had to chop and change their inflationary target and its form, and the Bill is littered with consequences that, manifestly, the Government have not thought through, as I shall explain.
  Finally, the Bill is yet another example of the Government's desire to remove power from the House and from elected representatives and give it away to appointed officials. They want to escape the blame for difficult decisions, and they want to remove any influence from Labour Back Benchers, whose demands for higher spending and laxer policy have wrecked every previous Labour Government.
  That brings me directly—
  Mr. Steve McCabe rose—
  Mr. Lilley: If I may make some progress, the hon. Gentleman may find that I answer the question that he has been prompted to ask.
  That brings me to the central issue of the role, accountability and independence of the Bank and of the Chancellor of the Exchequer. I shall explain where we stand on that issue. Conservatives have always been the enemies of inflation, because inflation harms the poor and the weak. Moreover, we have realised for far longer than Labour Members that inflation is essentially a monetary phenomenon. We have always believed that the Bank of England, through interest rate and funding policy, plays a key role in controlling inflation.
  As long ago as 1977, in the seminal work—which I know the Chancellor has committed to memory—"The Right Approach to the Economy", the party said that we favoured a more independent role for the Bank of England. A range of views were held then—and have been held since—about how much and what sort of independence the Bank should be given. We spelled out in practice the type of independence that we thought right in the final years of our Administration.
  The right hon. Gentleman may wish to remind me that, in November 1988, the then Chancellor, now Lord Lawson, drew up his specific proposal for giving the Bank operational independence. Although I was a very junior Minister at the time, I had some responsibility for banks, and I was therefore the only Minister consulted about the proposal before it went to the Prime Minister. The view that I expressed then to the Chancellor is that which I hold
  726
  now: the proposal has obvious attractions in reinforcing the battle against inflation, but it is difficult to square it with our system of parliamentary government.
  It is right to give the Bank the independence and the authority—which we did subsequently—to offer the sort of advice that Chancellors cannot easily refuse by publicising its views and its minutes, by making its inflation report independent of the Treasury, and so on. We have done that effectively.
  However, controlling inflation by interest policy is a technical matter that cannot simply be handed over to a group of experts. It involves considerable discretion, and that discretion affects people's livelihoods, their jobs, the value of their savings, the viability of their businesses and the burden of their debts. Such matters are absolutely central to the whole political debate, and they are crucial to the electorate. Whoever takes those decisions must be answerable to the House, and, through us, to the voters. Someone must carry the can—and that person should be the Chancellor.
  Mr. Malcolm Bruce: The right hon. Gentleman described the Bank of England's decision to put up interest rates last week as a "kick in the guts". The inflation figures were released today. Who does he think was right? What would he have done, and how would he have justified his actions?
  Mr. Lilley: I certainly would not have introduced the sort of Budget that, in light of the Bank of England's statements, made increases in interest rates inevitable if the Chancellor failed to take the Bank's advice.
  Mr. Darling: The right hon. Gentleman seems to have moved from the position where he appreciated the attractions of Lord Lawson's memorandum to the then Prime Minister. He has said that, because of what he regards as parliamentary sovereignty, he cannot support the principle of giving operational responsibility to the Bank of England. How does he square that view with the commitment he gave a few moments ago that he will have to wait and see if it works? If he opposes the move on principle, surely the answer must be beyond doubt—as it is for him on Europe.
  Mr. Lilley: The right hon. Gentleman keeps trying to make policies on principle without telling us what the principles are. Accountability is very important. The Chancellor should accept responsibility for important matters such as people's jobs, and the value of their savings and their debts. We cannot accept his attempt to try to escape the blame for taking difficult decisions.
  Whatever the views on either side of the House about delegating the Chancellor's responsibilities to an independent Bank, the Conservatives cannot support a Bill that transfers those powers to a Bank that has been made deliberately less independent.
  The Monetary Policy Committee that will set interest rates will have nine members. No fewer than seven of those will be appointed by the Chancellor, and even the other two will be appointed by the governor
  "after consultation with the Chancellor of the Exchequer".
  Moreover, they will be appointed for just three years. Members of the Bank's court will have their term reduced to three years. No other central Bank in the world, to my knowledge, has its directors appointed for a term of office shorter than the life of the Government who appoint them.

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  I am not suggesting that the worthy men and women appointed to the monetary policy committee and the court will all take instructions from the Chancellor.
  Mr. Geraint Davies: Will the right hon. Gentleman give way?
  Mr. Lilley: I will in a moment, if the hon. Gentleman will forgive me. I am not suggesting that members of the monetary policy committee will take instructions directly from the Chancellor, but we should recall what has happened elsewhere. Professor Gowland records in an interesting book published by Politeia that at the Federal Reserve in America the chairman appointed by Nixon was so anxious
  "to facilitate Richard Nixon's re-election in 1972"
  that it
  "took precedence over all other objectives. He was apparently prepared to manipulate interest rates at the President's request."
  No one suggests that anyone on this side of the Atlantic would give in to such pressures, but those appointed by a Chancellor on short-term contracts might be eager to secure re-appointment, and people would not have faith in their genuine independence. That must undermine the credibility and real independence of the Bank.
  Ms Abbott: I know that consistency is an over-rated virtue, but if the right hon. Gentleman is against independence for the Bank of England in principle, he ought to be reassured that the Chancellor will ostensibly have so much power over the monetary committee.
  Mr. Lilley: The worst of both worlds would be a bank that was influenced by the Chancellor, but for which he would not take responsibility to the House. That is precisely what he is creating through the Bill. I am grateful to the hon. Member for Hackney, North and Stoke Newington for giving me the opportunity to make that point, and for her considerable contributions on the subject, which I have read with great interest.
  The very least that we will demand if the Bill is passed is the lengthening of terms of tenure and the ratification of all appointments by the Select Committee, as recommended in its excellent report. We believe that the Bank should have independence to offer advice, which the Chancellor would find it difficult to refuse. That independence should be clear, visible, laid down in law and enshrined in the terms of appointment and tenure of members of the court and the Bank. We do not believe, however, that the Chancellor should escape his ultimate responsibility for final decisions on interest rates.
  Mr. Jim Murphy: It is appropriate that the right hon. Gentleman should give way at the point when he is discussing short-term contracts and security of tenure. If his performance does not improve in this debate and others, perhaps that is what we will be talking about this afternoon.
  728
  You said earlier that it would be sensible not to rule anything out and not to give any commitments. Why then, on the single European currency, are the Opposition committing themselves not for one term of office, but for two? Is that sensible or senseless?
  Mr. Deputy Speaker (Sir Alan Haselhurst): Order. May I remind the hon. Gentleman that at all times he is addressing the Chair, not the Opposition?
  Mr. Lilley: The answer is that the Government have already begun to campaign for entry to the single European currency in the next Parliament, and we have begun to campaign against it. That is sensible in the circumstances. It has nothing to do with the repealing measures taken by the Government in this Parliament.
  Mr. Malcolm Bruce: Will the right hon. Gentleman give way on that?
  Mr. Lilley: On that, or on the subject of the debate?
  Mr. Bruce: The right hon. Gentleman said at the beginning of his speech that the Bill hands away the Chancellor's most important responsibility. If that is what he believes, should he not be taking it back, not seeking to create an independence that is irreversible?
  Mr. Lilley: We want the Bank to be independent, and those who are members of the court to be independent in offering advice, not in operational control of interest rates. That is the system which we had established in the previous Parliament, and it was working well. The question is whether it would work better as a result of the changes that the Government propose.
  I agree with my right hon. and learned Friend the Member for Rushcliffe (Mr. Clarke) that the system manifestly was working well. It has given us the longest period of low inflation for half a century—almost 60 months below 4 per cent. By the end of the previous Parliament, it enabled the previous Chancellor to hit his inflationary target of 2.5 per cent. on the button. That is the key part of the golden economic legacy that the previous Government bequeathed to this one.
  If a system works, after half a century of failure, we are reluctant to tear it up and make substantial changes. If it ain't broke, don't fix it.
  Mr. Charles Clarke: The right hon. Gentleman was discussing the manipulation of interest rates a few moments ago. Does he concede that the former Chancellor, the right hon. and learned Member for Rushcliffe (Mr. Clarke), was involved in precisely such manipulation of interest rates before the general election, and that the system set in place by the Bill would prevent Chancellors from conducting such political manipulation?
  Mr. Lilley: I refer the hon. Gentleman to the speech by the hon. Member for Hackney, North and Stoke Newington, in which she said:
  "In May 1995,"
  the
  "then Chancellor refused to accept the Governor's advice … Two years later, we know that the former Chancellor's judgment was correct … he consistently called the economy right more times than Eddie George."

  729
  The hon. Lady is right. Over that period, we had the opportunity to see that my right hon. and learned Friend was right. His judgment has proved impeccable, and it is clear that the present Chancellor does not believe that he could emulate the success of my right hon. and learned Friend.
  Mr. Kenneth Clarke: I am grateful to my right hon. Friend for that tribute on the policies on which we agreed before the election. Is he aware that his clear description of the desirability of a monetary committee being entirely independent to give advice to the Chancellor is Labour party policy from the last general election? Its 1997 business manifesto stated:
  "For the Bank of England, we propose a new monetary policy committee to decide on the advice which the Bank of England should give to the Chancellor."
  How could a reputable Opposition change their mind so dramatically four days after the election, and now attack the shadow Chancellor for adhering to their former views?
  Mr. Lilley: I entirely agree with my right hon. and learned Friend. It is alarming that the Government intend to make the Bank less independent, as well as giving it different responsibilities. That is a serious matter, which we shall continue to criticise during the passage of the Bill.
  Mr. Clifton-Brown: Is not the danger of the Government's proposals that a Chancellor such as my right hon. and learned Friend the Member for Rushcliffe (Mr. Clarke), who has good judgment, was able to prolong the economic cycle, whereas a Chancellor who has no judgment at all has to hand over weighty decisions to an independent governor? Bankers are always cautious. The proposal is therefore likely to be deflationary, and will have the effect of shortening the economic cycle. Is not that a considerable danger?
  Mr. Lilley: That fear is shared on both sides of the House, although evidently not on the Government Front Bench. I shall deal with that in due course.
  Many hon. Members on both sides argue that several other countries, which have a longer track record of low inflation than we do, have independent central banks, but I believe that independent banks are as much a symptom as a cause of low inflation.
  The German Bundesbank is independent and able to take tough action without losing its independence because Germany has experienced two periods of hyper-inflation. That has created an inflationary culture. It is worth remembering that the Reichsbank had independence in the early 1920s, but that did not prevent the hyper-inflation then.
  Britain has now developed an anti-inflationary culture. That is partly a reaction to the near-hyper-inflation under the previous Government, when money lost a quarter of its value in a single year—[Interruption.] I am sorry; I mean the previous Labour Government. I am grateful to the Chancellor for reminding me that we achieved the best inflationary record in half a century.
  The anti-inflationary culture in Britain is also the result of the demise of the Keynesian illusion that was prevalent among the opinion-forming class in Britain—the belief
  730
  that monetary demand was the cause of economic growth. Even the Labour party leadership—the last group to learn—now accepts that inflationary demand brings no extra growth in the long term, and may even damage the underlying potential.
  The more the detailed proposals set out in the Bill have been examined, the more are the concerns that have been expressed—concerns which many of my right hon. and hon. Friends share. Alas, few of these concerns were addressed by the Chief Secretary. I hope that the Economic Secretary, if the hon. Lady is to reply, will valiantly cover these matters.
  A key concern is whether an independent bank, even a quasi-independent one as is proposed, will have a deflationary bias, as my hon. Friend hon. Friend the Member for Cotswold (Mr. Clifton-Brown) suggested. We are all agreed that inflationary finance cannot generate sustainable jobs and growth; indeed, it may even undermine them. A deflationary bias, however, would be even more destructive of jobs.
  The primary duty of the Bank in the terms of the Bill is to meet its inflationary target. It is my understanding that that overrides its secondary responsibility to support the Government's economic policy, including their objectives for growth and employment. The Chief Secretary seemed muddled on that, and tried to obfuscate the issue. The Bill is clear, however, as the hon. Member for Gordon (Mr. Bruce), the Liberal Democrat spokesman, said.
  Will the Chief Secretary confirm that, if there is a conflict between the inflationary target and the Government's other policies, the inflationary target will take precedence? The right hon. Gentleman cannot confirm that, but it is set out in the Bill. In those circumstances, the Bank is bound to start by trying to demonstrate its anti-inflationary machismo. We have considerable faith in Eddie George—that is not because I discovered recently that we both went to the same direct grant school—because he seems to be aware that there is a real economy as well as a financial system. I am sure, therefore, that he would not deliberately drive the economy into a slump.
  It is worth remembering, however, that the blame for the slump in the 1930s has been laid at the door of the then newly independent Federal Reserve Board. Robert Chote, the economic correspondent of the Financial Times, in an excellent Social Market Foundation booklet, quotes a study that shows that countries with independent banks have suffered deeper recessions than those without them.
  Central banks with the same independence as the Bank of England has before the Bill comes into force have suffered output losses averaging about 5 per cent. of national output in each recession. Those banks with the independence that the Bank will have as a result of the Bill have suffered output losses averaging at least 10 per cent. of national output.
  The hon. Member for Hackney, North and Stoke Newington (Ms Abbott) made a most thought-provoking speech in a recent debate. She reminded us that the reason Labour gave for nationalising the Bank of England in 1945 was that it allegedly played a deflationary role in the inter-war years. I hope that such historic episodes will prove irrelevant. It is just possible, however, that we are approaching a more deflationary era.

  731
  It is said that generals are always busy preparing for the previous war, and it would be tragic if our economic leaders were trying to create a solution to the problems of the past 50 years of inflation when the risks may lie in the opposite direction. The Government should give much thought to that before they finalise the Bill.
  The Bill separates off the Bank from the Treasury, and strips out a number of functions from the Bank, with no clear evidence that the consequences have been thought through.
  How will the Government co-ordinate fiscal and monetary policy? They clearly failed to do so in the recent Budget. Before the Budget, the Bank clearly indicated that, if the Government curbed consumer spending, interest rates need not rise. However, the Chancellor of the Exchequer put almost all his extra tax burden not on consumer spending but on savings, through his pensions tax. That having happened. the Bank immediately resumed raising interest rates.
  That is an example of the danger that Robert Chote, in his excellent pamphlet, presciently spelled out, when he wrote:
  "One danger"—
  Mr. Darling: A straw.
  Mr. Lilley: The right hon. Gentleman may think that Robert Chote is a straw, but I think that he made a cogent case in his Social Market Foundation pamphlet, as did Professor Gowland in his Politeia pamphlet.
  Robert Chote wrote:
  "One danger is that the economy will suffer if the Bank uses interests rate policy to pursue low inflation while the Government uses budgetary policy to pursue employment, growth and votes. This is a recipe for high interest rates, excessive Government borrowing and an overvalued exchange rate."
  I hope that the Economic Secretary will tell us how the Government intend to resolve that possible conflict in future better than they did recently.
  Mr. Geraint Davies: The right hon. Gentleman seems to be in favour of the principle of independence, but has produced a litany of reasons why we should be against it. Is he against independence? Is he against the interests of business as expressed by the Confederation of British Industry, the Institute of Directors and the Federation of Small Businesses?
  Mr. Lilley: The hon. Gentleman should perhaps read my speech, so that he will be able to take it in word by word.
  The Bill will hive off debt management to a new quango under the Treasury. We know that funding policy is an intrinsic part of monetary policy, and the Bill will leave the Bank as a one-club golfer without even a putter left in the bag. How will the Treasury, the Bank and the new board co-operate to handle monetary policy? If they need to get together, why is it necessary to separate them in the first place?
  With the removal of banking control to the Financial Services Authority—the "super-SIB"—it is difficult to see how and whether the Bank remains, as it surely must, responsible for ensuring the liquidity of the banking system and preventing systemic collapse.
  732
  What happens if the needs of the banking system conflict with those of the inflationary target? That has happened in the past in the United States, and it could conceivably be happening in Japan. I understand that there is a suggestion that a committee is to be established to work between the Bank, the FSA and the Treasury to try to cope with that sort of problem. If that is necessary, why is it necessary to hive off powers in the first place?
  That brings me to the creation of the FSA as a super-SIB. The Bill is only part of the process, but it will on implementation directly conflict with pre-election statements. More importantly, concerns expressed by the Chief Secretary when in opposition may, although he has disowned them today, prove well founded.
  The coverage of the FSA will be huge: its objectives will be many, and potentially in conflict with one another. The range of its activities will be so diverse that no one person in it will understand them all. Its structure will be as complex as those of the organisations that it replaces, if not more so. Practitioner involvement is likely to diminish, and costs are likely to escalate as salaries are equalised upwards.
  We have no objection to the objective of trying to bring greater simplicity and one-stop shopping to the business of financial regulation, but we fear that the Government may, almost casually, have bitten off more than they can chew. The process of setting up the FSA may cause regulators to take their eye off the ball, while spivs and crooks have a field day. We shall observe closely what is going on in the development of the proposed legislation.
  Through the Bill, the Chancellor of the Exchequer seeks to create a Bank with a duty to pursue an inflation target set by the Government, and to accommodate other Government policies. The members of the Monetary Policy Committee will be appointed by the Government, and it will, albeit only in a reporting sense, be accountable to Parliament. If need be, the Government, with the assent of Parliament, will be able to override the committee's judgment. We may approve or disapprove of these arrangements, but we can agree that it may claim to be, as the Chancellor asserted in his statement, a British solution to meet Britain's needs.
  The paradox is that, no sooner had the Chancellor published his British solution, than he announced that he wanted to sweep it away in a few years' time and replace it with a European solution to meet Europe's needs.
  The European solution is, of course, rather different from what the Chancellor thinks is right for Britain's needs. The planned European central bank has no inflation target laid down by a democratically elected Government—still less a Government responsible to the House. Only one of its directors will be British, and he or she will take an oath that they will act not in Britain's particular interests but in the interests of the whole. It will not be accountable to any Parliament or Government, least of all Britain's Parliament or Government. Nor will any Government—certainly not the British Government—be able to override its judgment if they think that the national interest requires it.
  Some hon. Members may prefer the approach laid down in the Maastricht treaty to that laid down in the Bill, but it is clear that the Chancellor of the Exchequer does not. If he did, he would have modelled his Bill on the Maastricht

  733
  paradigm. Can he or the Chief Secretary tell the House why they did not do so? May we assume that they considered their approach superior to the Maastricht model?
  Mr. Darling: We introduced the Bill because we thought that it was good for the British economy, regardless of whether this country joins the single currency. Notwithstanding what the right hon. Gentleman is saying about the single currency, does not the logic of his position lead him to exclude this country ever joining the single currency, because of the principles he holds?
  Mr. Lilley: The position of the Chief Secretary may well result in that conclusion, because, if he says that measures based on the principles in the Bill are right for Britain, how can he say that different measures based on different principles in the Maastricht treaty are also right for Britain? Why did he not answer that question? Why did not the Government model the Bill on the Maastricht paradigm? Because they believe that the measures in the Bill are superior. Why, then, do they want to trade in the Bill in a few years' time for the Maastricht independent central bank?
  Mr. Darling: I wonder why the right hon. Gentleman cannot answer the question that I put to him. The logic of his position on the single currency is that the Conservative party would never ever join the single currency. Is not that right?
  Mr. Lilley: The logic of our position is that we can influence only one Parliament—the next Parliament—at a time. The logic of the right hon. Gentleman's position is that, by signing a treaty—[Interruption.] The next Parliament is the one that we will influence, when we are in government. The right hon. Gentleman, by treaty, wants to rule out, for all future Parliaments, this country ever having its own currency, its own independent central bank, its own monetary policy. It is he who is taking a decision for all time. Those who do not want to determine our policy by treaty can do that only in one Parliament at a time.
  Mr. Darling: Which Parliament?
  Mr. Lilley: The Parliament at which we intend to get elected. We did not win in this Parliament, I regret to say, so we have no influence over this Parliament—we have only limited influence, unless we get the support of the hon. Member for Hackney, North and Stoke Newington, and teams of her cohorts and colleagues in voting down the Bill tonight. It is a badly drafted, ill-thought-out and potentially damaging Bill.
  Mr. Geoffrey Clifton-Brown: Did not that little exchange demonstrate precisely the position of Members of Her Majesty's Government? They have not realised yet that they are in government, and that is why they are having to give away these powers to the Bank of England.
  Mr. Lilley: It may be that. I can think of only one saving grace in the Bill: it will take decisions away from
  734
  a Government in whom I have very little confidence, and whom in the few months they have been in office have chalked up a pretty deplorable record.
  Until the Bill becomes law, the Chancellor is, in law, personally responsibly for all the decisions on monetary policy that have been taken in this Parliament. Every interest rate rise so far is his personal responsibility. He cannot blame the bank, because it is no more than his adviser, so five Labour interest rate rises so far are at his door.
  The reason why the Bank of England has used its quasi-independence to put up interest rates is because the Chancellor failed to curb consumer spending by encouraging people to save their building society windfalls. Instead, he taxed savings with his pensions tax. For the fifth successive month, he has missed his inflation target, as we heard today.
  Mr. Geraint Davies: Will the right hon. Gentleman give way?
  Mr. Lilley: No, I have given way to the hon. Gentleman already, and I am drawing to a close.
  Today's figures reflect first and foremost the impact—
  Ms Ruth Kelly: Will the right hon. Gentleman give way?
  Mr. Lilley: No, I shall wind up, if I may.
  Today's figures reflect first and foremost the impact of the Chancellor's interest rate rises, which are feeding through to mortgages and the retail price index. His Budget added, by his own calculation, 0.8 per cent. to the retail price index directly.
  The Bill is a product of a Government who should be ashamed of their short-term record; who are afraid to take the blame for difficult decisions; who are afraid of their own inability to judge the interests and needs of the British people; who are afraid of their own Back Benchers and wish to deprive them of power. It is a bad Bill, badly drafted and badly motivated. We will not let the Government escape their responsibility. We will vote against the Bill.
  5.5 pm
  Mr. Denzil Davies: One can say that the most controversial part of the Bill—we heard this in the speeches from my right hon. Friend the Member for Edinburgh, Central (Mr. Darling) and from the right hon. Member for Hitchin and Harpenden (Mr. Lilley)—must be part II. For part II of the Bill seeks to transfer the power to fix short-term interest rates, to conduct monetary policy and, in effect, control inflation, from an elected Chancellor of the Exchequer—who is directly answerable to the House, and through us in the House to the people—to the non-elected officials of the monetary policy committee of the Bank of England.
  Fundamental economic decisions that can affect the livelihood of our constituents, be they mortgagors, savers, business people, the unemployed, will be taken out of the domain of an elected Government and elected Parliament. In that regard, economic policy will be taken out of politics. My right hon. Friend the Chief Secretary calls it modernisation.

  735
  The implied message, so far as I can see, that is sent to our constituents by the Chancellor's decision to transfer power is clear: "Don't trust us with your money. We are just politicians. We are Chancellors, Prime Ministers, Ministers, Members of Parliament, politicians, but don't trust us with your mortgages. Don't trust us with your money. Don't trust us with inflation. We cannot be trusted to protect the value of your currency." That is the unappealing implied message that comes, I am sorry to say, from the Chancellor's decision.
  We are elected to the House. We enjoy the trappings of power. We obtain from time to time, from the taxpayer. the resources necessary to do our job. Sometimes we complain that we do not have enough. However, when it comes to a tough—that word is used very often these days—decision about money, and no decision is tougher than that to raise or reduce interest rates, I am sorry to say that we abdicate our responsibility and hand over our responsibility as politicians to a non-elected body.
  Why stop with monetary policy? What about fiscal policy? I listened to my right hon. Friend the Chief Secretary explain how wonderful the new system of accountability would be—how it would be far superior to what we have at the moment. Why not transfer all the Chancellor's powers—that is, what powers he has left? Why not transfer his fiscal powers to a board? Let us call it an Exchequer board, and because it is a board, let us give it a president. An Exchequer board would determine taxation, because if we cannot be trusted with monetary policy, how can we be trusted with taxation policy? Let us shift it all. Indeed, we could move on to the Department of Health, to education. Why not transfer all the power to boards, so that we have that marvellous system of accountability and modernisation that my right hon. Friend tells us about?
  It is no exaggeration to say that it was something of a surprise when my right hon. Friend the Chancellor announced a few days after the election that this was to be done. It was a surprise to the City—obviously a pleasant surprise, as the City— approved of the decision—and it was a surprise to most of the financial journalists to whom I have spoken. It has been said—although I am sure that it was a scurrilous accusation without foundation—that it was a surprise to most members of the Cabinet. I do not believe that. However, it was certainly a surprise to most of those who fought the election as Labour party candidates.
  Mr. Andrew Tyrie: Is the right hon. Gentleman aware that giving independence to the Bank so quickly was a complete breach of a clear pledge made by the Prime Minister when he was Leader of the Opposition? In a speech in 1995, he said:
  "We will … watch the track record of the Bank before deciding what, if any, steps should be taken towards greater operational responsibility for the Bank in interest rate policy."
  Mr. Davies: That point has already been made in the debate. Rather than refer to speeches made in opposition, I intend to consult the sacred text of the manifesto.
  Mr. Tyrie rose—
  Mr. Davies: No, I will not give way to the hon. Gentleman again.
  736
  Part II of the Bill was not an express term, as we lawyers describe it, in that covenant with the people on which the Prime Minister fought and won the election. Since the announcement, some Treasury Ministers have tried valiantly to reinterpret the text. While their efforts might gain fairly high marks in a school of sophists or a college of casuists, they are not really credible. It is clear that the move was not part of my party's policy.
  I will satisfy the hon. Member for Chichester (Mr. Tyrie) by quoting from the business manifesto, which is the most sacred text of all. The right hon. Member for Hitchin and Harpenden referred to it in an intervention. It says:
  "We propose a new monetary policy committee to decide on the advice which the Bank of England should give to the Chancellor."
  Nothing could be clearer than that. However, this Bill is not about advice: it is about power and the transfer of power from the Chancellor to the monetary policy committee of the Bank of England.
  Not only was the decision a surprise; it was a contradiction of other areas of Government policy. The thrust of policy—of which I entirely approve—has been and is the greater devolution of power from bureaucracy to democracy. That is one reason why we will establish a Parliament for Scotland and an Assembly for Wales, give greater democracy to the regions of England and have a mayor for London. In all those matters, the whole thrust of Government policy has been to transfer power from bureaucracy back to democracy, where that is possible within the modern state. Now the very heart of Government—the very heart of decision making—is going in the opposite direction and transferring power from democracy to bureaucracy.
  This debate takes place against the background of another increase in interest rates. It is tempting for all of us to wonder whether that decision was correct. I shall resist the temptation. I do not know whether it was or was not the right decision. What I do know—and what surprises me—is that some of the bizarre criticisms of the Bank of England have come from financial journalists who actually support the transfer of power from the Treasury and the Chancellor to the Bank of England.
  I want to quote part of one article in The Guardian last Friday, in which Mr. Alex Brummer wrote:
  "The danger of giving the Bank of England operational independence always was that it would show an inflationary bias".
  I should not talk about rugby after a Saturday when Llanelli was trounced by the All Blacks, but accusing a central bank of showing inflationary bias is like accusing the All Blacks of a try-scoring bias. Inflationary bias is what central banks are about, especially modern central banks. A long time ago, they were concerned with the external value of the currency, but it was at a time when currencies were not floating. The banks have now moved on to another pitch—the internal value of the currency. Inflation targets are being set, but they were not around when the Federal Reserve or the Bundesbank was established.
  The new pitch for power of the central banks is to have an inflationary target—we have it—and then shoot at the target and pretend that somehow interest rates will enable us to hit it. Central banks are about inflationary bias. Mr. Brummer obviously has not read the Bill—or if he has, he has read it in the same way as the Chief Secretary has read it, which is an incorrect way. Clause 11 clearly

  737
  states that the task of the Bank is to maintain price stability—or, in Mr. Brummer's language, to give an inflationary bias. Only subject to that is the Bank to support the Government's economic policy, including the objectives for growth and unemployment.
  That is exactly what is in the Maastricht treaty. I do not want to go down the same road on Europe that the right hon. Member for Hitchin and Harpenden rather foolishly followed. We shall have other opportunities to discuss that. The Maastricht treaty is exactly the same as clause 11—although not in words, as it is more elegantly drafted. It, too, says that the first duty is price stability—subject to that, high employment, apple pie and everything else can be considered. The Bank is being asked to make inflationary bias its priority, as The Guardian said. Of course, questions of growth and employment should be taken into account as part of all these matters.
  I happen to believe that it is wrong to divide fiscal policy and monetary policy. There is no evidence to show that it improves matters. Indeed, there is evidence from Germany just after reunification, and from the United States when President Reagan was pursuing a Keynesian economic policy, that, if there is too loose a fiscal policy, the Bank will over-compensate and have too tight a monetary policy.
  I am old-fashioned. I believe in democracy, but I also believe that decisions on fiscal policy and monetary policy cannot be divided. When we are considering growth and employment, decisions should be made by the elected representatives of the people who have to face elections. That may be old-fashioned, but it is the most sensible way to deal with these matters.
  I have great respect for my right hon. Friend the Chancellor and I hold him in high regard—that is not just a form of words—but he has been too hasty with this decision. It was not necessary to make the decision, and it was the wrong decision. For that reason, I regret that I shall not be able to join him in the Lobby this evening.
  5.18 pm
  Mr. Kenneth Clarke: It is a pleasure to follow the right hon. Member for Llanelli (Mr. Davies). I agree with a substantial number of his points. In fact, he is probably a more severe critic of the Bill than I am. He gave an absolute reason, in his opinion, for voting against it. He referred to a central point, which my right hon. Friend the Member for Hitchin and Harpenden (Mr. Lilley) also pursued—but which, astonishingly, was not mentioned by the Chief Secretary—which is that the Bill contradicts everything that the Labour party said throughout its period in opposition up to the time of the election, and in the manifesto on which it fought the election.
  Labour Back Benchers intervened a number of times in my right hon. Friend's speech. They looked at their bleepers and were obviously told to ask us whether we will commit ourselves to repealing the Bill in five years' time. My right hon. Friend the shadow Chancellor replied admirably to those interventions. After today's vote, we shall be faced with a fait accompli; in four or five years' time, we shall have an opportunity to see whether our fears were justified. Nevertheless, I disapprove of the way in which the change has been implemented and the remit that has been given to the Bank, and I will be quite content to vote against the Bill today.
  738
  The Government have not remotely explained why it took them only four days to eat every word that they pronounced on the subject when they were in opposition. Six months after the general election, we are perhaps getting rather accustomed to that style, as there have been rather more events since then that are in line with their peculiar approach to Government.
  Before the new Parliament was assembled, hon. Members had no opportunity to engage in serious debate on the matter with our constituents, with the general public, with financial commentators or with the business world. Then, with a bang and a flash, the Chancellor—in his first few days of dynamic and, as he always says, "modernising" action—announced to the House that he had a totally different policy towards the Bank of England, which he would include in this Bill.
  Mr. Tim Boswell: Just like that.
  Mr. Clarke: As my hon. Friend says, a bit like that famous magician, "just like that." The Chancellor pulled it out of his hat, and we are now debating the Bill.
  If the Labour party, now the Government, were minded to contemplate marching towards the past by granting a greater degree of independence than the Bank has enjoyed in recent years—as the hon. Member for Hackney, North and Stoke Newington (Ms Abbott) said, we have had experience in the United Kingdom of independent banks—I should prefer the formulation, to which they must now cling, that was occasionally given by both the Chancellor and the Prime Minister when they were in opposition: occasionally hinting that they might contemplate giving independence to the Bank of England after it had established a good track record. As hon. Members have already said in this debate, the Bank had no track record in four days of Labour government.
  I do not criticise the Bank. I worked well and constructively with it, and it is not a form of words to say that I had an extremely high regard for Eddie George and his colleagues in the Bank of England and for the advice that they gave me, even if I did not always agree with it. I was never savagely out of step with them in the advice that they gave me. With respect, however, I cannot say that they have an impeccable track record. They certainly do not have a good track record of inflation forecasting.
  I was rather dismayed by the extent to which the new Chancellor relied on the fact that the inflation forecast showed the need for instant action. In some of the minutes that the Bank now publishes, the Monetary Policy Committee keeps referring to the Bank's inflation forecast. We must have inflation forecasts. With the greatest respect, however, in recent years, the Bank of England has not been very good at forecasting inflation. The Bank has always overestimated the likely upside inflation risk—which is why the right hon. Member for Llanelli said that it has a deflationary bias. The Bank always fears the worst and reacts accordingly, which is what will cause damage. That is what I fear.
  Since the proposals were made, my reservation has been that, over the next few years, we will have a greater deflationary bias in policy. I fear that the Monetary Policy Committee—anxious to prove its anti-inflation credentials—will go in for overkill. If the committee does that and over-insures, to ensure that it establishes a reputation for hitting the inflation target, the price will be

  739
  paid by the general public. If the committee merely slows down growth but growth continues, we will sacrifice some of the extra jobs and rising living standards that we might otherwise have enjoyed. If the committee goes in overly for overkill, it will cause perhaps unnecessary damage to the daily lives of those working in the economy.
  Some independent banks have a better track record and very high respect in their countries. They have acquired a track record of taking a wider view of affairs. The Bank of England and the new Monetary Policy Committee have not yet satisfied me that the committee, on its track record, is the same type of beast as the Bundesbank, not to mention the Federal Reserve in the United State of America. Quite rightly, those bodies pursue price stability and low inflation, sometimes with targets that have been set for them. But they also take a view of the wider economic picture.
  I share what my right hon. Friend the shadow Chancellor described as the Conservative belief in the virtues of low inflation. I believe that creating in the UK a climate of permanently low inflation is a very desirable objective, and that it would be a big change in our culture. I do not believe, however, that hitting an inflation target should override every other consideration of economic policy in all circumstances and at all times. I tried to be a real-economy Chancellor, and I think that the House should require that the authorities deal with the real economy and take a slightly wider view.
  Mr. Malcolm Bruce: The right hon. Gentleman's views on the matter are well known. Is he telling the House, however, that, among his decisions, he accepts no responsibility for the inflationary pressures that have led the Bank to make its current decisions? Does he really believe that, throughout, he has been right and the Bank has been wrong?
  Mr. Clarke: Yes, I do. I think that the Bank is wrong today.
  The right hon. Member for Llanelli—who has been a Treasury Minister—was very wise to be cautious in his estimates of where one goes. One will not know, for about 18 months to two years, whether the judgment made on interest rates on a particular day was correct. One may never know the answer, because so many supervening events ensure that one can never guarantee that an inflation target is hit to the exact decimal point.
  It would have been a fluke if, before the general election, I had delivered a final inflation figure of 2.4 per cent. I aimed, however, to get it below 2.5 per cent. Although the hon. Member for Gordon (Mr. Bruce) gets very excited about today's 2.8 per cent., I am rather pleased with the inflation record of the past three or four years, combined with falling unemployment and high economic growth. The Liberals, and certainly the Chancellor, would be a little reckless in talking about some mythical belief that the previous Government relaxed control before the general election.
  In 18 months to two years, when the first full effects of the Government's decisions are apparent, we shall see how they are getting on in achieving a combination of economic growth, falling unemployment, lower inflation and the generally benign conditions that are required to produce steady growth with low inflation. Neither I nor, I think, any Opposition Member denies that low inflation
  740
  is an extremely important part—perhaps one of the most important parts—in achieving those conditions, but it is only a part of what should be the aim of macro-economic policy.
  It should never be forgotten—it is amazing how frequently it is forgotten in the discussions of commentators—that any democratically elected Government should pursue only one end in economic policy: to attempt to achieve higher living standards, low unemployment levels and improved employment prospects for the general population, whom we serve.
  If low inflation is usually helpful in producing that end, low inflation is very important. However, one should not draft a Bill—as this Bill is plainly drafted—stating that, if some momentary circumstance or shock presents a dilemma in which strict pursuit of the inflation target might damage prospects for growth and employment, the independent Bank should be legally obliged to agree that the inflation target takes priority over growth and employment.
  At the general election, the Labour party would have had a very animated debate indeed if it had made a statement about handing over that power to the Monetary Policy Committee of the Bank of England. All that I recall in the general election, however, was a lot of stuff about going up league tables and the inadequacy of our record on growth and employment—matters that seem to have vanished from the Bill.
  My fear is that the Bill is designed to encourage the extremely good Monetary Policy Committee to go for overkill. All the members of the committee are excellent and I have no criticism of any of them, although it is noticeable that several of them are Bank employees. The majority are from the Bank, while the independent people are appointed by the Chancellor, so these people are drawn from a fairly small circle.
  The Monetary Policy Committee is already demonstrating that tendency to go for overkill. There have already been five interest rate increases since the general election. The first was ordered by the Chancellor on the day that he made his announcement; the committee announced three successive increases in the following months. It also clearly flagged up the fact that it was going to continue to raise interest rates. I think that that was foolish, and particularly that it drove the value of sterling to a level that is causing considerable damage, which has a marked effect on our exports. Having paused for three months, as it said it would, and having considered the evidence, the committee yesterday raised interest rates by a further 0.25 per cent.
  These are difficult decisions. The hon. Member for Norwich, South (Mr. Clarke) alleged that after Christmas of last year I had somehow suspended economic judgment and was simply being driven by politics in not following the Bank's advice. I totally refute that. I printed the minutes. I do not believe that putting up interest rates by a quarter per cent. between Christmas and the general election would have cost one vote. [Interruption.]
  The phrase "Iron Chancellor" was one that I used to claim for myself. I would probably have made the same noises as the present Chancellor, saying that I had raised interest rates to make sure that we avoided boom and bust and that we had stability. The Chancellor has taken all that stuff from speeches of mine made three or four years

  741
  ago. I would have repeated it and it would have been accepted. However, there was an underlying policy dilemma that has not gone away.
  Mr. Charles Clarke: Will the right hon. and learned Gentleman give way?
  Mr. Kenneth Clarke: Yes, as I mentioned the hon. Gentleman.
  Mr. Charles Clarke: Does the right hon. and learned Gentleman believe that, if the Bill had been in force in the first part of the year while he was still Chancellor of the Exchequer, the interest rates would have been the same as they were?
  Mr. Kenneth Clarke: No, they would not. We would have fought the election after several interest rate increases. By the time the election came, we would probably have had the four or five that we have had now. My point is that they would have been wrong. Such increases imposed in that way were unnecessary.
  The hon. Gentleman looks incredulous. He is obviously a natural supporter of the Bill. He looks incredulous at the idea that I am suggesting that the Bank might be mistaken. "Could the Monetary Policy Committee ever be wrong?" is the hon. Gentleman's reaction. He finds it shocking that I could suggest that. In his eyes, I have no doubt committed the great sin of not only rejecting the advice to raise interest rates but then publishing the fact that I rejected it, publishing the advice and giving my reasons for doing so. Those reasons were economic. That was my acknowledgement of accountability to the House and a resistance of short-term political pressures.
  Mr. Charles Clarke rose—
  Mr. Kenneth Clarke: I will give way in a moment, but I must explain the dilemma. It is possible that these decisions are debatable; it is also possible that the eight wise men on the Monetary Policy Committee are getting it wrong, could get it wrong in future and should not be allowed carte blanche.
  At the moment we have a most uneven recovery. The service sector is strong and is the main contributor to the high levels of growth which are believed to be unsustainable. We have a very strong and somewhat unstable level of sterling, which is squeezing exports. There is a very low level of growth in manufacturing.
  The dilemma is to decide the extent to which one has regard to the deflationary effect of the strong value of sterling, the extent to which one has regard to the weak performance of manufacturing, and the extent to which overall stability is threatened by the strong growth of the service sector. This is not the time to have a full debate on the matter, but it is not obvious to me that there were underlying inflationary pressures when the new Government took over which required such a rapid increase. There is no resemblance between the current data and situation and the situation in the later 1980s when we last had boom and bust.
  Unemployment is falling, but the fall is slowing. There are some skill shortages, but the decline in unemployment is slowing. That has not fed through into wage inflation, the
  742
  old British curse. Earnings are now rising by 4.5 per cent., which would have been unimaginable in the late 1980s—4.5 per cent. over an underlying inflation rate of 2.8 per cent. The retail price index, which usually determines earnings, has been driven up by the Government's interest rate increases and the taxes that they have imposed. There was a 3.75 per cent. earnings increase in 1996. This is not driving inflationary pressure. The figures for factory gate prices produced yesterday are astonishingly low. I mentioned the RPI—food prices are almost static, and shop prices are not rising significantly within the RPI.
  Consumer spending has grown strongly by 5 per cent., but it has not shown any signs of accelerating this year. In fact, last month, it seemed to drop a little. That is against the background of the windfalls from the building societies. People feared what would happen when all that money flooded into the economy. My view was that the windfalls were only a one-off—if we acted to deal with the windfall spending, in 18 months' time we would find that the windfalls had gone and the action that we had taken meant our missing the target. In reality, only a quarter of the windfalls appear to be being spent, while most are being saved. The savings ratio in this country is satisfactorily high compared with what it was.
  Everyone, even the Monetary Policy Committee, expects the growth in the economy to slow down next year. I do not know of one commentator who does not think that the present high level of growth will slow next year. If the committee keeps piling on interest rate increases until it sees the slow-down starting, it will face the classic problem of monetary policy: one fires the shot from the cannon, but it takes 18 months to two years before one knows where it lands and what one has hit. If we keep raising interest rates in an economy that is on the point of starting to slow down, it will slow down much faster than expected.
  Two things seem to dominate the Monetary Policy Committee's minutes—which, incidentally, are anonymous, unlike the ones that I used to produce. First, the committee is obsessed with its forecasts. The committee opted for one of the increases because, had it not done so, the Bank's forecast would have shown inflation above 2.5 per cent. two years on, so it thought that it had better build in an interest rate increase to make the forecast that it had printed compatible with the target. I have already commented on the value of the forecasts.
  Secondly, the most serious thing that seems to trouble the committee is that the present rate of growth is unsustainable, despite the fact that everyone believes that it will slow down. The present rate of growth of 4 per cent. per annum is not sustainable, but we are taking a terribly pessimistic view of sustainable annual rates of growth. It has only just touched 4 per cent. In the boom of the 1980s, it was above 4 per cent. for most of four years. I agree that that was before disaster occurred, but let us not take action now, as soon as growth touches 4 per cent., to head off a feared future disaster when everyone knows that the rate will not be maintained.
  The Government are taking the most ridiculously pessimistic view of trend growth in this country. I do not know what trend growth is—no one does, but we have to take our best stab at it. The Government have revised the rate down from my reckless 2.5 per cent. to a more cautious 2.25 per cent., the average of what the British economy has achieved for the past 40 years. What an ambitious, modernising Government! What league tables we will soar up saying that trend growth is 2.25 per cent.!

  743
  It is because the Government do not approve of all our supply-side changes. They are probably anticipating the social chapter, the minimum wage and the trade union laws which will take us back to the trend rates of growth that this country used to enjoy. They have let loose a monetary committee that may ensure that we achieve disappointing results. The cost will fall on the public we serve, who were not given the faintest warning of the measure at any point in the election campaign.
  On accountability and openness, I share many of the views that have been expressed. The right hon. Member for Llanelli attacked the Government's views eloquently, asking why we should be trusted with anything if we are not trusted with monetary policy. What we now call monetary policy has developed only since Bretton Woods, only since Nigel Lawson was Chancellor has it been operated as it is now, and we have a pretty shocking record on running it.
  Of course there is a danger of short-term political pressures taking over. I am against short-term, populist pressures operating on monetary policy. That is why I published minutes. As Chancellor, I was accountable to the House, but I do not remember the House having any effect on interest rate decisions before they were taken. Even after decisions, most hon. Members were so cautious about giving their views that I was not put under too much pressure. Of course, if it all goes wrong and there is hyper-inflation, the Chancellor is rightly hammered by the House of Commons.
  I thought that the best way to avoid political pressure was to print the advice given to the Government month by month, and my response as Chancellor. That had previously been a state secret. I protected my other officials by not naming them. Junior Ministers enjoyed similar protection, although I do not think that they would have minded if we had given their individual views. I allowed them to disagree with me at the meetings. We produced genuine minutes of genuine meetings for the Select Committee and the Opposition to have fun with.
  We now have a new attempt to ensure openness. I should be cautious about allowing the Select Committee to vet all appointments. I do not like the American system. A similar system here might be subject to political influence. However, the Select Committee should demand proper openness.
  The monetary committee produces anonymous minutes. The opinion of the Governor of the Bank of England cannot be identified from the minutes any more. I do not know whether he allows his colleagues at the Bank to express openly at the meeting views that contradict his. They tended to have a more collegiate approach when I was at the Treasury. I think that there is a pretty safe batch of votes there.
  I shall not believe the new minutes—just as people, rightly, would not believe my minutes—until there is evidence of some division. So far, the monetary committee has been unanimous. It may not have been unanimous on the most recent increase, which was a little dodgy.
  In America, where the Federal Reserve produces minutes, the house view tends to prevail. It is a bit like a political party subject to a whip. The members have a frank discussion, but when they face the outside world they endorse unanimously the opinion that the leader—in this case the Governor of the Bank—has proclaimed.
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  I look forward to seeing evidence of votes. I want to know which members of the committee disagreed and why the rest of the committee overruled them. Until we have such minutes, the openness that is talked about will be inadequate. It is less open than the system before the election under the Conservative Government.
  Great claims are being made for the Bill that will not be borne out. If independence was to be contemplated, it should not have been done as it has been. The new system was rushed and ill thought through. The conditions that have been created do not reasonably resemble anything that Labour talked about at the general election. The Government will take us down the league tables of growth, and they could cause rising unemployment.
  Mr. John D. Taylor: I am thoroughly enjoying the right hon. and learned Gentleman's speech and I agree with most of it. However, I do not understand the consistency of being against an independent bank in the United Kingdom but in favour of control by an independent bank in Europe.
  Mr. Clarke: Making a European central bank politically accountable internationally would probably require an international council of Ministers, which, as the French wish, would produce more political intervention. If there is a European central bank and if we participate, I should prefer us to build on the point that I was making. Accountability to Parliament did not previously involve the House of Commons holding the Chancellor to account the day after an interest rate increase. I cannot remember that happening. Accountability for monetary decisions depends on openness and transparency.
  There is a great deal to be decided about the European central bank. It has to determine its monetary targets and its inflation target if it wants one. It has to decide how it will proceed. There is no reason why Europeans should be more hesitant than Americans in demanding proper minutes and that individual governors should proclaim their opinions. There must be proper openness in their discussions. The Treasury Select Committee should be no less hesitant about interviewing the governor and members of the executive committee of a European bank than it is about the Bank of England at the moment, particularly if the Governor of the Bank of England is one of the members. That is how the Bundesbank operates. The members of the board are the heads of the state banks of the various Länder. They offer themselves to account when they go back home.
  That all has to be worked on. I am discussing the Bill. It does not modernise procedures. It is not a considered step on Bank of England independence. It does not create a new anti-inflationary climate. It is the result of four days of dynamic action and an attempt by the Chancellor to be a macho new reforming Chancellor. We have been placed in the hands of a monetary committee that is showing every sign of overkill in pursuing its target. The Bill should be rejected because it is a gimmick, not a worthwhile addition to the country's armoury of economic powers to deal with its problems.
  5.45 pm
  Mr. Giles Radice: The shadow Chancellor's speech was rather ambiguous and uncertain. I was surprised when he ended up recommending that his party vote against the Bill. The right hon. and learned

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  Member for Rushcliffe (Mr. Clarke), the former Chancellor, made a better fist of putting the case against the Bill, although I should like to take him up on a couple of points.
  I congratulate the Government on their good sense and courage in giving the Bank of England operational responsibility for setting interest rates. It was the right thing to do and they were right to do it straight away.
  The Treasury and Civil Service Committee, of which I was a member, reported on the issue in December 1993. That report helped to lay the groundwork for the Government's policy. We recommended giving operational independence to the Bank. The Chancellor has generously recognised our work.
  We started with open minds. Having taken evidence from many sources and examined experience overseas, we were persuaded by the arguments for independence. There was a Conservative majority on the Select Committee. The conclusion was supported by all but one of the Labour members—the one who is in front of me at the moment—and by the Liberal Democrat member. Our model has now been accepted by the Government.
  Lord Lawson put strongly to us the key argument that Bank independence enhanced the credibility of monetary policy. Whatever the right hon. and learned Member for Rushcliffe may say, nobody—least of all the markets—trusts politicians to set interest rates, particularly in the run-up to an election. The Chief Secretary also pointed that out to the Select Committee.
  Who is to say that the people are wrong, from the track record? When Roy Jenkins was Chancellor, in the run-up to the 1970 election—which the Labour Government lost—he took a tough line. The right hon. and learned Member for Rushcliffe, a number of whose policies—particularly those on Europe—I admire, ran a relatively tight ship for two years, recovering from his rather poor inheritance as Chancellor. But in the run-up to the election, he relaxed public spending. He should have increased interest rates at the beginning of 1997, as I said during the Budget debate at the time, so I am not being wise after the event.
  Ms Abbott: My hon. Friend has repeated the well-rehearsed point that politicians cannot be trusted with interest rates. Will he explain, therefore, the intellectual rationale for trusting politicians with the other levers of monetary policy—fiscal policy and so on?
  Mr. Radice: It is not a purely intellectual argument, but one about practice. One has only to look at the record. That is why so many countries have been giving banks operational independence in respect of monetary policy.
  Mr. Mitchell: It is in fashion.
  Mr. Radice: It is not a question of fashion, but rather the result of practical experience. If my hon. Friend the Member for Great Grimsby (Mr. Mitchell) will settle down for a moment, I shall give him part of the argument.
  Operational independence can help to create a virtuous circle. Such independence enhances credibility, making it more likely that inflation targets will be achieved as the behaviour of the main players is influenced. In time, that enhanced credibility allows lower interest rates. As Lord Lawson said,
  746
  "If monetary policy remains in the hands of politicians, the markets demand an interest rate premium."
  The right hon. and learned Member for Rushcliffe knows that very well. The Select Committee looked into the matter and found that countries with independent central banks had a better inflation record than those without.
  A serious counter-argument has been put by my right hon. Friend the Member for Llanelli (Mr. Davies) and by the right hon. and learned Member for Rushcliffe, who questioned whether operational independence would lead to a more deflationary policy. In other words, would it lead to overkill? Some safeguards against this have been written into the Bill. For example, reasons have to be given if the inflation target is overshot or if there is an undershoot—in other words, if inflation is too low. If there is overkill, the Monetary Policy Committee has to inform the Chancellor why. That was not mentioned by the former Chancellor—in my opinion, unfairly, as it is written into the Bill.
  The primary role of the Monetary Policy Committee is to bear down on inflation, but the committee must also support the Government's economic policy, including the objectives of higher and stable levels of growth and employment, so it cannot ignore those factors. As I have said, the greater the credibility of monetary policy, the lower interest rates can be, increasing the stability of the system and producing a good environment for growth and employment. That is the basic rationale for the system.
  The model presented to us in the Bill also increases the openness of decision making. The right hon. and learned Member for Rushcliffe was gracious enough to admit that there is no golden age of accountability to which we can refer back. Under the old system there was a formal ability to question the Chancellor about interest rates, but he was not very forthcoming in replying to it. I remember Lord Lawson telling us:
  "When I want to put up interest rates I put them up. When I want to bring them down, I bring them down."
  That was a perfectly valid constitutional position, but it does not tell the House very much about the reasons behind the policy. If Chancellors thought they could get away with saying that, they did so.
  I accept that, acting on a suggestion from the Select Committee, the right hon. and learned Member for Rushcliffe published the minutes—all credit to him for that. They were sometimes quite revealing, but sometimes they were not. One had the impression that there may have been a meeting beforehand between officials from the two bodies and that some of the conflict did not come out into the open. It is fair to say that decision making remained fairly opaque.
  Under the new system, there is increased openness. First, the Chancellor sets inflation rates and has to answer to the House and the Select Committee. Secondly, there is a full publication of minutes and votes. Therefore, any differences and divisions will be clear. The Select Committee will certainly insist on that. Thirdly, the non-executive members of the reconstituted court of the Bank will review the performance of the Bank and report to Parliament. That will be one opportunity for Parliament to examine the Bank's performance on monetary policy. Lastly, the Select Committee will have an enhanced role.
  The Select Committee has been given a greater role than in the past. Although we have asked the Governor of the Bank of England to give evidence previously, in future

  747
  it will be done on a very different scale. We are committed to at least two dedicated sessions on the four inflation reports each year, and there could well be as many as four. I can announce to the House that the next one will be when the Governor and the members of the Monetary Policy Committee give evidence on 27 November. If there is division, we shall want to question representatives of the Monetary Policy Committee to find out the reasons for any differences and so get them out into the open. I agree that the best way to achieve an accountable system is to have an open system.
  We shall take evidence on the inflation target from my right hon. Friend the Chancellor, who is responsible for setting it, and the Governor, who is responsible for implementing it. We will do that every year. If there is an open letter from the Governor to the Chancellor on the reasons for the divergence of inflation from its target, we shall take evidence from the Chancellor and the Governor. If the Chancellor uses his power to override the Bank, we shall take evidence from him. We shall also take evidence from the non-executive members of the court on their assessment of the Bank and the Monetary Policy Committee. So the Select Committee will have an enhanced role and a much greater programme of hearings and reports to the House on the performance of the Monetary Policy Committee.
  In a sense, the Select Committee is also on trial. [Interruption.] Although my hon. Friend the Member for Great Grimsby wants me to be a terrorist, I shall not, even for him. However, we shall have to ask sustained and serious questions about the performance of the Monetary Policy Committee. There are very many able people on the Select Committee, and they will do that most effectively.
  We have also said in our report on accountability that there should be confirmatory hearings. The right hon. and learned Member for Rushcliffe has some reservations, but we believe that such hearings would be good for the independence of the Monetary Policy Committee and strengthen the relationship between the Bank and Parliament. Of course, when somebody is appointed, we can have a hearing and issue a report to the House on that person's suitability. The fact that we can and shall do it—even without formal powers being written into the Bill—could influence the Chancellor were he thinking of putting his granny or whoever on to the Monetary Policy Committee. So we hope the Select Committee will contribute to some extent, but it would be much better if formal powers could be written into the Bill.
  Ms Abbott: Is it right for my hon. Friend to talk about the Chancellor's granny in such disparaging terms? For all we know, she might be an expert on monetary policy.
  Mr. Radice: However good she is, it would be ill advised to put relatives on the Monetary Policy Committee.
  Mr. Kenneth Clarke: On a more serious point, I am not concerned about the Chancellor's granny, but I may be leaping in where the Chief Secretary feared to tread. Everybody seems to be very keen on confirmatory hearings. Is the idea that the Treasury Select Committee will cross-examine all the aspirants on their views on monetary policy? Will it award them marks them out of 10 in relation to their competence? Will it insist on more
  748
  or fewer strict monetarists? Will it want some "inflation is dead" men? We could end up with a peculiar Monetary Policy Committee if the Select Committee decided to approve people with whose views it happened to agree.
  Mr. Radice: It is easy to poke fun at the idea, but we shall look at the professional competence of the people concerned. We have good advisers and our own views. It will not be a question of putting monetarists or Keynesians on the committee, because we do not actually appoint members of the committee. That is a decision for the Chancellor. We will be able to make reports to the House on those appointed or nominated by the Chancellor and, in some instances, we may decide that they are not professionally up to the job. We may be wrong, but the House can take account of our view and dismiss it if it wants.
  Confirmatory hearings are a sensible approach, and the House should consider them seriously. We do not intend to introduce an American "advise and consent" system, and we would not delve into the sex life or tax position of Monetary Policy Committee nominees. We will examine their professional qualifications to do the job. I hope that the Government and the Modernisation Committee will consider the proposal with an open mind.
  My last point concerns the terms of office of the members of the Monetary Policy Committee. At the moment, the members—apart from Governor and Deputy Governor—will serve for only three years. It could be argued that that will give the Chancellor undue political influence over those members. Perhaps the terms should be longer than three years, and I hope that the Chief Secretary will consider that suggestion. Appointments to the court have also been reduced from a four-year to a three-year term. What is the rationale behind that change?
  I strongly support the Bill, because it will help to create monetary stability. I believe that is important, because I have lived through the 1970s, 1980s and the early 1990s. It will also help to create conditions for non-inflationary growth and will enhance the openness and accountability of monetary policy.
  6.2 pm
  Mr. Malcolm Bruce: I am glad to be called at last to speak in this debate, not least because there is more united support from the Liberal Democrats for the Bill than from Labour or Conservative Members. The latter appear to be somewhat confused and incoherent on the matter.
  The proposals in the Bill were not contained in the Labour party manifesto, although they were clearly spelled out in the Liberal Democrat manifesto and the paper that we published before that. During the election, the subject came up in numerous debates between the then Chancellor, the then shadow Chancellor and myself, but the current Chancellor gave no indication that he intended to introduce such a Bill. I can only conclude only that he must have been persuaded by the force of the arguments. However he arrived at his decision, the Liberal Democrats are keen to support it.
  The Economic Secretary to the Treasury (Mrs. Helen Liddell): I am loth to interrupt the hon. Gentleman's train of thought, but the issue of the contents

  749
  of the Labour party manifesto keeps being raised. I am sure that he has read the manifesto in some detail, but he may care to turn to page 13, which states:
  "We will reform the Bank of England to ensure that decision-making on monetary policy is more effective, open, accountable and free from short-term political manipulation."
  What is his problem?
  Mr. Bruce: The Economic Secretary knows that that is not a clear statement of operational independence, which is a clear policy that has been well discussed. Labour politicians, when in opposition, did not make their support for it clear. However, that is history. The Government's decision is welcome and I am happy to support it. Indeed, much of the detail is along the lines that we advocated. We would have preferred a more radical review of the structure of the bank, and we proposed that its name be changed to the United Kingdom reserve bank, with full statutory regional representation on the board of management or the court. Nevertheless, the Government have gone a long way towards our proposals.
  I intend to concentrate my remarks on the part of the Bill relating to monetary policy. I hope that my hon. Friend the Member for Twickenham (Dr. Cable) will be able to speak later on the regulatory aspects of the Bill.
  The proposals will bring the United Kingdom into line with almost every other major developed economy. I find it strange that we have heard such vehement opposition from hon. Members on both sides of the House to what has increasingly become recognised as good practice in the day-to-day management of monetary policy. The right hon. Member for Llanelli (Mr. Davies) made a ludicrous leap from the devolution of the day-to-day management of interest rates to the total management of economic policy. The change will enable the Government to get on with the job for which they are supposed to take responsibility-fundamental policy decisions on the economy-instead of being diverted by short-term arguments about interest rates.
  The right hon. and learned Member for Rushcliffe (Mr. Clarke) was unable to restrain himself from justifying the position of the Conservatives in government and his own track record. His argument appeared to be, "I am right and other people are wrong. You should be glad that I had the opportunity to take those decisions, because I was right."
  As the right hon. and learned Gentleman pointed out, the time lag is 18 months and we have not yet seen the full impact of his decisions, never mind those of the present Government. However, if I am not mistaken, it was about 18 months ago that he overruled the Bank of England's determination to put up interest rates—and we now have an inflationary pressure whose importance he downgrades, but which most commentators regard as real and requiring action. He is entitled to his opinion, but I am not sure that he is entitled to such uncompromising self-confidence.
  Mr. Kenneth Clarke: We have 12 months in which my approach may prove to be wrong, although everybody forecast that inflation would fall in the second half of this year. My point was about overkill and excessively deflationary policies. My argument was that five increases
  750
  of 0.25 per cent. each justify my suspicion that the Government have a deflationary policy. I might have decided on a couple of increases myself under the old arrangements, but I would not have reached 7.25 per cent. The Bank is behaving in precisely the way that we warned it would.
  Mr. Bruce: The right hon. and learned Gentleman is entitled to his opinion. He has declared it robustly and the next 18 months may test it out. He also said in his speech, and has just repeated it, that he might have made adjustments earlier. Had he done so, the situation might have been different now. [HON. MEMBERS: "He did not say that."] Yes, he did.
  Mr. Lilley: My right hon. and learned Friend said that the committee might have made adjustments earlier, but that it would have been wrong to do so.
  Mr. Bruce: That is a categorical statement about a matter of opinion, and that is the difficulty that arises in such cases. Such arguments are ultimately fruitless, because in reality someone has to make an objective economic decision. If a Chancellor appoints an independent committee to make the decision and then overrules it on the grounds that he knows best, he is effectively deciding that political, rather than economic, considerations will determine the management of monetary policy.
  Our experience over the years has been fairly bitter and, more often than not, we have been wrong rather than right. We can reflect on the fact that, on the day that the Chancellor announced his decision, long-term interest rates went down. Whatever the short-term considerations, the ultimate objective must be the real gains that are to be obtained from ensuring stable, low inflation, low long-term interest rates and a degree of convergence between our interest rates and those of parallel economies operating similar forms of operationally independent central banks. That ultimately is a prize with real benefits for mortgage payers, businesses and everybody who wants stability in economic management.
  I hope—at the moment it is only a hope—that the Conservative party will end its opposition to the proposal. I repeat what I said to the shadow Chancellor. I find it extraordinary that he can claim that the Chancellor is giving away his most important power—it is a questionable argument, but those were his words—while suggesting that he could not make up his mind whether or not the Conservatives would reverse the decision if they ever regained power. If what he said is true, he ought to commit his party to reversing the Chancellor's decision. The fact that he cannot and will not suggests that it is an argument for today, rather than a substantive belief. The shadow Chancellor then spelled out how one could make the Bank more independent—presumably by improving the Bill to make it acceptable to the Conservatives, and therefore not reversible.
  In our view, it would be helpful to have political consensus on this sooner rather than later. The Conservative party's position may not be a worry at the moment because nobody seriously expects it to be in government for a long time. But if the Conservatives are serious in their pretensions to regain power, people in business will want to know whether they would wish to reverse the policy. They cannot leave it in limbo for ever.

  751
  If they can be so definite about apparently never joining a single currency, it seems odd that they are not clear where they stand on this matter.
  This is the right Bill and it should command wide support. I do not believe that people will rush into the streets demanding that politicians be given the right to interfere once again in the short-term setting of interest rates. If one looks at the American example, I hear no clamour that Bill Clinton should take over control of interest rates from Alan Greenspan. I am not sure whether anyone—even the hon. Member for Hackney, North and Stoke Newington (Ms Abbott)—would replace Eddie George with the shadow Chancellor, although, essentially, that is what the hon. Lady is arguing for.
  Once the system is in place, it will be recognised as a sensible and practical way of making short-term decisions, allowing the Government to concentrate on the things that shape the long-term economy, which clearly include the fiscal stance and policies for promoting growth and investment. If we achieve stable low inflation, the climate for investment will be dramatically improved in the long term. People can start to assess risks on a much narrower basis, and clearly that will encourage a great many more investment prospects which currently fall by the wayside because of the need to allow for unpredictable fluctuations in exchange and interest rates.
  A sensible decision is being opposed by the Conservative party, which nevertheless has among its number a former Chancellor who is most enthusiastic about the policy—Nigel Lawson. The right hon. Member for Strangford (Mr. Taylor) intervened on the right hon. and learned Member for Rushcliffe and got him middle stump by asking for his view on an independent central bank for the United Kingdom as compared with a European central bank. It is neither consistent nor logical to oppose the principle of an operationally independent bank for the United Kingdom while being in favour of a single currency reinforced by a central European bank. He knows that to be the case, and was able to argue only on the detail.
  I had many debates with the right hon. and learned Member for Rushcliffe when he was Chancellor, and I always respected his style and his record, in spite of our differences on the details. Clearly he is proud of his record, and he has some reason to be proud. However, he can get carried away by some of his press releases—he certainly did at the end of the last Parliament. He seems to take the view that there was a great deal of entertainment in the Ken and Eddie show, and he took pleasure in being right, on his terms, more often than Eddie. The funny thing is that, when one talks to Eddie, he sees it rather differently in terms of who was right and who was wrong. He maintains, as the former Chancellor would, that the jury is still out on the final result.
  In spite of his assertions to the contrary, many commentators—I include myself among them—take the view that the conduct of the right hon. and learned Member for Rushcliffe before the election underlined the case for an operationally independent bank. I do not believe him when he says that the rate set in the six-month run-up to the election was not influenced by political considerations. He may have taken a different view, but others in the Cabinet at the time definitely thought that the Conservatives could do without interest rate rises in the run-up to the election. The sooner the Conservative party can accept the principle of the policy, the better.
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  The Conservative party will have no credibility if it opposes the policy, and it is not prepared to say whether it will endorse the policy or leave it uncertain.
  There are a number of issues which we can debate in more detail in Committee, but I should like to follow the hon. Member for North Durham (Mr. Radice), who referred to some of the Treasury Committee's recommendations which bear further consideration.
  The terms of appointment of the members of the Monetary Policy Committee are important and, having discussed the matter with people inside and outside the banking fraternity, I can say that there is a general recognition that three years is rather short, on two grounds. First, if one is trying to determine an inflation target and a policy to hit that target with a lag time of two years, one does not have an opportunity to produce a significant track record in three years. It takes longer than that, and that is fundamental to the argument.
  Second, and less importantly, is the freedom from apparent political pressure. I am not accusing the Chancellor of seeking directly to intervene on or influence the independence of the monetary committee, and I am not convinced that the people to be appointed would be susceptible to pressure. But the perception that they could be put under pressure cannot be removed in the case of a three-year appointment which requires their reappointment this side of a general election.
  Perhaps the period could be extended to five years—not the 10 or 15 years which apply in other countries—which would give them long enough to establish a track record and to depend for their reappointment on the next Government and the next Parliament, not the current ones. Those are persuasive arguments. If the Government genuinely believe that their claim to have an open mind is valid, I hope that they will be persuaded to reconsider the terms of appointment and extend them to take that into account.
  I wish to refer also to confirmatory hearings. The Government have indicated that they are not against them in principle, but the Chief Secretary—in his evidence to the Select Committee—basically said that, although he had an open mind, he would resist all amendments. He argued on the grounds of the time scale and the fact that this would be a radical departure that had implications for other appointments. That is why the hon. Member for North Durham is suggesting that the Modernisation Committee should look into that matter.
  I urge the Government to approach the matter the other way round. If we are to move in that direction—many feel that that is a logical area for Select Committees in general to be involved in—we have to start somewhere. I am suspicious of the argument that we should either introduce it across the board or not at all, because I know where that would lead:it would lead to our not introducing it at all.
  We should start somewhere, perhaps providing a model that could be extended elsewhere. That would be a good constraint from the Government's point of view: a Select Committee that knew that it would be judged to determine whether its use was to be extended would be constrained in its actions by that consideration. I hope that the Government will consider that a reasonable starting point that could be extended if the project was a success and not repeated if it was not. If they do not, I fear that we may never get into that slightly more innovative mode.

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  I ask the Government to follow the spirit of their own terms and allow their open-mindedness to develop into real, practical activity that could help to strengthen the role and respect of Select Committees and to test the Government's good faith. I am not challenging their good faith, but it must be borne into practical action.
  Everybody is aware that the Governor's term of appointment is due for review in the near future. I want to put it on record that, regardless of the differences of view that he has had with a variety of people, he has conducted himself in recent years with great credibility and integrity. The Government would do well, considering that this is a new departure, to take an early decision to confirm his reappointment. If this exercise is to be a success, it is pretty important for the Bank to know in whose hands its new role is to be developed.
  The Government have set themselves the task of preparing the country for membership of a single currency, even if, regrettably, they have effectively ruled out the possibility of an early decision in this Parliament—although I suspect that they may yet have to return to that. The Bank is likely to have some years of operational independence before the decision is finally made to become part of the European central bank, so perhaps its track record in those years will pave the way.
  The Conservative party has put itself in a remarkable position, given its track record and former contacts and support: on all the central issues, it is substantially on the wrong side of the debate with the business community, which needs at least some suggestion of a practical political focus for decision making that takes account of what is really happening.
  In the real world, politicians do not have the power they often claim to manipulate the economy as some interventionists would wish, but they can create a climate of stability and allow business to thrive. In the European environment, there is a clear determination to set up a strong single currency, pursuing policies of monetary and fiscal rectitude to the benefit of all the economies of the European Union.
  There is no apparent role for a United Kingdom that is not part of that, and the Conservative party has not articulated any coherent possible role in that circumstance. If it cannot do that, it can hardly be surprised that it cannot convince the captains of industry and the decision makers in business that what it has to say is relevant to the 21st century.
  The Government have made a commitment in principle to the single currency that accords with practical reality, and have introduced a Bill that accords with good common sense and should lay the foundations for stable low inflation and a climate of good investment. We commend it, and will support it.
  6.24 pm
  Mr. Mike Wood: As the first Labour Member for Batley and Spen and someone who has lived there since 1976, I cannot believe that any hon. Member is unaware of my constituency's precise location, but perhaps for the record I should fix its geographical location at the very heart of West Yorkshire, with a northern boundary that is co-terminous with both Bradford and Leeds.
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  My constituency is a mix of keenly independent-minded towns that pay no deference whatever to their more powerful northern neighbours, interspersed with attractive countryside that still shows the scars of an industrial past. Batley made its name and its wealth in the last century as the centre of the heavy woollen industry and from the manufacture of a specialist product called shoddy: the bringing together of used rags and woollen cloth to produce quality overcoats and carpets—an early example of recycling that brought an influx of workers from Ireland and, later, from the Indian sub-continent. Both those communities are now settled and form the core of the town's diverse and industrious population.
  The Spen valley is the centre of the wire-drawing industry—a process whereby metal rods are transformed into rolls of wire—and until recently was a major producer of asbestos products, resulting in much long-term illness and death for workers and their families.
  The last of our many pits, Gomersal, closed in the 1970s, more than 15 years before my immediate predecessor achieved passing fame by defending certain groups of miners during the Conservative Government's ill-conceived and malicious assault on one of the most efficient industries in the world. As a direct result of that disastrous policy, applications have been made in my area for opencast mining development, with all its attendant environmental and health problems.
  Mrs. Peacock held strong views on issues such as law and order and abortion, and liked to be thought of as an independent-minded Yorkshire woman. I wish her the peaceful and thoughtful retirement that she deserves.
  Over the years, we have suffered more than most at the hands of the boundary commission. The first Labour Member for Batley and Morley, Ben Turner, travelled at his own expense and by a circuitous route to Moscow in the early days of the Soviet Union. Granted an interview with Lenin, he informed the great man that he appreciated the scale of his problems but could not condone his methods. In the House he was hardly less forthright, and was a consistent advocate of a minimum wage.
  A contemporary of Ben Turner's was Tom Myers, the first Labour Member for Spen Valley. Tom for a short while replaced Sir John Simon, and his work is recognised in the name of my office premises in Cleckheaton: Tom Myers house. Constituents still call occasionally and ask to see Tom—or, to be more exact, they think that I am Tom. Recently the Co-op bank demanded his endorsement on a cheque and took a fair time to accept as sufficient justification for his absence the fact that he had been dead for 50 years.
  No introduction to my constituency would be complete without mention of and tribute to Dr. Broughton, who, after working as a Batley general practitioner, served as its Member of Parliament, to equally good effect, for more than 30 years. It was a tragedy not only for him but for his country that, while he was on his death-bed, the Callaghan Government fell for the want of the single vote that he would loyally have provided had his illness allowed.
  Mine is a constituency with many fine museums, some of national note, and a rugby league side in Batley Bulldogs that would also have national standing if its effort received more ample reward and, indeed, more financial backing.
  We are steeped in history, as reference to one short period will show. Dr. Joseph Priestley, one of this country's foremost scientific minds, was born in Birstall

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  and spent his formative years in the area. He is noted for his discovery and isolation of oxygen—not, as so many school essays are supposed to claim, its invention. As a minister of religion he held radical views that even now would not endear him to the establishment, or even to many Labour party selection meetings. As an open supporter of both the American and French revolutions, he was a target of Government agents. To the shame of this country, a great reforming mind was lost to America.
  Government agents also infiltrated and eventually undermined the working-class movement centred on the Spen valley that became known as the rise of the luddites. They were highly skilled and literate workers responsible for putting a fine quality hand finish on local woollen cloth. The machinery that threatened their jobs also threatened their families. That, combined with employers whose idea of industrial relations involved threats to ride up to their saddle girths in luddite blood, precipitated a violent conflict.
  While mortally wounded in a local hostelry, a youth called Booth was tortured to obtain the name of the luddite leader. The vicar of Liversedge, the Rev. Hammond Roberson, an active supporter of local industrialists, in an effort to obtain the confession, assured the lad that he could keep a secret. With his last gasp, Booth assured the cleric that he could, too, and he took the luddite leader's name to his grave.
  Hammond Roberson was a dinner companion of a local curate, the Rev. Patrick Brontë who, a year after the public hanging of the Spen valley luddites at York, brought his new bride to live at Hightown. It was there that Charlotte's sisters Emily and Anne were born. It was in the Spen valley that the famous novelists received their education.
  I do not expect the privilege of serving the area for as long as Dr. Broughton or the opportunity to confront and contradict world leaders as did Ben Turner, but I am confident that in this Parliament, as part of this Labour Government, I shall see the advent of Turner's long-sought minimum wage. I will have the opportunity to vote for regulations to stop further environmental destruction by opencast mining, and I will be part of the process that will introduce the long overdue ban of the import and use of asbestos.
  Today, we debate the Bank of England Bill, which has been headlined as the Bill that will allow the Bank of England the freedom to set interest rates—not an idea that I welcome wildly. Of course, it contains far more: new faces and new freedoms balanced by new responsibilities and accountability, as one would expect from a Government determined to position this country to meet the challenges and take the opportunities that the new millennium will bring. As such, it has much to recommend it to my constituents and to people throughout Britain. I am proud to be able to lend my support to the Bill today.
  6.31 pm
  Sir Peter Tapsell: It gives me great pleasure to be the first to congratulate the hon. Member for Batley and Spen (Mr. Wood) on his excellent maiden speech, to which the House listened with close attention and much pleasure. He spoke in a most interesting way about his constituency and some of its famous figures of the past. He also paid tribute to his
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  predecessor, Elizabeth Peacock, who is a great friend of mine. The only point on which I would venture to disagree with him was his suggestion that she might be looking forward to a quiet retirement. Knowing her as I do, and admiring her tremendous rigour and the bonny way in which she fought for her constituency and, in particular, for her miners, I am sure that quietness is the last thing she has in mind and that she will continue to play an active role in public life. We hope to hear from the hon. Gentleman often. From his closing remarks, it is obvious that he is a man of idealism, and will make a great contribution to our discussions.
  Right hon. and hon. Members on both sides of the House have expressed some astonishment that the introduction of independent monetary control by the Bank of England was announced four days after the general election without having been in the Labour party's manifesto. Even The Guardian of 7 May said that there was no democratic legitimacy for the proposal. One wonders why this dramatic announcement, now encoded in a Bill, should have been made with such a roll of drums so soon after polling day and before the House of Commons reassembled. There are four main reasons.
  The first was explained by Lord Healey in his usual helpful way, when he said that the idea of an independent central bank was a gimmick to be used as an apologia by failed Chancellors to shuffle off their failures on to the Bank of England. As has been pointed out, there have already been five increases in interest rates since polling day. Apart from the introduction of university charges, they are the most unpopular things that the new Labour Government have done.
  One can see that it is in the short term politically helpful to the Government to be able to say that it is the responsibility of other people. I doubt whether that will work for them, because in my constituency surgery on Saturday, nearly half the people who came to see me with their personal problems mentioned higher interest rates on their mortgages as a particular blow. None of them blamed it on the Bank of England. None seemed to have got the message. They seemed to feel that it was the responsibility of the Chancellor of the Exchequer. Perhaps every effort will be made by the spin doctors as time goes on to prove that those matters are no longer the responsibility of the Government.
  The second reason for the change is that every Labour Government have produced a sterling crisis leading to the devaluation of the pound: 1931, 1949, 1967 and 1976. By surrendering control over monetary policy, the Chancellor no doubt hopes that, in the next crisis, the independence of the Bank of England will provide him with an alibi.
  Thirdly, the Chancellor and his senior colleagues must hope that the change will provide him with a defence against his Back Benchers, who will not always be as supine and cringing in their parliamentary behaviour as they have been so far. When things start to go wrong on the economic front, as undoubtedly they will in the nature of things, and when unemployment starts rising, as undoubtedly it will at some point in the cycle, I hope that Labour Back Benchers will not allow themselves to be bought off with the excuse that the measures causing unemployment are not in the control of the Government but are the responsibility of the hard-hearted people on the Monetary Policy Committee of the Bank of England.

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  The fourth, and in many ways most important, reason for the change is to prepare the way for Britain to enter a single European currency managed by a European central bank that will be wholly independent of any form of democratic control. When one tells people—even sophisticated people in the City of London and in business—that the proposed European central bank will be subject to no democratic control or influence, they express disbelief.
  As some hon. Members were not here in the previous Parliament during our interminable discussions of the Maastricht treaty, it might be useful if I read out the relevant extract of article 7, which explains the exact position of the proposed European central bank. Article 7 states, in part:
  "neither the ECB, nor a national central bank, nor any member of their decision-making bodies shall seek or take instructions … from any government of a Member State or from any other body … The governments of the Member States undertake to respect this principle and not to seek to influence the members of the decision-making bodies of the ECB or of the national central banks in the performance of their tasks."
  That is what the Maastricht treaty imposes upon us. So much, therefore, for accountability and transparency.
  Some people have suggested that, as long as the minutes of the European central bank are published and we know who has taken the decisions, there is accountability. I see that the hon. Member for Finchley and Golders Green (Dr. Vis) wants to intervene. If he enters the House, it will be easier for me to give way and I shall most certainly do so.
  Mr. Deputy Speaker (Mr. Michael J. Martin): Order. Win the hon. Member for Finchley and Golders Green (Dr. Vis) be seated? He should not address the Chamber from those Benches, as they are not part of the House.
  Sir Peter Tapsell: I understand, but I shall be happy to give way to the hon. Gentleman now that he is in the House, if you will permit me to do so, Mr. Deputy Speaker.
  Mr. Deputy Speaker: The hon. Member for Finchley and Golders Green was outwith the precincts of the Chamber, so the hon. Member should carry on with his speech.
  Sir Peter Tapsell: I bow to that judgment, which has put me, after 38 years, into a unique position of experience in these matters. I see that the hon. Member for Finchley and Golders Green is rising again and, as it is presumably on a different point, I shall be happy to give way to him.
  Dr. Rudi Vis: Well, it is from a different position and I must apologise to you, Mr. Deputy Speaker. You talked about accountability and transparency, but the bit of the Maastricht treaty that you read out concerned independence, not accountability or transparency, which is elsewhere in the treaty. You would do well to read that out to us.
  Sir Peter Tapsell: The occupant of the Chair is being held responsible for a great many things for which I do not think he is responsible. I shall try to answer that intervention within the rules of order.
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  If we have a European central bank, it will be against the law to seek to influence or bring pressure to bear on it. As the Maastricht treaty explains, one can be heavily fined for attempting to influence the decisions of a European central bank. That will have far-reaching effects on the lives of all our citizens, and it is totally unacceptable.
  We are not today debating the European central bank, but there is an enormous and significant difference between that bank as described in the treaty and the proposals for the Bank of England set out in the Bill. The Bill is intended as a halfway house towards our economy being managed by a European central bank. Only by giving it independence at this stage can we take the necessary steps of joining the exchange rate mechanism for two years, joining the single European currency and being subsumed in the European central bank—when our gold reserves will be carried off to Germany.
  All that flows from this legislation as, without the establishment as an interim measure of an independent British central bank, it will not be possible for us to join European monetary union. Indeed, the Maastricht treaty makes it clear that countries must establish independent central banks before they can join the European central bank. Those seem good reasons for being suspicious of and, indeed, hostile to the idea of an independent central Bank of England, which will take these vital decisions on monetary matters.
  The Bill raises three main political considerations. The great macro-economic objections, which were mentioned by the right hon. Member for Llanelli (Mr. Davies) and my right hon. Friend the Member for Hitchin and Harpenden (Mr. Lilley), are that the Bill involves the separation of fiscal and monetary policy. That is a profound mistake, and it will lead to great trouble. It will make it much more difficult to manage the British economy efficiently, particularly in times of difficulty, if the Chancellor of the Exchequer is° not in control of monetary as well as fiscal policy.
  Nye Bevan is famously quoted as saying, "You don't have to read the book because it's all in the crystal ball," although he put it the other way round. The crystal ball shows clearly that a tight monetary policy was operated in tandem with a loose fiscal policy in the United States in the 1980s, and that we had the same thing in Germany in the 1990s after reunification—the Bundesbank operated a tight monetary policy while Chancellor Kohl's Government operated a lax fiscal policy. That impinged harshly on the British economy, because of our membership of the exchange rate mechanism between 1990 and 1992.
  Over-tough German monetary policy led to a much too tight monetary policy here at an inappropriate time in our monetary cycle. That caused appalling hardship in my constituency. Many small farmers and business men were bankrupted. It would not be an exaggeration to say that that hardship was the main cause of the Conservatives' unpopularity at the last general election, which stemmed from residual memories of those years of our membership of the ERM. It is extraordinary that there are those in the Labour party, of all parties, who want to go down that road again.
  Unemployment has always seemed to me to be the most appalling of all social scourges. I belong to a generation who remember the prewar years. One of my earliest memories was of standing in the dole queue with my

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  father, who had been a rubber planter in Malaya. When the slump meant that one could not sell rubber anywhere in the world, he came back to England, quite unqualified to work here, and he remained unemployed throughout most of my childhood, until the war broke out and he was able to join the Army again.
  My memories of the 1930s motivated my economics rather more than my subsequent reading of John Maynard Keynes, although he gave me the intellectual understanding of how all that unemployment came about. It is amazing to me that the Labour party, of all parties, has abandoned all those memories and does not seem to appreciate that, if we join a single European currency and have independent banks—whether British or, worse still, foreign—unemployment in this country will be much higher than it would otherwise be. That is not a party political point; it is demonstrably the case.
  As almost everyone who has spoken in the debate has admitted, and as my right hon. and learned Friend the Member for Rushcliffe (Mr. Clarke) rightly said, central bankers, by their nature, have a bias in favour of deflation. The right hon. Member for Llanelli also pointed that out very well. Whenever a group of central bankers get together, they are entirely preoccupied with the level of inflation. Of course that is important.
  Mr. Radice: There is a famous central banker called Mr. Greenspan who clearly looks after the real economy as well as the inflationary issues.
  Sir Peter Tapsell: I know Mr. Greenspan and I knew his three predecessors. He has done a good job in the United States and he takes a considerable interest in levels of employment and investment, but the US Federal Reserve bank, or the Fed as it is called, is vastly more subject to pressures and to democratic accountability than anything suggested for the European central bank—there is simply no comparison.
  Mr. Geraint Davies: Will the hon. Gentleman give way?
  Sir Peter Tapsell: Let me finish my response to the hon. Member for North Durham (Mr. Radice).
  When asked a similar question by him during a previous speech, I spelled out at considerable length—I shall not repeat it now—the enormous degree of accountability to which the Fed was subject. Mr. Greenspan's immediate predecessor told me that he spent an inordinate amount of time preparing for congressional hearings, which were held in front of the television cameras with millions of his fellow Americans watching, to justify the Fed's every move on monetary matters.
  There is no suggestion that pressure cannot be brought to bear on the Fed—every sort of pressure has been brought to bear: President Reagan tried to push out some members of the Fed and replace them with his own nominees, and Franklin Delano Roosevelt did the same in the 1930s. The Fed has always and openly been subject to tremendous pressures, which is regarded as entirely proper and appropriate, but the Maastricht treaty forbids that in respect of a European central bank. Any comparison between what is proposed for the people of this country if we join a single currency and what happens in America in respect of the Fed is entirely misleading.
  Mr. Davies: Does the hon. Gentleman agree that the Bank of England's forecasts on inflation are significantly
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  more optimistic and up-beat than other outside forecasts? That casts doubt on the myth that the Bank of England is run by pessimistic deflationary bankers. In fact, it is not full of bankers but is run more widely by economists. Secondly, does he agree that the whole point of having a committee to hold the Bank of England to account is to ensure that it does not follow that we have a deflationary instinct, which has been suggested by several hon. Members on both sides of the House, and is simply false?
  Sir Peter Tapsell: I am bound to say that I agree with every word that my right hon. and learned Friend the Member for Rushcliffe said on this point. I earned my living as a stockbroker for 35 years, and the research department of the firm in which I worked was nearly always more accurate in its forecasting than the Bank of England. We took pride in that fact, and there was widespread comment in the financial press whenever we were nearer the mark than the Bank.
  The Bank of England was unduly pessimistic in my right hon. and learned Friend's last months as Chancellor. Although he said that his parliamentary colleagues were reluctant to express a view, several times during his last year as Chancellor I went up to him in the Division Lobbies and said how glad I was that he was resisting Bank pressure to raise interest rates, which I thought to be unnecessary.
  I am sure that my right hon. and learned Friend was right to resist that pressure, and I agree with him that the Monetary Policy Committee will pursue unnecessarily deflationary policies, unless we are extremely careful. However, we will have to wait and see. Debates such as this and the occasional contact that even those of us who do not sit on the Treasury Committee have with members of the Monetary Policy Committee will be useful, because the committee can be made aware that we in the House of Commons are anxious about the possibility of unnecessarily deflationary policies. One hopes that they will therefore guard against them.
  Ms Abbott: Does the hon. Gentleman agree that, even though the Bank of England's current forecasts on inflation might be momentarily optimistic, the Bank's record as a forecaster is that it consistently shows a deflationary bias?
  Sir Peter Tapsell: Yes, that is what I believe. I do not criticise the Bank of England for that—in fact, I have the greatest admiration for the Bank. After the protection of the currency in an international sense, it is the prime duty of a central bank to avoid inflation, and the Bill puts that duty into law; but I object to the Bank being free from political control in that respect. It is one thing to have the Bank advising the Chancellor of the Exchequer on the dangers of inflation, but it is better that the Chancellor, having weighed the advice, should if necessary be able to reject it and subsequently give his reasons for doing so, which was the practice under the Conservative Government.
  I do not want anything I have said to be perceived as meaning that I do not regard the pursuit of stable prices as exceedingly important—of course I do. They are a necessary, but not sufficient, basis for steady growth and high and stable levels of employment, but if we are going to publish an annual inflation target each year, why should we not also have annual employment and growth targets?

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  In my time in the House of Commons, I have noticed that all Ministers have always refused to estimate future levels of employment. How is it possible to be confident that one has got the inflation target right 12 months ahead if one is not prepared to state one's employment target 12 months ahead? In Committee, we should try to amend the Bill so that the Chancellor of the Exchequer has to give employment and growth targets as well as an inflation target.
  Incidentally, that would horrify the Bank of England. Whenever I have suggested it to Bank officials, they have always replied that they would not want to take on that responsibility.
  Any fool—and the Bank of England is not staffed by fools—can produce stable prices by plunging an economy into the doldrums, as Montagu Norman demonstrated in the 1920s and 1930s, and as the current rulers of many of the continental European countries are demonstrating daily.
  By far the best economic state paper published this century was the all-party 1944 White Paper on employment, which made a point of saying that four aims should be given equal significance: stable prices, high levels of employment, a healthy balance of payments and an expanding economy. Those are the four economic balls that a Chancellor should always be juggling, so that no one ball falls to the ground.
  It is a great mistake to toss one of those balls—the monetary ball—across to the Bank of England and to leave the elected politicians to play with the other three. That might work for a time when unemployment is falling, but when unemployment starts to rise, this parliamentary democracy—as long as it is not abolished by our joining a single European currency—will not tolerate the key decisions affecting everyday life being taken by anyone other than Ministers answerable to the House.
  I turn finally to more technical, but still vital, issues posed by the Bill. Having been stripped of its supervisory role and its responsibility for managing the public debt through the gilt-edged market, it is not at all clear in the Bill whether the Bank of England is to continue to act as the lender of last resort. That is a matter of vital importance on which we need complete clarity, so I hope that, when she replies to the debate, the Economic Secretary will make a point of explaining whether the Bank is still to be regarded as the lender of last resort.
  The capacity to act effectively and in time as lender of last resort in a crisis such as the Barings crisis depends on the Bank's commercial intelligence system. The roles of prudential supervision and operational surveillance are closely linked, but they are not the same thing, and they are now to be separated, leaving the bank with responsibility for operational surveillance but stripped of its powers for supervising prudential banking.
  Will the Bank continue to have the same day-to-day knowledge of everything that is happening in the banking world when its supervision staff are transferred to the new Financial Services Authority? I doubt it, although it will retain responsibility for the stability of the financial system as a whole. I therefore predict considerable buck-passing in the years ahead between the Financial Services Authority and the Bank of England when anything goes wrong. The Bank of England will say, "We
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  could not have known in advance that this would happen: we no longer supervise that institution, and the FSA never told us." That will be a source of great trouble, whichever political party is in power.
  The fundamental truth about the Bill, however, is that, overall, it gives the Bank of England a greatly diminished institutional status. This aspect has been largely overlooked by commentators, who have concentrated on the Bank's enhanced independence in the setting of interest rates, but everyone in the Bank of England understands all too well the loss of power and prestige that will flow from the Government announcement of 6 May, which is why the Governor of the Bank of England very nearly resigned on that day, as he has said.
  Ever since it was founded in the reign of King William III, the Bank of England has exercised authority over a wider range of matters than any other central bank. That has been one reason for its great prestige. The Bill strips the Bank of many of its most important powers. It will no longer exercise prudential supervision over the financial institutions. It will no longer manage the Government bond market and the public debt.
  I can tell you, Mr. Deputy Speaker, from my experience as a stockbroker, that the Bank of England officials who operated in the Bank's supervision departments and in the gilt-edged departments enjoyed enormous prestige in the City of London. They were regarded as doing vital jobs and were treated with great respect, even by the most senior and successful of commercial bankers. When one takes those tasks away from the Bank of England, one is in fact, despite giving it enhanced powers over interest rates, transforming it into a quango, in which all but two of the new nine-man Monetary Policy Committee will be appointed by the Chancellor of the Exchequer—and the other two, appointed by the Governor, will also have to be approved by the Chancellor of the Exchequer.
  Furthermore, anyone with acquaintances in the lower echelons of the Bank of England will know of the crisis in morale that is gripping the whole staff of the Bank of England. Previously, Bank of England technical professionals wielded great power and influence—I have mentioned two of the spheres in which they did so. Although there has always been a court of directors, it was composed of non-executive directors who used to meet for lunch once a month and were usually grandees from other walks of life. In the career structure of the Bank, the objective of most Bank of England staff was to become an executive director; that was what motivated them.
  There will not now be many jobs for executive directors, so the career structure of the Bank of England has been largely destroyed by the proposals in the Bill. That will have a significant effect because, when I was at university, it was a matter of great prestige to get into the Bank of England on leaving university. Only getting into the Treasury or the Foreign Office ranked higher in prestige if one was seeking a career in public service.
  Under these proposals, few high fliers will want to join the Bank of England at the age of 23 and make a career. There will be no career for them. Only comparative mediocrities will join the Bank of England from now on. That is what my friends in the Bank of England, of whom I have several, tell me. It is the almost universal view of the junior and middle ranks of the Bank of England.
  Mr. Deputy Speaker, you may say that this is a matter of personalities and that it does not matter, but part of the prestige enjoyed worldwide by the City of London has

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  flowed from the immense respect in which its prime institution, the Bank of England, has been held by commercial, as well as central, bankers throughout the world. By diminishing the role of the Bank of England, as he is doing in the Bill, the Chancellor is reducing the standing of the City.
  The Chancellor and many others in the modern world dislike deference in all its forms, but deference to the Bank of England has been an important economic asset for the United Kingdom. Probably this will not worry the Chancellor, as he hopes to subsume the Bank of England into a European central bank run by foreigners over whom the British electorate and their representatives in this House will have no control, as I have shown by my quotations from the Maastricht treaty.
  My conclusion is that the Bill should be opposed, not only on the practical grounds that it will make the efficient macro-economic management of our affairs more difficult, lead to higher levels of unemployment than are necessary and diminish the power, influence and prestige of the Bank of England, but above all because it is a further constitutional retreat along the road to a single European currency and the sacrifice of British parliamentary self-government to the bureaucracies of a federal Europe.
  7.6 pm
  Ms Diane Abbott: There is no more powerful thing in the realm of economic ideas than fashion, and it is with some timidity that I stand up against the prevailing tide of fashion, which says that the answer for the British economy is an independent central bank; none the less, faced with the facts, I must do so.
  It was remarkable to see a Labour Government, elected in triumph with the biggest majority since the war, within days—not even weeks, but days—hand over one of the most important levers of economic power to an unelected quango. Of course, as my hon. Friends will remind me, at the time it was greeted with tremendous acclaim by the popular press. We must thank for that the—until recently unsung—labours of Charlie Whelan, who span it to political journalists in such a way that the coverage of the decision made it seem comparable to Moses parting the Red sea. Interestingly, the Government chose to announce the decision, not on the Floor of the House, where they might have been challenged and questioned, but in the press, via spin doctors.
  Even in the clamour of the acclaim and the triumph, however, I was reminded of nothing so much as a quotation from Horace Walpole:
  "They now ring the bells, but they will soon wring their hands."
  Everyone in the House wants low inflation. It is relatively easy to bring down inflation by simply slowing down activity; the trick is to achieve growth and low inflation. The argument that I have consistently advanced in my eight years on the Treasury Select Committee, and which I advance tonight in the Chamber, is that an independent central bank is not the best way to combine low inflation with growth.
  I really cannot accept the attempts of Ministers to wrap this policy decision up in the mantra of modernity. A bad idea is a bad idea, regardless of whether one calls it "modern". And the idea that there is anything modern in going backwards in monetary policy to a set-up that was discredited before most Members of the House were
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  born—the idea that we are modernising monetary policy by going backwards to the set-up of the 1930s—does not bear examination.
  I remind hon. Members that an independent central bank is not a new idea: Britain had experience of an independent central bank until 1945. I shall quote from the 1945 Labour manifesto—I know that it will embarrass some of my hon. Friends who do not like to remember that Labour has a past—which contained a commitment to bring the Bank of England under the control of the Government.
  Referring to the 1930s, the manifesto said:
  "Great economic blizzards swept the world in those years. The great inter-war slumps were not acts of God or of blind forces. They were the sure and certain result of the concentration of too much economic power in the hands of too few men. These men had only learned how to act in the interests of their own bureaucratically-run private monopolies which may be likened to totalitarian oligarchies within our democratic state. They had and they felt no responsibility to the nation."
  The issue of democratic accountability caused the 1945 Labour Government—I think everyone will concede that it was one of the greatest Labour Governments—to bring the Bank of England under democratic control. I argue that, far from being outmoded and swept aside by the triumphal progress of new Labour, the democratic accountability issue is as relevant today as it ever was.
  A fundamental problem with the Bill and the proposal is that they create a democratic deficit. My hon. Friends who support the proposal go on about monetary policy as though it were a mere technical matter that is best left to technicians with oily rags—politicians should not bother their heads about it. The hon. Member for Gordon (Mr. Bruce) said that, if the Government leave monetary policy to the independent central bank, they can concentrate on things that really shape the long-term economy. What a fatuous thing to say. What shapes the long-term economy more than the level of interest rates?
  When Europhile Members talk about other European countries and their independent central banks, they do not mention that the role of interest rates in the British economy is rather different, and slightly more sensitive, than that in other economies. For example, in Germany, a far smaller proportion of people own their own homes. Those who do have fixed rate mortgages, with interest rates fixed for the term of the mortgage.
  It is worth politicians' remembering that the British body politic is far more sensitive to changes in interest rates than the body politic in Germany or France. That is not the most important reason, but it is one reason why we should be wary of assuming that, because something works on the continent, it must work here also.
  Sir Michael Spicer: I hesitate to interrupt a most enjoyable and very interesting speech. The hon. Lady is correct in her description of German interest rate levels and how they compare with ours, and many hon. Members will agree with her comments. Does she agree that the task of trying to make the economies of Britain and Germany "converge"—to use the current idiom—is pretty well impossible?
  Ms Abbott: That is another speech for another time, which the hon. Gentleman may await at his pleasure.
  It is not just a matter of the British body politic being more sensitive to interest rates. All adherents to the idea of an independent central bank ignore the fact that interest

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  rates are not a technical matter: they should not be decided in Eddie George's boardroom once a month. Interest rates affect not just house prices, but the level of bankruptcy among businesses and the level of unemployment.
  I put it to the House—I have held this position consistently—that it is not the job of central bankers to decide issues that directly affect the levels of jobs, bankruptcy and economic despair among our constituents.
  Dr. Vincent Cable (Twickenham)rose—
  Ms Abbott: Please allow me to develop my argument. I realise that many distinguished hon. Members are passionate about this subject, but I must continue.
  Much has been said about how the Treasury Select Committee will hold the new independent central bank to account. I bow to no one in my respect for the Treasury Select Committee, under the distinguished chairmanship of my colleague the Member for North Durham (Mr. Radice). However, we cannot seriously believe that the Treasury Committee, with two and a half special advisers, can hold to account the Monetary Policy Committee and the battalions of economists behind Eddie George.
  Mr. Radice: Will my bon. Friend give way?
  Ms Abbott: I wish to continue. Many hon. Members wish to participate in the debate.
  When people make comparisons with the situation in the United States and the Federal Reserve, they must examine also the resources available to those Congress committees that hold the Federal Reserve to account.
  I put it to the Treasury: if it is serious about holding the Monetary Policy Committee to account, it should give the Treasury Select Committee not only more powers, but the resources, the back-up and the manpower to match the institutions that it is supposed to hold to account. The Treasury Select Committee has slender resources and other broad responsibilities. It is ludicrous to suggest seriously that it can hold the Bank and the Monetary Policy Committee to account in any meaningful way.
  I also have a problem with the intellectual basis for the decision. I would argue that is very flimsy: it is all about the power of fashion. My right hon. Friend said, rather grandly, earlier in the debate that the Government have taken these decisions "because we know they are right". That is quite an impressive statement, but how do we know that they are right? That may be a naive question, but I believe that it is the sort of question that one is sent to this place to ask.
  It is worth making another point that has not been made all evening. Although there is a relationship between independent central banks and low inflation—there is no question about that—a definite causal link between an independent central bank and low inflation has never been established. In other words, contrary to what my hon. Friends and some Liberal Democrats may say, merely having an independent central bank by no means guarantees low inflation. I would argue that a country such as Germany, which has an independent central bank, has that independent central bank because it has a low-inflation culture.
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  Let us stop and ask ourselves why the Germans feel strongly about low inflation and are willing to make sacrifices to keep it low. Twice in people's lifetimes, Germany suffered hyper-inflation—first under the Weimar republic and then immediately after the second world war. That country has an almost primal fear of hyper-inflation. I believe that it is not the independence of the Bundesbank that has caused Germany's excellent low-inflation record, but Germany's history and the state of its economy that has created a low-inflation climate, of which an independent central bank is a symptom and not a cause.
  The Bill will hand over one of the most important levers of economic policy to Eddie George. Let me say a word about the Governor of the Bank of England—he will no doubt read the transcript of the debate, if he is not listening to it now at the Bank. I think that Eddie George is a great man, and a fine Governor of the Bank of England. In fact, he plans to come to the House a week tomorrow to speak to the Campaign Group of Labour Members of Parliament about these matters.
  I urge all my hon. Friends to attend that meeting, which will provide one of the few opportunities for Back Benchers to question Eddie George closely. He is a fine public servant, and he clearly has a deflationary bias. There is nothing wrong with a central banker having a deflationary bias. That is what central bankers are for. What is wrong is to let central bankers off the leash—to allow central bankers, with their inflationary bias, to set interest rates with no checks or balances or accountability.
  I believe that, in introducing the Bill, my hon. Friends in the Treasury are victims of economic fashion. There is considerable academic evidence that the downside of an independent central bank is, as was said earlier, that it is hard to achieve co-ordination of policy, and there are risks to jobs and growth, and the danger of an overvalued pound.
  I remind the House that, of the 20 most frequently cited studies on central bank independence, only one associates independent central banks with growth. In a study by Guy Debelle and Stanley Fischer, they stated:
  "Since 1962, countries with independent central banks have suffered deeper recessions on average than those without."
  Mark Hutchison and Carl Walsh found the same thing in a study of New Zealand, and Robert Chote, the financial editor of the Financial Times, writing in a personal capacity, said:
  "People may lose their jobs unnecessarily because Mr. Brown is abdicating responsibility for achieving his inflation targets to the Bank."
  I believe that the wrong decision has been taken, for the wrong reasons, and announced in the wrong way. I believe that, sadly, before the end of this Parliament, I will be proved right on the deflationary bias of letting the central bank decide monetary policy without any democratic checks and balances. For those reasons, I cannot support my Government in the Lobby tonight.
  7.20 pm
  Sir Michael Spicer: Opposition Members found that a most enjoyable speech. I look forward to seeing how the hon. Member for Hackney, North and Stoke Newington (Ms Abbott) votes tonight after such a wonderful speech. Her colleagues on the Government Front Bench looked pretty grim throughout most of it.

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  Like the hon. Lady, I have long held reservations about the concept of an independent central bank. Let us not beat about the bush or kid ourselves: once the Bill is enacted, the Chancellor of the Exchequer will have a legitimate right to deflect the questions of hon. Members on any matters to do with interest rate policy. Furthermore, as my hon. Friend the Member for Louth and Horncastle (Sir P. Tapsell) said, it is probable that, on many other matters of monetary policy, we will not be able to question in the House and hold to account the person who is meant to be in charge of the economic management of the country.
  Despite the great reservations of most Conservative Members, the real dilemmas are those of Labour Members. The Conservative party has for many years been committed to the concept and the priority of price stability, but that does not apply to Labour. So many of the coded objections and reservations that are being expressed have at their root a fundamental concern about priority being given to price stability in the economic management of the country.
  That is why Labour Members have been banging on about the fact that the Bill states that the Bank of England shall take into account economic policy other than price stability, that it will be subject to the priority of price stability. Clauses 11 and 12 bother Labour Members.
  Clause 19 gives the Government overriding powers if they see matters getting out of control. It refers to "extreme economic circumstances", which I imagine might include an impending general election.
  Mr. Radice: That is for you lot.
  Sir Michael Spicer: That is a let-out which is written into the Bill.
  My concerns are the opposite of those expressed by Labour Members. The Bill opens up the possibility of questioning the price stability objective. Already in the debate, and certainly among some of my Labour colleagues on the Treasury Select Committee, it has been pointed out that the Bank must take account of other objectives. When should price stability be said to have come about? Some discretion is possible, with regard to time. Under the Bill, the bank must take into account objectives other than price stability.
  I have two fundamental objections to a Bill requiring the Bank to take into account objectives other than the narrow one of price stability.
  The first relates to a matter raised by the hon. Member for North Durham (Mr. Radice), who was rather unfairly attacked by the hon. Member for Great Grimsby (Mr. Mitchell). The hon. Member for North Durham is rather a good Chairman of the Select Committee, if we must have a Labour Chairman. I suspect that the hon. Member for Great Grimsby does not like the hon. Gentleman's views on Europe, and I agree with him. The hon. Member for North Durham and I do not agree at all on Europe, but that is no reason to attack his chairmanship of the Select Committee. The hon. Member for Great Grimsby was most unfair.
  In an exchange with my hon. Friend the Member for Louth and Horncastle, the hon. Member for North Durham raised the issue of Mr. Greenspan and the Federal Reserve, and the additional powers that Mr. Greenspan had. My hon. Friend observed that Mr. Greenspan was more accountable than other central bankers.
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  I was worried by the tone and direction of that discussion. It was implied that, if we chose the American route, it would lead to government by bank. Once the Bank is given responsibility, not just for the narrow application of the Government's inflation target—which, to be fair, is being offered—but for a panoply of economic objectives, however accountable one pretends the bank is, it will never really be accountable to the people.
  Labour Members who support the Government on the Bill will push the Government—they are already probing in the debate and elsewhere—to turn the bank into the economic manager of our country. That is dangerous territory. At least the Bill restricts the bank to a limited monetary application of a target set by the Government. Once we try to move beyond that—
  Mr. Radice: The Bill puts the matter simply. It states that the primary task of the Bank is to concern itself with inflation, but it must also consider the objectives of Government economic policy, which include growth and employment. It does not hand over everything; it gives the Bank a role.
  Sir Michael Spicer: The hon. Gentleman puts the matter in terms that worry me greatly. Once the bank starts to think of matters other than the narrow remit of the monetary policy it should set in order to achieve a target given to it by politicians, we are in dangerous territory.
  The hon. Gentleman is right to say that that is becoming the public perception of the way in which the bank will operate. I greatly admire Anatole Kaletsky, and agree with him on almost every aspect of European policy. I particularly agree with his article in The Times today, in which he exposed the fallacy of the leadership of the Confederation of British Industry and the figures it claims in support of its opposition to the single currency. That was a brilliant article. Last week he wrote a piece on the Bill in which he said:
  "In the long run, public support must be any central bank's overriding objective."
  He continued:
  "That is why it was right to raise interest rates yesterday but equally the Bank cannot afford to be acquiescent in high unemployment or snuff out economic growth."
  Once we talk about the Bank being popular or unpopular, we are in extremely dangerous territory. We are talking, in effect, of handing over the task of politicians to not a surrogate but a real government. That course is being pressed by Labour members of the Select Committee, who probe those who come before us in an attempt to get them to say, as in a way the Chairman, the hon. Member for North Durham said just now, that there is a range of objectives that the Bank must take into account and have in mind when it is applying its interest rates policy.
  In that approach, we are talking about a parallel Government. That causes me enormous worry, and that is one of the fundamental reasons why I am against the Bill and the path we are following.
  In this instance, the Labour party cannot have its cake and eat it. If it claims enormous responsibility for having set up a mechanism because it did not trust itself to apply a proper inflation-price—stability policy—a mechanism for

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  achieving that and guaranteeing it—it will have to accept that there may be a price to be paid in short-term unemployment.
  Present conditions are relatively easy for the Government because the Conservative Government left this Administration with such a strong economy. As my hon. Friend the Member for Louth and Horncastle (Sir P. Tapsell) said, it is possible now to have four or five objectives in mind at one time because they can all be met simultaneously. The problem will arise for the Government—the time may not be too far off—when they suddenly find themselves, in their own words, having to make hard choices. When that happens they will try to fudge. At the same time they will try to bully the Bank. Not only that, they will try to cast the blame on it for getting things wrong. In those circumstances we are without democratic government. That is what worries me so much about the implications of the Bill.
  7.32 pm
  Ms Ruth Kelly: I am grateful for the opportunity to take part in such an important debate. The move to grant operational independence to the Bank of England is certainly the most radical shake-up that has been seen in the operation of monetary policy since sterling's departure from the exchange rate mechanism, and possibly the most radical shake-up since the war.
  I shall not engage in the argument as to whether low inflation or price stability is a good idea. Many reputable economists have argued that there is no long-run trade-off between prices and output—the objective of monetary policy should be to provide a platform of stability for savers and investors to enable them to plan their futures, an objective which, if met, could increase the long-run growth rate of the economy.
  I was struck today by the comments of the right hon. and learned Member for Rushcliffe (Mr. Clarke), who asked why we should not continue the practice of the Chancellor of the Exchequer always taking decisions on interest rates. After all, the right hon. and learned Gentleman argued, he was always right and the Bank was always wrong about interest rates, whatever the facts of the case.
  Anyone who argues that the right hon. and learned Member for Rushcliffe showed better judgment than the Bank is severely misled. He took risks. He was also lucky. His most important piece of luck was the unexpected and massive appreciation of sterling since last August, and who would argue that that was a good thing? The appreciation of sterling was the only factor that ensured that the right hon. and learned Gentleman hit his inflation target; without it, he would have missed it hopelessly.
  Mr. Gibb: I agree with the hon. Lady that the rise in sterling has been damaging to large parts of the economy, but will she explain how the Government's proposal will lead to a depreciation of sterling?
  Ms Kelly: I shall address the impact of interest rates on sterling later.
  Under the previous Chancellor of the Exchequer, we saw a cavalier attitude to his inflation target in which economic propriety was sacrificed to political advantage.
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  I do not accept for one minute that the right hon. and learned Gentleman did not think that he was taking a risk with inflation. He was certainly prepared to take a risk, and prepared to stoke up inflationary pressures within the economy. If the right hon. and learned Gentleman had been allowed to continue his policy, we could have seen the re-emergence of yet another unsustainable Tory boom named after a Chancellor.
  It is not only the right hon. and learned Member for Rushcliffe who has played fast and loose with monetary policy, however. It seems that the practice is endemic to the office of Chancellor of the Exchequer. One just has to consider different countries throughout the world which operate in very different environments when considering bank independence, as my hon. Friend the Member for North Durham (Mr. Radice) said. Evidence suggests that independence is associated with lower inflation. Only one study suggests that it is connected with the growth of output. The implication is that it is possible to have low inflation without any loss of output or jobs.
  Some will argue, of course, that the Bank has the opposite flaw—that it has a tendency to excessive caution. I suppose that many right hon. and hon. Members would adopt that argument. Indeed, I heard the right hon. and learned Member for Rushcliffe taking up that very point, but the facts do not support it. Contrary to popular wisdom, the Bank's record since 1992 when the current system was set up has been incredibly impressive. Its track record demonstrates that it has consistently been among the most optimistic economic forecasters. Since 1992 it has nearly always been in the bottom quarter of economic forecasters, being far more optimistic than it has been given credit for.
  Indeed, the Bank's record shows that it was overly optimistic. Inflation outturns have consistently been in excess of the then Government's target of 2.5 per cent. over the past few years.
  The Bank has independence, whereas Chancellors are prone to political manipulation—a fact that has been recognised. My hon. Friend the Member for Hackney, North and Stoke Newington (Ms Abbott) said that few decisions made by Ministers had been met with such acclaim as the decision to grant operational independence to the Bank. The immediate reward was half a point off gilt yields. If the Bank is successful over time in reducing inflation to meet the Government's inflation target, gilt prices could fall even further.
  Gavyn Davies, the chief economist at Goldman Sachs, has estimated that, if yields on long bonds fall eventually by a full point, the Government's funding costs will be reduced by about £3.5 billion. That sum could be invested in the economy and could be used for extra public spending. A fall in bond yields would also reduce the cost of investment for private investors, and hence boost the economy in that way.
  I accept that some people have fundamental points to counter Bank independence, including those who have raised the problem of co-ordinating monetary and fiscal policy. It is true that, if we had an all-knowing benevolent Government who took all decisions in the national interest with no prospect or hint of political interference, it might be possible to deliver price stability, but anyone who thinks that that has been happening over the past 25 years

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  must have been living on another planet. Instead of stability, Government co-ordination has delivered boom and bust, unemployment and insecurity.
  Mr. John Hayes: Will the hon. Lady define more closely what she describes as "political interference" and the difference, in her estimation, between such interference and the exercise of political will as accountable to the electorate?
  Ms Kelly: I think that I have defined exactly what I mean by political interference. I have argued that the right hon. and learned Member for Rushcliffe played fast and loose with monetary policy and risked stoking up an inflationary boom just because an election was approaching.
  I shall now come back to the point about sterling, if I may. Some argue that relying so heavily on monetary policy to deliver the inflation target adds to the imbalance in the economy and contributed to the recent rise in sterling. I would draw their attention to the recent study carried out by Bank of England economists and referred to in yesterday's Financial Times, which showed that much less than a quarter of the recent rise in sterling since last August can be accounted for by monetary policy decisions, by expectations of future decisions or by anything to do with monetary policy.
  I will now deal with the charge that the inflation target ignores output. It was very interesting to hear some people argue that the central bank should have nothing to do with output while others argue that it should have targets for growth and output. Some argue that it is necessary to supplement the inflation target with separate, different targets. There is a separate case for that.
  It may be desirable to have targets to raise the underlying growth rate of the economy, but I would argue that output is not ignored when decisions are taken on interest rates. Those decisions are not completely technocratic—important judgments will be made in the short run between output and inflation.
  My right hon. Friend the Chancellor has framed his inflation target in such a way as to ensure that it is impossible to hit with precision at every moment. Indeed, the Governor of the Bank of England has recognised that, operationally, he interprets the target as meaning that the bank should aim to hit it on average over time, that the way to judge him will be to look back in five years' time, or whatever, to see whether he has achieved an average rate of 2.5 per cent. over that period.
  That means, inevitably, that the bank will have some discretion as to how it reacts to unexpected events which occur not just from month to month or year to year but from day to day. There will be events that impact on the economy, whether generated from the domestic economy or from abroad. Some of these completely unpredictable events—or supply shocks, such as a rise in the price of oil—will, if no corrective action is taken, reduce output and raise inflation. In those circumstances I would argue that it would be wise for the Bank to let inflation rise temporarily and not to exacerbate the short-term loss of output.
  I completely disagree that such discretion is undesirable. Indeed, my right hon. Friend the Chancellor recognised this dilemma in his Mansion House speech, in which he set out a system whereby the bank would have to write an open letter if inflation breached the trigger points of 1.5 per cent. or 3.5 per cent. The Bank has to
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  write an open letter to say what action it intends to take to return inflation to the target, and the time scale in which it intends that that should happen. He does not assume that the target will be met continuously.
  As Mervyn King, director of monetary policy at the Bank, and soon to be Deputy Governor, argued in his lecture to the London School of Economics last week:
  "It is striking that central banks have been reluctant to acknowledge openly that monetary policy has two components, an inflation target and a response to shocks. Provided an inflation target framework is interpreted to include these two distinct elements of monetary policy, then the charge of the critics that inflation targets mean ignoring output is false. Moreover, by allowing the horizon over which inflation is brought back to its target level to depend upon the nature and size of the shocks hitting the economy such a policy … is superior in principle to"
  the alternatives.
  Mr. Gibb: Did the hon. Lady not say in the Treasury Select Committee that how far the Bank of England deviates from its inflation target, how it deals with output in dealing with shocks, are political issues, but that the Bank of England appears to have great discretion here?
  Ms Kelly: I would argue that these decisions are fundamental to the way in which monetary policy is carried out. It is for those precise reasons that I would argue that proper accountability of the Bank is essential. In fact, precisely because of these responsibilities, the Treasury Select Committee has been given much greater powers to examine the Bank's policy and to hold it to account.
  The Select Committee system is recognised by Parliament and operates in the normal fashion. It is for those reasons that, although I support the Bill and support the granting of independence to the Bank, I argue that the hand of Parliament should be strengthened so that a Select Committee can properly carry out its responsibilities and hold the Bank to account.
  In particular, I suggest, as the Treasury Select Committee has suggested in its recent report, that members of the Monetary Policy Committee have the opportunity to come before the Select Committee in confirmatory hearings after their nomination to the Monetary Policy Committee by the Chancellor. I do not believe that such hearings would deter applicants. Given our assessment of the situation, it is clear that some of them would welcome the opportunity to appear before the Select Committee to clear up any points of potential public controversy.
  Such a system would enhance transparency and aid accountability. It would also shield the Chancellor from any charges that appointments might have been made on party political grounds.
  It is also vital—here I agree with my hon. Friend the Member for Hackney, North and Stoke Newington—that extra resources should be granted to the Select Committee so that it can correctly discharge its responsibilities and ask questions about the trade-offs that the Bank has made between output and inflation in the short run.
  The Bill is moving in the correct direction, and I welcome it. It is precisely because this decision is so momentous that I hope that my right hon. Friend the Chancellor will take the Select Committee's considerations seriously.
  7.45 pm
  Mr. Andrew Tyrie: It was a pity that my right hon. and learned Friend the Member for Rushcliffe (Mr. Clarke) was not here to answer some of the allegations made about him by the hon. Member for Bolton, West (Ms Kelly). Some of those allegations were very strong, and I am sure that when he reads them in Hansard he will be very disappointed that he was not here to answer them.
  I am sympathetic in principle to the idea of central bank independence, but I cannot support these half-baked proposals. I shall explain why in just a moment. Before I do, I want to clear up one issue that has been bouncing around in the House this evening: whether the decision to go ahead with independence was a breach of the Labour party's pledge in its manifesto. The manifesto says pretty clearly:
  "We will reform the Bank of England to ensure that decision-making on monetary policy is more effective, open and accountable."
  That may seem fairly clear, were it not for the fact that almost identical words were used by the Prime Minister when he was Leader of the Opposition. In a speech in 1995, he then went on to say that, after those reforms had been put in place:
  "We will then watch the track record of the Bank before deciding what, if any, further steps should be taken towards greater operational responsibility for the Bank in interest rate policy."
  It is absolutely clear that the public were misled by the manifesto wording. That is a disgrace. It is nothing more than we might expect. There was, of course, another remark from the then Leader of the Opposition along the lines, "We have no plans to raise taxes at all." How does that sit alongside the raid on pension funds? Or, to go back to the manifesto again, a line immediately above the one about the Bank, which says:
  "We will match the current target for low and stable inflation of 2.5 per cent. or less."
  Within a few weeks, that target was changed to a band, making inflation of 3.5 per cent. permissible. Those breaches of pledge do not register with the electors at the moment, but they will in time—as will the arrogance of the Chancellor, for example, when he reluctantly came to the House to announce Bank of England independence.
  I want to make three points. First, I want to explain why Bank of England independence has become such an issue only over the past 15 years. Secondly, I want to explain why the proposals in the Bill are a bit of a dog's dinner and why they probably will not deliver independence—I would be much more sympathetic to them if I thought they would. Thirdly, I want to suggest how, with the help of the Treasury Select Committee, the proposals could be made a little more palatable.
  For most of modern economic history—that is, the industrialised and relatively free trading period of the last 150 years—monetary policy was set by an external anchor: the exchange rate. For most of that time the monetary anchor was the gold standard, or Bretton Woods in the post-war period. National monetary policy was subordinate to the external anchor, so central bank independence did not matter very much.
  It was only after Bretton Woods collapsed that the debate about central bank independence gathered pace, both here and abroad—a period during which many countries decided to create independent central banks, and
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  a time during which successive Britain Governments had directors at the International Monetary Fund who were busy encouraging all countries to adopt independent central banks.
  After the collapse of Bretton Woods, our politicians soon had British monetary policy in a mess, which began to be sorted out only when the IMF arrived in 1976. Even so, attempts to find a substitute for the exchange rate anchor have had a mixed track record. Monetary base control was rejected as too crude, so it was never tried. Targeting the monetary aggregates became difficult with financial deregulation. Before long, policy became extremely discretionary, and it appeared that all depended on what the Chancellor thought.
  The problem for Britain with the discretionary approach, especially as other countries separated monetary policy from short-term political control, was that the UK's policy appeared to carry less and less credibility in the markets. A credibility gap was opening up between our monetary policy on inflation and those of the best-performing countries. It was a measurable gap in terms of bond yield differentials. Of course, part of the premium we were paying reflected policy mistakes, but the policy makers are just as likely to make misjudgments whether they sit in Threadneedle street or in Whitehall.
  The main purpose of central bank independence is not to call upon superior minds to do the job—I do not think that they are better ones in Threadneedle street—but to close the credibility gap and deal with the belief that politicians might be meddling in monetary policy with political objectives in mind.
  The crucial question is whether the Bill's proposals close the credibility gap. Do they really distance the Chancellor from decisions on short-term interest rates? That gap will be reduced only to the extent that people believe that the Bank is fully independent, and that is where these proposals are at their most deficient: there are too many get-out clauses—too many opportunities for the Government to meddle.
  It is, of course, right that the Bank should be obliged to act in accordance with overall Government economic policy—as set out in clause 11. The statutes of most central banks include something similar. Even the Bundesbank's statutes carry a similar injunction. The problems start with the fact that only operational responsibility is being given to the Bank; the inflation target will continue to be set by the Chancellor. As I have just said, he loosened the inflation target as one of his first gestures.
  Then there is the so-called override whereby, at least temporarily, the Chancellor can assume direct control over interest rate policy. Presumably, he would want to do that only when he could not achieve his objectives by relaxing the inflation target. It is a draconian power.
  Most worrying of all—other hon. Members have referred to this—is the term of office given to the Monetary Policy Committee. Of its nine members, five are effectively controlled one way or another by the Bank of England. Six—of whom two come from the group controlled by the Bank—are appointed for a term of only three years. Even the Governor and the Deputy Governors are appointed for only five years. That compares with the Bundesbank council, which has an appointment period of eight years, and with the US Federal Reserve board, to which appointments are for 14 years.

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  If the main purpose is to generate belief in the markets that interest rate policy will not be subject to short-term political considerations, it is as plain as a pikestaff that the terms of office should be longer than the life of a typical Parliament. Seven years sounds sensible; three will not do. As it happens, the Chancellor of the Exchequer made exactly that point, in a speech in May 1995 when in opposition, about his proposed advisory monetary policy committee's membership. He agreed that seven years would be right, so why on earth is that number not in the Bill? The fact that the Government seem reluctant to budge on any of these points must mean that, at the first sign of trouble, markets may once again open up the credibility gap.
  What can we do if the Bill does not find support in the Lobby tonight? We shall have to rely on the Treasury Committee—I was pleased to hear some of the remarks of the hon. Member for North Durham (Mr. Radice) on that. The Committee will have to make the best of a botched job and at least inject some accountability into the proposals. These arrangements give the Committee some scope to exercise that power, although there is no mention of that in the Bill—I gather from an earlier response to an intervention that that is for technical reasons. Incidentally, giving Parliament a more direct role in this area is an innovation; Parliament has never had a direct responsibility for the creation of money, or for the operation of monetary policy: both have always been matters for Executive—and before that Prerogative—control.
  I am pleased that the Treasury Committee will look beyond how well the Monetary Policy Committee will deliver the inflation target and look at the target itself and ask, "Is this the right target?" In doing so, I hope that it will take evidence not just from the Chancellor or even the Governor, but also from individual members of the Monetary Policy Committee. I am glad that the Treasury Committee will be able to dig its heels in to obtain some confirmation hearing power for all appointments to the Monetary Policy Committee; de facto, it will interview them. On this, the issue is not, as my right hon. and learned Friend the Member for Rushcliffe suggested, that people with a particular view will be chosen; it is that the wider public should be allowed to know their views. We should have a clear explanation of their thinking on crucial issues.
  I am also glad that the Treasury Committee will press for an extension of the term of office of the Monetary Policy Committee. Only if people have that extension will they speak freely when they come before the Select Committee. I also hope that the Treasury Committee will limit the scope of the Chancellor's use of the "extreme circumstances" clause. What are the extreme circumstances which might lead the Chancellor to override the Bank's operational independence? The circumstances must be defined. Let us go through the matter in detail.
  Mr. Geraint Davies: The hon. Gentleman has made some play about the Chancellor intervening in the extreme circumstances of economic shocks; yet earlier we heard the former Chancellor—the right hon. and learned Member for Rushcliffe (Mr. Clarke)—say that there is no
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  opportunity for us to intervene. Where do the Opposition stand on the convergence criteria, as it appears that there are enormous divisions?
  Mr. Tyrie: I am not on the Front Bench. I am expressing my view on the Bill. If we are going to go for independence, we must make a proper job of it and not have the sort of half-baked hotch-potch of a job that we have with this Bill. If we are going to go for independence, we must give the Bank not only operational responsibility but target or goal-performance responsibility.
  Mr. Davies: Will the hon. Gentleman give way?
  Mr. Tyrie: No, I will not give way a second time.
  I am also concerned that members of the Monetary Policy Committee will not be permitted to speak their minds after committee meetings.
  Mr. Loughton: Gagging orders.
  Mr. Tyrie: Yes, it is like a gagging order. I disagree not so much with the purdah period that the committee has decided to impose on itself around the time of the meetings, as there is some sense in that, as with the six-week lag between meetings and publication of the minutes. Minutes should be published much more quickly, within a few days. Moreover, committee members should be free to speak about them and, if necessary, to dissent from the decisions that have been taken. The forces of collegiality in the committee will be strong enough to ensure that the freedom to speak will be exercised only in extreme circumstances.
  If the Treasury succeeds in beefing up its role, we shall get at least half a loaf because, compared with current practice, there will be an increase in democratic accountability. For the first time. Parliament will have a little say in monetary policy.
  It will, however, be only half a loaf. Today, we are not debating a proposal for genuine independence. At best, it is a faltering step along the way; at worst, it is another political stunt—an attempt by new Labour to shed responsibility for tough decisions while keeping its hands on policy.
  If we cannot defeat the Bill in the Lobby today, it will be up to hon. Members—particularly those on the Treasury Select Committee—to try to make the best of this botched job.
  8 pm
  Mr. Keith Vaz: I welcome the Bill and pay tribute to my right hon. Friend the Chancellor of the Exchequer for his boldness and determination in attempting to reform one of our most redoubtable institutions, the Bank of England. I congratulate him on the Bill's provision for transferring control of interest rates to the Monetary Policy Committee. For far too long, our economic strategy has been characterised by the boom and bust policies preferred by the Conservative party. The Bill will guarantee the fiscal and monetary stability that our economy badly needs.
  I welcome also the Bill's provisions for transferring control of the regulation and supervision of banks to the Financial Services Authority. The measure will be of great

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  benefit on two counts: first, allowing the Bank to concentrate on its central task of maintaining economic stability; secondly, removing from the Bank a responsibility which it was totally inept in fulfilling—an incompetence demonstrated in its scandalous misconduct in the regulation of the Bank of Credit and Commerce International and of Barings.
  The House knows of the long-standing support of many hon. Members for the campaign to obtain justice for the thousands of depositors who lost everything in the BCCI collapse. In the six and a half years since the bank closed, I and other hon. Members have met the tragic victims of BCCI. I remember meeting a man who won the Spanish lottery and put his winnings into BCCI one week, only to lose them in the bank's collapse a week later. I remember also pensioners in Gibraltar who lost their life savings, and people driven by the shock to hunger strike and, in some cases, almost to suicide. I continue to receive letters from people for whom the suffering and stress is as great and as real today as it was on 5 July 1991, the day that BCCI closed.
  Six years after the then Secretary of State for Trade and Industry established a liquidation committee to chase up the $10 billion stolen by the fraudsters and to return the lost funds to the victims, depositors are not much closer to recovering their money than they were in 1991. Only one dividend, amounting to 24.5 per cent., has been paid out. Today—I do not know whether it was in advance of this debate—the liquidators announced for next year a second dividend, of 11.5 per cent. Despite those two payments—which amount to only 36 per cent. of the money that people had placed in BCCI—the tragedy of the bank's collapse continues.
  I should remind the House of the closure of BCCI. It closed because the Bank of England used its supervisory powers to step in and shut down the bank's operations. The merit of that decision is questionable, because it was within the Bank's remit temporarily to restrict the bank's licence, to force a management change, or even to mount a rescue operation, as it had done in the case of other banks. It remains a matter of great consternation for thousands of victims that the Bank employed what can be described only as a discriminatory attitude towards BCCI, whose situation was not totally dissimilar to other banks facing crisis or fraud.
  The decision to close the bank was made in a private meeting between the then Prime Minister, the then Chancellor of the Exchequer, the then Governor of the Bank of England, Mr. Leigh-Pemberton, and the then Deputy Governor of the Bank of England, Mr. Eddie George. At the time, we pointed out that Mr. Eddie George, despite his involvement in the bank's closure, was promoted to the Bank's governorship. I stopped calling for Mr. George's resignation over BCCI because, every time I did so, he was promoted by the previous Government. Today, I resist the temptation to praise him or to call for extending his contract, as it may have the opposite effect.
  Whatever the merits of the decision to close BCCI, the Bank's neglect of duty in allowing the fraud to be perpetrated for as long as it was, jeopardising the investments of thousands of depositors, is beyond doubt.
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  Lord Justice Bingham was asked to conduct the inquiry established by the then Chancellor of the Exchequer into the supervision of BCCI. He found that
  "the Bank's supervisory approach to BCCI was in my opinion deficient".
  Further in the report, he said:
  "the Bank did not pursue the truth about BCCI with the rigour which BCCI's market reputation justified".
  Lord Justice Bingham stated that no action was taken before 1991 to change the structure or management of BCCI, despite representations having been made to the Bank about fraudulent conduct within BCCI throughout the 1980s, and despite evidence having been presented to the Bank by the Foreign Office and the intelligence services. Lord Justice Bingham painted a picture of a Bank of England whose employees failed to communicate properly with each other, that disregarded and misplaced evidence that was being fed into it, that had a laid-back and relaxed attitude to the tasks in hand and that was incapable of acting decisively, despite having all the information before it.
  Lord Justice Bingham's report stated that the Bank's attitude towards a 1988 incident, in which BCCI was linked to drug traffickers, was
  "so off-hand as to suggest a lack of interest."
  Elsewhere in the report, again and again, the Bank was found to have
  "failed to live up to the task."
  Such conduct was totally unacceptable then, and it is totally unacceptable now. No disciplinary action of any type has been taken against any employee of the Bank of England.
  I should add that the full story of the Bingham report has not yet been told, as some of the appendices have been withheld from the public.
  Mr. Tyrie: What does all that have to do with the Bill?
  Mr. Vaz: Unfortunately, the hon. Gentleman has not read the Bill. He will see that the Bill deals with transfer of regulatory functions from the Bank of England. My speech therefore has absolutely everything to do with the Bill. Had he been in the Chamber for the opening speeches—
  Mr. Tyrie: I was.
  Mr. Vaz: —the hon. Gentleman will have heard the Chief Secretary to the Treasury refer specifically to BCCI and Barings and the need for independent regulation.
  I ask my hon. Friend the Economic Secretary to the Treasury to deal in her reply with the previous Government's decision to refuse to publish the confidential memorandums and appendices to the Bingham report. I do not want to put her on the spot, because I know that she will want to consider the matter carefully. In consultation with the Chancellor of the Exchequer, will she, please, consider the possibility of publishing that confidential information? It is not often that I find myself in total agreement with the liquidators of BCCI. At today's meeting in the House, however, they called for publication of the report. I hope that the Government will consider doing so.

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  I should like to pay tribute to those who have been involved in the campaign over the past six years. I pay tribute to Dr. Elias, who is chairman of the depositors protection association; Bernard Clarke, who has been advising the liquidation committee; and, most recently, Mr. Paul Lehmann and Mr. Jonathan Hirshler, both of whom are involved in trying to get justice.
  I must also mention the position of BCCI employees. Hon. Members who can cast their minds back to 5 July 1991 will know that the then Governor of the Bank of England, who had supervisory jurisdiction over the bank, described the employees of BCCI as part of a "criminal culture". As a result of that statement, many of the ex-employees, who were not involved in any way in the fraud, have found it extremely difficult to obtain employment.
  The Bingham report and its appendices are now history, but the Bank's conduct over BCCI is not. It is clear that the previous Administration failed to learn the lessons of Bingham. Norman Lamont, who was Chancellor at the time of publication of the report and who lost his seat on 1 May, told the House that Lord Justice Bingham said:
  "the Bank of England's general approach to supervision has served this country well"—[Official Report, 22 October 1992; Vol. 212, c. 580.]
  Mr. Lamont also agreed with the recommendation that a radical recasting of the legal structure of banking supervision would not be appropriate. It is important to note that that was the policy pursued by the Conservative party for a number of years, which is why we greatly welcome the Bill and the fact that there is going to be a change.
  The right hon. and learned Member for Rushcliffe (Mr. Clarke), who makes fleeting appearances in the Chamber, said in 1995 that we had one of the best regulatory systems in the world. I do not agree, and nor do the Government, which is why the Bill has been introduced.
  Mr. Loughton: This is all very interesting, and many of us have heard it many times before, but could the hon. Gentleman suggest how the successor to the Bank of England in this aspect of regulation—the Financial Services Authority—might do a better job, given that it will be an exceptionally bureaucratic, large and expensive organisation, which will take several years to get its act together? How does the hon. Gentleman think that the FSA will make a better fist of it than he claims the Bank of England has done in recent years?
  Mr. Vaz: The hon. Gentleman has not heard what I have to say, because he was not a Member of Parliament when I last spoke about BCCI. He has not been able to follow the argument. Clearly, the Bill will enable people who put their faith in British banks, and who therefore deposit their money in British banks, to know that there is an independent regulatory and supervisory authority.
  My point is that the collusion between the previous Government and the Governor of the Bank of England, which was not independent, enabled meetings to take place about BCCI, and stopped an independent view being taken of the problems with BCCI. Had there not been that collusion, and had there been independent and proper regulation. BCCI would not have closed.
  Mr. Loughton: I take the hon. Gentleman's point. The fact that I was not here when he last spoke about BCCI
  780
  does not mean that I am not aware of what he said. How does he think that the FSA will be more independent of the Chancellor than the Bank of England was?
  Mr. Vaz: The FSA is a new organisation which will be concentrating on supervising banks, and it will have the regulatory power to do so. With the greatest respect, I have to say that the involvement of the then Deputy Governor of the Bank of England, now the Governor, and all his officials at the Bank meant that there was not the necessary independence. The Bank did not have the necessary credibility to supervise BCCI properly. The hon. Gentleman has obviously not been listening to what I said. Had there been proper supervision, the mistakes that were made over BCCI would not have occurred.
  I welcome the Bill. I know that it will make a great deal of difference, not only to the credibility of the way in which this country supervises its banks but to the thousands of depositors—the 1.2 million account holders—who looked to Britain and to the Bank of England properly to supervise a bank like BCCI. Of course, the Bill has come far too late for the victims, who will have to wait at least 10 years for the liquidation to be completed, but it is not too late for all the others who may be caught in exactly the same situation.
  8.14 pm
  Dr. Vincent Cable: I want to talk primarily about part III of the Bill, which has attracted very little attention. I suspect that that is because it is less politically sexy, or perhaps it is just too complicated. However, it covers some important matters which need to be debated now, before the Bill goes into Committee. In general, my party supports the Bill, as we favour operational independence for the Bank of England and the idea of statutory uniform regulation. Within that broad framework, however, many questions still need to be answered.
  I shall maintain the flow of the debate on the management of monetary policy and take up some of the issues that have not yet been dealt with properly. I tried to intervene in the speech of the hon. Member for Hackney, North and Stoke Newington (Ms Abbott), who has left the Chamber. She perpetuated a fallacy that has been repeated several times. She tried to link the conduct of monetary policy with long-term investment and growth decisions.
  The simple fact is that the Bank of England, whether or not it is independent, has responsibility solely for short-term interest rates. Long-term interest rates, which are what really matter for the cost of capital in business and which influence long-term investment decisions, are set not by the Bank of England or the Government but in the markets. Governments can influence them only indirectly.
  Long-term interest rates are set in international markets but can be affected by expectations of inflation. It is the ability of an independent central bank to maintain low and stable inflation which gives low long-term interest rates. That is what matters for investment and growth, and that is why the Bill is so important.
  On the issue of central bank independence, I have a query about the link between this debate and our eventual entry into economic and monetary union. As the

  781
  Government know, we support their broad approach to EMU, but we are critical of the fact that they have passed up the opportunity for early entry. That will present some tricky transitional problems for an independent Bank of England.
  Those problems were graphically outlined in the interviews given by Mr. Duisenberg yesterday in the United Kingdom. He said that other countries in Europe would maintain close scrutiny of the United Kingdom's policy over the next few years should we wish to join EMU. They will scrutinise our policy closely not only in respect of inflation, which has converged very well, or of interest rates, but also of exchange rates.
  Whether or not we join the exchange rate mechanism, we will be expected later in this Parliament to maintain exchange rate stability. Given that there is no reference whatsoever to nominal or real exchange rate stability, it is not at all clear from the Bill how the Bank of England will carry out that task and reconcile it with its other task of maintaining low inflation. Some clarification of this problem, which has arisen as a result of delayed entry, needs to be provided.
  My frustration with the Bill and with some of the documentation that led to it—for example, the Large report—is that it is very much concerned with institutions and procedures. I recall an anecdote involving the former Prime Minister, James Callaghan. He spent a long time with civil servants who were describing a complex administrative reorganisation. With some frustration he said, "I can see the harness, but where is the horse?" The horse in this debate is the basic philosophy which will govern the regulation of the financial sector. It is not clear what the Government's thinking is, and we should be grateful for some guidance.
  We could caricature two possible ways forward. The first is that regulation proceeds in a permissive way which respects the flow of markets: in the retail market, it observes the principle of caveat emptor; in the wholesale market, it allows competition between institutions and allows bankruptcy for banks and other institutions. We know the dangers of that approach. Emptors are ripped off by vendors, as the hon. Member for Leicester, East (Mr. Vaz) has just described. If institutions are allowed to collapse, there is a danger of a collective, systemic collapse. That is why we do not endorse a totally permissive approach.
  However, it is possible to steer too far in the other direction. An over-regulated system presents its own problems of inflexibility and stifling initiative. We have seen examples in east Asia in recent months of the dangers of an over-regulated banking system, which perpetuates bad lending. We hope that the system of regulation that emerges from the new institutional arrangement is flexible and market oriented, which will allow more competition.
  If we are to be satisfied that the Government's proposals are the way forward, they must address various issues. The first, which has not been answered, was raised by the hon. Member for Louth and Horncastle (Sir P. Tapsell). What does the lender of last resort facility mean? At what point does the Bank of England intervene and according to what criteria? That is all buried in the
  782
  memorandum of understanding. Whether the central bank intervenes too frequently or not at all is of enormous importance.
  We also need clarification on the cost of regulation. The Bill says that the cost will rise from £30 million to £50 million as a result of the FSA inheriting the overheads of the Bank of England. However, there are other estimates. Coopers and Lybrand, which is a reputable organisation, has talked about a £200 million a year cost for regulation. I have no way of knowing whether that estimate is correct, but there may be a ballooning cost. If that happens, it will have a considerable effect on the operational efficiency of financial institutions, particularly small boutique institutions serving private clients as investors. Many such organisations could not afford the cost of monitoring complex regulation, and would be driven out of business, leaving large institutions to dominate. We need answers to such questions.
  Another issue that needs to be addressed is perhaps best covered by the dreadful word globalisation. To his credit, the Chief Secretary acknowledged the extent to which we are dealing with internationally integrated financial markets. He is the only contributor to the debate to have mentioned the international dimension. The Large report is entirely about regulation in one country and does not refer to international aspects. We are dealing with a highly integrated market. That involves not just the links between different banks. Any investor can now lock into electronic systems and take a broker in the United States as well as here. National systems of regulation increasingly make little sense.
  We must have clarity on how the international dimensions will be handled. The Chief Secretary made passing reference to that, but he did not mention that probably one of the most important international institutions at present is the Bank for International Settlements, which prevents collective collapse in the banking system. It is not clear from what has been said so far whether that will remain the responsibility of the Bank of England or be transferred to the new regulator.
  What will happen to our participation in the International Organisation of Securities Commissions, which is another key international institution designed to prevent collective collapse in the securities markets? There is an important international dimension to regulation which has not been properly covered.
  My final point relates to a specific aspect of financial markets that affects ordinary individuals more than any other—mortgages. We have heard about the impact of interest rates, but the Bill is important in another sense. There have been big changes in the home loans market. Banks have become building societies, and building societies have become banks. One of the main structural changes in the past year is the disappearance of large numbers of mutually owned institutions. That is a matter of great concern for many Labour Members and for me.
  Representations have been made to the Economic Secretary to get her to have a fresh look at the system of regulation that she inherited under the Building Societies Act 1997. I know that the issue may be more appropriate to the legislation that will succeed the Bill, but there is some urgency, because mutual institutions may have disappeared before the next batch of legislation comes forward. Will the Government be receptive to an amendment to the Bill to allow stricter regulations on mutual conversions?

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  I received a fax this morning containing an internet guide to carpetbagging, which illustrates the extent to which abuses are taking place, permitting the asset stripping of institutions. The situation needs to be addressed urgently. I wonder whether the Government would be prepared to use the Bill as a vehicle for that.
  The Bill provides a good structure, which we support in principle. However, as in so many other cases, everything depends on the small print. We shall criticise those aspects of the Bill with which we disagree.
  8.25 pm
  Mr. Austin Mitchell: I want to try to give a good Labour speech, rather like that given earlier by the right hon. and learned Member for Rushcliffe (Mr. Clarke), the previous Chancellor of the Exchequer. I regret the fact that, while the first act of the Labour Government in 1945 was to nationalise the Bank of England, the first act of the Labour Government in 1997 was to give the Bank of England independent control over the most important lever of economic management.
  I have no quarrel with the regulatory parts of the Bill, because the Bank of England had too many roles—none of which it performed well—to be an effective regulator. We have been reminded of its deplorable record on BCCI, Barings and Johnson Matthey. I read an article in The Sun a few years back and wondered how an organisation that could not stop its staff taking used bank notes home in their knickers until there were 14 cars parked outside the home of the used bank note taker could be an effective regulator. That is only an aside. Chaps regulating chaps did not work and does not work. It is as well that we are ending it—slightly too late for my preference, but it should be ended.
  I want to concentrate on independent control of interest rates, based on criteria that deal only with inflation, taking no account of employment, growth and all the other important factors for the performance of a Government. Inflation is a dead enemy. It is not going to resume. We are using a nuclear weapon to destroy a phenomenon that is dead anyway. That is overkill.
  The policy is justified by non sequiturs. The argument is that stability creates the conditions for growth. That is not true. There is no causal relationship between low inflation and growth, although it is clear that higher growth leads to a quickening of inflation, because inflation is a symptom of life. We need some inflation. If we got growth to 5 per cent.—which is not very high—inflation would go over the 2.5 per cent. target at which the Bank is instructed to aim. The Bank would therefore have to kill high growth, which seems disastrous.
  The economy is being fitted into a monetarist corset, rather like those impregnable Spirella corsets that used to be advertised in newspapers when I was a teenager and noticed such things. After years of slow growth, the economy needs a substantial boost. It is easy to get stability and low inflation—they can be found in graveyards. The only two periods of stable prices that I know of in recent economic history were in Salazar's Portugal and during the five years up to 1929 before the great crash in the United States. Neither case suggests that price stability and low inflation are of any great benefit to the economy.
  784
  There is no evidence on whether an independent central bank is better at dealing with inflation. That is a fad, not a fact. The best authority on the issue is a book by Eijffinger and de Haan. Their conclusions, which appear to be common sense, are that
  "a country with an independent central bank will. ceteris paribus,"—
  which they never are—
  "have a lower rate of inflation than will a country where politicians can steer the central bank's policy."
  However, the study compares a list of countries comprising the Philippines, Brazil and various south American economies with examples such as Germany where low inflation is inevitable because of its powerful industrial base, so it proves nothing.
  The study continues:
  "Most empirical studies, however, show that central-bank autonomy does not enhance economic growth £ Indeed, most studies suggest that central-bank independence is associated with higher disinflation costs."
  The evidence from the best study of such matters shows that central banks overkill and clobber the economy, and that their management of the economy produces deeper recessions.
  Television commentators and the Bank of England trot out the monetarist myth that a slight increase in interest rates now will produce lower inflation later, as if it were a scientific law—but that is not the case. Higher interest rates increase the value of the pound and make imports cheaper, thus dealing with inflation. They also make exports dearer and put people out of work, thus dealing with wage inflation. Essentially, they clobber the manufacturing economy and put people out of work as a means of restraining inflation. It is rather like trying to maintain an expensive car by bashing the carburettor with an enormous great hammer.
  Bank of England management is the opposite of stable. In a world of floating exchange rates, any increase in interest affects the exchange rate. The uncertain prospects for monetary union in Europe, which may or may not happen—the position may be wide, narrow, soft or hard—affect conditions here. Investors are attracted to Britain by higher interest rates, but repelled by the uncertainties in Europe.
  Giving the Bank of England—which has no higher wisdom in facing any problem than to put up interest rates—independent power over interest rates inevitably increases the value of the pound, and that has a damaging effect on the economy. Indeed, it will lead to a balance of payments problem, a fall in exports, an increase in imports and a loss of jobs. All that will happen next year, just when the new deal will be coming in to fight inflation and unemployment by micro-policies that will run contrary to the macro-policy enforced by the independent Bank of England.
  If Britain is managed by interest rates—which is what the Bank of England is attempting to do—it will be inherently more unstable than most of its competitors, because interest rates are crucial in our economy and most people are on flexible rather than fixed-rate mortgages. Therefore, an increase in interest rates has automatic and substantial effects on the retail prices index and house prices.
  One has only to recall what happened in the Lawson boom when interest rates were kept low because we were shadowing the deutschmark. There was an explosion of

  785
  credit and economic activity that had to be damped down massively within two years. It was followed by the Major deflation, when interest rates rose too high, leading to deep recession. We have disproportionate fluctuations as a result of the importance of interest rates in our economy. Therefore, interest rate management that is designed to produce stability instead produces instability in the economy.
  The Bank of England is not a repository of abstract wisdom and scientific knowledge about inflation. It is a vested interest in respect of finance, the City, housing and bankers, unleavened by the interests of manufacturing, which has been deeply damaged by the Bank's role in the economy, or the interests of the regions, which should be represented in the court and in our monetary policy.
  We need a Monetary Policy Committee composed of diverse economic interests, but instead we have clapped-out monetarists, Keynesians turned monetarist and then turned halfway back again into budding new Keynesians, and foreigners with curious backgrounds, as I read in The Observer. We need a diversity of economic viewpoints—labour economists, Keynesian economists and expansionary economists—rather than just monetarists.
  Finance is implicitly interested in dear money. The philosophy is to pile it high and sell it dear—quite unlike that of the supermarkets. Currently, the real interest rates are at record levels. In the 1970s and part of the 1980s, the real interest rate was actually negative, so people could afford to invest. Indeed, there was an incentive to do so. Now, with inflation at 2.8 per cent. and the interest rate at 7.5 per cent., the real interest rate is at a record level. That is a direct, damaging penalty on investment. The Bank of England and the banking community has an interest in high interest rates and a high, stable exchange rate. However, they do not represent the interests of manufacturers, which remain the drive motor of our economy and generate jobs.
  A misguided decision based on myths and inaccurate information, carried out at the wrong time—just when it can do maximum damage to the economy—made the Bank of England independent on interest rate policy. That brings me to my basic argument against the entire Bill: it destroys democratic accountability.
  All sides of the argument have been exaggerated today. Those in favour of the Bill have defended it, and exaggerated its benefits, saying that it will provide stability. People such as me might be inclined to exaggerate the penalties—although, frankly, I think not. Even if the Bill's effect in making interest rates and the exchange rate higher than they would otherwise have been and growth a little slower than it would otherwise have been is marginal, there will be damaging consequences for the British economy. We can argue about that, but the proof of the pudding will be in the eating. The people elect the Government to run the economy for their purposes—betterment, enrichment, jobs and growth. If those purposes are not achieved, the people can throw the Government out.
  The Government are now giving up power to an oligarchy whose interests point in the opposite direction from those of the people. It will not remove blame from my right hon. Friend the Chancellor of the Exchequer. We
  786
  saw that after the Budget, when he was blamed for not reducing demand by increasing taxes. It will not make him blameless—simply less powerful. We shall transform ourselves from one-club golfing, which was the approach of the right hon. and learned Member for Rushcliffe, to no-club golfing.
  If the Government are committed to not increasing taxes and they do not control monetary policy, how will they manage the economy without the fiscal or the monetary weapon? Democratic, accountable government needs to have both those weapons and to use them for the purposes of the people, which are different from the purposes of bankers. The people want economic management to provide jobs, growth, a maximisation of living standards and betterment. Because it reduces our ability to achieve those objectives and follow the purposes of the people in economic policy, I cannot vote for the Bill.
  8.38 pm
  Mr. Nick Gibb: I begin by congratulating the hon. Member for Batley and Spen (Mr. Wood) on an excellent maiden speech. I hope that we shall hear more from him in future.
  I shall keep my remarks brief, as I am keen to hear the debate among Labour Members on a matter that obviously divides them deeply.
  The Chancellor's decision to give the Bank of England independence over interest rates will prove to be the Government's first major policy error, and it occurred within four days of the new Labour Government coming to office. It has resulted in the abandonment of a monetary and economic policy that has yielded the best inflationary record for 50 years, low and falling unemployment, and steady growth. It has removed from direct control and accountability a principal lever of economic policy. As Robert Chote—who has been quoted many times tonight—the economics editor of the Financial Times, wrote in his excellent paper for the Social Market Foundation, an independent Bank of England
  "will weaken democratic control over a vital area of public policy."
  Monetary policy, and the conduct of monetary policy, has such a fundamental effect on people's lives and is so fundamental a part of economic policy that it has to be in the hands of those elected to office.
  The Bill will divorce monetary policy making from fiscal policy making. It will result in higher than necessary interest rates, with all the consequences for mortgages, for the competitiveness of British business and for higher unemployment.
  By giving the Bank of England independence on interest rates, the Government are signing up to the latest fashionable, quick-fix panacea. All the panaceas that Governments have adopted over many decades—the gold standard in the 1920s and 1930s, the parity with the dollar in the 1940s, the Bretton Woods arrangement and, most recently, the exchange rate mechanism—have ended in failure. There is no short cut to the successful management of the economy, which is difficult and sometimes requires unpopular policies.
  Mr. Nigel Beard: The United States and all the other nations in the European Union have separated fiscal control from their

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  Governments for some years. Why have all those countries performed better than we have in the past 18 years?
  Mr. Gibb: I shall come back to that point in a minute, but France and Germany currently have levels of unemployment that are twice as high as ours. The Conservative Government, by adopting a balance between sensible monetary and fiscal policies, achieved a steady and stable economy. Any number of trendy panaceas proposed and adopted by the present Government will not change that truth.
  I acknowledge that the immediate effect of giving the Bank of England control over interest rates was to reduce the premium between short-term and long-term interest rates. However, that premium had built up since the war because Britain has been plagued by periods of high inflation, mostly brought on by previous Labour Governments. The Government faced a choice between a quick-fix panacea, which would reduce the premium in the short term but at a cost to growth and employment, and a long-term commitment to conducting monetary and fiscal policy in such a way as to demonstrate that Britain has at last become a stable, low-inflation economy. They have gone for the quick fix. The previous Conservative Government opted for, and delivered, long-term stability.
  The various studies that have been trumpeted by the very few supporters of the Bill who have spoken today show that countries with an independent central bank have lower average inflation rates than countries that do not. I acknowledge that. The Harvard Institute of Economic Research showed, for example, that countries with central banks with the most independence—Switzerland, Germany and the USA—had an average inflation rate of less than 4 per cent. between 1951 and 1988. Those countries with central banks with the least independence—Spain, Australia and the United Kingdom—had average inflation rates of 7 per cent. during that time.
  However, as the hon. Member for Hackney, North and Stoke Newington (Ms Abbott) said, when she opposed the Government's policy in an Adjournment debate:
  "although there may be a statistical relationship between central bank independence and low inflation, no causal relationship can be established."—[Official Report, 11 June 1997; Vol. 295, c. 1055.]
  She repeated that comment today. That view is backed up by Michael Jenkins of Hull university, who has commented that there is no statistically significant relationship between high central bank independence and low inflation.
  I come to the cost of the policy. It is not the lack of a causal link that prompts my opposition to the Bill. Those countries with independent central banks have experienced much deeper recessions than those without, as the hon. Member for Great Grimsby (Mr. Mitchell) pointed out. He quoted the academics Sylvester Eijffinger and Jakob de Haan, who have studied the point in great detail. They cite five studies of central banks, four of which show that, for any given reduction in inflationary pressure, the deflationary cost is higher in those countries with independent central banks than in those without.
  Another academic study in 1994 by Guy Debelle and Stanley Fischer showed that since 1962 those countries with independent central banks have suffered deeper recessions, on average, than those without. The countries
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  with independent central banks did not enjoy higher growth levels, despite the high social costs of the recessions, so there was no compensatory rise in growth in the long term.
  The reason for that phenomenon is plain. If a Government give a central bank the duty to meet an inflation target, that is what it will do. Any idiot can eliminate inflation from an economy by pushing interest rates sky high, oblivious to the consequences for growth and unemployment. A successful manager of an economy has to secure a balance between low inflation and economic growth. As Stanley Fischer has pointed out:
  "An important reason to expose central bankers to elected officials is that, just as the latter may have an inflationary bias, the former may easily develop a deflationary bias. Shielded as they are from public opinion, cocooned within an anti-inflationary temple, central bankers can all too easily deny that cyclical unemployment can be reduced by easing monetary policy."
  That over-deflationary bias has been the experience of the Bank of England since before 1 May. In November 1995, for example, the Governor proposed a 0.5 per cent. rise in interest rates to combat what the Bank saw as incipient inflationary pressure in the economy. That rise was opposed by my right hon. and learned Friend the Member for Rushcliffe (Mr. Clarke) and, 18 months later, his opposition has been proved correct.
  Since the election, evidence of over-deflationary bias has been still more manifest. In six months, we have seen five interest rate rises—empirical evidence that independent central banks are more prone to set higher and excessive rates of interest than those that are not independent, because the incentives exist for them to do so. The Government acknowledged that fact soon after their announcement, on 6 May, of their decision to give the Bank independence. A few weeks later, the Chancellor revised his proposals.
  Mr. Geraint Davies: The hon. Gentleman asserted that the five rises in interest rates since the election were caused by independence being given to the Bank of England. He has no counter-factual evidence to suggest that interest rates would not have been higher under political control. The shadow Chancellor has no view on that, because he and the Conservative party do not know what the rate should be. In essence, he said, "This situation is awful, but I don't know what we would do." To suggest that the rises are a function of independence is rubbish—they are a market response to the current economic conditions.
  Mr. Gibb: The Government and the Chancellor say that it is the Bank's responsibility to determine interest rates, but now the hon. Gentleman is saying that the Chancellor is in favour of the five rises in interest rates since the general election.
  The Chancellor revised his original proposals, announced on 6 May, a few weeks later, seemingly in response to the criticism, which was abounding, that they would lead to excessive interest rates. He relaxed his inflation target and brought in a lower parameter below which the Bank was not allowed to let inflation stray. None the less, the deflationary instinct remains, as evidenced by last Thursday's interest rate rise, which was not widely acclaimed in the City.

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  That instinct will be institutionalised by the way which the Bill is drafted. Clause 11 proposes:
  "the objectives of the Bank of England shall be—

  (a) to maintain price stability and

  (b) subject to that, to support the economic policy of Her Majesty's Government".

  That appears to be copying the objectives of the Bundesbank. The 1957 Bundesbank law says that the Bundesbank shall regulate the volume of money in circulation and of credit supplied to the economy with the aim of safeguarding the currency.
  Section 12 of the Bundesbank law adds that the Bundesbank shall be required to support the general economic policies of the Federal Government. The same word "support" is used. That vague imperative to have regard to the general economic policy of the Government clearly has not worked well in recent years in Germany, where unemployment is more than 12 per cent., compared with 5.5 per cent. in Britain. Anatole Kaletsky argued in The Times in June that the very independence of the Bundesbank has led to the prolonged recession in Germany for the past few years.
  The United States, on the other hand, has a different model. The Federal Reserve Act of 1913 provides that the Federal Reserve shall conduct its operations
  "with a view to accommodating commerce and business."
  In 1978, the Humphrey-Hawkings Act specifically set the Federal Reserve the dual target of full employment and price stability.
  We are talking about something more fundamental than merely the structure of the objectives of an independent central bank, however. The principal reason for the success of the Federal Reserve in recent years is that the Fed is chaired by Alan Greenspan, a man who consistently gets it right. If another individual with a different view of the way in which monetary policy should be set had taken his position, the chances are that the Federal Reserve might not have been so successful. However, one cannot legislate for an Alan Greenspan. Monetary policy is not an exact science.
  As my right hon. Friend the Member for Fylde (Mr. Jack) said in the Adjournment debate on the subject in June:
  "Setting interest rate objectives requires feel, touch and sensitivity."—[Official Report, 11 June 1997; Vol. 295, c. 1073.]
  Even more than that, however, interest rate judgment depends on how potent an effect one believes an interest rate rise or fall will have on the economy. That is very much a political view.
  Whether an independent central bank will be successful depends on the composition of the Monetary Policy Committee and on the Governor. That is fine if things go well, but what happens if they go wrong? Because one cannot pass a law to ensure that the Bank gets monetary policy right; because the mechanics of interest rate policy are still the subject of political debate; and because handing that over to an independent bank will not stop interest rate policy being the subject of political debate, it is essential that such decisions remain in the hands of those elected to office, who are accountable and can be turfed out by the electorate if they get it wrong.
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  The key to maintaining a low-inflation economy is to have a low-inflation culture. To create that, one needs the backing of the British people. We can have any number in of independent institutions which are crafted and structured in any way we wish, but if the support of the people is not there, the central bank will not succeed. As Robert Chote says:
  "Central banks will only succeed in delivering low inflation if they reflect fundamental support for price stability in society."
  It is important that, when people go to the polls, they understand that they need to elect politicians for whom low inflation as a principal object of economic policy.
  In a free and democratic society, people must have the ability to determine the economic policy of this country, whether they are right or wrong. That is what the Government want to avoid. They realise that, given Labour's instinct for economic mismanagement, people will not vote for a Labour Government unless that Government hand over their conduct of the economy to someone else—anyone else.
  Mr. John Bercow: There is not a single word that my hon. Friend has uttered so far with which I have disagreed. Is not this Bill—although bad and damaging—but a halfway house? Following the logic of my hon. Friend's thesis, is it not an interim step to the wholesale abandonment of the power to control British monetary policy and interest rates outwith the United Kingdom altogether—to a European central bank that we do not elect and cannot remove?
  Mr. Gibb: I agree with every word that my hon. Friend says. The decision to join a single currency is part and parcel of the desire to hand over to somebody else—anybody else—economic decisions that the Government know they cannot trust themselves to take. That is why they went on about their promise not to raise taxes. That is why they made such a song and dance about sticking to Conservative spending plans. That is why the first thing that the Chancellor did was to give up his right to conduct monetary policy. Even new Labour does not trust new Labour.
  There was not a single word in the Labour party manifesto about giving independence to the Bank of England. It merely said:
  "We will reform the Bank of England to ensure that decision making on monetary policy is more effective, open, accountable and free from short-term political manipulation."
  Despite what the Economic Secretary said earlier, that does not mean giving the Bank of England independence. There is not a hint in that phrase about a plan which, in the words of the Prime Minister, is the
  "biggest step in economic policy making in Britain since world war two."
  Today, we are debating a Bill which the people did not vote for and did not expect—but that is typical of what we have come to expect from the Government. During the election, the Prime Minister wrapped himself in the Union Jack to demonstrate his Eurosceptic credentials; yet within six months, his Government have pledged themselves to take Britain into a single currency. Within four months, the Government have allowed through at two successive ECOFIN meetings a paper on European Union tax harmonisation proposals.

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  The Labour party challenged every reduction in unemployment over four consecutive years of the last Tory Government by challenging the basis of the figures. Since the election, the Labour Government have done nothing to revise or change the basis of those figures. The Government were elected on a pledge to bring unemployment down further—that is the whole basis of their economic policy, we are told. But every major economic decision taken by the Government since the election is designed, whether deliberately or not, to increase unemployment.
  The decision to give the Bank of England independence is leading to excessive rises in interest rates, which will, in due course, lead to unemployment increasing. The Budget and the Finance Act will take £10 billion out of the economy. The Government have signed up to the social chapter and proposed the introduction of a minimum wage, all of which will lead to job losses.
  On 20 May, the Chancellor stated that the introduction of an independent Bank of England and the appointment of a Monetary Policy Committee would be scrutinised by the Treasury Committee. I searched in vain through the Bill for even one reference to the Treasury Committee. Why is that? Are we meant to rely, for the only piece of democratic accountability in this whole undemocratic arrangement, on a statement in a letter from the Chancellor?
  The Chancellor also said that the Bank of England could use its own separate foreign exchange reserves to intervene in the money markets. How can we be sure that the Bank will conduct those operations for domestic purposes rather than for exchange rate stability? What is the Government's policy on exchange rate?
  The late Lord Ridley, in his autobiography, opposed an independent Bank of England, writing:
  "For what purpose would they use interest rate policy? In order to try to secure an artificial exchange rate, or to control the domestic money supply? The Bank of England is well known for its attachment to interfering with the exchange rate, and could never be trusted to operate interest rate policy for the sole purpose of domestic stability."
  What is the Government's strategy, and can the Bank of England be so trusted?
  The Government's rhetoric is of openness, but they announced the independence of the Bank of England on 6 May, the day before Parliament assembled. Was that so urgent that it had to be dealt with on a Monday rather than a Tuesday? The Government trumpeted their introduction of a green Budget and draft legislation for consultation, but took the biggest step in economic decision making since the war with no consultation or debate, before any announcement to the House.
  The Chancellor may be a close ally of the Prime Minister's, but in his six months in office he has made a series of political decisions that will do our economy enormous damage: the decision to give the Bank of England independence; the £5 billion smash-and-grab raid on Britain's pension funds; and the decision to take Britain into the single currency after the next general election. Those are the Government's three most damaging decisions since the general election; they were all made by the Chancellor and will all, I believe, lead the Labour party to lose office at the next general election. I urge the House to vote against the first of them this evening.
  9 pm
  Mr. Charles Clarke: I strongly support the Bill. I want to talk about the accountability of the Bank, on which the Treasury Committee has reported, and, in particular, to reject everything the hon. Member for Bognor Regis and Littlehampton (Mr. Gibb) said. I was glad that he spoke with such brevity—to allow the full involvement of Labour Members.
  I also reject the assertion of the right hon. and learned Member for Rushcliffe (Mr. Clarke) that the Bill would create a less transparent and open system of fixing monetary policy. I profoundly disagree, and I hope to explain why.
  We in Norwich have a specific interest in financial services. Norwich Union has its headquarters there, as does Virgin Direct with the new Virgin One bank account and Sedgwick's insurance brokers. They employ many people in my constituency. They want a stable economy with low inflation and transparent and open economic decision making so that they know where they stand. I believe that the Bill will supply that, and that is why I support it.
  There is concern in Norwich—as elsewhere—about the fact that monetary decisions can be taken according to the febrile concerns of the marketplace in the City rather than as a result of being rooted in the real needs of the economy, and that there is sometimes a mystical approach to monetary policy making that ignores economic realities.
  One of my constituents, who is regularly consulted by the regional agents of the Bank of England, said that he was concerned that decisions might be, and are, taken in the City without consideration of the impact on the price of the green pound or the consequences of the windfalls in Norwich as a result of Norwich Union's conversion. I believe that the Bill will allow those concerns to be dealt with.
  Other countries manage in different ways. The Bundesbank and the Federal Reserve have well-established systems of taking into account the real economy. There are different constitutional devices reflecting countries' different constitutions.
  The Treasury Committee addressed the issue and came to the central conclusion:
  "We believe that by bringing information into the public domain we can help to clarify the issues and that rigorous scrutiny of the basis for policy decisions will enhance the credibility and effectiveness of the monetary policy framework as a whole."
  I believe that that is fundamentally right and that that is what we are trying to achieve.
  In his evidence to the Select Committee, the Chief Secretary stated:
  "maximum transparency and openness in policy making … will add to the Government's credibility"—
  any Government's credibility—
  "and in turn will lead to a reduction in the premium we have to pay currently in terms of interest rates."
  I believe that those principles are right, and that is why the Bill is right.
  Our Select Committee sought to set out in its report how transparency and openness could be developed. I want to explain clearly what the Committee is saying. First, we will require the Chancellor to give clear evidence in the public domain about the basis of the clarification

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  and instruction that he gives, as set out in clause 12. He will be required to explain, directly and openly, not quietly and secretly, how he deals with the economic shocks mentioned earlier by the former Chancellor, the right hon. and learned Member for Rushcliffe.
  The Chancellor will be required to specify why, for example, he chooses a point target for inflation rather than a range; why he takes one measure, such as RPIX, rather than another; why he chooses a particular figure, such as the present 2.5 per cent. plus or minus one; and what general period the target should be met within. If he uses his powers under clause 19 to override the Bank, he will have to explain why he has done so and how he is doing it.
  One of the most ludicrous assertions that have been made tonight is the suggestion that the motive behind the Bill is to allow the Chancellor to shift responsibility to the Bank. He could not begin to do that. All Chancellors take responsibility for the inflation target they set and for the structure and framework of monetary policy. They are accountable for that to the House and to the Treasury Committee. The idea that the Chancellor might think that he can get rid of it and give it to Eddie George is ludicrous. That is not the motive that lies behind the Bill or the motive of the Chancellor, and the suggestion that it is is wrong. The accountability of the Chancellor that I have described is the clearest possible demonstration that the Government retain full responsibility for the key indicators of economic policy, including monetary policy. It is right that they should, and right that they are accountable for it.
  On the Bank, the Treasury Committee proposes a range of measures to bring into the public arena policy considerations and policy areas that have never been there before. I pay tribute to the former Chancellor, who is in his place, for some of the steps that he took to move that on with the inflation report, the publication of minutes and so on. The Bill seeks to take that further and bring more into the public arena.
  Hon. Members asked who would give evidence. Of course the Governor will give evidence and of course we want all members of the Monetary Policy Committee to be interviewed from time to time. If there was a division in the minutes, we would take evidence about why MPC members took different views. We are seeking to take evidence about the role of the court. There is a series of areas within the Bank's decision taking, and different people with different responsibilities in respect of which we hope that views and conduct of affairs will be open.
  What will the Committee do? First, we have stated—I believe that this can be achieved—that we will require the Bank to clarify its assumptions on matters such as foreign interest rates, the exchange rate, domestic and international growth and, critically, the relationship between interest rate movements and the real economy. With all credit to the former Chancellor, those areas and assumptions have not been in the public arena before, but they will be now. That will enhance the public debate about the conduct of economic policy.
  The Committee set out explicitly that we would require the Bank to provide in its main inflation report an annual statement of the transmission mechanisms that it believes operate in the relationship between monetary policy and
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  inflation. That is an important area: many assertions and ideas are discussed in various ways. We are saying that we want it out in the open every year so that we can examine the assumptions that have been made.
  On the open letter process, if there is any deviation from the target that is set, there will be full evidence, full hearings and full understanding in the full public arena. There will be hearings on the inflation report, as my hon. Friend the Member for North Durham (Mr. Radice) said, at least twice a year—and probably more often—to draw out the full picture. If we have the reserve powers allowed for in clause 19, there will be every opportunity to air the matter fully in the public arena. The Committee's report also mentions that we are seeking an annual debate on this issue in the House. The process will greatly increase transparency and openness, and will add to the credibility of the Bank.
  I am short of time and am coming up against the deadline. I had hoped to comment on the confirmatory hearings. I agree with my right hon. Friend the Chief Secretary to the Treasury that they are not a requirement for the Committee to be able to operate in the way I described, but proper confirmatory hearings would enhance the Committee's work.
  In conclusion, I urge hon. Members to read paragraphs 47 and 49 of our report, where we set out how confirmatory hearings can be conducted carefully and effectively without the worst practices of the congressional system. Such hearings would enhance the system. The Chief Secretary generously told our Select Committee that he had an open mind on that matter. I genuinely hope that, even with this Bill, he will have an open mind when considering amendments in that area.
  9.10 pm
  Mr. Howard Flight: This hotch-potch privatisation—the independence of the Bank of England—will, like the Chancellor's Budget, soon lose its initial popularity. If we are to have an independent central bank, let us do it properly like the Federal Reserve and have proper, full and open accountability and let those who are responsible be properly serviced and have objectives that cover the full range of economic activity, not merely over-narrow, anti-inflation objectives.
  The Government are claiming that there is some democratic accountability in the Bill and that they are opting for a midway house—the best that Britain can do at this stage. In that case, I cannot understand why the Chancellor is so keen on the proposed arrangements for the European central bank. That will be the worst sort of independent central bank arrangement—a bank that is not in any way democratically accountable and that leaves the door wide open for all the dangers that the hon. Member for Hackney, North and Stoke Newington (Ms Abbott) described so well. My great fear is that the ECB will be besotted with the desire to make the euro a strong reserve currency when Europe already has a large trade surplus. Over-valuation will result, and we will have Japanese-style deflationary and stagnatory problems.
  My main concerns relate to the dangers that will face Europe, given the coming climate. The proposals for how the Bank of England is to manage banking problems are weak. At the starting point, there are signs of misunderstanding. The Chancellor pointed out in the early summer that it was frightfully important that the

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  management of interest rates should be purely for inflation control and should not be contaminated by other factors. Was he not aware that in America, for example, this very decade, interest rates had to be managed to be low for quite some time in order to rebuild the capital base of the banking system, which had been ravaged by the previous recession? Was he not aware that the same situation obtained in Japan? Interest rate policy and being lender of last resort is a crucial part of a central bank's job in managing the overall stability of the banking system.
  My great fear is that the debt deflation and the competitive devaluations in the Asian economies will blow a nasty cold wind to the mature economies of America and Europe. The climate will be extremely difficult for the banking system. It is worrying that responsibility is not clearly laid out in those areas. One cannot have a central bank that might have to take large decisions against the background of systemic problems when responsibilities are not clearly laid down.
  To know what to do with particular banks, the Bank of England has to have responsibility for monitoring them, yet that power has now been sent off to the FSA. It is noteworthy that Alan Greenspan pointed out when the proposals were made that, in his opinion, it was extremely unwise to separate the responsibility for monitoring the banking system from overall responsibility for maintaining stability.
  The arrangements have not been clearly organised in the Bill: the co-ordination arrangements and the process for decisions on when the Bank of England may need to intervene massively to support the banking system and what authority it requires from the Government are not clear. I was around during the 1974 crisis, when many of our largest banks had to be supported by the Bank of England in the lifeboat. The lifeboat was a great tribute to the effectiveness of the Bank during a major systemic crisis. Given the current economic winds, I am greatly concerned that, because of the insufficiently clear and divided responsibilities, we might find that, at the crucial moment, these new and ill-defined arrangements will leave the Bank of England and the banking system ill equipped to deal with problems.
  Like my hon. Friend the Member for Chichester (Mr. Tyrie), I am opposed to the Bill. It does not do the proper professional job required if we are to go down the route of having an independent central bank. If we want to do that, let us do it professionally, like the Federal Reserve. For goodness' sake, let us be extremely wary. There is at least some democratic accountability back to the Treasury Committee, so let us be extremely aware of the risks ahead and get the Bank of England ready to deal with the great dangers that may face our banking system over the next two years.
  9.16 pm
  Mr. Ross Cranston: I have only four minutes to make a few points.
  I support the Bill without deviation and without hesitation. First, it puts the constitution of the Bank of England on a firm basis. It sets out the mechanisms for accountability that my hon. Friend the Member for Norwich, South (Mr. Clarke) described. Secondly, it sets out quite clearly the Bank's status in terms of monetary policy. Opposition Members do not seem to agree on that point—the right hon. and learned Member for Rushcliffe
  796
  (Mr. Clarke) says that we should leave things as they are, but others have said that we should make the Bank completely independent.
  Some hon. Members do not seem to have read the Bill, and I include some hon. Friends in that number. Clause 12 makes it clear that the Government set monetary policy; clause 11 makes clear that it is up to the Bank of England to set interest rates to meet the targets that the Government have determined. Under the Bill, the Bank will not be completely independent, but neither will it be completely under political direction. There is a fine balance, and the Government have got it right. The arrangements reflect those in other countries, such in as the Bundesbankgesetz.
  Thirdly, the Bill puts financial services on a firm footing. One of the problems that now face us is that, unfortunately, the Conservative Government did not implement properly the Gower report. They set up a range of self-regulatory organisations: we started with seven, reduced that number to five and then got down to four. It was a complete shambles.
  Under the Bill, financial services regulation will be brought under a proper umbrella. I am pleased that insurance is to come under that umbrella: current insurance law has not felt the wind of consumer protection, but the Bill puts investor protection in the retail sector to the forefront. I welcome that unreservedly. I support the Bill and I am sure the House will give it its approval.
  9.19 pm
  Mr. David Heathcoat-Amory: This most interesting debate has revealed deep cracks in the facade of new Labour. The most notable speeches by Labour Members were made by hon. Members who obviously do not believe that it is one of the tasks of a Labour Government to hand over control of economic policy to bankers, however eminent those bankers may be. Although they are bound to be dismissed as the voice of old Labour by the trendies on the Treasury Bench, they nevertheless represent a more authentic Labour tradition, from which we shall hear much more before this Parliament is out.
  More generally, the debate has shown that the Government proposals for a central bank that is independent in this country are not proposals for an independent bank in a real sense. They would be better described as proposals for a quango bank, designed to take unpopular decisions about things such as interest rates, but leaving the powers of appointment, the power to override and many other important powers, in the hands of the Chancellor of the Exchequer and the Government.
  As a result, the Bill will not satisfy those who believe in a genuinely independent central bank. They must be pretty numerous on the Labour Benches, because they are now committed in principle to the most independent central bank in the world, to be set up in Frankfurt—the European central bank. That bank, as we heard in the debate, will be forbidden to take any instructions from national Governments or Parliaments, and will not be accountable to any democratic body or institution, anywhere, for the foreseeable future. That is entrenched in treaty law—which is, of course, superior to national law.
  The Government, and Labour Members who want the United Kingdom to join a single European currency, have not followed through on that in the Bill, or even taken the

  797
  halfway step of setting up such a genuinely independent bank for our own purposes, so the Bill will not satisfy those who believe in a genuinely independent central bank. Nor will it satisfy those hon. Members from whom we heard tonight who believe that interest rate decisions should remain in democratically accountable hands. It is a dog's breakfast of a Bill, which will satisfy no one.
  Mr. Radice rose—
  Mr. Nigel Beard rose—
  Mr. Cranston rose—
  Mr. Heathcoat-Amory: I had better give way to the Chairman of the Treasury Select Committee.
  Mr. Radice: If it is such a dog's breakfast of a Bill, why do not the Opposition say that they will repeal it if they get into government? If it is so bad, why not repeal it?
  Mr. Heathcoat-Amory: That point was dealt with satisfactorily and comprehensively by my right hon. Friend the Member for Hitchin and Harpenden (Mr. Lilley).
  The hon. Member for North Durham (Mr. Radice) will know, because he was in the previous Parliament and the one before it, that Labour made several ill-judged promises to repeal legislation when it achieved office. There was scarcely a privatisation that was not accompanied by a ringing commitment to renationalise when Labour came back into office. All that has been ditched under the impact of events and reality.
  We shall not make the mistake of making knee-jerk reactions and promises to repeal legislation, but we are entitled to draw attention to the deficiencies in the legislation so that we do not need to repeal it, because it will not have become law by receiving a Second Reading. I hope that Labour Members who have spoken against the legislation will join us in the Lobby at 10 o'clock.
  Supporters claim that the Bill and the thinking behind it will establish a low-inflation culture in this country, and will commit everyone to the national imperative of low inflation. If that is the case, why did the Chancellor make no effort to consult anyone before he announced, four days after the general election, his intention to hand over powers to the Bank of England? There is nothing about it in the Labour manifesto, apart from a few weasel words about the Bank of England.
  As the right hon. Member for Llanelli (Mr. Davies) pointed out, the business manifesto—which is the really important one—contains a commitment to do something else: to set up a statutory advisory committee in the Bank of England. No preparations were made in the Labour manifestos, yet an announcement was made almost immediately, not to the House of Commons in the normal manner but by letter to the Governor.
  That announcement conflicted with the Chancellor's assertion in opposition that the Bank should demonstrate a successful track record in good advice and build greater public credibility. That is what he said on 26 February this year, but, rather than wait for the Bank and its committees to establish a track record of good advice,
  798
  he rushed in with this ill-considered proposal. Today the Chancellor of the Exchequer showed further contempt for the House by failing to introduce his legislation—he is not even present for the winding-up speeches. That is his attitude towards accountability to the House, and it is reflected in the Bill.
  In a typically powerful speech, my right hon. and learned Friend the Member for Rushcliffe (Mr. Clarke) explained to the House that the achievement of low inflation does not require an independent central bank. The Conservative Government established an inflation target of 2.5 per cent. or less. We said that we would reach that target by the end of the Parliament, and we did.
  One of the first things the present Chancellor did was relax that target—it is now 2.5 per cent. plus or minus 1 per cent. That sent a very dangerous message to the markets, financial commentators, economic agents and those who bargain wages and prices. That rather familiar message was that all Labour Governments are finally soft on inflation and give way on inflation. I am certain that this Labour Government, for one reason or another, will be no exception.
  Ms Kelly: If the right hon. Gentleman believes that the decision to loosen the inflation target—as he put it—is so damaging to the British economy, can he explain why bond yields fell by half a point on the day that the announcement was made?
  Mr. Heathcoat-Amory: I am sorry to tell the hon. Lady the bad news: inflation has increased since the Chancellor made that announcement. The Chancellor routinely, month after month, misses his inflation target. It is now above 2.5 per cent. He not only sent a signal that Labour Governments are soft on inflation, but compounded the error in the Budget by failing to deal with what he thought was incipient overheating with excessive consumer expenditure.
  If that was the problem—and he certainly thought it was—why did he fail to deal with it? Instead of taxing consumer expenditure, the Chancellor taxed the corporate sector through the windfall tax and the notorious £5 billion a year raid on pension funds. He has done nothing on the fiscal side to bring down inflation since the election—in fact, he has added to it.
  The strain of that anti-inflation strategy has been borne by the Bank of England. That is why we have seen five interest rate increases since the election. Who can tell whether the great men on the Monetary Policy Committee are right? We do not know, and we will not know for 18 months. That brings us back to the Chancellor's comment that he would have to wait some time until he could assess whether the Bank had built up the correct track record, before he handed it the powers. As I said, however, the Chancellor overrode that, and, in a great and unnecessary rush, he has given the Bank the authority to change interest rates.
  The detail of the Bill weaves an uncertain path between making the Bank independent and keeping it as an appendage of Government. That muddle has been spotted not only by hon. Members who have spoken in the debate, but by outside commentators. Professor Gowland has

  799
  been quoted. He knows a great deal about financial regulation and banking, and he has pointed out that the new arrangement, which is in fact a contract between the Treasury and the Bank,
  "will reduce the Bank's discretion."
  The Bank's task is to deliver a narrowly defined inflation target. It is required to take into account the Government's more general economic objectives, such as growth and employment, but those are explicitly to be subject—and therefore secondary—to the aim of price stability. That is to be written into statute law in clause 11.
  If we in this country were to experience an economic shock, perhaps a mild one—cost pressures of one sort or another—the Bank is forbidden by statute to give a higher priority to the maintenance of output and employment than to its overriding objective, which is to maintain price stability. Before the end of this Parliament, we shall see what strains and stresses that can create.
  In other words, the Bill combines minimal discretion with the maximum potential for damage. The reason is that the Government want to keep the Bank on a very short lead, while at the same time being able to blame the Bank for the unpopular decisions that may be required.
  The Treasury Select Committee concerned itself with the appointment of the great men on the committee and the directors. The Select Committee spotted the fact that the Monetary Policy Committee will, in part, report to the Bank's court of directors. All the members of that court are to be appointed by the Chancellor of the Exchequer, but the terms of appointment of the court are to be reduced from four to three years—less than a normal Parliament.
  Will the Economic Secretary accept the recommendations of the all-party Select Committee that the terms of appointment of members of the Monetary Policy Committee and the court should be made longer than is proposed in the Bill?
  Will the hon. Lady comment on another issue—who should be appointed to those important independent committees? We saw last week the rather regrettable spectacle of powerful outside lobbies getting at a Labour Government. We saw the motor racing industry successfully buying favours from a Labour Government. That was regrettable. It is now certain that the Labour party has broken an election pledge, under pressure from a powerful industrial lobby which happens to have given a lot of money to the Labour party.
  Understandably, the House and the Select Committee, which may have anticipated that, want to be certain that the appointees to the proposed bodies are above suspicion and beyond reproach. That is the least that the House can expect from the Government. I ask the Minister to state in her reply that the appointments to the Monetary Policy Committee should be confirmed by the Treasury Select Committee, if necessary after hearings.
  Another point that I would like the Minister to answer—it was raised by my hon. Friend the Member for Arundel and South Downs (Mr. Flight)—relates to the transfer of banking supervision from the Bank of England to the Financial Services Authority. A joint committee might be proposed to try to keep the Treasury, the Bank and the FSA in touch with one another, but at present it is the Bank that has the expertise and the knowledge to judge systemic risk in the banking system. We believe
  800
  that it is most unwise to transfer these responsibilities now to a new and untried organisation that is struggling still to set itself up and to take on the other tasks that it has to undertake.
  The Bill formalises an interest-rate-setting mechanism that we believe is not necessary to control inflation, and could in practice lead to a dangerous deflationary bias. That has been asserted by Labour Members as well. We believe also that the Bill risks a wider split between fiscal policy, which remains with the Treasury, and monetary policy, which is going to the Bank. For those and other reasons advanced by my right hon. and hon. Friends, we shall be urging the House to vote against Second Reading.
  9.35 pm
  The Economic Secretary to the Treasury (Mrs. Helen Liddell): We have just heard a speech encapsulating the difficulties in which the Conservative party finds itself. The right hon. Member for Wells (Mr. Heathcoat-Amory) could not even decide how long he wanted for his summing up.
  We have seen mounting tonight the extent to which one side of the Tory party does not know what the other side is doing. Until tonight's experience, I was rather doubtful about the theory of Pavlov's dogs, but bearing in mind the number of times that Conservative Members have returned to the issue, I am now convinced that, even in their sleep, they talk about the single currency.
  There is confusion on the Opposition Benches: on the one hand we are told that the inflation target is too tight, while on the other we hear that it is too loose. We hear that the right hon. and learned Member for Rushcliffe (Mr. Clarke) is the greatest thing since sliced bread—from a man who resigned from the right hon. and learned Gentleman's team in government. We have seen kissing cousins and the making of a marriage of convenience from a party that does not know whether it is coming or going.
  Mr. Tim Boswell: Will the Minister give way?
  Mrs. Liddell: Give me a minute, and I shall willingly give way to yet another member of the Opposition Front Bench, who perhaps will tell us whether the Conservative party is in favour of repealing the Bill.
  Mr. Boswell rose—
  Mrs. Liddell: I shall give way shortly.
  When the hon. Gentleman comes to the Opposition Dispatch Box, perhaps he will tell us whether he takes the view of the shadow Chancellor of the Exchequer, who says that there will be no knee-jerk reaction to whether the proposed legislation will be repealed, or whether he takes the view of the right hon. Member for Wells, who says that there will be no need to repeal it.
  Mr. Boswell: I take precisely the view of the shadow Chancellor of the Exchequer.
  The Minister seems to think that the question of European monetary union is not in any way associated with the Bill. That being so, why was it that, when the Chancellor of the Exchequer spoke only last week about

  801
  the preparations for monetary integration and the Governor of the Bank of England referred to our being in a sense a "pre-in", the operation of monetary policy widened the divergence between British interest rates and those in continental Europe? Is that a triumph for the Government's policy?
  Mrs. Liddell: We have just heard the alternative Opposition reply. It is yet another example of the extent to which Conservative Members find themselves isolated.
  Various hon. Members repeatedly wanted to bring the issue round to a European central bank. Let me say quite clearly: the decisions on monetary policy that have been taken by the Chancellor and the Government are based on the domestic needs of our economy. That is one aspect that seems to be singularly lacking from Opposition Members. What else can we expect, when the right hon. Member for Wells writes in The Sunday Telegraph:
  "The CBI is bad news for British industry"?
  We have seen Opposition Members tonight driving yet another wedge between the Conservative party and business in this country.
  Indeed, the right hon. Gentleman made it fairly clear that he has not followed the details of the Bill. He referred to price stability, and to whether action could be taken in the event of any external shocks to the economy. I draw his attention to part II of the Bill, clause 11, which specifically points out that, in relation to monetary policy, the objectives of the Bank of England shall be
  "to maintain price stability and, subject to that, to support the … economic policy"
  of Her Majesty's Government,
  "including its objectives for growth and employment."
  Indeed, the right hon. and learned Member for Rushcliffe pointed out quite clearly the mix of elements that make up macro-economic policy. Perhaps the right hon. Gentleman will now tell us which side he is on. Is it to be repealed? Or is it not?
  Mr. Heathcoat-Amory: I refer the hon. Lady to her own legislation, which says quite clearly, on page 5, clause 11, that the maintenance of price stability—[Interruption.] If she has it in front of her, perhaps she will read it to the House. It says that the objective of the legislation is to maintain price stability, and that the other objectives of economic policy are to be subject to that.
  The Chief Secretary got it all the wrong way round when he introduced the Bill. Perhaps the Economic Secretary will now do us the courtesy of getting it the right way around, and conceding that the other objectives of Government policy, such as growth and unemployment, are only subject to the maintenance of price stability, so that, when there is a dilemma, such as in a shock, price stability will be the overriding statutory requirement of the actions of the Monetary Policy Committee. Will she confirm that that is in her own legislation?
  Mrs. Liddell: I think that the right hon. Gentleman is having a second wind in the wind-up. There must be an echo in here, because I have just read out the relevant clause, and he has read it out again and got it the wrong
  802
  way around, as he has done repeatedly throughout the evening. Indeed—to take up another point that he made about financial stability and the role of the Bank of England, the Treasury and the Financial Services Authority—he plainly has not even bothered to consult the memorandum of understanding agreed between those organisations.
  That is another example of the confusion that has marked the debate from the very beginning. Whenever the shadow Chancellor got up, he would not say yes, he would not say no. He ended up impaled on the fence of his party's divisions and indecision. He claims on the one hand that the Chancellor is giving up one of the most important tools of economic policy, yet he will not tell us whether any incoming Conservative Government—should the country be so unfortunate as to get one—would repeal this legislation.
  However, the same shadow Cabinet, under the leadership of the right hon. Member for Richmond, Yorks (Mr. Hague) is prepared to commit this country, for the next 10 years, to not contemplating a single currency in Europe. He says one thing, but then says another.
  Presumably the single currency is of a much lower order than independence from the Bank of England. On the one hand the right hon. Gentleman says that giving the Bank of England operational independence is wrong; then he says that we are not giving it enough independence, because the Monetary Policy Committee could be influenced by the Chancellor. I hope that, by the time the Bill is considered in Standing Committee, Opposition Members will have made up their minds whether they are coming or going.
  I shall take up some of the specific points that the shadow Chancellor made. He was effusive in his compliments to the right hon. and learned Member for Rushcliffe, yet he stood against him in the leadership contest.
  The right hon. Gentleman referred to issues of debt management, something that was raised a number of times during the debate. One reason why the clauses relating to debt management put distance between the Bank and the debt management agency is specifically to ensure that there is greater transparency and increased credibility, so that there is no chance of Bank actions being misinterpreted in any way as monetary policy actions. Nor can there be any charge of insider trading. Cash management operations will be set up to avoid conflict with banking operations.
  The right hon. Gentleman also questioned whether there would be a deflationary bias. During the debate, we have heard that the proposals for the central bank will, on the one hand, be inflationary, while on the other they will be deflationary. Let us take the right hon. Gentleman's view, that there will be a deflationary bias. It is up to the Government and the Chancellor to set the targets for inflation. Indeed, the Government will regard undershooting as seriously as overshooting.
  The right hon. and learned Member for Rushcliffe referred to discussions in which he had been involved—the famous Ken and Eddie show, where on every occasion Ken was right and Eddie wrong. That is a classic example of why we need operational independence in the setting of interest rates. Indeed, the hon. Member for Louth and

  803
  Horncastle (Sir P. Tapsell) said that he had exerted political pressure on the former Chancellor in regard to his inflation performance.
  Sir Peter Tapsell: I said nothing of the sort. I said that, in the Division Lobby, I had congratulated my right hon. and learned Friend on his decision to resist pressure from the Bank of England unnecessarily to raise interest rates.
  Mrs. Liddell: In relation to the overall impact on the setting of interest rates in this country, is it not reassuring that, outside the closed atmosphere of the Lobbies of the House of Commons, there will be rational debate about the correct level for interest rates to meet the inflation target?
  The right hon. and learned Member for Rushcliffe said that, for certain elements of the proceedings, the minutes of the Monetary Policy Committee do not specifically refer to the names of members. However, the voting performance of members is revealed. What a difference from the Ken and Eddie show, when there was one vote plus a casting vote, and Ken held both votes. That is not the right or modern way to set interest rates.
  My hon. Friend the Member for North Durham (Mr. Radice), the Chairman of the Treasury Select Committee, made a number of telling points. A number of hon. Members have referred to the Committee's recommendations. I reiterate what my right hon. Friend the Chief Secretary said about having an open mind on the recommendations, while taking up the points about three-year appointments.
  There is a good precedent for appointments based on three years. The Hempel report suggests that, for corporate governance, there is logic in company directors being appointed for three years, because that increases accountability. [Interruption.] The hon. Member for Gordon (Mr. Bruce) makes a sedentary intervention. Just because an appointment is for three years does not mean that it cannot be renewed. It could be three years, six years or nine years. If the Monetary Policy Committee were ever to become static, longer appointment periods would not help the analysis of monetary policy.
  A number of hon. Members referred to confirmation hearings. As my right hon. Friend the Chief Secretary said when he appeared before the Treasury Select Committee, the Government remain open-minded on that issue, but there are precedents relating to other activities of the House, which might be more widely discussed in other forums.
  I greatly regretted the comments of the hon. Member for Louth and Horncastle on the role of Bank of England staff after banking supervision is transferred to the Financial Services Authority. The clear implication of his comments is that, once banking supervision is removed from the Bank of England, those who work in the Bank will be second rate. As one who works closely with Bank of England staff, I think that that was a regrettable point. However, I was much reminded of the quality of the Bank's staff when I heard the very impressive speech by my hon. Friend the Member for Bolton, West (Ms Kelly).
  I pay due tribute to the maiden speech of my hon. Friend the Member for Batley and Spen (Mr. Wood), who made a most telling contribution to the debate. He brought us back to first principles in many instances, telling us of the history of the community that he represents and the
  804
  issues that impact on it. It was an impressive and most gracious speech, in which he paid due tribute to his predecessor. He mentioned the Batley Bulldogs rugby team. Another Batley bulldog has joined the House for our deliberations in this Parliament, and I pay tribute to him.
  I shall take together the points made by my right hon. Friend the Member for Llanelli (Mr. Davies) and my hon. Friends the Members for Hackney, North and Stoke Newington (Ms Abbott) and for Great Grimsby (Mr. Mitchell).
  We heard well-rehearsed arguments that, in June 1997, were part of an Adjournment debate. It is always very enjoyable to hear my hon. Friend the Member for Hackney, North and Stoke Newington make her case. She has a clear case, although I do not agree with it. I remind her that allowing inflation to get out of control impacts most perniciously on lower-paid and poorer people. Losing control of inflation affects the poor more than it affects anyone else, and establishing more effective means of controlling inflation in our economy is extremely important.
  From many of today's speeches by Opposition Members, one would have had the clear impression that Government economic policy begins and ends with inflation. As the right hon. and learned Member for Rushcliffe said, however, other instruments of economic policy are important.
  Nevertheless, we must realise that inflation is a cornerstone of much else in economic policy. The right hon. and learned Gentleman mentioned growth trend rates. They are not altered in a six-month period, because experience and performance must build up within the economy. He may mock the Monetary Policy Committee's decisions on interest rates. Nevertheless, he himself will have to take responsibility for the fact that he should have been acting before the general election, but failed to do so. That point was made most eloquently by my hon. Friend the Member for Bolton, West.
  We have heard some thoughtful and wide-ranging speeches. We heard an impressive speech by my hon. Friend the Member for Leicester, East (Mr. Vaz), who has taken a considerable interest in the Bank of Commerce and Credit International. Hon. Members on both sides of the House will realise the extent to which he has vigorously pursued that issue. He asked me a very specific question on the Bingham report. As the question goes wider than the subject of today's debate, for now I will say only that I have heard what he said, and that I will get back to him on the matter.
  The hon. Member for Twickenham (Dr. Cable) raised some other issues. He asked, as he always does, some specific and very interesting questions. A particularly interesting one related to the possible criteria for market intervention. The Government expect that interventions beyond normal ones in money market operations will be extremely rare, and practised only if there were to be a serious systemic threat.
  The memorandum of understanding—which I mentioned earlier—between the Bank and the Financial Services Authority emphasises the need for co-operation and an exchange of information in assessing the need for intervention, and the form that that intervention should take. Ultimately, it will be up to the Chancellor to approve

  805
  an intervention, and he will have to have justification for putting public money at risk. I am sure that the hon. Gentleman will recognise the reasons for that.
  Several points were made about financial regulation, which is a vital element of the way in which the Government are taking forward our responsibilities for the development of the financial services sector. The Bill is but the first stage in a wider reform of financial services.
  The hon. Member for Twickenham asked specifically about the cost of regulation. The explanatory memorandum estimates the cost of banking supervision to be £50 million, including overheads. The basis for the Coopers and Lybrand figure of £250 million to which the hon. Gentleman referred is unknown to us. We think that it might relate to the costs of supervision in general, but we are not clear about the genesis of the Coopers and Lybrand conclusions.
  We believe that bringing under a single regulator nine different structures and nine different operating forums, thus avoiding all the duplication that has caused such chaos in the financial community, will provide the opportunity for more effective regulation at lower cost. Indeed, my right hon. Friend the Chief Secretary referred to cash ratio deposits and how they will be put on a statutory basis.
  We will consult on that, to make sure that we have a proper assessment of the right level of cash ratio deposits. The Government have made it clear that our aim is that the aggregate burden on the financial institutions should be no higher, and preferably lower, than it is at present.
  The hon. Member for Twickenham also asked about the role of the International Organisation of Securities Commissions. One reason we sought to reform financial regulation is that we are determined to see our financial regulation as a world beater—and as a source of competitive advantage to British financial institutions. Financial regulation is a critical element in making markets competitive globally. I hope that the hon. Member is reassured that we hope to build on the extensive experience of financial supervision available in Britain, and to play our part internationally.
  The shadow Chancellor referred to the possibility of conflict between the various regulators. There is already substantial potential for conflict, some arising out of the complexity of individual firms. Firms in the financial services sector have changed dramatically since the 1980s; banks have greatly extended their activities; and the building societies that have converted to banks have a mixed bag of financial products available and have a mixed bag of regulators. The Bill will ease the burden of regulation, and make regulation more transparent.
  The shadow Chancellor also referred to the cost of regulation. It is a specific commitment of the Financial Services Authority to make sure that the cost of regulation is proportionate to the benefits of regulation.
  Several hon. Members mentioned British independence for the central bank, and the EMU-compatible bank. As I said, it is interesting to see how hon. Members have returned to this issue. The preparations for EMU and the debate that must take place in this country are completely different from the issues covered by the Bill. The Bill is about providing the basis for stability in our economy.
  806
  Over the past 18 years, we have seen the impact of boom and bust on our economy, and the hardship caused for ordinary people. If our economy is to grow convincingly, it is essential that our decision making should be put on a sound basis that leads to coherent and stable financial policy.
  At the end of the debate, the view of the Conservatives remains unclear. They have dodged the question whether they would repeal the legislation. I shall be interested to discover the line that they take in Committee.
  Question put, That the Bill be now read a Second time:—
  The House divided: Ayes 364, Noes 139.

  Division No. 86]

  [9.59 pm

  AYES

  Adams, Mrs Irene (Paisley N)

  Church, Ms Judith

  Ainger, Nick

  Clapham, Michael

  Ainsworth, Robert (Cov'try), NE)

  Clark, Rt Hon Dr David (S Shields)

  Allan, Richard

  Clark, Dr Lynda

  Allen, Graham

  (Edinburgh Pentlands)

  Anderson, Donald (Swansea E)

  Clark, Paul (Gillingham)

  Anderson, Janet (Rossendale)

  Clarke, Charles (Norwich S)

  Armstrong, Ms Hilary

  Clarke, Eric (Midlothian)

  Ashton, Joe

  Clarke, Rt Hon Tom (Coatbridge)

  Atherton, Ms Candy

  Clarke, Tony (Northampton S)

  Atkins, Charlotte

  Clelland, David

  Austin, John

  Clwyd, Ann

  Ballard, Mrs Jackie

  Coaker, Vernon

  Banks, Tony

  Coffey, Ms Ann

  Barron, Kevin

  Cohen, Harry

  Battle, John

  Coleman, Iain

  Bayley, Hugh

  Colman, Tony

  Beard, Nigel

  Connarty, Michael

  Begg, Miss Anne

  Cook, Frank (Stockton N)

  Beith, Rt Hon A J

  Cooper, Yvette

  Bennett, Andrew F

  Corbett, Robin

  Benton, Joe

  Corston, Ms Jean

  Bermingham, Gerald

  Cotter, Brian

  Berry, Roger

  Cousins, Jim

  Best, Harold

  Cranston, Ross

  Blizzard, Bob

  Crausby, David

  Boateng, Paul

  Cummings, John

  Borrow, David

  Cunliffe, Lawrence

  Bradley, Keith (Withington)

  Cunningham, Jim (Cov'try S)

  Bradley, Peter (The Wrekin)

  Dalyell, Tam

  Brinton, Mrs Helen

  Darling, Rt Hon Alistair

  Brown, Rt Hon Gordon

  Darvill, Keith

  (Dunfermline E)

  Davey, Edward (Kingston)

  Brown, Rt Hon Nick (Newcastle E)

  Davidson, Ian

  Brown, Russell (Dumfries)

  Davies, Geraint (Croydon C)

  Browne, Desmond

  Dawson, Hilton

  Bruce, Malcolm (Gordon)

  Denham, John

  Burden, Richard

  Dismore, Andrew

  Burgon, Colin

  Dobson, Rt Hon Frank

  Burnett, John

  Donohoe, Brian H

  Burstow, Paul

  Dowd, Jim

  Butler, Mrs Christine

  Drew, David

  Cable, Dr Vincent

  Drown, Ms Julia

  Caborn, Richard

  Dunwoody, Mrs Gwyneth

  Campbell, Alan (Tynemouth)

  Eagle, Angela (Wallasey)

  Campbell, Mrs Anne (C'bridge)

  Eagle, Maria (L'pool Garston)

  Campbell, Menzies (NE Fife)

  Edwards, Huw

  Campbell, Ronnie (Blyth V)

  Efford, Clive

  Campbell-Savours, Dale

  Ellman, Mrs Louise

  Casale, Roger

  Ennis, Jeff

  Caton, Martin

  Fearn, Ronnie

  Cawsey, Ian

  Fisher, Mark

  Chapman, Ben (Wirral S)

  Fitzpatrick, Jim

  Chaytor, David

  Fitzsimons, Loma

  Chidgey, David

  Flint, Caroline

  Chisholm, Malcolm

  Flynn, Paul

  807

  Follett, Barbara

  Kelly, Ms Ruth

  Foster, Don (Bath)

  Kemp, Fraser

  Foster, Michael Jabez (Hastings)

  Kennedy, Charles (Ross Skye)

  Foster, Michael J (Worcester)

  Kidney, David

  Foulkes, George

  Kilfoyle, Peter

  Fyfe, Maria

  King, Andy (Rugby & Kenilworth)

  Galloway, George

  King, Ms Oona (Bethnal Green)

  Gapes, Mike

  Kingham, Ms Tess

  George, Andrew (St Ives)

  Kirkwood, Archy

  George, Bruce (Walsall S)

  Kumar, Dr Ashok

  Gerrard, Neil

  Ladyman, Dr Stephen

  Gibson, Dr Ian

  Lawrence, Ms Jackie

  Gilroy, Mrs Linda

  Lepper, David

  Godsiff, Roger

  Leslie, Christopher

  Goggins, Paul

  Levitt, Tom

  Golding, Mrs Llin

  Lewis, Ivan (Bury S)

  Gordon, Mrs Eileen

  Liddell, Mrs Helen

  Gorrie, Donald

  Livsey, Richard

  Grant, Bernie

  Lock, David

  Griffiths, Jane (Reading E)

  McAllion, John

  Griffiths, Nigel (Edinburgh S)

  McAvoy, Thomas

  Griffiths, Win (Bridgend)

  McCabe, Steve

  Grocott, Bruce

  McDonagh, Siobhain

  Gunnell, John

  Macdonald, Calum,

  Hain, Peter

  McFall, John

  Hall, Mike (Weaver Vale)

  McGuire, Mrs Anne

  Hamilton, Fabian (Leeds NE)

  McIsaac, Shona

  Hanson, David

  McKenna, Mrs Rosemary

  Harman, Rt Hon Ms Harriet

  Mackinlay, Andrew

  Harvey, Nick

  McLeish, Henry

  Heal, Mrs Sylvia

  Maclennan, Robert

  Healey, John

  McNulty, Tony

  Heath, David (Somerton & Frome)

  MacShane, Denis

  Henderson, Doug (Newcastle N)

  Mactaggart, Fiona

  Henderson, Ivan (Harwich)

  McWilliam, John

  Hepburn, Stephen

  Mahon, Mrs Alice

  Heppell, John

  Mallaber, Judy

  Hesford, Stephen

  Mandelson, Peter

  Hill, Keith

  Marsden, Paul (Shrewsbury)

  Hinchliffe, David

  Marshall, David (Shettleston)

  Hodge, Ms Margaret

  Marshall, Jim (Leicester S)

  Hoey, Kate

  Marshall-Andrews, Robert

  Home Robertson, John

  Martlew, Eric

  Hood, Jimmy

  Maxton, John

  Hoon, Geoffrey

  Meacher, Rt Hon Michael

  Hope, Phil

  Meale, Alan

  Howarth, Alan (Newport E)

  Merron, Gillian

  Howarth, George (Knowsley N)

  Michael, Alun

  Howells, Dr Kim

  Michie, Bill (Shef'ld Heeley)

  Hoyle, Lindsay

  Michie, Mrs Ray (Argyll & Bute)

  Hughes, Ms Beverley (Stretford)

  Milburn, Alan

  Hughes, Kevin (Doncaster N)

  Miller, Andrew

  Hurst, Alan

  Moffatt, Laura

  Hutton, John

  Moonie, Dr Lewis

  Iddon, Dr Brian

  Morgan, Alasdair (Galloway)

  Illsley, Eric

  Morgan, Ms Julie (Cardiff N)

  Ingram, Adam

  Morgan, Rhodri (Cardiff W)

  Jackson, Ms Glenda (Hampstead)

  Morley, Elliot

  Jenkins, Brian

  Morris, Ms Estelle (B'ham Yardley)

  Johnson, Alan (Hull W & Hessle)

  Morris, Rt Hon John (Aberavon)

  Johnson, Miss Melanie

  Mountford, Kali

  (Welwyn Hatfield)

  Mudie, George

  Jones, Barry (Alyn & Deeside)

  Mullin, Chris Chris

  Jones, Mrs Fiona (Newark)

  Murphy, Denis (Wansbeck)

  Jones, Helen (Warrigton N)

  Murphy, Jim (Eastwood)

  Jones, Ms Jennifer

  Murphy, Paul (Torfaen)

  (Wolverh'ton SW)

  Naysmith, Dr Doug

  Jones, Jon Owen (Cardiff C)

  O'Brien, Bill (Normanton)

  Jones, Dr Lynne (Selly Oak)

  O'Brien, Mike (N Warks)

  Jones, Nigel (Cheltenham)

  O'Hara, Eddie

  Jowell, Ms Tessa

  Olner, Bill

  Kaufman, Rt Hon Gerald

  O'Neill, Martin

  Keeble, Ms Sally

  ÖOpik, Lembit

  Keen, Alan (Feltham & Heston)

  Organ, Mrs Diana

  Keen, Ann (Brentford & Isleworth)

  Osborne, Ms Sandra

  Keetch, Paul

  Palmer, Dr Nick

  808

  Pearson, Ian

  Stewart, David (Inverness E)

  Pendry, Tom

  Stewart, Ian (Eccles)

  Perham, Ms Linda

  Stinchcombe, Paul

  Pickthall, Colin

  Stoate, Dr Howard

  Pike, Peter L

  Stott, Roger

  Plaskitt, James

  Strang, Rt Hon Dr Gavin

  Pollard, Kerry

  Straw, Rt Hon Jack

  Pond, Chris

  Stringer, Graham

  Pope, Greg

  Stuart, Ms Gisela

  Pound, Stephen

  Stunell, Andrew

  Powell, Sir Raymond

  Sutcliffe, Gerry

  Prentice, Ms Bridget (Lewisham E)

  Taylor, Rt Hon Mrs Ann

  Prentice, Gordon (Pendle)

  (Dewsbury)

  Prescott, Rt Hon John

  Taylor, David (NW Leics)

  Primarolo, Dawn

  Taylor, Matthew (Truro)

  Prosser, Gwyn

  Thomas, Gareth (Clwyd W)

  Purchase, Ken

  Thomas, Gareth R (Harrow W)

  Quin, Ms Joyce

  Timms, Stephen

  Quinn, Lawrie

  Tipping, Paddy

  Radice, Giles

  Todd, Mark

  Rammell, Bill

  Tonge, Dr Jenny

  Raynsford, Nick

  Touhig, Don

  Reed, Andrew (Loughborough)

  Truswell, Paul

  Reid, Dr John (Hamilton N)

  Turner, Dennis (Wolverh'ton SE)

  Rendel, David

  Turner, Desmond (Kemptown)

  Robinson, Geoffrey (Cov'try NW)

  Turner, Dr George (NW Norfolk)

  Roche, Mrs Barbara

  Twigg, Derek (Halton)

  Rooker, Jeff

  Tyler, Paul

  Rooney, Terry

  Vaz, Keith

  Ross, Ernie (Dundee W)

  Vis, Dr Rudi

  Roy, Frank

  Walley, Ms Joan

  Ruane, Chris

  Ward, Ms Claire

  Russell, Ms Christine (Chester)

  Watts, David

  Ryan, Ms Joan

  Webb, Steve

  Salter, Martin

  White, Brian

  Sanders, Adrian

  Whitehead, Dr Alan

  Sawford, Phil

  Wicks, Malcolm

  Sedgemore, Brian

  Williams, Rt Hon Alan

  Sheerman, Barry

  (Swansea W)

  Sheldon, Rt Hon Robert

  Williams, Alan W (E Carmarthen)

  Shipley, Ms Debra

  Williams, Mrs Betty (Conwy)

  Short, Rt Hon Clare

  Willis, Phil

  Singh, Marsha

  Wills, Michael

  Smith, Angela (Basildon)

  Wilson, Brian

  Smith, Miss Geraldine

  Winterton, Ms Rosie (Doncaster C)

  (Morecambe & Lunesdale)

  Wise, Audrey

  Smith, John (Glamorgan)

  Wood, Mike

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

  Woolas, Phil

  Snape, Peter

  Wray, James

  Soley, Clive

  Wright, Anthony D (Gt Yarmouth)

  Southworth, Ms Helen

  Wright, Dr Tony (Cannock)

  Squire, Ms Rachel

  Wyatt, Derek

  Starkey, Dr Phyllis

  Tellers for the Ayes:

  Steinberg, Gerry

  Mr. Clive Betts and

  Stevenson, George

  Mr. David Jamieson.

  NOES

  Ainsworth, Peter (E Surrey)

  Butterfill, John

  Ancram, Rt Hon Michael

  Cash, William

  Arbuthnot, James

  Chapman, Sir Sydney

  Atkinson, David (Bour'mth E)

  (Chipping Barnet)

  Baldry, Tony

  Chope, Christopher

  Beggs, Roy

  Clark, Rt Hon Alan (Kensington)

  Bercow, John

  Clark, Dr Michael (Rayleigh)

  Beresford, Sir Paul

  Clarke, Rt Hon Kenneth

  Blunt, Crispin

  (Rushcliffe)

  Body, Sir Richard

  Clifton-Brown, Geoffrey

  Boswell, Tim

  Collins, Tim

  Bottomley, Peter (Worthing W)

  Colvin, Michael

  Bottomley, Rt Hon Mrs Virginia

  Cran, James

  Brazier, Julian

  Curry, Rt Hon David

  Brooke, Rt Hon Peter

  Davis, Rt Hon David (Haltemprice)

  Browning, Mrs Angela

  Day, Stephen

  Bruce, Ian (S Dorset)

  Donaldson, Jeffrey

  Burns, Simon

  Duncan, Alan

  809

  Duncan Smith, Iain

  Malins, Humfrey

  Emery, Rt Hon Sir Peter

  Maude, Rt Hon Francis

  Evans, Nigel

  Mawhinney, Rt Hon Dr Brian

  Faber, David

  May, Mrs Theresa

  Fabricant, Michael

  Nicholls, Patrick

  Fallon, Michael

  Norman, Archie

  Flight, Howard

  Ottaway, Richard

  Forth, Rt Hon Eric

  Page, Richard

  Fowler, Rt Hon Sir Norman

  Paterson, Owen

  Fox, Dr Liam

  Pickles, Eric

  Fraser, Christopher

  Prior, David

  Gale, Roger

  Randall, John

  Garnier, Edward

  Robathan, Andrew

  Gibb, Nick

  Robertson, Laurence (Tewk'b'ry)

  Gill, Christopher

  Roe, Mrs Marion (Broxbourne)

  Gillen, Mrs Cheryl

  Rowe, Andrew (Faversham)

  Goodlad, Rt Hon Alastair

  Ruffley, David

  Gorman, Mrs Teresa

  St Aubyn, Nick

  Gray, James

  Sayeed, Jonathan

  Green, Damian

  Shepherd, Richard

  Greenway, John

  Simpson, Keith (Mid-Norfolk)

  Grieve, Dominic

  Smyth, Rev Martin (Belfast S)

  Gummer, Rt Hon John

  Soames, Nicholas

  Hamilton, Rt Hon Sir Archie

  Spelman, Mrs Caroline

  Hammond, Philip

  Spicer, Sir Michael

  Hawkins, Nick

  Spring, Richard

  Hayes, John

  Steen, Anthony

  Heathcoat-Amory, Rt Hon David

  Streeter, Gary

  Heseltine, Rt Hon Michael

  Swayne, Desmond

  Hogg, Rt Hon Douglas

  Syms, Robert

  Howard, Rt Hon Michael

  Tapsell, Sir Peter

  Howarth, Gerald (Aldershot)

  Taylor, Ian (Esher & Walton)

  Hunter, Andrew

  Taylor, Rt Hon John D (Strangford)

  Jack, Rt Hon Michael

  Taylor, John M (Solihull)

  Jackson, Robert (Wantage)

  Taylor, Sir Teddy

  Jenkin, Bernard

  Townend, John

  Johnson Smith,

  Tredinnick, David

  Rt Hon Sir Geoffrey

  Tyrie, Andrew

  Key, Robert

  Viggers, Peter

  King, Rt Hon Tom (Bridgwater)

  Walter, Robert

  Kirkbride, Miss Julie

  Wardle, Charles

  Laing, Mrs Eleanor

  Waterson, Nigel

  Lansley, Andrew

  Wells, Bowen

  Leigh, Edward

  Whitney, Sir Raymond

  Letwin, Oliver

  Widdecombe, Rt Hon Miss Ann

  Lewis, Dr Julian (New Forest E)

  Wilkinson, John

  Lidington, David

  Wilshire, David

  Lilley, Rt Hon Peter

  Winterton, Mrs Ann (Congleton)

  Lloyd, Rt Hon Sir Peter (Fareham)

  Winterton, Nicholas (Macclesfield)

  Loughton, Tim

  Yeo, Tim

  Luff, Peter

  Young, Rt Hon Sir George

  Lyell, Rt Hon Sir Nicholas

  MacGregor, Rt Hon John

  Tellers for the Noes:

  Maclean, Rt Hon David

  Mr. Oliver Heald and

  McLoughlin, Patrick

  Mr. John Whittingdale.

  Question accordingly agreed to.
  Bill accordingly read a Second time, and committed to a Standing Committee, pursuant to Standing Order No. 63 (Committal of Bills).

  BUSINESS OF THE HOUSE
  Motion made, and Question put forthwith, pursuant to Standing Order No. 15 (Exempted business),
  That, at this day's sitting, Consideration of Lords Amendments to the Local Government (Contracts) Bill may be proceeded with, though opposed, until any hour.—[Mr. Kevin Hughes.]
  Question agreed to.

Local Government (Contracts) Bill
Lords amendments considered.
Local Government (Contracts) Bill
  Clause 1

    FUNCTIONS TO INCLUDE POWER TO ENTER INTO CONTRACT.
    Lords amendment: No. 1, in page 1, line 19, after ("financier") insert
    (", or any insurer of or trustee for the financier,")
    10.14 pm
    The Minister for Local Government and Housing (Ms Hilary Armstrong): I beg to move, That this House doth agree with the Lords in the said amendment.
    Mr. Deputy Speaker (Mr. Michael Lord): With this, it will be convenient to discuss also Lords amendment No. 9.
    Ms Armstrong: Clause 1(2) provides that a local authority may make arrangements with financiers for step-in rights; that is, rights to intervene where the contractor is unable to meet his obligations to the authority or to the financier. The amendment provides that these arrangements can also involve—[Interruption.]
    Mr. Deputy Speaker: Order. I ask hon. Members to leave the House quickly and quietly if they are not taking part in the debate.
    Ms Armstrong: The amendment provides that these arrangements can also involve financiers' insurers or trustees. Amendment No. 9 amends clause 4 of the Bill to provide that a contract between a local authority and a financier's insurer or trustee may be a certified contract and thus may have the protection of clause 2 (1) of the Bill. That is the "safe harbour" provision.
    Lords amendment agreed to.

  Clause 2

    CERTIFIED CONTRACTS ASSUMED TO BE INTRA VIRES.
    Lords amendment: No. 2, in page 2, line 22, leave out from first ("a") to end of line 27 and insert ("local authority has entered into a contract which is a certified contract
    ("the existing contract") and the existing contract is replaced by a contract entered into by it with a person or persons not identical with the person or persons with whom it entered into the existing contract, the replacement contract is also a certified contract if—")
    The Minister for London and Construction (Mr. Nick Raynsford): I beg to move, That this House doth agree with the Lords in the said amendment.
    Clause 2 (4) provides that, where a certified contract is novated—that is, replaced by another identical contract because a new contractor or financier is substituted for the original one—the new contract shall also be a certified contract. The amendment makes it absolutely clear that, for these purposes, a contract is replaced only if the parties to the contract are different.
    Lords amendment agreed to.
    Lords amendment: No. 3, in page 2, line 37, at end insert—
    ("( ) The application of subsection (1) in relation to a contract entered into by a local authority does not affect any claim for damages made by a person who is not (and has never been) a party to the contract in respect of a breach by the local authority of any duty to do, or not to do, something before entering into the contract (including, in particular, any such duty imposed by a statutory provision for giving effect to any Community obligation relating to public procurement or by section 17(1) of the Local Government Act 1988).")
    Mr. Raynsford: I beg to move, That this House doth agree with the Lords in the said amendment.
    The amendment reflects concerns raised by the hon. Member for Christchurch (Mr. Chope) in Committee, as well as points made during the outside consultation. The amendment makes it clear that clause 2(1) does not prevent a person other than the contractor from bringing an action against the authority seeking damages because procurement procedures had been disregarded. In particular, we have in mind a claim by an unsuccessful bidder for the contract who feels that proper procurement procedures have not been complied with. Such legal action could result only in the payment of damages by the authority and not in the setting aside of the contract. It would not, therefore, affect the position of the appointed contractor or his financiers.
    Mr. Christopher Chope: We are grateful for the Government's response to the concerns expressed on the issue.
    Lords amendment agreed to.

  Clause 3

    THE CERTIFICATION REQUIREMENTS
    Lords amendment: No. 4, in page 2, line 41, at beginning insert
    ("The requirement specified in this subsection is that")
    Ms Armstrong: I beg to move, That this House doth agree with the Lords in the said amendment.
    Mr. Deputy Speaker: With this, it will be convenient to discuss Lords amendments Nos. 5 to 7.
    Ms Armstrong: The amendments clarify a point about the certification requirements referred to in clause 3, and ensure that the requirements for certifying contracts will operate as intended. As long as a certificate states that it has been copied to any persons prescribed in regulations, and confirms that requirements imposed by regulations concerning the issue of the certificate have been complied with, the contractor can be satisfied that the certificate will not be invalidated if it becomes evident that the authority has not in fact done those things.
    Lords amendment agreed to.
    Lords amendments Nos. 5 to 7 agreed to.

  Clause 4

    CERTIFICATION REQUIREMENTS: SUPPLEMENTARY
    Lords amendment: No. 8, in page 3, line 25, at end insert—
    ("( ) Where the certification requirements have been satisfied in relation to a contract by a local authority within section 1(3)(a) or (d), the local authority shall secure that throughout the period for which the contract operates—

    (a) a copy of the certificate which has been issued is open to inspection by members of the public at all reasonable times without payment, and

    (b) members of the public are afforded facilities for obtaining copies of that certificate on payment of a reasonable fee.")

    Mr. Raynsford: I beg to move, That this House doth agree with the Lords in the said amendment.
    The amendment was drafted in response to an undertaking that I gave to the hon. Member for Christchurch in Committee. It requires a local authority that has issued a certificate, other than the receiver of the Metropolitan police district or a probation committee, to secure that a copy of the certificate should be freely available for inspection by members of the public at all reasonable times, and to provide facilities to allow copies to be obtained for a reasonable fee. The authority remains under that duty for as long as a certified contract operates.
    Mr. Chope: I am grateful to the Minister for his positive response on this open government amendment, which originated with the Opposition. Perhaps he could explain, however, why it does not extend to the receiver for the Metropolitan police district or to a probation committee.
    Mr. Raynsford: I feared that the hon. Gentleman would pursue that point: it is a complicated one, and I ask him to bear with me while I explain the circumstances.
    Unlike other local authorities, probation committees are accountable to the Home Secretary and not to the local taxpayer. They are under a statutory duty under section 4 of the Probation Service Act 1993 to ensure that probation services are provided efficiently, and the Home Secretary has statutory powers to intervene when a probation committee fails to discharge its duties responsibly.
    The expenditure of probation committees is 80 per cent. funded by the Home Office. Only about 20 per cent. is funded by local authorities, and much of that is supported by revenue support grant from my Department. Only a small proportion is raised by local taxation and, accordingly, probation committees are primarily accountable to central Government.
    Sir Robert Smith: It occurs to me that that is just about the ratio of funding for local government at the moment: 80 per cent. from central Government, and 20 per cent. raised locally.
    Mr. Raynsford: The hon. Gentleman is talking about something that is not relevant to the specific Lords amendment. If he consults the procedures of the House, he will realise that he is speaking wide of the mark.

    813
    Probation committees are not subject to the disclosure requirements of the Local Government (Access to Information) Act 1985. The accountability of probation committees to the Home Secretary for the effectiveness and efficiency of the services they provide covers the lawfulness of the contracts that they enter into, and, through the Home Secretary, they are accountable to Parliament. The Home Secretary monitors the provision of probation services through Her Majesty's inspectorate of probation and the Audit Commission.
    In view of those existing arrangements, it is not necessary to require probation committees, for reasons of public accountability, to allow inspection of certificates by members of the public.
    On 16 July, my right hon. Friend the Home Secretary announced the prisons/probation review, which, after public consultation, may have a major impact on the structure and organisation of the probation services and the legislation covering their functions. Similar arrangements apply to the inner London probation service, where the receiver for the Metropolitan police district acts for statutory purposes in place of the responsible authority—that is, one or more local authorities. The probation committee for the inner London probation service is also accountable to the Home Secretary.
    The receiver for the Metropolitan police district is not subject to local government disclosure requirements. The receiver is for most purposes not a local authority. Through the Home Secretary, as police authority, he is accountable to Parliament. His general liability to account and be answerable with the Commissioner of Police of the Metropolis is contained in the Metropolitan Police Act 1829 and the subsequent 1851 Act.
    Lords amendment agreed to.
    Lords amendment No. 9 agreed to.

  Clause 5

    SPECIAL PROVISION FOR JUDICIAL REVIEWS AND AUDIT REVIEWS
    Lords amendment: No. 10, in page 4, line 5, after ("on") insert
    ("an application for judicial review or")
    Ms Armstrong: I beg to move, That this House doth agree with the Lords in the said amendment.
    Mr. Deputy Speaker: With this, it will be convenient to discuss Lords amendments Nos. 11 and 12.
    Ms Armstrong: The amendments reflect concerns raised by the hon. Member for Sutton and Cheam (Mr. Burstow) in Committee, as well as in outside consultation. They have two effects. They expressly give a court a discretion in judicial review, as well as in audit review, to determine that a certified contract shall have effect as if the local authority had had power to enter into it and had exercised that power properly. They also require the court, in considering how to exercise that discretion, to have regard to two matters. The court would have to consider the likely consequences of a decision to
    814
    set the contract aside, first, for the authority's financial position and, secondly, for the provision of services to the public.
    It is important that where a certified contract is challenged in judicial review or by the auditor, the court shall have a clear discretion to allow the contract to continue if, after weighing up all conflicting interests and taking account of all relevant circumstances, it feels that, on balance, that would be in the wider interests, financial and otherwise, of the local community.
    Mr. Paul Burstow: I thank the Minister for considering the discussions in Committee and on Report in which I raised the matter and which led to the amendment. It is important that the courts can have regard for the consequences for council tax payers and for the finances of the local authority, but I ask the Minister to assure the House that the Bill does not preclude the courts from considering the impact of discharge terms. Having read the debate in the other place, especially in Committee, I was struck by the remarks of the Lord Donaldson, who said:
    "I just do not know whether a court could set aside discharge terms."—[Official Report, House of Lords, 21 October 1997; Vol. 582, c. 629.]
    Can the Minister say whether the Bill would prevent a court setting aside discharge terms? That goes to the heart of the matter that I raised. It would help the House to have an assurance on that basis.
    Ms Armstrong: As we are in the final stages of the Bill, I want to make sure that I get this absolutely right.
    If the discharge terms are set aside, the repudiation terms apply, as set out in clause 7. In other words, if the judge is not satisfied that the discharge terms are not proper discharge terms, he can apply clause 7, the repudiation terms.
    Lords amendment agreed to.
    Lords amendments Nos. 11 and 12 agreed to.

  Clause 7

    ABSENCE OF RELEVANT DISCHARGE TERMS
    Lords amendment: No. 13, in page 5, line 16, leave out from ("section") to ("do") in line 21 and insert
    ("the circumstances in which there are no relevant discharge terms having effect between the local authority and a person who is a party to the contract include (as well as circumstances in which no such terms have been agreed) circumstances in which the result of a determination or order of a court, made (despite section 6(4)) on an application for judicial review or an audit review, is that such terms")
    Mr. Raynsford: I beg to move, That this House doth agree with the Lords in the said amendment.
    The amendment was made partly in response to a point raised by Lord Bowness on Second Reading in another place about the relationship between clauses 6(4) and 7(3).
    The amendment clarifies the circumstances under which there are no discharge terms having effect. Clearly, there will be no discharge terms where none have been agreed by the parties to the certified contract. It is also possible, however, that, despite clause 6(4), a court might conclude in an extreme case in public law proceedings

    815
    that terms agreed as discharge terms are not to have effect. The amendment to clause 7(3) makes it clear that that, too, would be a situation in which there were no discharge terms, so that the contractor or financier would be entitled to repudiatory damages.
    Lords amendment agreed to.

    New clause
    Lords amendment: No. 14, after clause 8, to insert the following new clause— Contracting out of functions in connection with certified contracts—
    ".—(1) An authorisation given by virtue of an order under section 70 of the Deregulation and Contracting Out Act 1994 (authorisation by local authority of exercise by another person of functions of authority for period not exceeding ten years) may specify that it is to be for a period exceeding ten years if it is given in connection with a certified contract.
    (2) But an authorisation given in connection with a certified contract may not by virtue of subsection (1) specify that it is to be for a period exceeding the shorter of—

    (a) the period for which the contract is to operate, and

    (b) forty years.

    (3) For the purposes of this section an authorisation is given in connection with a certified contract if

    (a) the authority by which it is given is a local authority for the purposes of this Act,

    (b) the authority and the authorised person are parties to the contract, and

    (c) the authorisation is given to enable the authorised person to perform or better perform his obligations under the contract."

    10.30 pm
    Mr. Raynsford: I beg to move, That this House doth agree with the Lords in the said amendment.
    Mr. Deputy Speaker: With this, it will be convenient to take Lords amendments Nos. 16 to 18.
    Mr. Raynsford: I beg to move that this House doth agree with the Lords in the said amendment.
    The effect of amendment No. 14 is that where a local authority is to enter into a certified contract, it may authorise the contractor to exercise any function that it is permitted to contract out by an order under part II of the Deregulation and Contracting Out Act 1994 for the period for which the contract is to operate, subject to a maximum of 40 years. The 1994 Act at present limits authorisations to 10 years, which would limit the scope for partnerships.
    Amendments Nos. 16 and 17 are consequential. The effect is that the new clause will be treated in the same way as clauses 2 to 8. It will come into force at the same time as those clauses, on a day to be appointed by the Secretary of State, and it will apply to any contract entered into after 12 June 1997.
    Amendment No. 18, which slightly modifies the title of the Bill, is required to reflect the subject matter of the new clause.
    Lords amendment agreed to.

    Clause 9

      POWER TO TREAT EXPENDITURE AS NOT BEING CAPITAL EXPENDITURE
      Lords amendment: No. 15, in page 6, line 22, leave out ("55(7)") and insert ("55(3) or (7)")
      Ms Armstrong: I beg to move, That this House doth agree with the Lords in the said amendment.
      The amendment refines the amendment to section 57 of the Justices of the Peace Act 1997 proposed in clause 9 of the Bill, and further extends the opportunity to enter into partnership contracts. Under section 55(2) of the Act, a magistrates courts committee is able to procure any goods and services that are current expenditure items direct from suppliers, rather than through the paying authority.
      Section 55(3) defines current items as items that, if they were procured by the paying authority, would not be capital expenditure. The amendment, by including section 55(3) in the regulation-making power conferred by clause 9, will enable expenditure under certain partnership contracts to be treated as "not capital" for the purpose of allowing magistrates courts committees to procure direct. That will allow the committees to enter into specified contracts direct with suppliers.
      Mr. Chope: I thank the hon. Lady for the way in which she has dealt with this and the other amendments. It is significant that there is a lot more interest in the Bill at this stage, after it has been considered in the other place, than there was when it was initially considered. Perhaps that is an indication of the increasing pressure on the Government as the weeks of this Parliament go by.
      Conservative Members are certainly conscious of the fact that we could have debated these issues all night. The lack of knowledge that certain Labour Members have on this subject tempted us to take them through the procedure for the whole night, but we decided on reflection that we would not do so on this occasion. Perhaps future opportunities will arise.
      Lords amendment agreed to.
      Lords amendments Nos. 16 to 18 agreed to.

      EUROPEAN COMMUNITY DOCUMENTS
      Motion made, and Question put forthwith, pursuant to Standing Order No. 119 (9) (European Standing Committees),

      FIFTH FRAMEWORK PROGRAMME FOR RESEARCH AND TECHNOLOGICAL DEVELOPMENT (RTD)
      That this House takes note of European Community Documents Nos. 7310/97, on the European Fifth Framework Programme for Research and Technological Development, and 10385/97, on the amended proposal for the Fifth Framework Programme; and supports the Government's view that the Commission's proposals would benefit from amendment in key areas to improve focus, targeting and responsiveness to user needs.—[Mr. Clelland.]
      Question agreed to.

  Transport Links (Dover)
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. Clelland.]
  10.34 pm
  Mr. Gwyn Prosser: I am grateful for the opportunity to make my maiden speech in this Adjournment debate on the subject of my choice—a matter essential to the past, present and future well-being of my constituency. Although more than half of my constituency can be described as rural, the majority of jobs are either related to the port or town-based, and the very existence of the port and the town relies on Dover's transport links—road and rail links to other parts of Kent and to London, the cross-channel links to France and Belgium, and deep-sea shipping links to other parts of Europe and to the worldwide shipping lanes.
  Early in my Merchant Navy career, I developed the British seafarer's natural affection for the sight of the white cliffs of Dover—it was our first sniff of Europe, our first view of Britain and our first sight of home. However, over the past 18 years, living in Dover and Deal and bringing up my family in Dover, I have been able to enjoy the much wider attractions of the area. These include the greenery of the north downs which lie above the white cliffs, the splendid views from Dover castle, the enchanting seaside town of Deal and, of course, the warmth and steadfast character of the people who populate my very special and very beautiful constituency—the constituency that we like to call the white cliffs country.
  Those people's jobs and their futures are closely related to the sustained success of our cross-channel ferries, our sea-cats and our hovercraft, and the continued development of the public trust port of Dover, which has served one of the busiest and most strategic sea crossings in the world for more than a century. Dover has long been privileged to act as the gateway to Europe: we are pleased to serve in that role, which provides us with direct jobs on cross-channel ferries, jobs in the port of Dover and jobs in port-related service industries. However, we are also charged with serving as gatekeepers, which brings duties and responsibilities that on occasion tax our resources, impact negatively on our communities and strain our inadequate transport links.
  In the short time since the new Labour Government came to power, we have suffered the criminal activities of bootleggers, the influx of hundreds of mostly bogus asylum seekers and the crippling disruption caused by the recent French lorry drivers' dispute. For many years, we have had to witness the carriage of live animals for export: we have seen the cruelty that it inflicts, and we look forward to the day when this evil trade will cease. Just over the horizon, we are bracing ourselves for major job losses with the P and 0 and Stena line proposals to cut their fleet in a merged operation. We face the threat of further massive redundancies if our on-board duty-free sales are abolished.
  Of course, I make no connection between the election of the new Government and Dover's difficulties—on the contrary, Ministers have listened to our concerns and, where possible, acted promptly to ease our problems. However, problems in our transport links have remained unaddressed for many years. The link that has caused
  818
  most of our distress has been the fixed link—the channel tunnel—not only because it was allowed to be built without a public inquiry, but because of the uneven way in which the previous Government supported the tunnel in relation to the cross-channel fleet and the port of Dover.
  Nothing highlights the uneven approach of the Conservative Government more than the comparison between the tunnel, which was provided with a four-lane motorway connection right up to the terminal entrance before the tunnel was operational, and the port, which, after 20 years of all-party campaigning, still relies on the inadequate A2 single carriageway at its eastern approach.
  I acknowledge that, after the tunnel was operational, the A20 was extended into Dover, but that was one of the tunnel-related roads, to give east Kent access to the tunnel, and its configuration means that drivers travelling from London to east Kent are exposed to 70 miles of channel tunnel signage and are then invited to leave the motorway for the Eurotunnel terminal 10 miles before they reach the port of Dover.
  Dualling of the last seven miles of the A2 from Lydden to Dover is well overdue. It will make an important contribution to the economic development of the area by easing traffic flows to the port and to the towns of Dover and Deal, opening up better access to the White Cliffs business park and supporting improved road links to the proposed new industrial development at the redundant Ministry of Defence site at Old Park barracks, in addition to greatly improving safety on a piece of road that has an unacceptably high accident rate.
  I am aware that the project is now being considered as part of the roads review, but I urge Ministers to take account of the fact that this short stretch of inadequate road is an essential link to the port of Dover, which is diversifying and expanding to meet the challenge of the channel tunnel, and it is crucial to the successful development of our job creation projects.
  At this stage, it may be appropriate to give some recognition to the efforts of my predecessor, Mr. David Shaw, the work that he put into campaigning for the dualling of the A2, and the careful attention that he gave to his constituents in casework. He took a robust and combative stance in the Chamber on many issues—as you may well remember, Mr. Deputy Speaker—but I felt that he had gone a little too far when, only four months after the general election, he returned to Dover with a camera crew and accused the new Labour Government of failing to dual the A2.
  Before Mr. Shaw, there was Mr. Peter Rees, who, in the few contacts that I had with him, always acted in a gentlemanly and helpful manner; before him was the late David Ennals, who enjoyed a distinguished career in the House before being elevated to another place, where he continued to work hard promoting overseas aid and fostering international relationships.
  All three of my predecessors pressed hard for better road links, but Dover also suffers from inadequate rail links. As the Government consider their existing plans to develop an integrated transport system, I am sure that Ministers will wish to take account of the need to encourage investment in the rail links to ports such as Dover, where relatively small amounts of funding can open up new modes of rail transport and enhance the potential of our train service facilities.

  819
  A truly integrated transport system will need to link road and rail networks to international shipping routes as well as the short sea routes to continental Europe. With such links in mind, it troubles me to hear that, at a time when the Government are seeking to shift freight from road to rail, Railtrack appears to be selling off its freight yards, such as Town Yard at Dover's Western Docks terminal.
  Dover has survived many difficulties in the past 15 years. First, we had to put up with the disruption caused by the construction phase of the channel tunnel and its road connections. In the little village estate of Aycliffe, thousands of tonnes of countryside were gouged out behind Shakespeare cliff, and 71 homes were demolished for road building.
  Secondly, in a premature response to the impact of the tunnel, P and 0 European Ferries forced staff cuts in 1988 which resulted in a bitter 12–month dispute and the sacking of more than 1,000 local seafarers who were fighting to maintain safe manning levels on the vessels. Many of those sacked are still unemployed, and the P and 0 Sacked Seafarers Committee is still campaigning for justice and compensation for those local people.
  Thirdly, at Christmas 1993, as the single market came into being, we lost 600 jobs in one weekend when the roles of the freight forwarders and the frontier brokers ended. Just last month, ex-miners in the village of Aylesham gathered to mark the 10th anniversary of the closure of their pit and the complete shut-down of the east Kent coalfield. Overall, some 2,000 jobs have been squeezed out of our ferry and port-related industry in an effort to compete with the tunnel. People are rightly angry that a bankrupt channel tunnel with £ 8 billion of debt, which was heavily favoured by the previous Government, should be allowed to continue to steal traffic from the highly successful surface fleet, and further to threaten the jobs of local people.
  Dover has suffered in the past and survived, and we are fighting back again now. In the village of Aylesham—where male unemployment reached 25 per cent.—the local people, supported by public and private partnerships, have opened a complex of workshops, training areas and community facilities to create jobs and breathe new hope into the village and the surrounding areas. The Labour district council has won single regeneration budget funding for a £17 million project to regenerate the east Kent coalfield and create more than 500 new jobs.
  The barracks, vacated when the Royal Marines school of music in Deal was shut down, will hopefully soon be developed to create jobs and provide educational and community facilities. However, we shall need help from Kent county council with improving the A258 and providing better access. Similarly, the St Radigund's industrial estate will be sustained and enhanced if improved access can be provided at the notorious Coombe Valley road railway bridge.
  The port of Dover is now safe from privatisation. I thank the Minister and my hon. Friend the Member for Stoke-on-Trent, North (Ms Walley) for their visits to Dover and their robust support for our campaign to stop the privatisation of the port in 1996. Now that the threat has passed, the harbour board is planning an ambitious expansion of the already successful cruise terminal. I am pleased to say that it is determined to retain the train ferry services to take advantage of Labour's new transport initiatives.
  820
  Dover has other ambitious plans too numerous to cover in this short debate, but the key to them all is the provision of improved road links, the maintenance and upgrading of our existing rail links, and even-handed support for our highly successful surface fleet as it adapts to meet the changes and the challenges posed by the channel tunnel.
  10.47 pm
  Dr. Stephen Ladyman: I am grateful to my hon. Friend the Member for Dover (Mr. Prosser) and to the Minister for allowing me to make a brief contribution to the debate.
  My hon. Friend's maiden speech was excellent, and I enjoyed it very much. I wish to associate myself with all his comments, and I add an extra plea to the Minister—I do not expect her to respond to it tonight. Will the Government give sympathetic consideration to the need to improve the road that links my hon. Friend's Dover constituency with the neighbouring constituency of South Thanet?
  I have referred to the A256 before in the House. The road link is crucial to the economic future of Thanet and supports the largest employer in our region, the pharmaceutical company Pfizer. The improvement of that road is absolutely vital not only to that company but to my whole constituency and to the ferry industry in Ramsgate, which is a close neighbour of Dover.
  10.48 pm
  The Parliamentary Under-Secretary of State for the Environment, Transport and the Regions (Ms Glenda Jackson): I congratulate my hon. Friend the Member for Dover (Mr. Prosser) on his maiden speech. It is regrettable that so few hon. Members were in the House to hear him give a speech that showed not only his intimate knowledge of his constituency and his constituents, but his dedication to them and their interests. He displayed his generosity by allowing my hon. Friend the Member for South Thanet (Dr. Ladyman) an intervention in his debate.
  I am grateful to my hon. Friend the Member for Dover for giving us an opportunity to debate such an important topic. In 1996, the port of Dover accounted for 36 per cent. of the United Kingdom's international passenger traffic and 12 per cent. of the UK's international unitised freight.
  Dover is the largest trust port in the UK in terms of turnover—£43 million in 1996, an increase of 8 per cent. on 1995. The harbour board has been investing substantial sums in the port, where there has recently been important expansion in the cruise liner business.
  Clearly, Dover has a major role in the United Kingdom's links not only with continental Europe but with the rest of the world. That highlights the fact that good transport links are vital to this country's continued economic success. The best use of the existing transport infrastructure will be made to ensure that the economic importance of Dover is maintained and enhanced in a sustainable way.
  I well understand my hon. Friend's desire for early decisions on the road schemes that he and my hon. Friend the Member for South Thanet mentioned, particularly the dualling of the A2 from Lydden to Dover. As my hon. Friend the Member for Dover will be aware, that scheme

  821
  is currently being considered as part of our roads review. He will also know that the Government have embarked on a fundamental review of transport policy. Our objectives are a strong economy, a sustainable environment and an inclusive society. Transport is a vital part of all those aims.
  Good communications are central to the economy and our quality of life. However, the backdrop to the fundamental review is a candid recognition that we need a shift in direction. Revised national road traffic forecasts published last month show traffic increasing by almost 40 per cent. over the next 20 years. If current policies continue, congestion will get worse, the impact on the environment will be even more severe, and those who have no access to private transport will find it even more difficult to get around.
  We must develop an integrated transport system that makes the best use of the contribution that each mode can make; ensures that all options are considered on a basis that is fair and is seen to be fair; and takes into account from the outset considerations of accessibility, integration, safety, the environment and the economy. Above all, an integrated transport system must be sustainable. One of the encouraging aspects of such an ambitious task is the degree of consensus attaching to the view that we need to change.
  It is a feature of the policy development work now under way that we are involving a wide range of external advice and expertise, including local authorities, businesses, trade unions, transport professionals and transport users. That is the context for the roads review examining the role that trunk roads should play in an integrated and sustainable transport policy.
  Against the background of increased congestion, we have three broad options for roads: first, to make better use of existing infrastructure; secondly, to manage demand; and thirdly, to provide new infrastructure.
  To make best use of existing infrastructure is the obvious first choice. It has been provided at substantial cost in financial and environmental terms, and we must make the best use of that investment. We must, however, be realistic about what the various options can deliver.
  We must also seriously consider other, harder options—managing demand and providing new infrastructure. Managing demand is a vast topic. It encompasses reducing the need to travel —by land use planning, for example—an assessment of the extent to which a shift to other modes can be encouraged, and inevitably, the question of controlling demand by pricing or rationing mechanisms.
  Providing new infrastructure is a very difficult option, financially and in terms of its potential impact on the environment. Our starting point is that we will not proceed with major new road construction unless we are satisfied that there is no better alternative. Even then, there will be difficult choices to be made within the limited resources available.
  There is no substitute for rigorous case-by-case examination of the options. Volume 2 of our roads review consultation document entitled "What role for trunk roads?" sets out, region by region, the perceived traffic problems and the roads programme inherited from our predecessors.
  822
  We are seeking from those regional consultations a view on whether those are the most important problems, or whether other problems deserve greater priority. We envisage two outputs from this part of the review: a firm, short-term investment programme, and a programme of studies to examine the remaining problems, out of which the medium and long-term investment programme will emerge.
  The Government office for the south-east has held three day-long seminars over the autumn as part of our consultation process on integrated transport. A seminar in Ashford on 14 October examined transport corridors in the east of the region, including the Kent transport corridor between the M25 and the channel ports. Points made by my hon. Friend about the importance of the A2 Lydden-Dover improvement, in terms of safety, regeneration and support of the local economy were also made at the seminar. There was a clear consensus on the importance, regionally and nationally, of high-quality reliable routes, both road and rail, to the south-east ports. Some problems were highlighted as requiring particularly urgent solutions. We shall be taking all these views into account, along with the written and other representations that we have had.
  Developing a forward-looking integrated transport policy that supports a strong economy, contributes to a sustainable environment and helps to create a just and inclusive society, is a huge challenge. The road network is, of course, only one piece of the transport jigsaw. My hon. Friend has spoken of the way in which the port of Dover is responding to the challenge of the channel tunnel. The tunnel has added to the importance of south-east Kent as a transport hub, and the building of the channel tunnel rail link will increase this still further. As well as allowing a doubling of the number of trains between London, Paris and Brussels at peak times, development of the channel tunnel rail link, which the Government are keen to see delivered as quickly as possible, will provide additional capacity for new and much faster commuter trains between Kent and London.
  The Government are determined to encourage greater use of the railways for passengers and freight. We wish to see improvements in existing rail services. My right hon. Friend the Minister of Transport recently gave the franchising director new objectives, setting out the development of the passenger rail network of the future and mapping out the key role that we envisage for railways in our integrated transport policy. Connex South Eastern, which operates rail services to Dover, is required by its franchise agreement to replace all its existing mark 1 slam-door rolling stock.
  I understand that it is its intention that the brand new 375 class rolling stock will be deployed on the route to Dover via Sevenoaks-Ashford by the end of 1999. Railtrack, in partnership with Connex South Eastern, is also in the process of carrying out major improvements to Dover Priory station to enhance the service that is provided to passengers. I shall write to my hon. Friend about the proposed sale of rail lands.
  The Government are keen to encourage an increase in the use of rail freight, thus delivering important environmental benefits by taking lorries off our roads. Rail freight grants are available to help meet the extra costs generally associated with moving freight by rail.

  823
  My hon. Friend raised the question of the recent French lorry drivers' dispute. The Government deeply regretted the disruption caused by the blockade in France. We are pleased that the dispute has now been settled and that our hauliers are again able to go about their legitimate business.
  We acknowledge that the ferries had the option of sailing to alternative ports in Belgium, whereas the channel tunnel is a fixed link, but we made it clear that we sought unrestricted access through this principal entry point to mainland Europe.
  My hon. Friend raised a number of issues that are of particular concern to Dover and to his constituents, though not all are within my direct responsibility. The proposed merger between P and O and Stena Line is a matter, as I am sure my hon. Friend is aware, for my right hon. Friend the President of the Board of Trade.
  My hon. Friend mentioned also a topic that is of concern in Dover and, I would say, throughout the country—the export of live animals. I understand that it would not be possible for the Government to take unilateral action to ban live exports but we await with great interest the outcome of the Compassion in World Fanning case. The Government have already taken significant steps to improve the welfare of animals during
  824
  transport, and we are committed to making further progress.
  The abolition of duty free sales for intra-EU journeys is a matter for my right hon. Friend the Chancellor of the Exchequer. I regret that my hon. Friend has heard me reiterate a point that I made to him when he came to see me with a deputation of other colleagues who are also concerned about the issue.
  My hon. Friend also touched on the recent influx of asylum seekers arriving at Dover, which now appears to have abated owing to the measures that the Government have taken—including television broadcasts in the Czech Republic—to correct misleading impressions about our immigration procedures. However, we continue to monitor the situation carefully.
  Again, I am most grateful to my hon. Friend for bringing Dover's transport links to the attention of the House. I am sure that he will appreciate that, until we have completed our fundamental review of transport policy and the role of trunk roads within that policy, I cannot tell him what priority the schemes he advocates can expect to be given, but I can assure him that the Government are fully aware of the important—indeed, unique— role that Dover plays in Britain's transport network.
  Question put and agreed to.
  Adjourned accordingly at Eleven o'clock.

HOME DEPARTMENT

  Ibrahim Sey
  Mr. Cohen
  To ask the Secretary of State for the Home Department what action has been taken following the unlawful killing verdict at the inquest of Ibrahim Sey; and if he will make a statement. [14481]

  Mr. Michael
  An inquest jury concluded that Mr. Sey's death was by unlawful killing. The cause of the death was found to be postural asphyxia and excited delirium. Concern about the use of CS gas has been expressed in press reports, and Counsel for Mr. Sey's family expressed concern about the possible role of CS but no evidence was submitted to show that CS contributed to Mr. Sey's death. There is nothing in the Coroner's comments to attribute Mr. Sey's death to the use of CS. The Coroner recommended changes to training, and that all police forces should review the use of CS sprays.

  The Commissioner of Police of the Metropolis informs me that the Metropolitan Police have taken note of and reviewed the Coroner's recommendations and responded positively and immediately to them. This includes issuing clear instructions on how to deal with postural asphyxia and acute exhaustive mania in the near future.

  After considering the implications, including the safety of the public and his officers, the Commissioner has decided that it is appropriate for CS spray to be issued to all Metropolitan Police officers. The use of CS spray will be carefully monitored by the Metropolitan Police.

  In view of the large number of officers involved in the incident, the Metropolitan Police are considering to whom the verdict applies. This is complicated by the fact that it is not the role of an inquest to apportion blame to individuals. The Metropolitan Police have removed ten police officers from operational duty until their individual positions can be established.

  Correspondence
  Mr. Winnick
  To ask the Secretary of State for the Home Department when the hon. Member for Walsall, North will receive a reply to his letter of 4 June (Ref. 5345038). [15351]

  Mr. Mike O'Brien
  I sent an interim reply to my hon. Friend on 25 June and a final reply on 10 November.

  Casinos
  Mr. Dismore
  To ask the Secretary of State for the Home Department if he will make a statement on the regulation of advertising by the casino industry. [14917]

  Mr. George Howarth
  Under section 42 of the Gaming Act 1968, casinos may not advertise their location or facilities.
  460
  We are considering the proposals for partial relaxation of the ban on advertising set out in the November 1996 consultation paper "Second Consultation on Casino Deregulation". We will announce the outcome of our consideration in due course.

  Mr. Dismore
  To ask the Secretary of State for the Home Department if he will make a statement on the expansion of the casino industry into other geographical areas in the United Kingdom. [14918]

  Mr. George Howarth
  Regulations made under the Gaming Act 1968 confine the licensing of casinos to 53 permitted areas in Great Britain; 116 casinos were operating there on 31 March 1997.

  The previous Government consulted on proposals to designate additional permitted areas. We are considering whether new permitted areas are desirable in principle. We will make our conclusions known in due course.

  Mr. Dismore
  To ask the Secretary of State for the Home Department if he will make a statement concerning the level of trade union organisation in the casino industry. [14916]

  Mr. George Howarth
  The Government have no separate figures on trade union organisation or membership in the casino industry.

  Exports Initiative
  Mrs. Gillan
  To ask the Secretary of State for the Home Department when the decision was taken to end the Home Office Exports Initiative; and when it will be terminated. [14960]

  Mr. Michael
  The decision to end the Home Office Exports Initiative was taken in July. It was terminated at the end of October.

  Mrs. Gillan
  To ask the Secretary of State for the Home Department what estimate he has made of the number of companies which will be affected by the decision to terminate the Home Office Exports Initiative. [14961]

  Mr. Michael
  During the period of the Exports Initiative, it is estimated that the Home Office Exports Promoter had dealings with some 80 companies, including those who participated in trade events sponsored by the Initiative. These companies, together with others in the policing and security sector, will continue to have access to the full range of overseas trade services of the Department of Trade and Industry and the Foreign and Commonwealth Office.

  Mrs. Gillan
  To ask the Secretary of State for the Home Department what estimate he has made of the savings which will be made by abolishing the Home Office Exports Initiative. [14963]

  Mr. Michael
  The initiative had an annual budget of £100,000; approximately £40,000 of this will be saved in the current financial year.

  Mrs. Gillan
  To ask the Secretary of State for the Home Department what plans he has made for a scheme to replace the Home Office Exports Initiative. [14962]
  461
  Mr. Michael
  The trade associations and companies in the policing and security sector will continue to have access to the full range of overseas trade services of the Department of Trade and Industry and the Foreign and Commonwealth Office. My right hon. Friend the President of the Board of Trade is considering what specific additional support for exporting may be provided for this sector.

  Burglar Alarms
  Mr. Ruane
  To ask the Secretary of State for the Home Department what were the costs of false burglar alarm call-outs for each police force in England and Wales in each of the past three years. [14829]

  Mr. Michael
  The information requested is not collected centrally. I understand that last year the Association of Chief Police Officers introduced a policy to reduce false alarms by 10 per cent. per year over four years. In 1996–97, false calls fell by 12.2 per cent. and the target is likely to be met again in 1997–98.

  Data Protection
  Mr. Gordon Prentice
  To ask the Secretary of State for the Home Department if he will publish a list of the responses to the consultation paper, "Data Protection: the Government's Proposals." [14834]

  Mr. George Howarth
  I have placed the list in the Library.

  Gaming Act 1968
  Mr. Dismore
  To ask the Secretary of State for the Home Department what assessment he has made of the proposal in the report of the Gaming Board for 1996–97 that there is a need for substantial reform of the Gaming Act 1968. [14915]

  Mr. George Howarth
  We are carefully considering this. The Government will make their intentions known in due course.

  Metropolitan Police (Equal Opportunities)
  Mr. McDonnell
  To ask the Secretary of State for the Home Department what is the staffing complement of the P2 branch of the Metropolitan Police service's equal opportunities unit; and if he will make a statement on its current level of staffing. [15024]

  Mr. Michael
  The Commissioner informs me that there are five staff allocated to the Equal Opportunities Unit in the Metropolitan Police, P2 branch. I am told that the Unit is not carrying any vacancies and that the current level of staffing is considered appropriate to the work of the branch.

  Police strength, England and Wales, 31 March 1997 (excluding secondments)

  Rank

  Male

  Female

  White

  Black

  Asian

  Other

  Total

  Number

  Per cent.

  Number

  Per cent.

  Number

  Per cent.

  Number

  Per cent.

  Number

  Per cent.

  Number

  Per cent.

  Association of Chief Police Officers (ACPO) Ranks

  184

  94·8

  10

  5·2

  193

  99·5

  0

  —

  1

  0·5

  0

  —

  194

  Superintendent

  1,248

  96·9

  40

  3·1

  1,286

  99·8

  1

  0·1

  1

  0·1

  —

  —

  1,288

  Chief Inspector

  1,611

  95·6

  74

  4·4

  1,675

  99·4

  5

  0·3

  2

  0·1

  3

  0·2

  1,684

  462
  The Unit has some administrative responsibilities and advises senior managers and personnel managers in the Metropolitan Police on matters concerning equal opportunities and fairness relating both to police and civil staff. I am told that the Unit does not itself investigate cases. Investigations are carried out by the Complaints Investigation Bureau or Area Complaints Investigation Branches.

  The responsibility for ensuring equality of opportunity through the Metropolitan Police rests with all members of the Service.

  Post-release Support Services
  Mr. McNamara
  To ask the Secretary of State for the Home Department, pursuant to his answer of 28 July,Official Report, columns 3–4, if he will review the provision of post-release support services for long sentence prisoners whose convictions have been overturned by the Court of Appeal. [13088]

  Ms Quin
  [holding answer 6 November 1997]: The support services to which my hon. Friend the Minister of State referred in his reply to a question from my hon. Friend on 28 July, Official Report, columns 3–4, are national and local voluntary organisations which provide help to prisoners on release. It is for those organisations, which are independent from government, to decide what services they are able to offer.

  As my hon. Friend also mentioned, probation services are able to help with resettlement problems experienced by released prisoners. Since those who have had their convictions overturned would be free of any ties with the criminal justice system and its agencies, there is no statutory obligation for probation services to provide assistance to people in these circumstances. However, probation services can, and do, provide help on a voluntary basis. Again, it would be for the service concerned to decide what help it is able to offer in the particular circumstances. The Government currently have no plans to introduce any legislative requirements to compel probation services, or any other organisation, to provide support services to prisoners whose convictions have been overturned.

  Equal Opportunities
  Mr. Vaz
  To ask the Secretary of State for the Home Department if he will provide a breakdown of(a) the numbers and (b) the percentages, of police officers according to their grade, by (i) gender and (ii) ethnic origin. [14979]

  Mr. Michael
  The latest available information is given in the table.
  463

  Police strength, England and Wales, 31 March 1997 (excluding secondments)

  Rank

  Male

  Female

  White

  Black

  Asian

  Other

  Total

  Number

  Per cent.

  Number

  Per cent.

  Number

  Per cent.

  Number

  Per cent.

  Number

  Per cent.

  Number

  Per cent.

  Inspector

  5,899

  95·3

  291

  4·7

  6,153

  99·4

  11

  0·2

  14

  0·2

  12

  0·2

  6,190

  Sergeant

  17,585

  93·3

  1·265

  6·7

  18,653

  99·0

  66

  0·3

  82

  0·4

  50

  0·3

  18,850

  Constable

  79,604

  82·4

  17,030

  17·6

  94,636

  97·9

  917

  0·9

  656

  0·7

  425

  0·4

  96,634

  Total

  106,131

  85·0

  18,710

  15·0

  122,595

  98·2

  999

  0·8

  756

  0·6

  490

  0·4

  124,841

DUCHY OF LANCASTER

  Quangos
  Mr. Terry Lewis
  To ask the Chancellor of the Duchy of Lancaster what proposals he has to make quangos more open, accountable and effective. [15848]

  Dr. David Clark
  The Government are determined to make quangos more accountable for what they do, more open in how they do it and more effective in achieving their aims. I am pleased to announce the publication today of the consultation paper "Opening up Quangos", which builds on the valuable work done by the Committee on Standards in Public Life under Lord Nolan's chairmanship.

  Our proposals mark a new phase in opening up quangos to public scrutiny and making them more accountable to the people they serve. The Government's devolution policy will help to bring quangos in Scotland and Wales under the proper level of scrutiny that a modern democracy demands. Our purpose is the same for public bodies which operate on a United Kingdom or Great Britain basis, or an England or England and Wales basis. The proposals in the consultation paper will help to achieve this.

  Copies of the consultation paper are being widely circulated and placed on the Internet, as well as in the House libraries. Copies will be sent personally to all right hon. and hon. Members. The results of the consultation exercise will be taken into account in the preparation of the Government's White Paper on Better Government, due to be published next year.

  I am also pleased to announce the publication today of "The Executive Non-Departmental Public Bodies 1997 Report", which summarises for the first time the main objectives and achievements of the larger executive non-departmental public bodies, charting their performance against key targets. This is the first of a series of annual publications that will develop in detail and coverage in future years and improve measurement of the performance of public bodies.

  Monitor Consultancy
  Mr. MacShane
  To ask the Chancellor of the Duchy of Lancaster if he will list(a) the nature and value of contracts his Department has entered into and (b) discussions ministers or officials have held with the Monitor Consultancy since 1990. [14958]

  Mr. Kilfoyle
  [holding answer 7 November 1997]: The Cabinet Office, including the Office of Public Service and its agencies (Civil Service College, Property Advisers to the Civil Estate, Security Facilities Executive, the Buying Agency, Central Computer and Telecommunications Agency and Government Car and Despatch Agency) and
  464
  the Central Office of Information, have no record of entering into any contracts or of holding any discussions with Monitor Consultancy since 1990.

PRIME MINISTER

  Climate Change Conference
  Mr. Stunell
  To ask the Prime Minister what is the composition of the United Kingdom delegation to the Climate Change Conference at Kyoto; and if he will make a statement. [15589]

  The Prime Minister
  My right hon. Friends the Secretary of State for the Environment, Transport and the Regions and the Minister for the Environment, accompanied of officials, will represent the United Kingdom at the third Conference of the Parties to the Climate Change Convention.

  Ethnic Monitoring
  Mr. Gordon Prentice
  To ask the Prime Minister what monitoring is undertaken of the ethnic balance among staff whose salaries are paid from the Civil List; and what estimate he has made of the proportion of such staff who are from ethnic minorities. [15432]

  The Prime Minister
  The Personnel Office at Buckingham Palace maintains records of the ethnic origin of all Royal Household employees including those whose salaries are paid from the Civil List. Currently approximately 3 per cent. of Civil List employees are from ethnic minorities. The Royal Household is an equal opportunities employer (that is to say appointment and promotion are on ability without regard to sex, ethnic origin or religion).

  Minister without Portfolio
  Mr. Baker
  To ask the Prime Minister if the forthcoming White Paper on Freedom of Information will consider the answering practices of the Minister without Portfolio. [14515]

  The Prime Minister
  [holding answer 10 November 1997]: No.

  Mr. Baker
  To ask the Prime Minister if he will make a statement on the decision of the Minister without Portfolio to give no information in respect of conversations, meetings or other engagements undertaken in pursuance of his duties as Minister without Portfolio and its consistency with parliamentary accountability. [14523]

  The Prime Minister
  [holding answer 10 November 1997]: No.

CULTURE, MEDIA AND SPORT

  Delegated Legislation
  Mr. Clifton-Brown
  To ask the Secretary of State for Culture, Media and Sport if he will list all(a) secondary, (b) other delegated legislation and (c) all deregulation orders his Department made during the summer adjournment. [14377]

  Mr. Tom Clarke
  I refer the hon. Member to the reply given by my right hon. Friend the Chancellor of the Duchy of Lancaster on 5 November 1997,Official Report, column 216.

  Millennium Projects
  Mr. Woolas
  To ask the Secretary of State for Culture, Media and Sport what assessment he has made of the educational benefits of the millennium projects. [13396]

  Mr. Chris Smith
  The Millennium Commission has always been committed to supporting projects which provide access to information and sources of learning, and education has emerged as one of five key themes in the Commission's grant programmes. For example, over £33 million has been offered in grant to the new University for the Highlands and Islands, and most of the larger funded projects have a major educational element. The Government intends that the Millennium Experience and its associated national programme will have a significant educational aspect for visitors and participants, as well as being entertaining. It is envisaged that the Dome at Greenwich will become the hub of a new national digital network for learning.

  Sports Broadcasting
  Mr. Vaz
  To ask the Secretary of State for Culture, Media and Sport what representations he has received concerning changes to the listing of sports events for broadcast on terrestrial television channels; and if he will make a statement. [14982]

  Mr. Fisher
  Since the current review of the listed events was announced in May, some 609 representations have been received on this subject, including 18 letters from hon. Members. My right hon. Friend the Secretary of State will be making a statement shortly.

  Violent Films
  Mr. Dafis
  To ask the Secretary of State for Culture, Media and Sport what representations he has received on the showing of violent films on national television, with particular reference to "Natural Born Killers"; and if he will make a statement. [14812]

  Mr. Fisher
  The Department has received 17 letters about violence on television in the last three months. One of the letters received this month referred specifically to the film "Natural Born Killers" to be shown on Channel 5 on 8 November.

  A working party established by the broadcasting regulators is currently pursuing initiatives to meet public concern about the portrayal of violence and I understand that it is likely to report its conclusions early in the new year.

  National Libraries Week
  Mr. Vaz
  To ask the Secretary of State for Culture, Media and Sport what steps the Government are taking to support National Libraries Week. [14980]

  Mr. Fisher
  The Government wholeheartedly supports National Libraries Week and has been actively involved with the preparations for it. My right hon. Friend the Secretary of State wrote to all MPs to publicise National Libraries Week, and to encourage them to become involved in library events in their constituencies. He also launched the Week at the House of Commons on Monday 3 November. DCMS Ministers have subsequently been involved in a number of other related events during the Week.

  Monitor Consultancy
  Mr. MacShane
  To ask the Secretary of State for Culture, Media and Sport if he will list(a) the nature an value of contracts his Department has entered into and (b) discussions Ministers or officials have held with the Monitor Consultancy since 1990. [14947]

  Mr. Tom Clarke
  [holding answer 7 November 1997]: My Department was established in 1992 and since that date has not let any contracts, nor held any discussions, with the Monitor Consultancy.

  Tennis
  Mr. Edward Davey
  To ask the Secretary of State for Culture, Media and Sport what estimate he has made of the number of tennis clubs in England during each of the last 25 years. [15147]

  Mr. Banks
  According to the Lawn Tennis Association's (LTA) Survey of 1996, there are a total of 3,200 tennis clubs in England of which 2,400 are affiliated to the LTA. This compares against 2,700 LTA affiliated clubs 25 years ago.

  Mr. Edward Davey
  To ask the Secretary of State for Culture, Media and Sport how much lottery funding has been provided to local tennis clubs to secure the freehold purchase of their existing grounds. [15151]

  Mr. Banks
  The English Sports Council has made awards totalling £184,649, to two tennis clubs to assist with the freehold purchase of their existing grounds.

  Mr. Edward Davey
  To ask the Secretary of State for culture, Media and Sport how many people in England he estimates play tennis; and what have been the trends over the last 25 years.[15150]

  Mr. Banks
  According to the Lawn Tennis Association's (LTA) Survey of 1996, there are 4.5 million people who play tennis in England, of which 1.75 million play regularly (once a fortnight or more). I understand that the LTA have not kept records of tennis participation levels for the last 25 years.

  Sports Clubs
  Mr. Edward Davey
  To ask the Secretary of State for Culture, Media and Sport what is the minimum length of tenancy a sports club is required to hold in order to qualify for national lottery funding for capital projects. [15148]
  467
  Mr. Banks
  The minimum length of leasehold required is dependent on the size of the award, as follows:

  Years

  Up to £5,000

  3

  £5,001–£10,000

  5

  £ 10,001–£ 15,000

  7

  £15,001–£25,000

  10

  £25,001–£35,000

  12

  £35,001–£50,000

  15

  More than £50,000

  21

  British Academy for Sport
  Mr. Tipping
  To ask the Secretary of State for Culture, Media and Sport when he plans to announce the location of the British Academy for Sport. [14420]

  Mr. Banks
  We hope to make an announcement on the location shortly.

  Concessionary Television Licences
  Mrs. Ballard
  To ask the Secretary of State for Culture, Media and Sport if he will make a statement on anomalies within the current concessionary television licence scheme. [14435]

  Mr. Fisher
  The regulations governing the concessionary scheme give rise to a number of real and perceived anomalies. However, changes at the margins of the scheme, to address such anomalies, would most likely create new ones and would do little to improve the public acceptability of the scheme. The current Agreement between the Government and the BBC specifies that the licence fee system will continue until 2002. In reviewing the arrangements for funding the BBC after the year 2002 we shall also comprehensively examine the concessionary arrangements. In the meantime, the Department for Culture, Media and Sport has produced a simplified explanatory leaflet on the concessionary scheme, which explains the qualifying criteria for the concession and answers some common questions about the scheme. Copies of the leaflet have been placed in the Libraries of the House.

  Tobacco Sponsorship
  Mr. Nigel Jones
  To ask the Secretary of State for Culture, Media and Sport what assessment he has made of the impact of withdrawal of tobacco sponsorship on sport; and if he will make a statement. [14904]

  Mr. Banks
  We are looking very carefully at how best to achieve an end to the advertising and promotion of tobacco at sports events in a way which will minimise any damage to the sports concerned. Discussions are underway within Government on how best to achieve this and I am consulting the sports concerned. Plans include a transitional period. The Government will publish a White Paper next year setting out measures to tackle tobacco consumption.

  After considering the issue of sponsorship in great depth the Government has proposed excluding Formula One from the scope of the proposed EU Directive on tobacco advertising and sponsorship which is currently being negotiated. We have always made clear that we are
  468
  pursuing twin objectives of reducing smoking and of safeguarding sport from any effects arising from the loss of tobacco sponsorship. The fact is that a blanket Europe-wide ban on Formula One sponsorship would not only mean fewer Grand Prix in Europe, but also, perversely, more tobacco advertising on our TV screens beamed in from events outside the European Union.

  Television Licences (Hotels)
  Mr. Jenkins
  To ask the Secretary of State for Culture, Media and Sport (1) how many hotel television licences have been issued in each year since 1990; and what was the total revenue received by the BBC from hotel television licences for each of these years; [14566]

  (2) what steps his Department is taking to prevent the evasion of television licensing regulations by the proprietors of hotels; [14568]

  (3) what estimate he has made of the revenue lost to the BBC through the evasion of television licensing regulations by hotels. [14567]

  Mr. Fisher
  [holding answer 10 November 1997]: Records of television licence fee revenue received from hotels are available only from 1991. Licence fee revenue from hotels since 1991 is:

  Year

  Number of hotel licences issued (000s)

  Revenue (£ million)

  1991–92

  60

  4·6

  1992–93

  58

  4·7

  1993–94

  61

  5·0

  1994–95

  65

  5·5

  1995–96

  65

  5·3

  1996–97

  66

  6·1

  Under the Broadcasting Act 1990, the BBC has been responsible for the administration of the television licensing system since April 1991. We understand from the BBC that no separate estimate is available of the cost of television licence fee evasion by the hotel trade. The BBC's agent, TV Licensing, makes use of a national hotels database, in addition to standard enforcement procedures, to ensure compliance by hotels with the licensing regulations, and new guidance issued to TV Licensing's enquiry officers includes specific instructions on hotels.

TRADE AND INDUSTRY

  Computers (Century Date Change)
  Mr. David Atkinson
  To ask the President of the Board of Trade if she will make a statement on the guidelines or directives issued by the European Commission on the millennium computer problem; and if she will make a statement. [13156]

  Mrs. Roche
  No guidelines have been issued by the Commission.

  Mr. Ian Taylor
  To ask the President of the Board of Trade what estimate she has made of the call on departmental budgets required to carry out the adjustments of their computers to cope with the Year 2000 problem. [14910]
  469
  Mrs. Roche
  Each department is responsible for dealing with the Year 2000 problem affecting its own computers. Within core DTI the cost of dealing with the problem is estimated at £2.7m which will be found from existing PES provision. Agencies are responsible for their own programmes of work.

  Competition Policy
  Mrs. Dunwoody
  To ask the President of the Board of Trade if she will list those organisations which have responded to the draft Bill on competition policy. [12986]

  Mr. Nigel Griffiths
  The organisations and individuals who have responded to the consultation document "A prohibition approach to anti-competitive agreements and abuse of dominant position: draft Bill" to date are as follows:

  Allen & Overy

  Anderson & Company

  Anti Copying in Design

  Ashurst Morris Crisp

  Association Gas Supplies Ltd.

  Association for Payment Clearing Services

  Association of British Pharmaceutical Industry

  Association of Chartered Certified Accountants

  Association of Consulting Engineers

  A.T. & T. (UK) Ltd.

  Baker & McKenzie

  B.A.T. Industries

  BATMark

  Berwin Leighton

  B.G. plc.

  Bishop & Robertson Chalmers

  B.L.W.A.-Association of The Laboratory Supply Industry

  Lord Borrie Q.C.

  Brewers & Licensed Retailers Association

  British Alcan Aluminium plc.

  Bristows Cooke & Carpmael

  British Brands Group

  British Broadcasting Corporation

  British Energy

  British Insurers' International Committee

  British Music Rights

  British Petroleum

  The British Phonographic Industry

  British Printing Industries Federation

  British Property Federation

  British Retail Consortium

  British Standards Institution

  British Steel

  British Telecom

  Burger King

  Burness

  Michael Burnside Esq.

  Mr. Justice Buxton

  Cable & Wireless

  Campaign For Real Ale

  Centrica

  Channel Four Television

  Chartered Institute of Patent Agents/Mills & Reeve

  470

  Chemical Industries Association

  The Cinema Exhibitors' Association

  City of London Law Society

  Professor Roger Clarke

  Clifford Chance

  B. Colgate Esq.

  Combined Merchants (UK) Ltd.

  Commercial Radio Companies Association

  The Community Pharmacy Action Group

  Competition Law Association

  Confederation of British Industry

  Confederation of Passenger Transport UK

  Conoco Europe Gas Ltd.

  Construction Confederation

  Construction Industry Council

  Consumers' Association

  The Council for Professions Supplementary to Medicine

  Cooper & Lybrand

  Coudert Brothers

  Dairy Industry Federation

  Professor Steve Davies

  Dawson, Mason & Carr

  Dibb Lupton Alsop

  Dixons Group plc/S. J. Berwin & Co.

  The Document Company: Xerox

  Jonathan Downing Esq.

  Electricity Industry/Eversheds

  Energy Intensive Users Group

  English Welsh & Scottish Railway

  Enron Europe Ltd.

  Esso

  Eversheds

  F. J. Cleveland & Company

  Federation of Agricultural Co-operatives (UK) Ltd.

  The Federation of Environmental Trade Associations

  Federation of Small Businesses

  Finance & Leasing Association

  Food & Drink Federation

  The Forum of Private Business

  Mark Furse Esq.

  Garretts

  Gas Consumers Council

  General Cable

  General Dental Council

  GKN Plc.

  Herbert Smith

  Holman, Fenwick & Willan

  Simon Hossack Esq.

  Clive Howard-Luck Esq.

  Martin Howe Esq.

  Independent Television Association

  The Insolvency Council

  The Institute of Chartered Secretaries & Administrators

  Johnsons News Group

  Kingfisher

  The Law Society

  The Law Society of Scotland

  Licensing Executives Society

  471

  Linklaters & Paines

  Lloyd's

  London International Insurance & Reinsurance Market Association

  London Transport

  Lovell White Durrant

  McCullochs

  Marks & Spencer

  Mars/Lovell White Durrant

  Music Industries Association

  National Association of Master Bakers

  The National Association of Estate Agents

  National Consumer Council

  National Federation of Retail Newsagents

  National Food Alliance

  National Power

  The Newspaper Publishers Association Ltd.

  Newspaper Publishing plc.

  The Newspaper Society

  Northern Ireland Electricity

  Norton Rose

  NTL (UK)

  Office of the Rail Regulator

  Office of Telecommunications

  One 2 One

  Passenger Transport Executive Group

  Peachey & Co.

  Pinsent Curtis

  The Post Office

  Leolin Price C.B.E Q.C.

  Producers Industrial Relations Service Ltd.

  Proprietary Association of Great Britain

  Rt. Hon. John Redwood M.P.

  Regulatory Policy Institute

  Retail Motor Industry Federation

  Reuters

  Jonathan Rickford Esq.

  The Royal Institution Of Chartered Surveyors

  Royal Pharmaceutical Society of Great Britain

  Scottish Association of Master Bakers

  Scottish Power

  Thomas Sharpe Q.C.

  Shell International Ltd.

  Simmons & Simmons

  Singletons

  Slaughter and May

  The Society of Motor Manufacturers & Traders Ltd.

  Somerset County Council

  The Takeover Panel

  The Telecommunications Managers Association

  Tesco

  Trade Marks Patents And Designs Federation

  Travers Smith Braithwaite

  UK Offshore Operators Association Ltd.

  UK Petroleum Industry Association Ltd.

  UK Steel Association

  The Union of Independent Companies

  Unisys Ltd.

  472

  Professor John Vickers

  The Water Companies Association

  Water Services Association

  Derek Webb Esq.

  Wedlake Bell

  Tony Weir Esq.

  Whitbread Plc.

  Nicholas Williams Esq.

  Wragge & Co.

  The Department of Trade and Industry has also been engaged in detailed exchanges about the Bill with other public bodies, including the Monopolies and Mergers Commission, the Office of Fair Trading, 0FTEL, ORR, OFGAS, OFFER, OFWAT and OFREG (NI).

  Banking Industry
  Mr. Vaz
  To ask the President of the Board of Trade (1) what meetings have taken place between members of her Department and representatives of the United Bank Ltd. in 1997 to date; [14971]

  (2) what meetings have taken place between members of her Department and representatives of the Banking Insurance and Finance Union to date. [14972]

  Mr. Ian McCartney
  Members of my Department hold meetings with a wide range of organisations. Details of these meetings and the matters discussed are not held centrally. The information requested could therefore only be obtained at disproportionate cost.

  Mr. Vaz
  To ask the President of the Board of Trade what representations she has received regarding the industrial dispute in the United Bank Ltd. [14970]

  Mr. Ian McCartney
  My Department has received some representations from the Banking Insurance and Finance Union about this dispute.

  Mr. Vaz
  To ask the President of the Board of Trade if she will make a statement on the Government's policy towards employment relations in banks. [14976]

  Mr. Ian McCartney
  Employment relations in banks, as elsewhere, are a matter for the management and employees concerned.

  Patents
  Mr. Gordon Prentice
  To ask the President of the Board of Trade how many proposals were patented in each year since 1990; and how many have been taken up. [15165]

  Mr. Ian McCartney
  Since 1990 the United Kingdom Patent Office has granted patents as follows:

  Year

  Total

  UK applications

  1990

  9,396

  3,265

  1991

  9,346

  3,307

  1992

  9,421

  3,331

  1993

  8,330

  3,019

  1994

  9,530

  3,517

  1995

  9,475

  3,648

  1996

  7,132

  2,737

  473
  During the same period, the European Patent Office granted the patents covering the United Kingdom under the European Patent Convention, to which the United Kingdom is a signatory, as follows:

  Year

  Total

  UK applications

  1990

  22,783

  1,096

  1991

  24,729

  1,186

  1992

  28,407

  1,311

  1993

  34,256

  1,470

  1994

  39,242

  1,705

  1995

  38,877

  1,596

  1996

  37,203

  1,585

  Information on which of these has been commercially exploited is not available, and could not be compiled at reasonable cost. However, during this period the following total numbers of patents covering the UK were renewed, perhaps indicating commercial exploitation:

  Year

  Total

  1990

  230,994

  1991

  227,220

  1992

  228,665

  1993

  222,897

  1994

  230,566

  1995

  243,732

  1996

  256,991

  A breakdown of this table to cover UK applicants could be provided only at disproportionate cost.

  Professional Qualifications
  Mr. Jenkins
  To ask the President of the Board of Trade for what reasons the Institute of Financial Accountants qualifications were not included in the list of professional qualifications in the European Communities (Recognition of Professional Qualifications) Regulations 1991; and if she will list(a) those professions and (b) professional qualifications which are recognised in EU countries under the Regulations.[14934]

  Mr. Ian McCartney
  Statutory Instrument 1991 No. 824 lists professions which are regulated by law or public authority in the UK and professional titles awarded by bodies incorporated by Royal Charter. Since the Institute of Financial Accountants does not fall within those categories it is not necessary for its qualifications to be listed in the Statutory Instrument.

  The list of professions and titles in Statutory Instrument 1991 No. 824 is not intended to be exhaustive. The EU Directives dealing with mutual recognition of professional qualifications lay down rules which apply to the recognition of all professional qualifications (including those relevant to the Institute of Financial Accountants) whether or not listed in internal legislation of Member States.

LORD CHANCELLOR'S DEPARTMENT

  Overseas Travel
  Mr. Malcolm Bruce
  To ask the Parliamentary Secretary, Lord Chancellor's Department if he will list each of the overseas trips made by himself and other members of his ministerial team since 2 May, specifying in each case(a) the participating Minister or Ministers, (b) the destination of the trip, (c) the purpose of the trip and (d) the cost of the trip; and if he will make a statement. [15256]

  Mr. Hoon
  The following overseas visits have been made by Ministers in the Lord Chancellor's Department since 2 May:1. (a) participating Minister: The Lord Chancellor, accompanied by a Private Secretary and Press Officer
  (b) destination: Hong Kong
  (c) purpose of trip: to express confidence in the HKSAR's enthusiasm to continue the Basic Law as expressed in the Joint Declaration in 1984. This stated that:
  "The Hong Kong Special Administrative Region will be vested with executive, legislative and independent judicial powers, including that of final adjudication. The laws currently in force in Hong Kong will remain basically unchanged".
  In particular, the Lord Chancellor discussed with the Chief Justice of Hong Kong arrangements for making sitting Law Lords available from the UK to sit judicially in Hong King. He also met leading politicians representing all the main interests in Hong Kong.
  (d) cost of the trip: £17,186.53
  2. (a) participating Minister: Mr. Geoff Hoon, accompanied by a Private secretary and an official.
  (b) destination: Strasbourg and Potsdam
  (c) purpose of the trip: to participate in discussions on the European Court of Human Rights following implementation of Protocol 11 to the ECHR and to have discussions with MEPs and others on legal matters concerning the forthcoming UK Presidency of the EU.
  (d) cost of the trip: £2,560.30

  Public Record Office
  Mr. Baker
  To ask the Parliamentary Secretary, Lord Chancellor's Department how many documents deemed appropriate for release for public scrutiny are currently withdrawn from the Public Record Office by the Department of origin. [14451]

  Mr. Hoon
  The Question concerns a specific operational matter on which the Chief Executive of the Public Record Office is best placed to provide an answer and I have accordingly asked the Chief Executive to reply direct.

  Letter from Sarah Tyacke to Mr. Norman Baker, dated 7 November 1997:
  PQ 98/335: DOCUMENTS WITHDRAWN FROM THE PUBLIC RECORD OFFICE BY THE DEPARTMENT OF ORIGIN
  I have been asked by the Lord Chancellor's Parliamentary Secretary to reply for the Public Record Office to your question about the above.

  475
  Four thousand six hundred and fifty documents are currently temporarily withdrawn from the Public Record Office by the department of origin, as authorised by section 4(6) of the Public Records Act, 1958. Most of these documents are deemed appropriate for release for public scrutiny and even when temporarily withdrawn can be made available on demand by a member of the public for consultation in our reading rooms or in the withdrawing department. However I regret that we do not separately enumerate the documents in this category.

ENVIRONMENT, TRANSPORT AND THE REGIONS

  Kirkby Stephen Bypass
  Mr. Maclean
  To ask the Secretary of State for the Environment, Transport and the Regions if the inspector's report on the Kirkby Stephen bypass was seen by Ministers before publication was abandoned. [14172]

  Ms Glenda Jackson
  [holding answer 3 November 1997]: The inspectors report on the Kirkby Stephen Bypass proposal is still under consideration by the Secretary of State as he has received no formal notification that the proposal has been abandoned.

  Mr. Maclean
  To ask the Secretary of State for the Environment, Transport and the Regions what communication or discussion there has been between Ministers or officials in his Department and councillors or officials of Cumbria County Council over the handling of the inspector's report on the Kirkby Stephen bypass. [14171]

  Ms Glenda Jackson
  [holding answer 3 November 1997]: There has been no communication or discussion between Ministers and representatives of Cumbria County Council. County Council officials have recently enquired of my officials the position regarding the Inspector's report in the event of the statutory Orders for the scheme being withdrawn. My officials are awaiting formal notification from the County Council of its intentions in relation to the future of the scheme. However, I can tell the right hon. Member that, in the event of the statutory Orders being withdrawn, in line with Departmental policy the Secretary of State would propose to publish the report.

  Mr. Maclean
  To ask the Secretary of State for the Environment, Transport and the Regions what representations his Department received relating to publication of the inspector's report on the Kirkby Stephen bypass. [14173]

  Ms Glenda Jackson
  [holding answer 3 November 1997]: My Department has received a verbal representation from Cumbria County Council officials in relation to this matter. No other representations have been received.

  Public Inquiry Reports
  Mr. Maclean
  To ask the Secretary of State for the Environment, Transport and the Regions when was the last occasion on which his Department did not publish the report of an inspector following a public inquiry. [14170]
  476
  Ms Glenda Jackson
  [holding answer 3 November 1997]: The Government have never failed to publish an Inspectors Report following a Public Inquiry into Local Highway Authority Orders.

  Birmingham Northern Relief Road
  Mr. Baker
  To ask the Secretary of State for the Environment, Transport and the Regions what compensation payments would have been required to have been made, and to whom, had the decision to proceed with the Birmingham Northern Relief Road not been taken. [13778]

  Ms Glenda Jackson
  [holding answer 3 November 1997]: As Section 1(4) of the New Roads and Street Works Act 1991 requires, the Birmingham Northern Relief Road Concession Agreement makes provision in certain circumstances for compensation payments to the Concessionaire. Under the Agreement signed in February 1992 by the previous Government the detailed provisions about compensation payments were agreed to be commercially confidential.

  Mr. Baker
  To ask the Secretary of State for the Environment, Transport and the Regions what compensation payments are payable to the Government in the event that Midland Expressway Ltd. decide to withdraw from the concession agreement to construct and operate the Birmingham Northern Relief Road. [13777]

  Ms Glenda Jackson
  [holding answer 3 November 1997]: As Section 1(5) of the New Roads and Street Works Act 1991 requires, the Birmingham Northern Relief Road Concession Agreement makes provision in certain circumstances for compensation payments to the Government. Under the Agreement signed in February 1992 by the previous Government the detailed provisions about compensation payments were agreed to be commercially confidential.

  Local Authority Funding
  Mr. Watts
  To ask the Secretary of State for the Environment, Transport and the Regions if it is his policy(a) to return to a needs-based capital approvals allocation system and (b) that any increased capital allocation will be made to local authorities via basic credit approvals. [14196]

  Mr. Raynsford
  The Government are carrying out a Comprehensive Spending Review, a root and branch review of public spending in all Government Departments. Conclusions will emerge in new spending plans and in new policies reflecting the Government's priorities next year. In parallel with this, we have set up a review to look at the future arrangements for local authority finance, in close collaboration with local government and representative organisations. This will include consideration of capital allocation systems and options for local authority support for capital expenditure. We will be consulting widely from late Autumn on particular aspects of the system and plan to issue a White Paper in the Spring on our policies for local government in England, including finance, best value and democratic renewal.

  In 1998–99 we have agreed that the HIP allocations will be based on 50 per cent. on need, whereas previously it had been intended that 100 per cent. of the allocation would be subject to ministerial discretion. We have also

  477
  agreed that the allocation of Supplementary Credit Approvals under our Capital Receipts Initiative should be made on the basis of 66 per cent. reflecting need.

  Channel Tunnel
  Mr. Rowe
  To ask the Secretary of State for the Environment, Transport and the Regions what assessment he has made of the likely date for completion of the channel tunnel rail link; and if he will make a statement. [14555]

  Ms Glenda Jackson
  Under the Channel Tunnel Rail Link Development Agreement, the construction of the CTRL is the responsibility of London and Continental Railways Ltd. I understand from LCR that they expect to complete the CTRL during 2003.

  Mr. Rowe
  To ask the Secretary of State for the Environment, Transport and the Regions when he expects to make the first payment to London and Continental Railways under the agreement under the Channel Tunnel Rail Link Act 1996. [14551]

  Ms Glenda Jackson
  The Government's contract with LCR provides for the first instalment of capital grant to be paid when LCR have completed 68 per cent. of the CTRL by value. I understand from LCR that they expect the first instalment of grant will fall due during 2001.

  Mr. Rowe
  To ask the Secretary of State for the Environment, Transport and the Regions what was the difference between the actual passenger numbers on Eurostar in 1996–97 and the Government's estimate for that period when it was handed over to London and Continental Railways. [14552]

  Ms Glenda Jackson
  In the 1996 calendar year Eurostar carried 4.9 million passengers on the London-Paris/Brussels routes and in the first nine months of 1997 they have carried 4.54 million passengers. This represents a 20 per cent. increase on the same period for 1996. The previous Government made no estimates of future Eurostar patronage at the time of transfer of the business to London and Continental Railways.

  Housing (Wheelchair Access)
  Mr. Hancock
  To ask the Secretary of State for the Environment, Transport and the Regions what plans he has to extent Part M of the Building Regulations. [14497]

  Mr. Raynsford
  I plan to make a statement shortly on the extension of Part M of the Building Regulations to new dwellings.

  Mr. Hancock
  To ask the Secretary of State for the Environment, Transport and the Regions how many homes have been constructed in each of the last five years that do not meet the standards set out for accessibility by disabled people under the terms of the changes proposed in 1995 to Part M of the Building Regulations. [14498]

  Mr. Raynsford
  It is not possible to give a full assessment of how many homes do, or do not, meet the standards of accessibility proposed in 1995 as it is not possible to quantify homes constructed in the private sector which have incorporated accessibility for disabled people on a voluntary basis. As a broad indication, however, a comparison can be made between total housing completions in Great Britain and homes 478
  completed by Housing Associations, or registered social landlords, where Housing Corporation Housing Development Scheme Standards will have applied. Those standards provide accessibility for disabled people comparable to the changes proposed to the Building Regulations in 1995. The relevant figures for the last five years are:

  Total completions (thousands)

  Housing Association completions (thousands)

  1992

  171·9

  26·3

  1993

  178·5

  35·4

  1994

  186·0

  36·7

  1995

  190·7

  38·4

  1996

  179·0

  31·5

  1997 (Q1, 2 and 3)

  133·9

  20·2

  Mr. Hancock
  To ask the Secretary of State for the Environment, Transport and the Regions what is the average waiting time for social housing for people requiring a home built to wheelchair standards. [14500]

  Mr. Raynsford
  Information on average waiting times for social housing is not collected centrally.

  In 1991, the former Department of the Environment carried out research into access into local authority housing. The research included a very small number of applicants requiring a home built to wheelchair standards. Their average waiting time was 21 months.

  However, the research did not cover access to housing association accommodation. Since 1988, housing associations have been key providers of homes built to wheelchair standards.

  Mr. Hancock
  To ask the Secretary of State for the Environment, Transport and the Regions what estimate he has made of the percentage of homes to be constructed using the capital receipts that will(a) be accessible to disabled people and (b) meet wheelchair standards under the terms of the extension proposed in 1995 of Part M of the Building Regulations. [14499]

  Mr. Raynsford
  It is not possible to estimate the percentage of homes constructed using capital receipts that will be accessible to disabled people as the use made of capital receipts is at the discretion of local authorities. However, where local authorities choose to use capital receipts to support registered social landlords normal Housing Corporation Development Scheme Standards will apply. Those standards provide accessibility for disabled people comparable with the 1995 proposals for extending Part M of the Building Regulations to new dwellings, including accessibility for wheelchair users for the purposes of visitability.

  London Underground
  Mr. Vaz
  To ask the Secretary of State for the Environment, Transport and the Regions if he will make a statement on the Government's plans for the future of London Underground. [14701]
  479
  Ms Glenda Jackson
  The Government are considering a wide range of options for public-private partnerships for London Underground, while ruling out wholesale privatisation. The options being considered were detailed in my reply to my hon. Friend the Member for Crewe and Nantwich (Mrs. Dunwoody),Official Report, 3 November 1997 column 67.

  Minister for London and Construction (Visits)
  Mr. Ottaway
  To ask the Deputy Prime Minister if he will list the towns and cities outside the United Kingdom visited by the Minister for London and Construction and the dates on which the visits took place since 1 May. [15025]

  Mr. Raynsford
  From 27 to 31 August, I visited New York, Boston and Washington, USA on a fact finding trip to learn about the US experience of Mayoral systems and to speak at the American Political Science Association Conference. On 24 and 25 September, I attended the EU Housing Ministers' meeting in Amsterdam. Between 3 and 10 October, I led a construction trade delegation of 17 British companies to promote British trade overseas. The delegation visited Amman and Aqaba in Jordan and Sharm El Sheikh and Cairo in Egypt. On 17 October, I visited Cologne in Germany to meet the Mayor of Cologne and discuss German Mayoral systems, from 6 to 9 November, I visited Madrid and Barcelona in Spain to learn about Spanish experiences of Mayoral systems and also to speak at the 1st Conference of the European Federation of Town Centres on Town centre management.

  Pavements
  Mr. Gordon Prentice
  To ask the Secretary of State for the Environment, Transport and the Regions if he will issue guidance to local authorities concerning the exercise of their powers to keep pavements free of advertising boards and goods for sale. [14839]

  Mr. Raynsford
  There is sufficient guidance to local planning authorities on control of outdoor advertisements in the Department's Circular 5/92, using powers in the Town and Country Planning (Control of Advertisements) Regulations 1992. Local highway authorities have powers in the Highways Act 1980 to remove obstructions on pavements. Both planning and highway authorities must consider whether to exercise these powers on a case-by-case basis.

  Consultants
  Miss Kirkbride
  To ask the Secretary of State for the Environment, Transport and the Regions if he will list the consultancy firms and the directors of consultancy firms who are employed to work on best value pilots for local councils; and if he will make available details of these contracts. [14767]

  Mr. Raynsford
  Following a competitive tender, the Department of the Environment, Transport and the Regions has awarded a research contract worth £⅓ million to the Local Government Centre at Warwick University's Business School to conduct an evaluation of all the Best Value pilot schemes. The study, which will be directed by Dr. Steve Martin, with Professor John Benington in support, started in October of this year and will finish in Autumn 2000. Principal researchers on the study include Dr. Mike Geddes and Dr. Jean Hartley (of the Local 480
  Government Centre), Dr. Ian Sanderson (of the policy Research Institute, Leeds Metropolitan University) and Tony Bovaird (Aston Business School).

  The details of any contracts entered into by individual local authorities are matters for those authorities.

  Road Accidents
  Sir Teddy Taylor
  To ask the Secretary of State for the Environment, Transport and the Regions how many road accidents over the most recent annual period for which figures are available were(a) drink related and (b) drugs related. [14557]

  Ms Glenda Jackson
  [holding answer 6 November 1997]: In 1996 there were 10,850 accidents involving death or injury in which at least one driver or motorcycle rider was over the legal limit. No comparable figures are available for drugs-related accidents. However the Department is currently one year into a three-year research programme to assess the incidence of drugs-driving and its implications for road safety.

  Roads (Private Finance)
  Mr. Chope
  To ask the Secretary of State for the Environment, Transport and the Regions what support he is giving to local authorities to develop road schemes using private sector finance. [14774]

  Ms Glenda Jackson
  [holding answer 7 November 1997]: My Department has taken a number of measures to facilitate local authority PFI projects, including highway and other transport schemes. These include the introduction of a Bill to clarify local authorities powers to enter into PFI contracts, consultation on a draft instrument to permit local authorities to delegate a range of highway functions and the release of model contract documents developed for Highways Agency roads.

  Advance Corporation Tax
  Mr. Burns
  To ask the Secretary of State for the Environment, Transport and the Regions (1) what assessment he has made of the estimates of the financial costs of the changes made to ACT in July 1997 budget made by(a) Chelmsford Borough Council and (b) Essex County Council; [15071]

  (2) what representations his Department has received in respect of making full compensation available to (a) Chelmsford Borough Council and (b) Essex County council for the impact that the changes to ACT will have on their budgets. [15073]

  Mr. Raynsford
  Representations have been received from the Local Government Association and several local authorities, including Essex County Council and Chelmsford Borough Council. The Local Government Association, with the support of my Department and the United Kingdom Steering Committee on Local Authority Pensions, is establishing by means of a national survey the impact of the Budget changes on local authority employers' pension costs. This information will be used to inform the actuarial valuations of each fund and how future employers' pension costs in Essex and elsewhere are affected. These factors, and any others which will
  481
  emerge from the 1998 actuarial valuations, will be taken into account when the level of local authority provision is determined for 1999–2000 and for subsequent years.

  Out-of-town Leisure Complexes
  Mr. Burstow
  To ask the Secretary of State for the Environment, Transport and the Regions (1) what his Department's policy is towards existing planning guidance in relation to large out of town leisure complexes which may impact on existing facilities; and what plans he has to issue new planning guidance to cover out-of-town leisure complexes; [14739]

  (2) what plans he has to issue new planning guidance to minimise the disturbance to local residents caused by large out-of-town leisure complexes. [14738]

  Mr. Raynsford
  The Government are firmly committed to the objectives of Planning Policy Guidance Note 6: "Town Centres and Retail Developments", which seeks to sustain and enhance the vitality and viability of our existing city, town and district centres by making them the focus for investment, particularly in retail, office, leisure and other appropriate developments.

  The Government propose to ensure that the approach in PPG6 is applied just as firmly to leisure developments as to retail developments. In applying the sequential approach to selecting sites, the Government will expect developers to demonstrate why they could not develop elements of a large scheme on more central sites, with less on-site car parking.

  The current policy for leisure developments, therefore, consists of PPG6 and the Government Response to the Report of the Environment Committee (Cm 3729). We have no current plans to issue further guidance.

  The Department will shortly be commissioning research on planning and leisure development. We will want to consider the implication of that research before considering whether guidance on this aspect needs to be amended.

  Local planning authorities are required to determine planning applications in accordance with their development plans, unless other material considerations indicate otherwise. Factors such as the impact of large out-of-town leisure complexes on the neighbourhood are capable of being material planning considerations, and where appropriate, local planning authorities can impose conditions on planning permission to minimise such impacts.

  Water Meters
  Mr. Edward Davey
  To ask the Secretary of State for the Environment, Transport and the Regions if he will assess the hardship caused to pensioner one-person households who are unable to have water meters installed due to technical difficulties but are not entitled to rebates on their water rates; and if he will make a statement. [14097]

  Angela Eagle
  The Government are undertaking a review of the water charging system in England and Wales to ensure that it operates in a fair and equitable way. We have made clear our opposition to compulsory metering for essential household use under current arrangements, but we shall be looking at metering policy including the availability of meters to customers who wish 482
  to pay on a measured basis. The review will pay particular attention to the effect of present charging methods on special cases such as large households, single persons and low income households including pensioners.

  Health Action Zones
  Mr. Burstow
  To ask the Secretary of State for the Environment, Transport and the Regions what has been his Department's role in developing the Government's proposals for health action zones. [14586]

  Angela Eagle
  We have been working closely with the Department of Health to encourage positive links between health action zones and other area-based programmes such as the Single Regeneration Budget Challenge Fund. An official from the Department will sit on a national reference panel to advise on the bids.

  Local Government Review
  Mr. Burstow
  To ask the Secretary of State for the Environment, Transport and the Regions what estimate his Department has made of the total cost to date of all stages of the local government review process for(a) his Department (b) local councils in England.[14588]

  Mr. Raynsford
  The cost of the Local Government Commission, which undertook the structural review of Local Government between 1992 and 1997, was £21.261 million. Under the Local Government Re-organisation Costs Scheme the most recently available bids for transitional costs submitted by all reorganising authorities in respect of expenditure incurred between 1994–95 and 1997–98 total £439·152 million.

  Utility Trenching
  Ms Jennifer Jones
  To ask the Secretary of State for the Environment, Transport and the Regions if he will review the impact of unregulated utility trenching on the environment in the west midlands. [14725]

  Ms Glenda Jackson
  Under the New Roads and Street Works Act 1991, local highway authorities have a duty to co-ordinate utility street works and the utilities have a duty to co-operate with the highway authorities and with each other. The Act also imposes requirements as to the standard of reinstatements and as to signing and guarding of works in progress. The Government keep the working of the Act under review and expect to make changes to the associated secondary legislation from time to time.

  Regional Development Agency, West Midlands
  Ms Jennifer Jones
  To ask the Secretary of State for the Environment, Transport and the Regions what action he will take to include the voluntary sector in the preliminary planning for a Regional Development Agency in the west midlands. [14724]

  Mr. Caborn
  In taking forward our proposals for Regional Development Agencies in England, we have closely involved all the key stakeholders in each region, including those from the voluntary sector. Detailed arrangements for the Regional Development Agencies will be set out in a White Paper on England's regions to be published in the next few weeks.

  Uniform Business Rate
  Mr. Prior
  To ask the Secretary of State for the Environment, Transport and the Regions what percentage of the uniform business rate was paid by small and medium enterprises; and what was the uniform business rate per employee paid by(a) small and medium enterprises and (b) large companies in the last year for which figures are available. [14805]

  Mr. Raynsford
  This information is not held by the Department.

  Mr. Prior
  To ask the Secretary of State for the Environment, Transport and the Regions how much revenue was raised by the uniform business rate in the last year for which figures are available. [14886]

  Mr. Raynsford
  Total contributions paid into the non-domestic rating pool for distribution back to local authorities was £11,471 million for 1995–96, the last year for which figures are available.

  Street Trees
  Ms Jennifer Jones
  To ask the Secretary of State for the Environment, Transport and the Regions if he will introduce an environmental impact appraisal system to assess the damage to trees on streets caused by(a) utility trenching, (b) roadworks, and (c) traffic disruption. [14726]

  Ms Glenda Jackson
  I have no plans to introduce a general requirement for environmental appraisal in relation to street trees. However, in accordance with the Environmental Impact Assessment Directive (85/337/EEC), certain projects undertaken by utilities and highway authorities require such assessment where they are judged likely to have significant effects on the environment. In such cases, the developer must provide an Environmental Statement which includes, amongst other things, a description of any likely significant effects on trees and other flora.

  Manufactured Sucrose Polymers
  Dr. Whitehead
  To ask the Secretary of State for the Environment, Transport and the Regions what investigations he has undertaken into the environmental consequences of the entry of manufactured sucrose polymers into the Untied Kingdom food chain. [14937]

  Angela Eagle
  As far as I am aware, no investigations have been undertaken by this Department into the environmental consequences of the entry of manufactured sucrose polymers into the United Kingdom food chain.

  Green Belt
  Miss Kirkbride
  To ask the Secretary of State for the Environment, Transport and the Regions what plans he has to change the requirement for areas which consist mainly of green belt land to take their full quota of the requirement for new homes. [14763]

  Mr. Raynsford
  Government polices encourage local authorities to make full and effective use of land within existing urban areas. The Government have a national target of 50 per cent. of all new housing to be built on previously used land.
  484
  The Government's Green Belt policies remain as set out in Planning Policy Guidance Note 2. There is a presumption against inappropriate development in the Green Belt, except where there are very special circumstances justifying the proposal which outweigh the harm to the Green Belt. PPG2 emphasises that, once fixed, Green Belt boundaries should be changed only in exceptional circumstances. Any such changes proposed by a local planning authority would need to be subject to full public consultation. They must be advertised for a period of six weeks, during which anyone may lodge an objection. The planning authority have to consider all the objections and representations made to them. An inquiry must then be held, unless none of the objectors wish to take part. In addition my right hon. Friend the Deputy Prime Minster would need to be satisfied that all opportunities for development within the urban areas contained by or beyond the Green Belt had been fully considered.

  A40 (Cheltenham)
  Mr. Nigel Jones
  To ask the Secretary of State for the Environment, Transport and the Regions if he will exempt from the trunk road review the scheme to detrunk the A40 through Cheltenham; and if he will make a statement. [14903]

  Ms Glenda Jackson
  The consultation exercise at present taking place as part of the trunk road review specifically invites views on the size and role of the network and whether some trunk roads should be transferred to local authorities or vice versa. In these circumstances I think that I would be premature to proceed with consideration of a specific proposal, such as detrunking the A40 through Cheltenham, before we have concluded the review.

  Housing Corporation
  Ms Jennifer Jones
  To ask the Secretary of State for the Environment, Transport and the Regions if he will list the directors of the Housing Corporation, indicating the tenure of their directorships, their remuneration and the qualifications which led to their appointments. [14730]

  Mr. Raynsford
  In making appointments to the Board of the Housing Corporation, candidates are sought who, in addition to their individual areas of expertise and knowledge, are able to take a broad view of housing policy and related issues. Candidates should be able to contribute usefully in directing a major Non-Departmental Public Body and to make constructive contributions to the development of social housing policy at the national level. The Board needs members with a range of skills and expertise extending from knowledge of finance and regulation to an understanding of how housing policy impacts on other areas of social welfare.

  Council Houses, Bromsgrove
  Miss Kirkbride
  To ask the Secretary of State for the Environment, Transport and the Regions how much more of its own reserves Bromsgrove district council will be permitted to spend on council house improvements in the current financial year and in each of the next three years under the terms set out in the Local Government Finance (Supplementary Credit Approvals) Bill. [14762]
  485
  Mr. Raynsford
  The Local Government Finance (Supplementary Credit Approvals) Act 1997 provides for a local authority's set-aside capital receipts to be taken into account when Supplementary Credit Approvals are distributed. The Act underpins the Government's Capital Receipts Initiative under which Bromsgrove District Council is entitled to receive Supplementary Credit Approvals to the value of £188,000 in 1997–98, and £564,000 in 1998–99. These resources may be used to support housing and housing associated regeneration works. In the first instance, however, it is for individual councils to decide on priorities in their area. Longer-term funding arrangements under the Initiative are being considered in our Comprehensive Spending Review.

  Nuclear Waste
  Mr. Llew Smith
  To ask the Secretary of State for the Environment, Transport and the Regions what assessment he has made of the impact of the transposition of European Council directive 96/29/Euratom on basic radiation safety standards on the current nuclear waste management strategy of the United Kingdom. [14715]

  Angela Eagle
  Directive 96/29/Euratom lays down basic safety standards for the health protection of the general public and workers against the dangers of ionising radiation. It updates standards set for these areas by previous Directives. The new Directive is required to be implemented into United Kingdom law by 13 May 2000. The precise manner of implementation is currently being considered by Government.

  Housing Associations
  Ms Jennifer Jones
  To ask the Secretary of State for the Environment, Transport and the Regions how many housing associations have been registered by the Housing Corporation since May 1992; and what proportion of them were housing co-operatives. [14709]

  Mr. Raynsford
  Since May 1992 a total of 163 social landlords have been registered with the Housing Corporation; 16 per cent. (26) of these were housing co-operatives.

  Drink-Driving
  Mr. Kidney
  To ask the Secretary of State for the Environment, Transport and the Regions if he will introduce a lower permitted maximum alcohol blood level for drivers of road vehicles.[15038]

  Ms Glenda Jackson
  We are currently considering a number of measures to combat drink-driving, including the case for reducing the present maximum permitted blood-alcohol level for drivers.

  Derelict Sites
  Mr. Edward Davey
  To ask the Secretary of State for the Environment, Transport and the Regions what estimates he has made, by county, of the number of derelict sites in England; and how many of these sites were formerly used for (i) sport and (ii) recreation. [15155]

  Mr. Raynsford
  The latest information is from a survey of derelict land undertaken in 1993, which provides estimates of the area of derelict land by type of dereliction at county and district level. This information 486
  is included in Table 5 of "Survey of Derelict Land in England 1993 Volume 2-Reference Tables", a copy of which is in the House of Commons Library. There is no information available on the number of derelict sites at county level.

  Derelict land is defined as
  "land so damaged by industrial or other development that it is incapable of beneficial use without treatment".

  It is unlikely that sites formerly used for sport and recreation would fall under this definition, and such sites were not separately classified within the types of dereliction recorded.

  The Department's Land Use Change Statistics for England show that from 1985 to 1992, some 640 hectares of land previously used for outdoor recreation, or leisure and recreational buildings, became vacant or derelict. However, in some cases this will have been an intermediate stage before redevelopment.

  Rail Grants
  Ms Walley
  To ask the Secretary of State for the Environment, Transport and the Regions what the breakdown was by region of(a) freight facilities grants and (b) track access grants in the most recent available year; and if he will make a statement. [15313]

  It is not possible to allocate track access grants to specific regions since the grant aided traffic traverses more than one region and, in one case, all regions. Awards of track access grant are paid over a number of years; in 1996–97 £12.3 million was paid to five claimants.

  The Government are committed to encouraging greater take-up of grants from all regions.

  Ms Glenda Jackson
  In the 1996–97 financial year seven rail and one inland waterways freight facilities grants were awarded in England:

  Region

  Number of awards

  Value of awards £

  East Midlands

  2 (rail)

  1,335,472

  Yorkshire and Humber

  2 (rail)

  509,787

  North West

  1 (rail)

  230,805

  North East

  1 (rail)

  402,029

  London

  1 (rail)

  1,904,032

  South East

  1 (Inland Waterways grant)

  47,338

  Home Energy Efficiency Scheme
  Mr. Duncan Smith
  To ask the Secretary of State for the Environment, Transport and the Regions (1) what the total amount of money available is under the home energy efficiency scheme in the current winter to help meet the cost of loft, tank and pipe insulation, draught proofing and energy advice; [15177]

  (2) what is the maximum award available under the home energy efficiency scheme. [15176]

  Angela Eagle
  [holding answer 10 November 1997]: The Home Energy Efficiency Scheme helps vulnerable families keep warmer and use less energy by paying grant, to a maximum of £315, towards the cost of improving the

  487
  energy efficiency standards of their homes. The measures available are loft insulation, cavity wall insulation, controls for heating systems, draught proofing, energy efficient lamps and water tank insulation. In addition, personal advice on energy use is offered. The scheme is open to householders who receive income-related benefits, disability allowances or are aged 60 or over; £75.1 million has been allocated to it in 1997–98. Expenditure is spread evenly throughout the year for

  maximum efficiency. I shall review the scheme shortly to check that it is helping the people who need it most. I will also ensure that it complements effectively the home insulation schemes to assist pensioners which I expect to emerge from our Capital receipts and Environment Task Force initiatives.

  Landfill Sites
  Mr. Baker
  To ask the Secretary of State for the Environment, Transport and the Regions if he will list the landfill sites where disposal of(a) clinical waste, (b) radioactive waste and (c) special waste is permitted, and where no liner is in place within the landfill site. [14525]

  Angela Eagle
  Site licences and supporting information is available on the public register. The information is not available in the form requested. However, the Environment Agency is undertaking work to provide a fuller response, and I will write to the hon. Member.

  Mr. Baker
  To aske the Secretary of State for the Environment, Transport and the Regions how many landfill sites have been in operation in England in each of the last 10 years; and how many, in each year, have operated with no liner in place on all part of the site. [14526]

  Angela Eagle
  There are currently a total of 1,838 sites of which 256 are notes as lined or leachate managed and 1,582 where liner and leachate management is not mentioned. Some of these sites may, however, be lined or leachate managed. Data for site licences prior to 1997 are also publicly available, but additional time would be needed to undertake the numerical analysis as these data were originally collected by the individual waste regulation authorities-prior to the establishment of the Environment Agency in April 1996. The information could not, therefore, be obtained other than at disproportionate cost.

  Mr. Baker
  To ask the Secretary of State for the Environment, Transport and the Regions at what percentage of landfill sites in England the methane produced is used to feed electricity into the national grid. [14530]

  Angela Eagle
  The Environment Agency is responsible for waste regulation in England and Wales. Separate figures are not immediately available for England. However, 499 landfill sites in England and Wales accept significant amounts of biodegradable waste which will generate methane; 108 of these sites extract the methane gas and flare it; 52 sites utilise the methane they extract to produce electricity. This represents 10.4 per cent. of the sites that are capable of producing methane.
  488
  Mr. Baker
  To ask the Secretary of State for the Environment, Transport and the Regions in what circumstances landfill sites are allowed to operate with no liner. [14531]

  Angela Eagle
  Any planning permission or site licence granted for landfill in the past 10 years will have been based on a site specific risk assessment, which will have established the need for, and specification and performance standard of, a liner system. This accords with the guidance provided in Waste Management Paper 26B. There will be examples where the risk assessment confirms that no liner or specific containment system is necessary in order to achieve the required environmental protection. In these cases the site can operate without a liner. Considerations will include the nature of the wastes and prediction of degradation processes (inert or biodegradable wastes), site characteristics (natural clay containment of fissured limestone) and proposed after use. The approach is therefore based on the concept of deriving design performance standards through the use of probabilistic risk assessment, to estimate an acceptable impact on the surrounding environment.

  Waste Disposal
  Mr. Baker
  To ask the Secretary of State for the Environment, Transport and the Regions if he will list(a) the total waste disposal in each year since 1986 (i) in absolute terms and (ii) per head of population and (b) the percentage of waste in each year since 1986 which has been (1) landfilled, (2) incinerated and (3) recycled. [14527]

  Angela Eagle
  Annually updated information has not been collated centrally on a regular basis for the disposal of all controlled waste streams. Best estimates of the proportion of controlled wastes, excluding sewage sludge and dredged spoils going to each of the main waste management options in 1990 are given in the table:

  Type of waste

  Landfill

  Incineration

  Recycled/re-used

  Household

  90

  5

  5

  Commercial

  85

  7·5

  7·5

  Construction and demolition

  63

  0

  30

  Other industrial

  73

  1

  18

  Total

  70

  2

  21

  In a new survey of household and municipal waste carried out by the Department of the Environment, Transport and the Regions and the Welsh Office, local authorities in England and Wales reported that 83 per cent. of municipal waste was disposed of to landfill, almost 10 per cent. was incinerated, about half of that with energy recovery and about 7 per cent. was recycled.

  Information on the disposal of sewage sludge is published annually in the "Digest of Environmental Statistics". Typically in recent years approximately 10 per cent. of sewage sludge was disposed of to landfill and around 5 per cent. was incinerated. A further 8 to 10 per cent. was used beneficially in land reclamation and soil and compost products.

  Recycling
  Mr. Baker
  To ask the Secretary of State for the Environment, Transport and the Regions if he will make a statement on his policy in respect of mandatory deposits on containers. [14528]

  Angela Eagle
  The Producer Responsibility Obligations (Packaging Waste) Regulations 1997 were introduced earlier this year to implement the requirements of Directive 94/62/EC on Packaging and Packaging Waste, including the achievement of the recovery and recycling targets it sets down. Based on the "polluter pays" principle, the UK Regulations therefore place obligations on producers of packaging waste to ensure the recovery and recycling of a proportion of the UK's packaging waste to meet a minimum recovery target (including recycling) of 50 per cent. and minimum recycling targets for each material of 15 per cent. by 2001.

  Deposit and return systems are one means by which producers of packaging can ensure access to reusable or recoverable packaging in order to discharge their obligations under the Regulations. However, the Government has no plans to make this mandatory.

  Mr. Baker
  To ask the Secretary of State for the Environment, Transport and the Regions what recent assessment he has made of the net environmental impact of using new as against recycled paper. [14532]

  Angela Eagle
  There is a substantial amount of research into this issue. We shall be assessing the results of this research in due course.

  Mr. Baker
  To ask the Secretary of State for the Environment, Transport and the Regions (1) what discussions he has had with(a) manufacturer and (b) retailers to encourage the reuse of containers; [14533]

  (2) what discussions he had with burger retailers in respect of the environmental impact caused by burger containers. [14534]

  Angela Eagle
  Since 1993, there have been extensive discussions with the packaging industry and with businesses using packaging to devise a system for achieving higher levels of recovery and recycling of packaging waste.

  In July 1993 the previous Government launched their Producer Responsibility challenge to industry to find ways of increasing the amount of waste being recovered in the UK. Throughout 1995, the then Department of the Environment consulted widely on seven industry options for the form of a legal obligation on businesses to recover and recycle packaging waste. After much debate, the former Government accepted that the shared approach put forward in the industry agreement of 15 December 1995 was the option that attracted the broadest industry consensus. Following consultation between July and September 1996, the then Secretary of State for the Environment-right hon. Member for Suffolk, Coastal (Mr. Gummer)-laid draft Regulations before Parliament, and on 6 March 1997 the Producer Responsibility Obligations (Packaging Waste) Regulations 1997 came into force.

  Under these Regulations, businesses are required to recover and recycle specified tonnages of packaging waste based on the amount of packaging handled by the business
  490
  in the previous calendar year. Businesses can meet their obligations on their own or by joining a business-led compliance scheme and six compliance schemes have so far been registered with the Environment Agencies to help businesses meet their obligations.

  The Regulations place three main obligations on certain businesses which manufacture packaging raw materials, convert materials into packaging, fill packaging with goods or sell packaging. Importers are also obliged. Thus, retailing businesses, including burger retailers, will be required to assess the tonnage of packaging handled by their business and calculate a tonnage obligation which they must recover; they must also recycle a minimum tonnage of each material. Because the obligation is tonnage-based, businesses have a strong cost incentive to minimise the amount of packaging that they use as well as to minimise the amount of packaging waste.

  The Regulations include an incentive to re-use packaging by allowing businesses to leave out of the calculation of their obligations any tonnage of packaging that they are re-using. Packaging which is used for the first time will attract recovery and recycling obligations. By re-using containers, businesses will be able to reduce the tonnage of packaging waste which they are required to recover and recycle and thus also reduce their costs.

  I recently announced that a Producer Responsibility Forum is being set up to provide a broader forum for those who are affected by the Regulations to come and discuss various issues of interest. This will being together, for example, business, local authorities, the waste industry and the Environment Agencies.

  The Government have supported the case for periodic review of the Regulations. My right hon. Friend the Member for Oldham, West and Royton (Mr. Meacher) has therefore announced his proposals for a two staged review of the Regulations-Departmental News Release number 204. Further discussions will therefore be continuing with manufacturer, fillers, retailers and importers of packaging, as well as others affected by the Regulations.

  Mr. Baker
  To ask the Secretary of State for the Environment, Transport and the Regions what evaluation he has made of the length of journey by car from home to recycling point which negates the environmental benefit of recycling the average amount recycled per journey, assuming recycling to be the only purpose of each journey. [14536]

  Angela Eagle
  Circumstances affecting the degree of environmental benefit from recycling vary throughout the country. Determining the length of journey which negates this effect is therefore an extremely complex matter. Any average figure given would almost certainly be incorrect for any one particular situation.

  There have been a number of studies into this question that have employed Life Cycle Analysis and Economic Valuation techniques. One such study from Coopers and Lybrand, for example, found that on average a 10 per cent. increase in the distance of a car journey to the bring site reduced the environmental benefits of recycling by 0.7 per cent. However, the number of assumptions made to arrive at this conclusion are considerable.
  491
  The Government are keen to encourage the development of a network of recycling points or kerbside collection schemes such that special car journeys are rendered unnecessary. The target in Making Waste Work is that there should be easily accessible recycling facilities for 80 per cent. of households by 2000.

  Mr. Baker
  To ask the Secretary of State for the Environment, Transport and the Regions if he will list the percentages of(a) glass, (b) paper, (c) aluminium cans and (d) steel cans recycled in each European Union country for each year from 1986 to date. [14537]

  Glass recycling rates for EC countries and Norway

  Percentage of apparent consumption

  1986

  1987

  1988

  1989

  1990

  1991

  1992

  1993

  1994

  1995

  Austria

  39

  44

  —

  —

  —

  60

  64

  68

  76

  76

  Belgium

  44

  39

  —

  —

  —

  55

  54

  55

  67

  67

  Denmark

  32

  32

  —

  —

  —

  35

  48

  64

  67

  63

  Finland

  —

  25

  —

  —

  36

  31

  44

  46

  50

  50

  France

  28

  26

  —

  29

  29

  41

  44

  46

  48

  50

  Germany

  45

  49

  49

  53

  54

  61

  60

  65

  75

  75

  Greece

  —

  —

  —

  —

  15

  17

  20

  20

  —

  —

  Ireland

  8

  8

  —

  —

  23

  23

  27

  29

  31

  39

  Italy

  26

  38

  —

  —

  48

  53

  53

  52

  54

  53

  Luxembourg

  No information available

  Netherlands

  49

  50

  52

  55

  67

  70

  73

  76

  77

  80

  Portugal

  13

  14

  14

  24

  27

  30

  30

  29

  32

  42

  Spain

  20

  22

  —

  —

  27

  27

  27

  29

  31

  32

  Sweden

  —

  —

  22

  22

  —

  44

  58

  59

  56

  61

  UK

  —

  14

  14

  17

  21

  21

  26

  29

  28

  27

  Paper and card recycling rates for EC countries and Norway

  Percentage of apparent consumption

  1986

  1987

  1988

  1989

  1990

  1991

  1992

  1993

  1994

  1995

  Austria

  —

  —

  —

  —

  37

  —

  —

  —

  66

  65

  Belgium

  14

  14

  —

  —

  —

  —

  —

  —

  14

  12

  Denmark

  30

  29

  30

  30

  35

  35

  36

  46

  43

  44

  Finland

  —

  —

  —

  40

  41

  —

  48

  46

  43

  57

  France

  34

  35

  34

  34

  34

  34

  34

  36

  36

  38

  Germany

  42

  42

  43

  44

  44

  47

  50

  55

  59

  67

  Greece

  —

  —

  —

  —

  28

  29

  30

  30

  20

  19

  Ireland

  6

  11

  —

  —

  —

  —

  —

  —

  13

  12

  Italy

  25

  27

  27

  26

  27

  28

  28

  30

  28

  29

  Luxembourg

  No information available

  Netherlands

  53

  57

  59

  48

  50

  53

  58

  53

  67

  77

  Portugal

  —

  —

  42

  39

  41

  41

  39

  38

  39

  37

  Spain

  55

  54

  54

  51

  51

  —

  47

  49

  48

  52

  Sweden

  —

  —

  —

  —

  43

  46

  —

  50

  57

  54

  UK

  27

  27

  26

  28

  35

  36

  35

  33

  36

  35

  Telecommunications Masts
  Mr. Jenkin
  To ask the Secretary of State for the Environment, Transport and the Regions, pursuant to his decision in respect of the appeal by Orange PCS Ltd. for a telecommunications mast on land at Gun Hill Industrial Estate, Dedham (Ref. COL/96/1259) if he will make a statement on its compatibility with planning guidance for masts in or near areas of outstanding natural beauty and other sensitive areas. [15349]

  Mr. Raynsford
  My right hon. Friend issued his decision allowing a telecommunications mast at Gun Hill, Essex, on 28 October 1997. The reasons for allowing the appeal were set out in the decision letter, which was sent to the hon. Gentleman. These decisions took into account the relevant policies in the Essex Structure Plan and the
  492
  Angela Eagle
  Figures for paper and glass from 1986 to 1995, from the OECD Environmental Data Report, 1997 are set out in the attached tables. However, definitions may vary from one country to another and the figures may not be directly comparable. In particular, the recycling rates may be based on total amounts of waste produced, rather than total apparent consumption.

  Published figures for aluminium and steel cans are not readily available.

  Colchester Borough Local Plan and current guidance set out in Planning Policy Guidance Notes 7 and 8, relating to development in the countryside and the provision of telecommunications facilities.

  Mr. Jenkin
  To ask the Secretary of State for the Environment, Transport and the Regions what assessment he has made of the adequacy of planning guidance on telecommunications masts in respect of protection afforded to sensitive areas such as areas of outstanding natural beauty. [15348]

  Mr. Raynsford
  Current planning policy guidance on telecommunications development is set out in planning policy guidance note 8—PPG8 revised. That guidance reflects our general policy of facilitating the growth of new and existing telecommunications systems while
  493
  protecting the environment. Those objectives include the protection of the
  countryside and urban areas, especially designated areas such as National Parks, areas of Outstanding Natural Beauty and conservation areas.

  Mr. Jenkin
  To ask the Secretary of State for the Environment, Transport and the Regions how many mobile telecommunications masts have been constructed in(a) the Borough of Colchester and (b) Tendring District. [15347]

  Mr. Raynsford
  This information is not collected centrally. However, the Government consider it desirable that the number of telecommunications masts is kept to a minimum. Wherever possible, we would wish to see good use made of existing masts and other structures for the installation of new antennas.

  Ancient Woodland
  Mr. Baker
  To ask the Secretary of State for the Environment, Transport and the Regions if he will list the percentages of each county covered by ancient woodland in(a) 1986 and (b) 1996 or other available years. [14535]

  Angela Eagle
  Figures held by English Nature, showing the change in percentage cover of ancient woodland by Count, since 1930, are as follows (figures are not available for 1986):

  County

  Country area sq km

  c1930 percentage cover

  1996 percentage cover

  Avon

  1,360

  2·64

  2·28

  Bedfordshire

  1,217

  1·94

  2·12

  Berkshire

  1,296

  5·16

  4·50

  Buckinghamshire

  1,839

  4·77

  4·29

  Cambridgeshire

  3,382

  1·03

  0·84

  Cheshire

  2,280

  0·87

  0·72

  Cleveland

  649

  2·52

  2·46

  Cornwall

  3,652

  2·01

  1·89

  Cumbria

  6,762

  2·41

  2·29

  Derbyshire

  2,675

  1·82

  1·67

  Devon

  6,655

  2·25

  2·23

  Dorset

  2,627

  3·06

  2·94

  Durham

  2,383

  1·54

  1·69

  East Sussex

  1,786

  10·77

  10·40

  Essex

  3,682

  2·62

  2·35

  Gloucestershire

  2,611

  6·52

  6·73

  Greater London

  1,579

  1·78

  1·57

  Greater Manchester

  1,391

  0·61

  0·61

  Hampshire

  3,689

  7·84

  6·90

  Hereford and Worcester

  3,870

  4·97

  4·70

  Hertfordshire

  1,598

  3·73

  3·31

  Humberside

  3,405

  0·18

  0·16

  Isle of Wight

  392

  3·85

  4·14

  Kent

  3,650

  9·32

  7·85

  Lancashire

  3,007

  0·94

  0·90

  Leicestershire

  2,493

  1·06

  1·01

  Lincolnshire

  5,987

  1·09

  1·04

  Merseyside

  661

  0·19

  0·17

  Norfolk

  5,323

  0·54

  0·51

  North Yorkshire

  8,240

  1·70

  1·67

  Northamptonshire

  2,361

  3·25

  2·75

  Northumberland

  5,031

  1·02

  0·96

  Nottinghamshire

  2,140

  1·05

  0·96

  Oxfordshire

  2,553

  3·14

  2·83

  Shropshire

  3,516

  3·16

  2·66

  Somerset

  3,495

  3·01

  2·64

  South Yorkshire

  1,631

  3·50

  2·85

  Staffordshire

  2,571

  2·50

  2·15

  494

  County

  Country area sq km

  c1930 percentage cover

  1996 percentage cover

  Suffolk

  3,781

  1·28

  1·13

  Surrey

  1,677

  6·71

  5·75

  Tyne and Wear

  610

  2·31

  2·01

  Warwickshire

  2,006

  2·02

  2·14

  West Midlands

  897

  1·31

  0·81

  West Sussex

  1,979

  8·40

  8·49

  West Yorkshire

  1,981

  1·75

  1·67

  Wiltshire

  3,490

  3·80

  3·65

  Air Quality
  Mr. Truswell
  To ask the Secretary of State for the Environment, Transport and the Regions what steps he is taking to implement the National Air Quality Strategy. [15741]

  Mr. Meacher
  I am pleased to announce that the Air Quality Regulations 1997 have been laid today. These regulations will set the National Air Quality Strategy objectives in statutory form and initiate the system of local air quality management under Part IV of the Environment Act 1995. I also announced in July that this Government would initiate an immediate review of the National Air Quality Strategy. This review will look at all aspects of the Strategy, including the objectives themselves and the measures required to meet them.

DEFENCE

  Military Training and Equipment
  Mr. Stinchcombe
  To ask the Secretary of State for Defence if the Kenyan Government meet the criteria established to assess the suitability of overseas security forces to receive military training and military equipment from the United Kingdom. [15200]

  Dr. Reid
  The Kenyan armed forces satisfy the criteria used to determine the suitability of overseas security forces to receive military training from the United Kingdom. Any application for a licence to export defence equipment to Kenya would, as for all countries, be considered on a case-by-case basis and in accordance with the Government's export criteria which were announced by my right hon. Friend the Foreign Secretary on 28 July 1997,Official Report, column 65-66.

  Mr. Stinchcombe
  To ask the Secretary of State for Defence if the list of those countries qualifying to receive military training and equipment from the United Kingdom is to be reviewed to take account of the Government's ethical foreign policy. [15201]

  Dr. Reid
  The review of the list of countries qualifying to receive military training will take account of the Government's ethical foreign policy. The list relates solely to military assistance. Applications for the export of defence equipment to all countries are considered in accordance with the Government's export criteria, announced by my right hon. Friend the Foreign Secretary on 28 July 1997,Official Report, columns 65-66.
  495
  Mr. Stinchcombe
  To ask the Secretary of State for Defence what assessment is made of potential future human rights violations by overseas Governments applying for military training or equipment from the United Kingdom before such applications are granted. [15199]

  Dr. Reid
  The possibility of the training requested leading to human rights violations is one of the factors taken into account in considering whether such applications should be granted. In the case of conventional arms exports, licence applications are considered taking into account respect for human rights and fundamental freedoms in the recipient country. An export licence will not be issued if there is a clearly identifiable risk that the proposed export might be used for internal repression.

  Official Hospitality
  Mr. Malcolm Bruce
  To ask the Secretary of State for Defence what is his estimate of the expenditure by(a) his Department, (b) its agencies and (c) its non-departmental public bodies on official hospitality for (i) 1980–81, (ii) 1987–88, (iii) 1990–91, (iv) 1991–92, (v) 1992–93, (vi) 1993–94, (vii) 1994–95, (viii) 1995–96, (ix) 1996–97 and (x) 1 May to 30 September 1997. [15266]

  Dr. Reid
  The request for figures on hospitality expenditure before 1992–93 can be provided only at disproportionate cost. The figures for total expenditure for the years 1992–93 to 30 September 1997 are listed below:

  £ million

  (i) 1992–93

  4·952

  (ii) 1993–94

  4·577

  (iii) 1994–95

  4·867

  (iv) 1995–96

  4·949

  (v) 1996–97

  5·327

  (VI) 1 May 1997 to 30 September 1997

  2·034

  These figures reflect expenditure incurred by my Department, the establishments and formations of the Armed Forces at home and abroad, and by individual officers occupying Command and international appointments for which entertainment allowances were payable. Entertainment expenditure for agencies and non-departmental public bodies are included in these figures and are not held separately.

  Overseas Travel
  Mr. Malcolm Bruce
  To ask the Secretary of State for Defence what is his estimate of the expenditure by(a) his Department, (b) its agencies and (c) its non-departmental public bodies on overseas travel for (i) 1980–81, (ii) 1987–88, (iii) 1990–91, (iv) 1991–92, (v) 1992–93, (vi) 1993–94, (vii) 1994–95, (viii) 1995–96, (ix) 1996–97 and (x) 1 May to 30 September 1997; and if he will provide a breakdown to show (1) air fares and (2) other expenditure relating to overseas travel. [15267]

  Dr. Reid
  This information is not held centrally and could be provided, if at all, only at disproportionate cost.

SCOTLAND

  University Students
  Mr. Beith
  To ask the Secretary of State for Scotland how many students domiciled in England or funded by English education authorities are currently studying for first degrees in Scottish universities. [13870]

  Mr. Wilson
  The latest year for which published figures are available is 1994–95. In that year, 16,793 English domiciled students were studying for a first degree in a Scottish University or College. Of these, 16,649 were studying full-time and 144 were studying part-time.

  Mr. Beith
  To ask the Secretary of State for Scotland what consultations he has had with(a) English education authorities, (b) student representative organisations and (c) universities about his proposal to charge students from England attending Scottish universities higher tuition fees than students from Scotland or from other EU countries. [13871]

  Mr. Wilson
  I invited comments on the Dearing and Garrick reports on 23 July, including comments on Garrick recommendation 29 which covers the issue of tuition fees for comparable qualifications. Since then, responses have been received from student representative organisations, amongst others, and the Committee of Scottish Higher Education Principals, whom I have also met. I have had extensive discussion with Ministerial colleagues in the Department of Education and Employment, and my announcement on Monday 27 October with regard to tuition fees was the agreed position of the Government.

  Dounreay Nuclear Plant
  Mr. McGrady
  To ask the Secretary of State for Scotland what discussions he has had about the discharge authorisations for the Dounreay nuclear site; with whom the discussions took place; and what the outcome is of such discussions. [14284]

  Mr. Chisholm
  In the first instance it is for the Scottish Environment Protection Agency to determine the terms of the discharge authorisations for the Dounreay Nuclear site. In March 1997 SEPA consulted the then Secretary of State on the terms of revised discharge authorisations which it proposed to grant. My right hon. Friend the Secretary of State subsequently noted that the authorisations which SEPA proposed to make differed significantly from those on which the initial consultation was based. In August he therefore asked SEPA to conduct a further round of consultation based on the authorisations it is minded to grant, to ensure that the widest range of views is obtained. Arrangements to conduct this fresh round of consultation are now well advanced.

  My right hon. Friend has not held discussions with other parties about the discharge authorisations.

FOREIGN AND COMMONWEALTH AFFAIRS

  Visas
  Mr. Vaz
  To ask the Secretary of State for Foreign and Commonwealth Affairs what, at 1 October, was the average waiting time for(a) visas and (b) interviews relating to visa applications in respect of United Kingdom posts at (i) Bombay, (ii) Islamabad, (iii) New Delhi, (iv) Calcutta, (v) Karachi, (vi) Dhaka, (vii) Washington, (viii) New York, (ix) Da-es-Salaam, (x) Nairobi and (xi) Lagos. [14237]

  Mr. Fatchett
  Entry clearance posts in the Indian sub-continent receive a heavy volume of applications to join families in the United Kingdom. People applying for an indefinite stay, known as "settlement", are divided into separate queues for interview. This allows posts to deal more quickly with those who may have a claim to compassionate treatment.

  The information my hon. Friend requested is as follows:

  Post

  Waiting time for a straight forward visit application

  Waiting time if an interview is required for a visit visa

  Waiting time for a settlement interview

  Bombay

  same day

  same day

  Q1 same day

  Q2 2 months

  Q3 2 months

  Q4 5 months

  Islamabad

  same day

  22 days

  Q1 5 moths

  Q2 5 months

  Q3 6 months

  Q4 9 months

  New Delhi

  same day

  same day

  Q1 same day

  Q2 2.5 months

  Q3 3.5 months

  Q4 4.5 months

  Calcutta

  same day

  5 days

  7 days

  Karachi

  same day

  15 days

  9 weeks

  Dhaka

  same day

  same day

  Q1 3 months

  Q2 3 months

  Q3 3 months

  Q4 9.5 months

  Washington

  same day

  1 day

  2days

  New York

  same day

  4 days

  same day

  Dar-es-Salaam

  same day

  2-3 days

  2-3 days

  Nairobi

  same day

  6 days

  24 days

  Lagos

  same day

  11 days

  5 months

  The queue groupings are:

  Q1-Spouses and children under 18 of British citizens; elderly relatives; (maximum waiting time-03 months).

  Q2-Spouses and children of non-British citizens; (maximum waiting time-3 months).

  Q3-Fiance(e)s and other first time applicants (maximum waiting time-6 months).

  Q4-Re-applicants (maximum waiting time-9 months).

  Ethnic Minorities
  Mr. Vaz
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on the open day held by his Department in order to recruit more members of the ethnic minority community to join the Foreign Office. [14229]

  Mr. Tony Lloyd
  We were delighted to welcome more than 900 members of the public to this Department's Open Day on 19 September. Many young people from all over Britain attended; some had travelled form the Orkney Islands. They fully represented the diversity of modem Britain: ethnic minorities; people with disabilities; students from a variety of schools; careers advisers; religious and community leaders. non-governmental organisations and pressure groups representing a broad range of the interests of the people of the UK, at home and overseas, also joined us.

  Our purpose in opening up this Department was to show what the Department does.

  It is our intention to project this Department as a professional, modern and friendly organisation which works hard to represent the interests of the British people overseas and not the forbidding and stuffy place of popular myth. We hope that young women and men, from all communities and social backgrounds, will consider coming to work with us at this Department, helping us to make it an organisation which is truly representative of all the people of the UK.

  The Open Day was a huge success. In September alone there was a 274 per cent. increase in the average monthly recruitment enquiries and this Department's monthly careers briefings are fully booked for months ahead.

  We intend to make Open Days a regular feature in this Department's calendar of events.

  Middle East Peace Process
  Mr. David Atkinson
  To ask the Secretary of State for Foreign and Commonwealth Affairs what plans he has to raise the Middle Eastern Peace Process with particular reference to resolving the refugee issue, during the United Kingdom Presidency of the European Union. [14474]

  Mr. Fatchett
  The Palestinian refugee issue is to be resolved in direct final status negotiations between Israelis and palestinians. We recognise the importance of finding a mutually acceptable solution to the issue as part of a just, lasting and comprehensive peace agreement. We are considering what contribution we can make during our Presidency to support efforts to resolve this issue.

  Montserrat
  Ms Abbott
  To ask the Secretary of State for Foreign and Commonwealth Affairs how many people are currently living in communal shelters in Montserrat; and if he will make a statement. [14998]
  499
  Mr. Tony Lloyd
  As at the morning of 6 November, there were 783 people living in communal shelters.

  Ms Abbott
  To ask the Secretary of State for Foreign and Commonwealth Affairs how many new homes are currently being built on the island of Montserrat; and if he will make a statement. [14999]

  Mr. Tony Lloyd
  Contractors employed by the Department for International Development have recently completed 50 new houses at Davy Hill. Work is underway at Lookout on another 50 which should be completed in late December.

  Also available to Montserratians are Government funded, self-help financial assistance schemes to build or complete their own properties. These schemes are administered by the Government of Montserrat and numbers of participants are not known, although £342,000 has been provided to date under the materials assistance project.

  Ms Abbott
  To ask the Secretary of State for Foreign and Commonwealth Affairs how many migrants from Montserrat are currently in the United Kingdom; how many entered in (i) June, (ii) July, (iii) August and (iv) September; and if he will make a statement. [15001]

  Mr. Tony Lloyd
  Figures are not available in the precise form requested. Under the voluntary evacuation scheme which began in April 1996, a total of 1,049 Montserratians had entered the UK by 3 July 1997; a total of 1,291 had come by 28 July, and by 1 September a total of 1,715 had arrived. Following the introduction of an assisted passage scheme, a further 635 Montserratians arrived in the UK in September. We estimate that there are currently around 3,000 in the UK.

  Ms Abbott
  To ask the Secretary of State for Foreign and Commonwealth Affairs how many patients are currently being cared for in the temporary hospital in Montserrat; what are the hospital's sanitation arrangements; and if he will make a statement. [15000]

  Mr. Tony Lloyd
  There are currently five patients in the acute ward and a further 37 elderly persons cared for in the Margetson Memorial Home. A community services unit on the same site accommodates approximately 30 elderly or disabled persons evacuated from their homes.

  The sanitation system at the temporary hospital was not designed for such heavy use. As part of an ongoing programme of major works at the hospital, the Department for International Development is spending approximately £150,000 on improvements to sanitation.

  Dependent Territories
  Ms Abbott
  To ask the Secretary of State for Foreign and Commonwealth Affairs when the current review of the status of Britain's dependent territories will be completed; and if he will make a statement. [14988]
  500
  Mr. Tony Lloyd
  We hope to complete the review to coincide with the Dependent Territories Association Conference scheduled to take place in London on 4 February of next year.

  Ms Abbott
  To ask the Secretary of State for Foreign and Commonwealth Affairs who will be responsible for drawing up the review of Britain's dependent territories; and if Governments of the dependent territories themselves will be invited to make submissions. [14990]

  Mr. Tony Lloyd
  We are responsible for drawing up the review, consulting other Ministries and Governments of Dependent Territories. The Government of Gibraltar were already considering proposals for constitutional change before we announced this review. We will therefore be looking at these proposals separately.

  Iraq
  Mr. Llew Smith
  To ask the Secretary of State for Foreign and Commonwealth Affairs how many members of the current UNISCOM Inspection Team in Iraq are from the United Kingdom; and if he will indicate their qualifications for being part of the UNISCOM team. [14712]

  Mr. Tony Lloyd
  There are currently 11 UK personnel serving with the UN Special Commission in Baghdad. All have been provided in response to specific requests from the Special Commission for people with the skills required in the Special Commission's work-for example, an understanding of biological or chemical weapons technology.

  Amsterdam Treaty
  Mr. Mitchell
  To ask the Secretary of State for Foreign and Commonwealth Affairs which Minister of the Crown signed the treaty of Amsterdam; and if he will list the topics of each declaration made by Her Majesty's Government, or to which they are a party, indicating dates on which these were published, and place of publication. [15058]

  Mr. Doug Henderson
  I signed the Treaty of Amsterdam on behalf of the Crown. The United Kingdom participated in the 51 Declarations adopted by the Conference and annexed to the Final Act of the Conference. Those Declarations are listed, and reproduced, in a Command Paper-Cm 3780-which was published on 29 October 1997.

  European Courts
  Mr. Mitchell
  To ask the Secretary of State for Foreign and Commonwealth Affairs, pursuant to his answer of 27 October,Official Report, column 665, if he will list those articles of the signed version of the treaty of Amsterdam, and those of the provisional version (CONF 4001/97) published on 19 June, which will require referral by courts and tribunals of member states of the European Union to the Court of Justice of the European Community

  501
  in Luxembourg, broken down into those which are (a) part of and (b) not part of the area of freedom, security and justice provided for in the provisional version above. [15034]

  Mr. Doug Henderson
  Except as set out in (ii) below, no article of the Treaty of Amsterdam requires courts and tribunals of Member States to refer questions to the European Court of Justice.

  In the Area of Freedom Security and Justice: (i) Member States are given the option under Title VI of the Treaty on European Union to accept the jurisdiction of the ECJ to give preliminary rulings on measures adopted under this Title. (ii) under Article 73p of the new title Ma of the EC Treaty (draft Article H in the preliminary version CONF 4001/97), Member States' courts of last instance may in some circumstances be required to refer to the ECJ.

  In other areas, there is no modification of the arrangements for preliminary rulings set out in Article 77 of the EC Treaty.

  European Court of Justice
  Mr. McDonnell
  To ask the Secretary of State for Foreign and Commonwealth Affairs what representations the United Kingdom Government have made on the Swedish Government's failure to nominate Judge Briton Sundberg-Weitman for appointment to the European Court of Justice. [15281]

  Mr. Doug Henderson
  None.

  Mr. McDonnell
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will seek a review of the procedure for the appointment of judges to the European Court of Justice to ensure appointments are made on the basis of competence and do not discriminate against women and ethnic minorities. [15282]

  Mr. Doug Henderson
  No. Appointments to the European Court of Justice are made in accordance with Article 167 of the Treaty establishing the European Community, which states that:"The Judges and Advocates-General shall be chosen from persons whose independence is beyond doubt and who possess the highest judicial offices in their respective countries or who are jurisconsults of recognized competence; they shall be appointed by common accord of the governments of the Member States for a term of six years."

  So far as UK appointments are concerned, our policy is to nominate the best qualified candidate, regardless of ethnic origin, gender, marital status, sexual orientation, political affiliation or, subject to the physical requirements of the office, disability.

  Correspondence
  Mr. Austin
  To ask the Secretary of State for Foreign and Commonwealth Affairs when he expects to reply to the letters from the hon. Member for Erith and Thamesmead dated 24 April, 17 June and 23 September; what is his Department's standard for response times to letters from hon. Members; and if he will make a statement. [15624]
  502
  Mr. Fatchett
  The letters referred to by my hon. Friend were answered on 7 November 1997. As to my Department's response times to letters from hon. Members I would refer my hon. Friend to the replies I gave to my hon. Friends the Members for Leicester, East (Mr. Vaz) and for Walsall, North (Mr. Winnick) on 4 November,Official Report, column 166–67.

  Overseas Travel
  Mr. Malcolm Bruce
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will list each of the overseas trips made by himself and other members of his ministerial team since 2 May, specifying in each case(a) the participating Minister or Ministers, (b) the destination of the trip, (c) the purpose of the trip and (d) the cost of the trip; and if he will make a statement. [15216]

  Mr. Tony Lloyd
  The information is in the following table:

  Date

  Venue

  Purpose of visit

  Total cost £

  May

  71

  Germany, France

  Bilateral

  5,550

  12–13

  France

  WEU Ministerial

  5,480

  18–20

  USA, Netherlands1

  Bilateral

  33,040

  23

  Netherlands

  Special European

  Council

  7,638

  June

  2

  Luxembourg

  General Affairs Council

  19,692

  Council

  19,692

  Italy

  Bilateral

  5–61

  Sweden

  European Socialist

  Meeting

  4,669

  16–171

  Netherlands

  European Council

  11,347

  20–22

  USA (Denver and

  G7 Summit and UN

  22–23

  New York)

  Special Session on

  128,312

  Environment

  15,750

  27–1 July2

  Hong Kong

  Handover

  89,777

  July

  7–9

  Spain

  NATO Summit

  34,443

  13–15

  Russian Federation

  Bilateral

  34,017

  221

  Belgium

  General Affairs

  Council/

  Inter—Governmental

  Conference

  3,717

  27–29

  Bosnia, Croatia

  Bilateral

  18,172

  August

  26–1 September

  Indonesia,

  Bilateral

  Philippines,

  Malaysia, Singapore

  191,241

  September

  9

  Germany

  Bilateral

  7,313

  14–151

  Belgium

  General Affairs

  Council

  7,486

  21–261

  USA

  United Nations

  General Assembly

  102,609

  October

  6–9

  Pakistan

  In attendance upon

  12–15

  India

  Her Majesty The

  Queen

  16,206

  November

  3

  Ireland

  Bilateral

  4,796

  9–10

  Belgium

  General Affairs

  7,500

  1 Accompanied by Mr. D. Henderson MP.

  2 Accompanied by Mr. D. Fatchett MP.

  503
  FCO Ministers undertook the following overseas visits during the same period:

  Date

  Venue

  Purpose of visit

  Total cost £

  (i) Mr. T Lloyd

  MP

  May

  8

  Netherlands

  Chemical Weapon

  Convention

  Conference

  758

  26–27

  France

  OECD Ministerial

  Meeting

  1,009

  June

  23–25

  South Africa, Uganda, Kenya

  Bilateral

  11,806

  July

  21–22

  USA

  Bilateral

  8,251

  August

  3–6

  Democratic Republic EU Troika Visit of Congo

  7,650

  September

  10–11

  France

  Council of Europe

  1,993

  14–24

  Colombia/Brazil

  Bilateral

  5,842

  28–31

  FRY Bosnia

  Bilateral

  9,454

  (ii) Mr. D. Henderson MP

  May

  5–6

  Belgium

  Inter—Governmental

  Conference

  1,712.03

  16

  Netherlands

  Informal Personal Representatives Meeting

  2,044.42

  26–28

  Belgium

  Informal Personal Reps Meeting

  887.21

  June

  11–12

  Spain

  Bilateral

  2,245

  20–21

  Ireland

  Bilateral

  254

  26

  Luxembourg

  General Affairs Council

  4,404

  July

  15–16

  France

  European Parliament

  Plenary

  1,060

  August

  5–8

  Greece

  Bilateral

  1,950

  October

  1–2

  Netherlands

  Bilateral

  842

  6

  Luxembourg

  General Affairs

  Council

  4,632

  7–8

  Gibraltar

  Bilateral

  2,144

  13–15

  Turkey, Istanbul

  Bilateral

  1,736

  20–22

  Slovenia, Romania,

  Bilateral

  Bulgaria

  8,339

  25–26

  Luxembourg

  Informal Foreign

  Minister's Weekend

  2.022

  31–2

  Italy

  Bilateral

  1,380

  November

  3

  Estonia, Lithuania,

  Bilateral

  Latvia, Finland

  7,444

  (iii) Mr. D. Fatchett MP

  May

  25–29

  Syria, Lebanon, Jordon, Israel, Palestine

  Bilateral

  6,521

  504

  Date

  Venue

  Purpose of visit

  Total cost £

  June

  7–15

  India, Pakistan

  Bilateral

  11,148

  21–26

  Kuwait, UAE, Oman

  Bilateral

  9,382

  July

  22

  Belgium

  Bilateral

  621

  26–30

  Malaysia, Brunei

  EU/ASEAN Meeting

  11,690

  September

  2

  Luxembourg

  EU/India Troika

  Meeting

  787

  12–22

  Australia, New

  Bilateral

  Zealand, Cook

  Islands, USA

  22,870

  (iv) Baroness

  Symons

  June

  14–19

  Trinidad and

  Bilateral

  Tobago, Montserrat,

  USA

  8,138

  29–1 July

  Montserrat

  Bilateral

  10,652

  September

  16–18

  USA

  Bilateral

  5,077

  22–26

  India

  Bilateral

  8,865

  October

  6–10

  Canada

  Bilateral

  3,000

TREASURY

  European Council
  Mr. Timms
  To ask the Chancellor of the Exchequer if he will make a statement on the Council meeting of the Economic and Finance Ministers of the European Union held on 5 November. [15430]

  Mr. Gordon Brown
  I represented the UK at the Economic and Finance Council-ECOFIN-of the European Union in Brussels on 5 November. The Economic Secretary accompanied me.

  The Council had only one agenda item to consider, the preparation of the Special Employment Council in Luxembourg later this month. The Council discussed the Commission's draft Employment Guidelines brought forward in response to the Amsterdam European Council's remit.

  The Council made progress towards a draft that suited all, and the Presidency has undertaken to draft Conclusions in time for the next ECOFIN on 17 November. There was strong support for the development of Action Plans.

  The Council gave broad endorsement to the EIB' s plans to assist employment. It also gave a general welcome to the European Parliament's proposed package of EC Budget employment-related spending.

  EC (Excessive Deficits)
  Sir Richard Body
  To ask the Chancellor of the Exchequer what is the maximum amount that can be levied as a fine in accordance with the amended proposal for the excessive deficit procedure laid down in European Union document 9486/97. [12502]
  505
  Mrs. Liddell
  According to Council Regulation (EC No. 1467/97, of 7 July 1997, the maximum single fine cannot exceed an upper limit of 0.5 per cent. of GDP. Fines would not apply to Member States that do not participate in the single currency.

  Government Statistics
  Mr. Soames
  To ask the Chancellor of the Exchequer what steps he intends to take to improve the quality and accuracy of Government statistics. [15082]

  Mrs. Liddell
  The Government places great importance on the quality and reliability of official statistics to guide and monitor policy and to inform the public about social and economic matters. The Government Statistical Service is constantly looking for ways to improve the quality of the statistics produced, within the constraints of available resources. It is vital that official statistics also command widespread public confidence. Accordingly, we shall be taking forward our manifesto commitment to the creation of an independent National Statistical Service, and an announcement will be made in due course.

  Windfall Tax
  Mr. Steen
  To ask the Chancellor of the Exchequer what estimate he has made of the revenue raised from the windfall tax(a) in total and (b) from each of the water and sewerage companies. [15041]

  Mr. Geoffrey Robinson
  The windfall tax is expected to raise some £5.2 billion in total, of which water and sewerage companies are expected to pay some £1.65 billion. The liability of individual companies is a confidential matter between them and the tax authorities.

  Euro Symbol
  Sir Richard Body
  To ask the Chancellor of the Exchequer what factors determined the choice of the euro symbol. [13853]

  Mrs. Liddell
  The euro symbol was designed by the European Commission services. The final choice was made from a number of alternative designs taking into account a survey of the views of the general public.

  Local Authority Pension Schemes (Kent)
  Mr. Norman
  To ask the Chancellor of the Exchequer what representations she has received on the need to compensate Kent county council and other local authorities in Kent for the cost to local authority pension schemes of the abolition of the payment of tax credits on dividends; what response he has made; and if he will make a statement. [14993]

  Mr. Geoffrey Robinson
  I have received a number of representations from local authorities about the effects on local authority pension schemes of the removal of tax credits in respect of Advance Corporation Tax. In my replies, I have explained that the extent to which these changes affect local authority budgets will depend on the overall judgments made by the funds' actuaries as they undertake revaluations due, in England, to take effect from 1999–2000. The Government has told the Local 506
  Government Association that it will take all factors into account in determining the level of local authority provision for 1999–2000 and subsequent years.

  Financial Regulation
  Mr. Vaz
  To ask the Chancellor of the Exchequer when he last met the Governor of the Bank of England to discuss financial regulation; and when he next plans to do so. [14987]

  Mrs. Liddell
  My right hon. Friend often meets the Governor to discuss a range of different subjects.

  Single Currency
  Mr. Denzil Davies
  To ask the Chancellor of the Exchequer, pursuant to his oral statement of 27 October,Official Report, column 584, what are the main criteria against which Her Majesty's Government will judge whether a single currency is successful enough for the United Kingdom to seek to join. [14318]

  Mrs. Liddell
  My right hon. Friend the Chancellor has set out the five economic tests that define whether there is a clear and unambiguous economic case for Britain to join the single currency.

  These tests are: first, whether there can be sustainable convergence between Britain and the economies of a single currency; secondly, whether there is sufficient flexibility to cope with economic change; thirdly, the effect on investment; fourthly, the impact on our financial services, and finally whether it is good for employment.

  Household Statistics
  Mr. Leigh
  To ask the Chancellor of the Exchequer if he will list the percentage of families with dependent children which are(a) married couples, (b) cohabiting couples and (c) lone parent by each type. [14453]

  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. Edward Leigh, dated 11 November 1997:
  The Chancellor of the Exchequer has asked me to reply, as Director of the Office for National Statistics (ONS), to your recent question about the marital status of adults with dependent children.
  This information, taken from the 1996 General Household Survey, is contained in the following table:

  Family type and marital status

  Families with dependent children

  Great Britain 1996

  Per cent.1

  Married couple

  70

  Cohabiting couple

  8

  Lone mother

  20

  single

  7

  widowed

  1

  divorced

  6

  separated

  5

  Lone father

  2

  All lone families

  21

  Base

  2,975

  1Because of rounding some sub-totals differ from the sum of their parts.

  507
  Mr. Leigh
  To ask the Chancellor of the Exchequer if he will list the percentage of households headed by a person who is (i) married, (ii) cohabiting, (iii) single, (iv) widowed, (v) divorced, (vi) separated and (vii) cohabiting with someone of the same sex. [14452]

  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. Edward Leigh, dated 11 November 1997:
  The Chancellor of the Exchequer has asked me to reply, as Director of the Office for National Statistics (ONS) to your recent question on the marital status of heads of households.
  This information, taken from the 1996 General Household Survey, is contained in the following table:

  Marital status of head of household

  Great Britain 1996

  Per cent.

  Married

  54

  Cohabiting

  6

  Single

  13

  Widowed

  15

  Divorced

  8

  Separated

  3

  Same sex cohabiting

  1—

  Base

  9,158

  1Estimated at 0.1 per cent.

  Overseas Investment
  Mr. Forth
  To ask the Chancellor of the Exchequer if he will list for(a) 1970, (b) 1980, (c) 1990 and (d) the latest available date, the totals for United Kingdom private sector overseas investment in (i) the other European Union countries, (ii) North America and (iii) the rest of the world. [14483]

  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 John Kidgell to Mr. Eric Forth, dated 11 November 1997:
  The Chancellor of the Exchequer has asked the Director of the Office for National Statistics to reply to your recent question asking for a breakdown of the United Kingdom's private sector overseas investment. The Director has asked me to respond in his absence.
  The figures requested are shown in the attached table. They are based on net flows of outward direct investment i.e. where a United Kingdom company has a significant and lasting interest in an enterprise operating overseas. No information is available centrally regarding the geographical breakdown of portfolio overseas.

  Overseas direct investment net flows

  £million

  Area

  19701

  19801

  1990*

  1995*

  1990‡

  1995‡

  EU (14 countries)

  104

  486

  4,448

  8,473

  5,103

  9,613

  North America

  185

  1,861

  1,152

  11,092

  941

  10,523

  Rest of the world

  257

  1,044

  3,552

  5,536

  4,064

  5,888

  1 Figures for 1970 and 1980 exclude investment in oil companies. To enable comparison across time, 1990 and 1995 are presented both *excluding and ‡including oil companies.

  Paracetamol (Deaths)
  Mr. Clappison
  To ask the Chancellor of the Exchequer how many(a) adults and (b) children have committed suicide using paracetamol in each of the last 10 years. [14279]

  Mrs. Helen 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. James Clappison dated 11 November 1997:
  The Chancellor of the Exchequer has asked me, as Director of the Office for National Statistics (ONS), to reply to your recent question asking how many adults and children have committed suicide using paracetamol in each of the last 10 years.
  The information is given in the following table.

  Deaths (a) from suicide and (b) undetermined whether accidentally or purposely inflicted, where paracetamol is mentioned on the death certificate, England and Wales, 1993–1996

  (a) Suicide

  Paracetamol without mention of other drugs Age

  Paracetamol with mention of other drugs Age

  Year

  0–14

  15–19

  20 and over

  0–14

  15–19

  20 and over

  1993

  —(—)

  —(—)

  67(7)

  —(—)

  7(—)

  162(35)

  1994

  —(—)

  —(—)

  68(5)

  —(—)

  3(1)

  141(19)

  1995

  —(—)

  1(—)

  75(2)

  1(—)

  3(—)

  141(17)

  1996

  —(—)

  —(—)

  54(6)

  —(—)

  7(—)

  153(16)

  (b) Undetermined whether accidentally or purposely inflicted

  Paracetamol without mention of other drugs Age

  Paracetamol with mention of other drugs Age

  Year

  0–14

  15–19

  20 and over

  0–14

  15–19

  20 and over

  1993

  —(—)

  2(—)

  60(6)

  —(—)

  3(—)

  65(19)

  1994

  1(—)

  —(—)

  51(5)

  1(1)

  3(—)

  91(21)

  1995

  —(—)

  2(—)

  69(—)

  1(—)

  7(1)

  110(29)

  1996

  —(—)

  3(—)

  51(3)

  —(—)

  4(—)

  90(19)

  The figures in brackets are those deaths where there was a mention of alcohol. These figures are included in the non-bracketed figures.
  Data prior to 1993 can be obtained from Tables 10 and 11 in Mortality statistics: accidents and violence, series DH4 (1987–89) and Tables 10 and 11 in Mortality statistics; injury and poisoning, series DH4 (1990–92). Copies are available in the House of Commons library.
  The inclusion of a substance in the above tables (and in Tables 10 and 11) does not imply that it is necessarily toxic; and, where two or more substances are listed together, the contribution, if any, of each to the death is unknown. Even where one substance is listed alone there may well be other factors with an important bearing on the death.
  Since 1993, the ONS has held all deaths information electronically. The data were extracted using a "text search" facility, focusing on paracetamol and a list of paracetamol-containing compounds. Although provision was made to take into account spelling errors in the recording of these compounds, the figures should be seen as estimates because it cannot be guaranteed that every single case has been identified. The ONS is actively exploring, with interested parties, ways to improve these data.

  Mr. Clappison
  To ask the Chancellor of the Exchequer how many accidental deaths of(a) adults and (b) children have been caused by paracetamol in each of the last 10 years. [14280]
  509
  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. James Clappison, dated 11 November 1997:
  The Chancellor of the Exchequer has asked me, as Director of the Office for National Statistics (ONS), to reply to your recent question asking how many accidental deaths of adults and children have been caused by paracetamol in each of the last 10 years.
  The information requested is shown in the following table.

  Deaths from accidental poisoning where paracetamol is mentioned on the death certificate, England and Wales, 1993–96

  Paracetamol without mention of other drugs Age

  Paracetamol with mention of other drugs Age

  Year

  0–14

  15–19

  20 and over

  0–14

  15–19

  20 and over

  1993

  —(—)

  1(—)

  43(9)

  1(1)

  1(—)

  40(17)

  1994

  2(—)

  2(-)

  36(10)

  1(—)

  4(1)

  49(15)

  1995

  —(—)

  1(—)

  34(6)

  —(—)

  2(1)

  46(20)

  1996

  1(—)

  3(1)

  36(5)

  —(—)

  6(1)

  43(11)

  The figures in brackets are those deaths where there was a mention of alcohol. These figures are included in the non-bracketed figures.
  Data prior to 1993 can be obtained from Tables 10 and 11 in Mortality statistics: accidents and violence, series DH4 (1987–1989) and Tables 10 and 11 in Mortality statistics: injury and poisoning, series DH4 (1990–1992). Copies are available in the House of Commons Library.
  The inclusion of a substance in the above table (and in Tables 10 and 11) does not imply that it is necessarily toxic; and, where two or more substances are listed together, the contribution, if any, of each to the death is unknown. Even where one substance is listed alone there may well be other factors with an important bearing on the death.
  Since 1993, the ONS has held all deaths information electronically. The data were extracted using a "text search" facility, focusing on paracetamol and a list of paracetamol-containing compounds. Although provision was made to take into account spelling errors in the recording of these compounds, the figures should be seen as estimates because it cannot be guaranteed that every single case has been identified. The ONS is actively exploring. with interested parties, ways to improve these data.

  Tax Harmonisation
  Mr. Malcolm Bruce
  To ask the Chancellor of the Exchequer what is his policy on the harmonisation of(a) value added tax and (b) other indirect taxes in the European Union; and if he will make a statement. [13531]

  Dawn Primarolo
  [holding answer 30 October 1997]: The Government, while supportive of efforts to simplify and modernise the current European Community VAT system, is opposed to further unnecessary harmonisation of VAT at the Community level. With regard to the other indirect taxes which are the subject of EC-wide legislation (the excise duties on alcohol and alcoholic beverages, tobacco products and mineral oils), the Government believes that Member States should be free to set these excise duty rates at the levels they feel are appropriate to their own particular circumstances, subject only to the agreed minimum rates. Nevertheless, the Government considers that there should be movement towards the approximation of these excise duty rates across the EC and that some steps in the direction of the UK pattern of indirect taxation make sense.

  Income Tax
  Mr. Malcolm Bruce
  To ask the Chancellor of the Exchequer what is his estimate of the effects on employment of raising the level of the personal income tax allowance by £1,000 per annum; and if he will make a statement. [14519]

  Dawn Primarolo
  [holding answer 10 November 1997]: Improving the incentive to work will help increase employment. The Government is currently looking at ways of streamlining and modernising the tax and benefits system to meet the objectives of promoting work incentives, reducing poverty and welfare dependency, and strengthening community and family life. This review includes looking at benefits, tax rates and allowances to find the most effective way to encourage employment and reward work.

  Tax Changes
  Mr. Malcolm Bruce
  To ask the Chancellor of the Exchequer what is his estimate of the cumulative revenue yield for(a) 1997–98, (b) 1998–99, (c) 1999–2000, (d) 2000–1 and (e) 2001–2 resulting from announced changes to direct and indirect taxation in these years; and if he will make a statement. [13281]

  Dawn Primarolo
  [holding answer 6 November 1997]: The forecast cumulative revenue yield for 1997–98, 1998–99 and 1999–2000 for the changes announced in the July 1997 Budget are shown in table 2.2 of the Financial Statement and Budget Report (HC85). Tables 2B.1 and 2B.2 of the same document show the revenue effects of measures announced since the 1996 Budget for these years and of measures announced in 1996 Budget or earlier which take effect after the 1997 Budget. Estimates are not available beyond 1999–2000.

  Mr. Malcolm Bruce
  To ask the Chancellor of the Exchequer what is his estimate of the cumulative revenue yield for(a) 1992–93, (b) 1993–94. (c) 1994–95, (d) 1995–96 and (e) 1996–97 from the changes in direct and indirect taxation announced in the budgets over the period from 1992 to 1996; and if he will make a statement. [13282]

  Dawn Primarolo
  [holding answer 6 November 1997]: For each budget the forecast cumulative revenue yield of changes for 1992–93 to 1996–97 are given in the Financial Statement and Budget Reports (March 1992 tables 4.1, 4A.1 (covering 1992–93 and 1993–94), March 1993 tables 4.1, 4B.1, (1993–94 to 1995–96), November 1993 tables 4.1 annex B to chapter 4 first table (1994–95 to 1996–97), November 1994 tables 5.1, 5B.1 (1995–96 to 1997–98), November 1995 tables 5.1, 5B.1, November 1996 Annex A to chapter 6 first table). The outturn revenue yield of the announced budget changes to taxation are not available. However over the period 1992–93 to 1996–97 tax as a share of GDP rose from 34½ per cent. to 36 per cent.

  EU Budget
  Mr. Malcolm Bruce
  To ask the Chancellor of the Exchequer what plans he has to use the 1998–99 Contingency Reserve in order to accommodate a higher than expected United Kingdom net contribution to the European Community Budget in 1998–99; and if he will make a statement. [14521]
  511
  Mrs. Liddell
  [holding answer 10 November 1997]: Should the UK's net contribution in 1998–99 turn out to be higher than in published public expenditure plans, the additional expenditure would fall to be met from the Reserve. There is, however, no reason to suppose that the estimates made by the previous Government will be insufficient.

  Mr. Malcolm Bruce
  To ask the Chancellor of the Exchequer on what date he will be able to publish a revised estimate of the United Kingdom's net contribution to the European Community Budget for 1998; if he will update the figures for United Kingdom expenditure on the European Communities for 1998–99 as set down in the Financial statement and Budget report 1997–98, page 123, Table 5.A.4; and if he will make a statement. [14520]

  Mrs. Liddell
  [holding answer 10 November 1997]: An estimate for the UK's net contribution to the 1998 European Community Budget will, as usual, be included in the annual White Paper on the EC Budget. The Government hopes to publish the White Paper on the 1998 Budget in the Spring of next year. A revised Treasury forecast for the UK's net contribution in respect of the financial year 1998–99 will be included in the "Financial Statement and Budget Report", and also the "Departmental Report of the Chancellor of the Exchequer's smaller Departments", both of which are expected to be published in March next year.

  Green Budget
  Mr. Gibb
  To ask the Chancellor of the Exchequer if he will make a statement on the arrangements for the presentation of the Green Budget to Parliament. [15086]

  Mrs. Liddell
  [holding answer 10 November 1977]: My right hon. Friend the Chancellor will make a statement to the House on 25 November (as announced to the hon. Member for East Ham (Mr. Timms) on 30 October, Official Report, column 884), when he will also be presenting a Command Paper.

  VAT (Energy Saving Materials)
  Mr. Malcolm Bruce
  To ask the Chancellor of the Exchequer if his Department has yet completed its review of the rate of value added tax on energy-efficient materials; and if he will make a statement. [14517]

  Dawn Primarolo
  [holding answer 10 November 1997]: Customs have completed their review and are now preparing a report for publication.

  G7 Central Banks
  Mr. Boswell
  To ask the Chancellor of the Exchequer if he will list the various differences in the arrangements for operational independence by central banks in the conduct of monetary policy among those G-7 countries which have introduced such arrangements, from those applicable under his proposals in the United Kingdom. [14511]

  Mrs. Liddell
  [holding answer 10 November 1997]: The proposed arrangements by the Chancellor to give the Bank of England statutory operational responsibility over monetary policy are along similar lines to the arrangements in other G-7 countries. Most countries have moved to give central banks greater operational
  512
  responsibility and to focus monetary policy on price stability. However the arrangements for the UK are a British solution for British needs.

  The Monetary Policy Committee of the Bank of England has operational responsibility to achieve a monetary policy target set by the Chancellor. The Chancellor retains the right to override the operational autonomy of the Bank in extreme economic circumstances and if it is in the public interest.

  Arrangements for other G-7 countries give varying degrees of independence to the central bank. The most independent is the Bundesbank, which has full independence from the Government and is required neither to consult nor report to Parliament. The Banque de France has recently been reformed to give it full independence over monetary policy decisions and bring its arrangements into line with the proposed arrangements for the ESCB.

  In the US, the Federal Reserve has discretion over both the goals and instruments of monetary policy; but it is required to give a full account of its policies to Congress.

  The Bank of Japan Law has been revised recently to establish the independence of the Bank of Japan (which comes into effect from April 1, 1998), but is designed to ensure that Government views are heard. The Government retains the right to attend and make proposals to the Policy Board.

  The Bank of Canada also has considerable discretion over the goals and instruments of monetary policy. But the Canadian Government has ultimate responsibility for the direction of monetary policy and, in case of disagreements, retains the right to issue a directive to the Bank in respect of monetary policy.

  The Banca D'Italia also has considerable autonomy. The Governor sets autonomously the official discount rate, and neither Parliament or the Government can interfere in this process. However the Bank's annual monetary policy objectives must be approved by the Inter-Ministerial Committee for Economic Planning.

  Mr. Heathcoat-Amory
  To ask the Chancellor of the Exchequer what estimate he has made of the costs of converting to the Euro for(a) Government, (b) retailers, (c) manufacturers, (d) the financial sector, (e) the public and (f) the economy as a whole; and if he will make a statement. [13718]

  Mrs. Liddell
  [holding answer 3 November 1997]: The cost of converting to the euro would depend on the timing and detailed nature of the transition. The Chancellor has set up a Standing Committee to consider how the United Kingdom would approach the transition to the euro if and when the United Kingdom joins, and he is receiving advice from business sources through a Business Advisory Group looking at the practical implications of economic and monetary union.

  The Government believes that, in principle, the United Kingdom should join a successful EMU provided the economic benefits of joining are clear and unambiguous. The Chancellor set out the five tests against which the economic case will be judged. The Treasury's assessment of the five economic tests is available in the Library of the House.

  Tourism
  Sir Richard Body
  To ask the Chancellor of the Exchequer how much money is set aside in the current European Union budget for tourism(a) under the Leader II programme and (b) under other European programmes; how much of this is targeted at projects in the United Kingdom; what assessment he has made of the cost-effectiveness of the programmes; and if he will make a statement. [12501]

  Mr. Tom Clarke
  I have been asked to reply. The information is not available in the form requested.

  Many Community programmes have an impact on tourism, or tourism has a role to play in them although tourism is not the primary purpose of the programmes. No figures are therefore available which show the total spending which might have relevance to tourism. The Commission has recently produced a report highlighting some of these areas and the Department for Culture, Media and Sport submitted an Explanatory Memorandum to Parliament on 31 July on European Community Document COM(97) 332 FINAL (also numbered 9712/97): Community Measures Affecting Tourism in 1995–96.

  The only direct programmes relating to tourism have been the European Year of Tourism 1991 and the Tourism Action Plan of 1993–95, both of which were criticised in European Court of Auditors Special Report No 3/96 (Document 11833/96, also numbered 17859) on tourist policy and the promotion of tourism, on which the European Legislation Committee of the House reported in its Report No 16 session 96/97, and on which there was subsequent correspondence by the Chairman of the Committee and my right hon. Friend the Secretary of State.

AGRICULTURE, FISHERIES AND FOOD

  Farmers (Exchange Rate Fluctuations)
  Mr. Edwards
  To ask the Minister of Agriculture, Fisheries and Food what proposals he has to introduce a system of dispensation to reflect exchange rate fluctuations similar to that available to German farmers. [14965]

  Mr. Rooker
  EU rules make it possible for the UK to compensate farmers for the income effects of revaluations of the rates used to convert subsidies and other amounts fixed under the CAP into sterling. Paying this aid would have significant implications for UK public expenditure. We are keeping the situation under review but, on the evidence currently available, have concluded that the case for payment is at present not proven.

  Calves
  Mr. Hancock
  To ask the Minister of Agriculture, Fisheries and Food how many calves have been imported from the continent for slaughter in United Kingdom abattoirs since 1 July; from which countries they have been imported; and if he will make a statement. [14908]
  514
  Mr. Rooker
  Information taken from the Animal Movement (AN1MO) electronic data system indicates that no bovine animals were imported into the United Kingdom from the continent for slaughter between July and September 1997 inclusive.

  Live Animal Exports
  Mr. Etherington
  To ask the Minister of Agriculture, Fisheries and Food what plans he has to bring into force the new arrangements whereby the veterinary surgeons responsible for inspecting live animals prior to export will be appointed and paid by him; and if he will make a statement. [13913]

  Mr. Morley
  Preliminary discussions have been held with the British Veterinary Association and the Royal College of Veterinary Surgeons about the arrangements for the appointment and payment of local veterinary inspectors by this Department. Following consideration of points raised by the B VA and the RCVS, formal proposals will be drawn up including a date for implementing the new arrangements.

  Sheep Annual Payment Scheme
  Mr. Jack
  To ask the Minister of Agriculture, Fisheries and Food (1) what is his Department's estimate for expenditure on the sheep annual payment scheme for 1997–98; [15461]

  (2) what was his Department's forecast of expenditure on sheep annual payment for the financial year 1997–98. [15460]

  Mr. Morley
  I am replying in my right hon. Friend's absence as he is on official business in South Africa.

  The Department's published estimate provision for 1997–98 included £175 million for the sheep annual premium scheme, which is entirely funded by reimbursements from the European Agricultural Guidance and Guarantee Fund. The estimate has not changed.

  Mr. Jack
  To ask the Minister of Agriculture, Fisheries and Food if he will make representations to the Treasury, in respect of his Department's underspend on current payments of sheep annual payment, to use the surplus to maintain 1997 levels of hill livestock compensatory allowance payments; and if he will make a statement. [15459]

  Mr. Morley
  I am replying in my right hon. Friend's absence as he is on official business in South Africa.

  The Sheep Annual Premium Scheme is fully funded by the European Union. To the extent that actual expenditure falls short of the published estimates, the shortfall is offset by a corresponding loss of receipts from the European Agriculture Guidance and Guarantee Fund. As such, no spare funds result which could be directed towards the payment of Hill Livestock Compensatory Allowances.

  Public Expenditure
  Mr. Jack
  To ask the Minister of Agriculture, Fisheries and Food if he will make a statement on his Department's public expenditure ceiling for 1997–98. [15462]

  Mr. Morley
  I am replying in my right hon. Friend's absence as he is on official business in South Africa.
  515
  The published Estimate Provision for the Ministry of Agriculture, Fisheries and Food for 1997–98, net of EAGGF reimbursement if £765 million.

  Hill Livestock Compensatory Allowance
  Mr. Jack
  To ask the Minister of Agriculture, Fisheries and Food if his Department's maintenance of 1997 levels of Hill Livestock Compensatory Allowance rates of payment for 1998 will breach his overall PES limit for 1997–98. [15463]

  Mr. Morley
  I am replying in my right hon. Friend's absence as he is on official business in South Africa.

  The rates of payment for Hill Livestock Compensatory Allowances in 1997 included a one off increase to help farmers cope with the immediate effects of the BSE crisis. PES provision for 1997–98 does not provide for this increase to be sustained in 1998.

  Household consumption in Great Britain1

  Grams of product per person per week2

  Beef3

  Beef sausages

  Corned beef4

  Frozen burgers (all meats)5

  1995

  1996

  1997

  1995

  1996

  1997

  1995

  1996

  1997

  1995

  1996

  1997

  January

  145

  123

  119

  23

  27

  13

  14

  14

  12

  16

  20

  13

  February

  133

  104

  106

  26

  21

  13

  15

  14

  3

  5

  19

  8

  March

  136

  104

  126

  19

  12

  14

  17

  11

  16

  19

  15

  16

  April

  107

  68

  95

  14

  12

  10

  12

  11

  12

  14

  15

  18

  May

  126

  93

  116

  25

  15

  11

  18

  11

  16

  22

  15

  16

  June

  107

  89

  127

  22

  14

  9

  15

  13

  16

  18

  19

  16

  July

  96

  106

  87

  27

  13

  21

  16

  14

  14

  23

  13

  23

  August

  98

  100

  103

  25

  14

  17

  15

  12

  16

  25

  17

  15

  September

  122

  93

  —

  26

  15

  —

  19

  10

  —

  30

  16

  —

  October

  137

  109

  —

  24

  15

  —

  14

  10

  —

  19

  15

  —

  November

  122

  109

  —

  22

  22

  —

  15

  10

  —

  21

  16

  —

  December

  117

  105

  —

  22

  12

  —

  17

  10

  —

  14

  11

  —

  Source:

  Sample estimates of household purchases from the National Food Survey.

  1Information is not available about beef contained in a wide range of other products such as meat pies.

  2 In the case of the three meat products the weight shown is of the product not the weight of beef contained within it.

  3May include a very small amount of veal.

  4May contain a small amount of other corned meat.

  5Consumption of frozen beefburgers is not separately available. Excludes cooked burgers taken home.

  Fisheries (Minimum Landing Sizes)
  Mr. Gill
  To ask the Minister of Agriculture, Fisheries and Food if he will list by species(a) the minimum landing size in force prior to the recent Fisheries Council meeting and (b) the proposed new minimum landing sizes. [15346]

  Mr. Morley
  I have arranged for the material requested to be placed in the Library of the House.

  Fisheries (Discards)
  Mr. Gill
  To ask the Minister of Agriculture, Fisheries and Food what were the rules in respect of discarding prior to the Fisheries Council meeting on 30 October; what rules will apply to discards in future; and if he will make a statement on the changes involved. [15345]

  Mr. Morley
  The present EC technical conservation regulation requires sorting of fish to be carried out immediately after nets have been hauled. The Regulation requires protected species (defined in the Regulation) in excess of catch composition percentages laid down, to be

  Beef
  Mr. Jack
  To ask the Minister of Agriculture, Fisheries and Food if he will publish for each month, for(a) 1995, (b) 1996 and (c) 1997 to date the levels of domestic beef consumption. [15458]

  Mr. Morley
  I am replying in my right hon. Friend's absence as he is on official business in South Africa.

  Available monthly information on the consumption of beef in the home is given in the table.

  This information is from the National Food Survey. The monthly estimates shown contain a greater level of sampling error than the quarterly results normally published for this survey. Therefore a degree of caution is needed when comparing individual month on month changes.

  discarded immediately into the sea. Other provisions require undersized fish, shellfish and crustaceans to be discarded immediately.

  The new EC Regulation agreed at the Fisheries Council on 30 October to come into effect on 1 January 2000 alters these rules so that:
  for all vessels at all times the percentage of target species retained on board must be at least half that required by the Regulation;
  in addition, for those vessels required to complete logbooks, after the first 24 hours of a trip the catch composition percentages must be correct at time of the daily completion of the logbooks;
  in all cases, the catch composition percentages must be correct at time of return to port.

  As in the present regulation, undersized specimens must be discarded immediately.

  These changes are to reduce the quantity of fish discarded.

WALES

  Telecommunications
  Mr. Llwyd
  To ask the Secretary of State for Wales what current plans there are to introduce new telecommunications infrastructure, with particular reference to the provision of fibre optics, into the whole of Wales; and if he will make a statement. [14550]

  Mr. Hain
  Infrastructure investment is a matter for telecommunication companies. Nevertheless Welsh Office officials regularly meet telecommunication infrastructure providers to encourage the expansion and upgrading of the network throughout Wales. Support is also given to initiatives being driven forward by local authorities and development agencies which aim to improve the telecommunications infrastructure.

  Education
  Mr. Ruane
  To ask the Secretary of State for Wales if he will list by constituency the(a)number and (b) percentages of 16 to 18-year-olds in full-time education ranked by descending percentage. [14828]

  Mr. Hain
  In the academic year 1995–96, 59,026 16 to 18-year-olds–58 per cent of the age group-participated in full-time education. No comprehensive central record of students' home addresses is maintained so figures by constituency are not available.

  Gwent Levels Wetland Reserve
  Mr. Edwards
  To ask the Secretary of State for Wales when he expects to make an announcement about(a) the proposed Gwent Levels Wetland Reserve and (b) the proposed compulsory purchase orders; and what assessment he has made of alternative approaches to the proposed Gwent Levels Wetland Reserve. [14959]

  Mr. Win Griffiths
  The report of the Inspector on the public inquiry into the appeals and applications by the Land Authority for Wales is currently under consideration by my right hon. Friend. The inquiry dealt with a number of complex issues and a decision will be issued as soon as possible. It would not be appropriate at this stage to comment on matters related to those appeals and applications.

  Offset Exhibition
  Ann Clwyd
  To ask the Secretary of State for Wales what assistance the Welsh Office gave to the organisers of the Offset exhibition at the North Wales Centre, Aberconwy; and what was the cost to public funds. [15299]

  Mr. Hain
  The Welsh Office did not provide any assistance to the organisers of the Offset UK97 conference held at Llandudno last month. The Welsh Development Agency, however, did provide support to 518
  bring the event to Wales. The detail of that support is an operational matter for the Agency and I have therefore asked the Chief Executive to write to my hon. Friend direct.

  General Practitioners
  Ann Clwyd
  To ask the Secretary of State for Wales how many sole practitioner GPs there are in(a) Wales as a whole and (b) each health authority area. [15286]

  Mr. Win Griffiths
  The information is given in the following table:

  Single-handed general medical practitioners as at 1 April 1997

  Number

  North Wales

  31

  Dyfed Powys

  11

  Morgannwg

  19

  Bro Taf

  28

  Gwent

  36

  Wales

  125

  Military Exports
  Ann Clwyd
  To ask the Secretary of State for Wales (1) what discussions he has had with the Welsh Office Exports Promotion Department about the Government's policy on the sale and supply of military, security and police equipment to oppressive regimes; and if he will place the minutes of the meeting in the Library; [15296]

  (2) what (a) instructions and (b) policy guidelines he has issued to the Welsh Office Exports Promotion Department about the Government's policy on the sale and supply of military, security and police equipment to oppressive regimes; and if he will place a copy of such guidelines and instructions in the Library. [15297]

  Mr. Hain
  I refer my hon. Friend to the answer I gave her on 27 June which sets out the Government's position on these matters-Official Report, column 648.

  NHS Funding
  Ann Clwyd
  To ask the Secretary of State for Wales how much of the additional funding for the NHS in the coming year will be allocated to Wales. [15287]

  Mr. Win Griffiths
  In my right hon. Friend the Chancellor's Budget Statement on 2 July,Official Report, column 315, he announced an additional £1.2 billion for the NHS in 1998–99 of which an additional £60.2 million will be allocated to Wales.

  Higher Education
  Mr. Alan Williams
  To ask the Secretary of State for Wales what proposals he has to increase his 1997–98 allocation of funds to higher education. [13774]

  Mr. Hain
  [holding answer 3 November 1997]: I was pleased to announce on 5 November that in 1998–99 an additional £10 million will be available for higher

  519
  education in Wales. This new investment will match proportionately the package announced for England recently by my right hon. Friend the Secretary of State for Education and Employment.

  Social Services
  Mr. Burstow
  To ask the Secretary of State for Wales (1) if he will list for each social services department his estimate of the additional funding which will be made available this winter; [14590]

  (2) if he will list by health authority the dates on which the social services departments within each health authority were invited to make applications for additional funding to assist with managing pressures over this winter, indicating the deadlines they were given for completing their funding applications. [14595]

  Mr. Win Griffiths
  I have recently announced an additional £9.548 million for health authorities this year to alleviate to pressures on emergency admissions. Health authorities will submit their action plans to my officials at the end of November. It will be for health authorities to consider whether, as part of their plans, additional funding will be provided to social services departments.

  In July, I also announced £2.5 million to promote primary and community health care in Wales. Within that, health authorities may apply for a share of £250,000 set aside for joint ventures with private nursing homes to provide care this winter for those who do not require the full range of hospital services or who are awaiting the completion of packages of care before discharge.

  Roads
  Mr. Llwyd
  To ask the Secretary of State for Wales if he will list total Government spending on the(a) M4, (b) A55, (c) A470 and (d) A487 in current real value prices, for (i) each year since 1970 and (ii) in total. [14688]

  Mr. Hain
  The information on expenditure is not held centrally for each individual road in the Welsh trunk road network as much of the work on these roads is carried out by local authorities acting as trunk road agents for the Welsh Office.

  Mr. Llwyd
  To ask the Secretary of State for Wales if he will list total Government spending planned for each of the next five financial years and the current financial year on the(a) M4, (b) A55, (c) A470 and (d) A487 expressed in current real value, indicating the cumulative total planned. [14687]

  Mr. Hain
  Spending plans for the current financial year are detailed in the 1997 Welsh Office Departmental Report, copies of which are available in the Library of the House. Plans for the next and subsequent financial years will be published following the outcome of the relevant Public Expenditure Survey deliberations.

  Official Hospitality
  Mr. Malcolm Bruce
  To ask the Secretary of State for Wales what is his estimate of the expenditure by(a) his Department, (b) its agencies and (c) its non-departmental public bodies on official hospitality for (i) 1980–81,
  520
  (ii) 1987–88, (iii) 1990–91, (iv) 1991–92, (v) 1992–93, (vi) 1993–94, (vii) 1994–95, (viii) 1995–96, (ix) 1996–97 and (x) 1 May to 30 September 1997. [15270]

  Mr. Ron Davies
  The information requested is as follows:

  Welsh Office £

  Agency (CADW) £

  1991–92

  36,463

  —

  (figures include CADW)

  1992–93

  38,000

  —

  (figures include CADW)

  1993–94

  26,818

  2,248

  1994–95

  28,784

  1,734

  1995–96

  22,090

  417

  1996–97

  21,033

  478

  1997–981

  6,524

  16

  11 May to 30 September 1997.

  Expenditure on hospitality by non-departmental public bodies sponsored by my Department is a matter for the management of these bodies; details are not held centrally. Figures for 1980–81, 1987, 1988 and 1990–91 are not available.

  Overseas Travel
  Mr. Malcolm Bruce
  To ask the Secretary of State for Wales if he will list each of the overseas trips made by himself and other members of his ministerial team since 2 May, specifying in each case(a) the participating Minister of Ministers, (b) the destination of the trip, (c) the purpose of the trip and (d) the cost of the trip; and if he will make a statement. [15272]

  Mr. Ron Davies
  Since being elected to Office, I have undertaken one overseas trip. Between 11 and 18 October I visited Japan and Korea to promote inward investment. The Welsh Development Agency, who funded the trip, estimate that the costs for myself and my Private Secretary amounted to some £21,676. There have been no other ministerial trips overseas.

  Mr. Malcolm Bruce
  To ask the Secretary of State for Wales what is his estimate of the expenditure by(a) his Department, (b) its agencies and (c) its non-departmental public bodies on overseas travel for (i) 1980–81, (ii) 1987–88, (iii) 1990–91, (iv) 1991–92, (v) 1992–93, (vi) 1993–94, (vii) 1994–95, (viii) 1995–96, (ix) 1996–97 and (x) 1 May to 30 September 1997; and if he will provide a breakdown to show (1) air fares and (2) other expenditure relating to overseas travel. [15271]

  Mr. Ron Davies
  Records are not held separately for expenditure on overseas travel by my Department or its agency, and are not held centrally for NDPBs.

  Publicity and Advertising
  Mr. Malcolm Bruce
  To ask the Secretary of State for Wales what is his estimate of the total expenditure on all forms of publicity and advertising by(a) his Department, (b) its agencies and (c) non-departmental public bodies for (i) 1993–94, (ii) 1994–95, (iii) 1995–96, (iv) 1996–97, (v) the 1997–98 year to date, (vi) the 1997–98 full year estimate and (vii) the 1998–99 planned expenditure. [15273]
  521
  Mr. Ron Davies
  The total expenditure on all forms of publicity and advertising by(a) my Department, (b) its agency CADW and (c) non-departmental public bodies for the years requested are set out in the following table.

  Annual expenditure

  (a) Welsh Office

  Total expenditure £000

  1993–94

  1,358

  1994–95

  1,725

  1995–96

  1,929

  1996–97

  1,795

  197–98 to date (end October)

  891

  1997–98 full year estimate

  12.4 million

  1998–99 Publicity plans for the 1998–99 financial year have not been finalised.

  1Includes expenditure on Referendum publicity.

  (b)CADW

  Total expenditure £000

  1993–94

  301

  1994–95

  305

  1995–96

  305

  1996–97

  316

  1997–98 to date (end October)

  202

  1997–98 full year estimate

  321

  1998–99

  1321

  1Estimate.

  (c) NDPB's

  Total expenditure £000

  1993–94

  1n/a

  1994–95

  17,197

  1995–96

  17,800

  1996–97

  18,255

  1997–98 to date (end October)

  7,311

  1997–98 full year estimate

  17,832

  1998–99 Budgets for 1998–99 have not yet been set

  1Comparable figures for this year are not available.

EDUCATION AND EMPLOYMENT

  Denominational Schools
  Mr. Norman
  To ask the Secretary of State for Education and Employment what effect the Government's proposals in the Education White Paper will have on the composition of the governing bodies of denominational schools when they change from grant-maintained status to foundation or aided schools. [14967]

  Mr. Byers
  The consultation document, "Framework for the Organisation of Schools", set out in detail our proposals for the composition of foundation and aided school governing bodies under the new schools framework.

  Our consultation was genuine. We listened carefully to the views expressed and have agreed to make some amendments to the proposed composition of aided school governing bodies to accommodate a majority of two
  522
  foundation governors at primary schools and three at larger secondary schools. This will apply to denominational grant-maintained schools which choose to become aided. As set out in the Technical Consultation Paper, denominational grant-maintained schools which choose to become foundation will still have a significant number of foundation governors, but not a foundation majority. I am pleased to say that this overall approach has been welcomed by the churches.

  Staffordshire Training and Enterprise Council
  Mr. Jenkins
  To ask the Secretary of State for Education and Employment what percentage of the Staffordshire TEC budget was spent on(a) management training for small firms and (b) business start-up training in each of the last five years. [15352]

  Dr. Howells
  It is not possible to respond to this question as "management training for small firms" is not identified as a separate TEC budget line by either DfEE or DTI.

  The situation with regard to Business start-up training is given below (only the last four years detailed records are readily accessible).

  Contract year

  TEC budget1(£million)

  Business start-up budget2£

  Business start-up budget as a percentage of TEC budget

  1994–95

  26.3

  800,555

  3

  1995–96

  26·0

  159,124

  0·6

  1996–97

  28·3

  400,000

  1·4

  1997–98

  24·5

  557,348

  2·3

  1 TEC budget 1994–95 and 1995–96 comprises of DfEE funds only.

  TEC Budget 1996–97 and 1997–98 comprises of DfEE funds and DTI Business Support funds (including ERDF co-financing).

  2Business start-up budget 1994–95 and 1995–96 comprises of DfEE funds only.

  Business start-up budget 1996–97 comprises of £350,000 from the Single Regeneration Budget and £50,000 from Staffordshire TEC Reserves.

  Business start-up budget 1997–98 comprises of £289,000 from the Single Regeneration Budget, £131,000 from Staffordshire TEC Reserves and £137,348 for Enterprise Rehearsal within the DfEE funding stream for Training for Work.

  Student Loans
  Mr. Gordon Marsden
  To ask the Secretary of State for Education and Employment what plans he has to extend eligibility for Access Fund payments to part-time students in higher education from 1998–99; and what estimate he has made of the cost. [14434]

  Dr. Howells
  We have already indicated that part-time students will become eligible for consideration for payment from the higher education Access Funds from the beginning of the academic year 1998–99. Our guidance to the Funding Council will be amended to reflect this. We have also announced that the total amount available to the higher education Access Funds will be doubled.

  Spending from the Access Funds is not demand led in the sense that if more students are eligible to apply, more money will need to be paid out. A fixed sum is allocated for the academic year and distributed amongst higher education institutions, who decide individual payments on

  523
  the basis of the evidence of financial difficulties presented by students applying. Doubling the amount available is intended to improve the position of both part-time and full-time students.

  GCSE Results (New Towns)
  Barbara Follett
  To ask the Secretary of State for Education and Employment if he will list by gender the

  Pupils aged 15 in maintained schools in England 1995–96 achieving five or more grades A in GCSE

  Boys

  Girls

  Total

  Number

  Percentage

  Number

  Percentage

  Number

  Percentage

  Camden

  60

  8·1

  130

  12·5

  190

  10·6

  Greenwich

  39

  3·3

  55

  4·5

  94

  3·6

  Hackney

  10

  1·7

  31

  3·9

  41

  3·0

  Hammersmith and Fulham

  26

  4·8

  47

  9·2

  73

  6·9

  Islington

  10

  1·2

  28

  5·2

  38

  2·8

  Kensington and Chelsea

  27

  9·9

  20

  7·1

  47

  8·5

  Lambeth

  6

  1·1

  26

  3·7

  32

  2·6

  Lewisham

  28

  2·6

  57

  5·9

  85

  4·1

  Southwark

  10

  1·1

  23

  2·6

  33

  1·9

  Tower Hamlets

  20

  1·8

  21

  2·1

  41

  1·9

  Wandsworth

  41

  4·4

  46

  6·3

  87

  5·3

  Westminster

  22

  3·3

  38

  6·0

  60

  4·6

  Barking and Dagenham

  26

  2·8

  17

  2·0

  43

  2·4

  Barnet

  170

  10·2

  242

  15·9

  412

  12·9

  Bexley

  71

  5·4

  105

  8·7

  176

  7·0

  Brent

  38

  3·4

  43

  4·1

  81

  3·7

  Bromley

  132

  9·0

  203

  13·8

  335

  11·4

  Croydon

  52

  3·2

  120

  8·0

  172

  5·5

  Ealing

  47

  3·8

  74

  5·9

  121

  4·9

  Enfield

  90

  5·3

  148

  10·0

  238

  7·5

  Haringey

  34

  4·0

  49

  5·8

  83

  4·9

  Harrow

  97

  9·1

  138

  13·4

  235

  11·2

  Havering

  68

  4·7

  125

  8·9

  193

  6·8

  Hillingdon

  67

  5·1

  101

  8·2

  168

  6·6

  Hounslow

  54

  4·2

  123

  9·7

  177

  6·9

  Kingston upon Thames

  86

  14·2

  153

  20·6

  239

  17·8

  Merton

  26

  3·1

  69

  9·5

  95

  6·0

  Newham

  22

  1·6

  66

  4·8

  88

  3·2

  Redbridge

  91

  6·9

  145

  11·4

  236

  9·1

  Richmond upon Thames

  42

  5·6

  104

  13·7

  146

  9·7

  Sutton

  117

  11·7

  136

  14·8

  253

  13·2

  Waltham Forest

  37

  3·0

  72

  6·2

  109

  4·6

  Birmingham

  261

  4·4

  419

  7·3

  680

  5·8

  Coventry

  64

  3·7

  106

  6·2

  170

  4·9

  Dudley

  111

  5·7

  149

  8·3

  260

  7·0

  Sandwell

  35

  1·8

  36

  2·0

  71

  1·9

  Solihull

  85

  5·8

  132

  9·2

  217

  7·5

  Walsall

  77

  4·2

  101

  6·0

  178

  5·0

  Wolverhampton

  34

  2·3

  120

  8·2

  154

  5·3

  Knowsley

  8

  0·9

  15

  1·8

  23

  1·3

  Liverpool

  115

  4·3

  131

  4·8

  246

  4·5

  St· Helens

  48

  4·5

  109

  9·8

  157

  7·2

  Sefton

  116

  6·6

  156

  8·9

  272

  7·8

  Wirral

  152

  7·3

  222

  11·1

  374

  9·2

  Bolton

  98

  5·7

  121

  7·5

  219

  6·6

  Bury

  53

  5·0

  140

  13·9

  193

  9·3

  Manchester

  43

  2·1

  84

  4·3

  127

  3·2

  Oldham

  53

  3·2

  103

  6·4

  156

  4·8

  Rochdale

  45

  3·5

  67

  5·1

  112

  4·3

  Salford

  19

  1·7

  58

  4·7

  77

  3·3

  Stockport

  123

  8·0

  160

  9·9

  283

  8·9

  Tameside

  55

  4·0

  82

  6·0

  137

  5·0

  Trafford

  97

  8·6

  169

  14·1

  266

  11·4

  Wigan

  115

  5·5

  199

  10·4

  314

  7·9

  Barnsley

  22

  1·6

  51

  4·2

  73

  2·9

  Doncaster

  69

  3·7

  116

  6·3

  185

  5·0

  Rotherham

  89

  5·1

  105

  5·8

  194

  5·5

  Sheffield

  176

  6·4

  220

  8·6

  396

  7·5

  Bradford

  86

  2·7

  141

  4·8

  227

  3·7

  Calderdale

  69

  5·6

  96

  8·0

  165

  6·8

  524
  number and percentage of 15-year-olds living in the 21 English new towns who achieved at least five grade A GCSE passes in the 1996–97 school year. [14394]

  Dr. Howells
  The GCSE results of pupils are collected by Local Education Authority area in which the school is located not by where a pupil lives. Information is not available by new towns, however, the latest data available by LEA are shown in the following table.
  525

  Pupils aged 15 in maintained schools in England 1995–96 achieving five or more grades A in GCSE

  Boys

  Girls

  Total

  Number

  Percentage

  Number

  Percentage

  Number

  Percentage

  Kirklees

  85

  3·6

  185

  8·1

  270

  5·8

  Leeds

  184

  4·5

  314

  8·1

  498

  6·2

  Wakefield

  76

  4·1

  103

  5·6

  179

  4·8

  Gateshead

  71

  6·0

  102

  8·8

  173

  7·4

  Newcastle upon Tyne

  58

  4·1

  124

  8·9

  182

  6·5

  North Tyneside

  51

  4·3

  106

  9·5

  157

  6·8

  South Tyneside

  26

  2·7

  52

  5·3

  78

  4·0

  Sunderland

  43

  2·2

  105

  5·6

  148

  3·8

  Isles of Scilly

  3

  27·3

  3

  20·0

  6

  23·1

  Bath and North East Somerset

  68

  6·8

  110

  11·0

  178

  8·9

  City of Bristol

  57

  3·4

  99

  6·1

  156

  4·7

  North Somerset

  93

  8·5

  108

  10·6

  201

  9·5

  South Gloucestershire

  85

  5·8

  133

  10·5

  218

  8·0

  Hartlepool

  19

  3·1

  31

  5·2

  50

  4·1

  Middlesbrough

  27

  2·8

  37

  3·9

  64

  3·3

  Redcar and Cleveland

  62

  5·9

  80

  7·6

  142

  6·7

  Stockton on Tees

  69

  5·5

  103

  8·8

  172

  7·1

  City of Kingston upon Hull

  22

  1·4

  50

  3·4

  72

  2·4

  East Riding of Yorkshire

  94

  5·2

  164

  9·1

  258

  7·1

  North East Lincolnshire

  45

  4·2

  44

  3·8

  89

  4·0

  North Lincolnshire

  61

  5·7

  65

  6·4

  126

  6·1

  North Yorkshire

  325

  9·8

  396

  12·6

  721

  11·2

  York

  69

  7·8

  88

  10·7

  157

  9·2

  Bedfordshire

  155

  4·5

  280

  8·6

  435

  6·5

  Berkshire

  350

  8·0

  513

  12·4

  863

  10·2

  Buckinghamshire

  469

  11·8

  506

  13·1

  975

  12·4

  Cambridgeshire

  315

  8·0

  412

  10·8

  727

  9·3

  Cheshire

  507

  8·7

  707

  12·1

  1,214

  10·4

  Cornwall

  198

  6·8

  264

  10·0

  462

  8·3

  Cumbria

  181

  6·2

  264

  9·5

  445

  7·8

  Derbyshire

  297

  5·3

  433

  7·8

  730

  6·6

  Devon

  332

  6·0

  551

  9·9

  883

  7·9

  Dorset

  291

  7·7

  438

  12·3

  729

  9·9

  Durham

  156

  4·2

  244

  6·9

  400

  5·5

  East Sussex

  175

  5·1

  282

  8·9

  457

  6·9

  Essex

  540

  5·9

  784

  8·9

  1,324

  7·4

  Gloucestershire

  240

  7·7

  366

  12·1

  606

  9·9

  Hampshire

  531

  6·1

  813

  9·8

  1,344

  7·9

  Hereford and Worcester

  216

  5·4

  364

  9·1

  580

  7·3

  Hertfordshire

  448

  7·6

  699

  11·8

  1,147

  9·7

  Isle of Wight

  40

  5·6

  48

  6·8

  88

  6·2

  Kent

  647

  7·0

  943

  10·3

  1,590

  8·6

  Lancashire

  542

  6·5

  758

  9·3

  1,300

  7·9

  Leicestershire

  254

  4·5

  392

  7·3

  646

  5·9

  Lincolnshire

  239

  6·7

  374

  10·6

  613

  8·6

  Norfolk

  203

  4·7

  347

  8·4

  550

  6·5

  Northamptonshire

  188

  5·0

  259

  7·0

  447

  6·0

  Northumberland

  129

  6·9

  232

  11·7

  361

  9·4

  Nottinghamshire

  234

  3·8

  375

  6·4

  609

  5·1

  Oxfordshire

  200

  6·4

  303

  10·2

  503

  8·2

  Shropshire

  179

  6·9

  252

  10·7

  431

  8·7

  Somerset

  207

  8·1

  284

  11·3

  491

  9·7

  Staffordshire

  348

  5·3

  528

  8·6

  876

  6·9

  Suffolk

  272

  7·3

  377

  10·6

  649

  8·9

  Surrey

  315

  6·7

  501

  11·2

  816

  8·9

  Warwickshire

  166

  5·8

  231

  8·3

  397

  7·1

  West Sussex

  293

  7·4

  488

  12·4

  781

  9·9

  Wiltshire

  258

  8·1

  388

  12·5

  646

  10·3

  Total England

  15,792

  5·7

  23,965

  9·0

  39,757

  7·3

  Higher Education
  Dr. Vis
  To ask the Secretary of State for Education and Employment what studies his Department has(a) commissioned and (b) evaluated into the unit costs of comparable education programmes provided by (i) training and enterprise councils and (ii) colleges. [13113]
  526
  Dr. Howells
  The Department published "The Public Funding Cost of Education and Training for 16–19 year olds in England in 1995–96" in March this year. This covers the cost of successfully achieving 3 A levels and advanced GNVQs in colleges and NVQ3s in work-based training. The analysis is carried out by the Department in consultation with external partners.

  Welfare to Work (West Midlands)
  Ms Jennifer Jones
  To ask the Secretary of State for Education and Employment what arrangements have been made to involve the voluntary sector in the Welfare to Work programme in the west midlands. [14265]

  Mr. Alan Howarth
  Responsibility for the subject of the question has been delegated to the Employment Service agency under its Chief Executive. I have asked him to arrange for a reply to be given.

  Letter from Leigh Lewis to Ms Jennifer Jones, dated 11 November 1997:
  The Secretary of State has asked me to reply to your question about the arrangements that have been made to involve the voluntary sector in the Welfare to Work programme in the West Midlands. This is something that falls within the responsibilities delegated to me as Chief Executive of the Agency.
  A great deal of activity has been undertaken, both at a regional level and locally, to ensure that voluntary sector organisations in the West Midlands are fully involved with the development of New Deal and the plans to implement it. In particular, over 100 representatives from 73 voluntary organisations attended a series of regional consultation events over the summer. They represented a range of voluntary sectors including women's groups; those with concern for issues of crime, race, homelessness, age; more general volunteer bureaux; and those representing local churches.
  In more recent months the Employment Service Regional Director, Scott McIntyre, has personally met a number of voluntary organisations including the Princes Trust, Birmingham Voluntary Sector Council, Groundwork Trust, Business in the Community, Rathbone Community Industry, West Midlands Low Pay Unit, Foyer for Birmingham, the Irish Community Forum, British Trust for conservation Volunteers and is due to meet shortly the Young Offender Consortium.
  Employment Service District Managers in the region have also been working with voluntary sector networks, through District events and meetings. For instance, in the Black Country Pathfinder area 89 organisations attended two District Voluntary Sector conferences from the full range of voluntary organisations in the area.
  In the same Pathfinder area Dudley Council for Voluntary Services, Sandwell Council of Voluntary Organisations, Wolverhampton Voluntary Sector Council and Walsall Voluntary Sector Council are all involved in a Joint Venture Partnership to take forward the Voluntary sector option in the Pathfinder.
  A similar level of activity can be found throughout the rest of the region and is set to continue as New Deal is developed further over the next few months. Assessment panels which are taking place over the next few weeks will consider in detail the plans for each New Deal partnership in the region. Three members of these panels, Allison Millward (Groundwork Trust and a member of the National Task Force), Ian Morrison (Birmingham Voluntary Services Council) and Sue Nicholls (Hereford and Worcester Community Council) will be from the voluntary sector.
  I hope this is helpful.

  Social Affairs Council
  Mr. Ernie Ross
  To ask the Secretary of State for Education and Employment if he will make a statement on the outcome of the EU Social Affairs Council on 6 November. [15841]

  Mr. Andrew Smith
  I represented the UK at the Social Affairs Council on 6 November.
  528
  This supplementary meeting was convened solely for the purpose of making preparations for the Extraordinary European Council on Employment taking place in Luxembourg on 20–21 November.

  The meeting discussed the Commission's draft communication concerning the preparation of draft Guidelines on Employment which were called for by the Amsterdam European Council in June. I expressed the UK's broad satisfaction with the overall structure and key themes of the Guidelines and welcomed growing recognition that EU wide numerical targets on employment and unemployment were inappropriate. There was agreement among Member States and the Presidency on the need for the Guidelines primarily to express consensus on the areas in which Member States should take action to tackle unemployment and promote employability and that Member States should draw up Action Plans as the basis for national implementation of the Guidelines. The UK has a number of detailed comments which it will be discussing with the Presidency and other Member States. There will be further discussion at a joint meeting of the Social Affairs Council and the Economic and Finance Council of Ministers on 17–18 November.

  School (Exclusions)
  Mr. Steen
  To ask the Secretary of State for Education and Employment what is his current estimate of the number of children excluded from(a) primary and (b) secondary schools. [15059]

  Ms Estelle Morris
  In the 1995–96 school year, 1,608 pupils were permanently excluded from primary schools and 10,344 were permanently excluded from secondary schools.

  Figures for the 1996–97 school year will be collected as part of the annual Schools Census in January 1998.

  Modern Apprenticeships
  Mr. Colvin
  To ask the Secretary of State for Education and Employment what is his estimate of the number of trainees that are likely to qualify for modem apprenticeship this year; and what is his estimate of the trend for the next three years. [13900]

  Dr. Howells
  The number of people joining Modem Apprenticeships in 1997–98 is planned to be about 62,500.

  All Government-funded programmes are currently being reviewed as part of the Departmental Spending Review. Plans for 1998–99 and later years will be announced in due course.

  Careers Advice (Wolverhampton)
  Ms Jennifer Jones
  To ask the Secretary of State for Education and Employment if he will make a statement on the monitoring arrangements and criteria to be used by the Government Office of the west midlands when evaluating the performance of the private Careers Advice Service (PROSPECTS) operating in Wolverhampton. [14263]
  529
  Dr. Howells
  All Careers Service companies must submit a plan to their local Government Office which contracts with careers service companies on a basis which is designed to ensure that necessary outcomes are achieved and the requirements of the DfEE are met. These requirements are set out in the document "The Requirements and Guidance for Careers Service Providers". This requires Careers Services to evaluate systematically their delivery of all contracted outcomes, operate an effective system for collecting customer feedback, and undertake a thorough annual review of their activities.

  The Government Office monitors Careers Service companies' performance against the key indicators set down in this document against the companies' business plans and against the terms of the contract. Regular monitoring of the financial position of Careers Service companies is also routinely undertaken.

  Grant-maintained Schools (Brent)
  Mr. Gardiner
  To ask the Secretary of State for Education and Employment if he will list the balances held by each grant-maintained school in the London Borough of Brent. [15464]

  Mr. Byers
  The monitoring of financial information provided by individual grant-maintained schools, including information on balances, is a matter for the Funding Agency for Schools. I have therefore written to Sir Anthony Tippet, Chairman of the Funding Agency, to ask him to provide the figures requested.

  Child Care
  Mr. Jim Cunningham
  To ask the Secretary of State for Education and Employment what action he is taking to implement a child care strategy; and what is the timetable for that strategy. [14570]

  Mr. Alan Howarth
  We have already taken action to improve child care by extending the child care disregard and offering young people the opportunity to obtain training and work experience in child care as part of the New Deal programme. We are currently developing a National Child care Strategy which will help parents, especially women, to balance family and working life and I will make an announcement in the first part of next year.

  Hackney Borough Council
  Mr. Sedgemore
  To ask the Secretary of State for Education and Employment (1) if he plans to approve the proposals contained in the report of the Improvement Team which he sent into Hackney Council; [15378]

  (2) if he plans to reject any of the proposals contained in the report of the Improvement Team which he sent into Hackney Council; [15379]

  (3) what assessment he has made of the criticisms made by the chief executive of Hackney Council of the proposals contained in the report of the Improvement Team which he sent into Hackney; and what plans he has for further work by the Improvement Team. [15380]

  Mr. Byers
  The Improvement Team appointed to advise Hackney Local Education Authority have delivered a report on the "Management and Leadership of the 530
  Hackney LEA" to the Chief Executive of the Borough. I am pleased that Hackney Council's Education and Leisure Services Committee have agreed to the appointment of a Director of Education on the salary recommended by the Improvement Team to provide leadership of the education service. The Improvement Team is continuing with its work and will submit an interim report to my right hon. Friend the Secretary of State in January 1998.

  Overseas Travel
  Mr. Malcolm Bruce
  To ask the Secretary of State for Education and Employment what is his estimate of the expenditure by(a) his Department, (b) its agencies and (c) its non-departmental public bodies on overseas travel for (i) 1980–81, (ii) 1987–88, (iii) 1990–91, (iv) 1991–92, (v) 1992–93, (vi) 1993–94, (vii) 1994–95, (viii) 1995–96, (ix) 1996–97 and (x) 1 May to 30 September 1997; and if he will provide a breakdown to show (1) air fares and (2) other expenditure relating to overseas travel. [15259]

  Dr. Howells
  The information requested is available only at disproportionate cost.

  Official Hospitality
  Mr. Malcolm Bruce
  To ask the Secretary of State for Education and Employment what is his estimate of the expenditure by(a) his Department, (b) its agencies and (c) its non-departmental public bodies on official hospitality for (i) 1980–81, (ii) 1987–88, (iii) 1990–91, (iv) 1991–92, (v) 1992–93, (vi) 1993–94, (vii) 1994–95, (viii) 1995–96, (ix) 1996–97 and (x) 1 May to 30 September 1997. [15258]

  Dr. Howells
  The information requested is available only at disproportionate cost.

  Publicity and Advertising
  Mr. Malcolm Bruce
  To ask the Secretary of State for Education and Employment what is his estimate of the total expenditure on all forms of publicity and advertising by(a) his Department, (b) its agencies and (c) non-departmental public bodies for (i) 1993–94, (ii) 1994–95, (iii) 1995–96, (iv) 1996–97, (v) the 1997–98, year to date, (vi) the 1997–98, full year estimate and (vii) the 1998–99 planned expenditure. [15261]

  Dr. Howells
  Before the merger in July 1995, the Department operated separately funded programmes of publicity. This continued until the end of the financial year 1995–96.

  Information on the publicity and advertising spend of agencies and non-departmental public bodies is not held centrally by the Department

  The costs of the total expenditure on publicity and on advertising for the former Departments are as follows:

  Department for Education

  1993–94: £10.1 million

  1994–95: £9.4 million

  1995–96: £5.4 million

  Department of Employment

  1993–94: £11.1 million

  1994–95: £11.1 million

  1995–96: £11.0 million

  531
  The costs of the total expenditure on publicity and advertising for the present Department are as follows:

  Department for Education and Employment

  1996–97: £17.4 million (provisional)

  1997–98: £4.0 million (to date)

  1997–98: £12.6 million (current budget, but £13.2 million subject to the passage of the Winter Supplementary Estimate).

  The projected expenditure on publicity and advertising in 1998–99 for the Department is £13.1 million.

SOCIAL SECURITY

  Incapacity Benefit
  Mr. Jenkins
  To ask the Secretary of State for Social Security what plans the Government have to review the all work test for incapacity. [15354]

  Mr. Denham
  I refer my hon. Friend to the reply I gave my hon. Friend the Member for Wakefield (Mr. Hinchliffe) on 27 October,Official Report, column 731.

  Mr. Jenkins
  To ask the Secretary of State for Social Security how many appeals against incapacity benefit disallowance were(a) received and (b) heard in the year ending March 1997; and what was the success rate for applicants. [15353]

  Mr. Denham
  The information is in the table.

  One of the Government's first priorities for Social Security is to modernise both the appeals system and the decision making process. We intend to introduce measures to streamline and simplify the system to make it easier to understand and more cost effective.

  Date

  Minister

  Destination

  Purpose

  Cost

  23 September

  Keith Bradley

  Brussels

  To exchange views on the likely agenda in the social security policy area for the UK Presidency of the EU.

  £1,499

  8 October

  Keith Bradley

  Bonn

  £1,418

  12–14 October

  Joan Ruddock

  Venice

  To attend a conference on "women in decision-making".

  £1,693

  1. The figures have been rounded to nearest pound.

  2. The figures include all related costs incurred by the Minister's party, which on each occasion included the Minister's Private Secretary and one other official.

  Mortgage Payments
  Mr. Blunt
  To ask the Secretary of State for Social Security if she will review the practice whereby Benefits Agency adjudication officers cannot approve new mortgages for disabled persons until mortgage funds are advanced in circumstances where building societies are refusing to advance mortgages without confirmation of income support funds. [14621]

  Mr. Keith Bradley
  Modernising the social security system is a key priority of the Government. The administration of Income Support is a matter for Peter Mathison, the Chief Executive of the Benefits Agency. He will write to the hon. Member.532

  Period

  Number of incapacity benefit appeals against disallowance received

  Number of appeals heard

  Percentage of appeals heard and decided in the claimant's favour

  April 1996 to March

  1997 100,703

  59,567

  44 per cent.

  Source:

  Benefits Agency and Independent Tribunal Service.

  Advertising (Disability Discrimination Act 1995)
  Mr. Burstow
  To ask the Secretary of State for Social Security if she will place in the Library the correspondence sent by her Department to the Advertising Standards Authority disputing their draft recommendation on the compliant made by Ms Liz Lynne, about the national press advertisement for the Disability Discrimination Act 1995. [14809]

  Mr. Denham
  The information, with a copy of the final adjudication, has been placed in the Library.

  Overseas Travel
  Mr. Malcolm Bruce
  To ask the Secretary of State for Social Security if she will list each of the overseas trips made by herself and other members of her ministerial team since 2 May, specifying in each case(a) the participating Minister or Ministers, (b) the destination of the trip, (c) the purpose of the trip and (d) the cost of the trip; and if she will make a statement. [15224]

  Mr. Field
  The information is in the table.

  The Government intend to work constructively with their EU partners-member states, the Parliament and the Commission. These visits help prepare for a successful UK Presidency of the EU in 1998.

  Letter from Peter Mathison to Mr. Crispin Blunt, dated 10 November 1997:
  The Secretary of State for Social Security has asked me to reply to your recent Parliamentary Question asking if she will review the practice whereby Benefits Agency (BA) adjudication officers (AOs) cannot approve new mortgages for disabled persons until mortgage funds are advanced in circumstances where building societies are refusing to advance mortgages without confirmation of Income Support (IS) funds.
  Decisions on individual entitlement to Social Security benefits are made by independent adjudication authorities. In order to make a decision an AO needs to consider the actual facts of the case. It is not possible to give a decision based on hypothetical circumstances. BA staff can however give advice on the rules that will be applied if a mortgage is taken out.

  533
  The current arrangements generally work well by giving customers a good indication of the help they may received if their circumstances change, while protecting the right of the AO to make a decision on the facts as they change. There are no plans therefore to review this practice.
  I hope you find this reply helpful.

CABINET OFFICE

  Millennium Dome
  Mr. Marshall-Andrews
  To ask the Minister without Portfolio (1) if he will provide details of the estimated total fees payable to(a) the Richard Rogers Partnership and (b) M and C Saatchi in relation to the millennium dome project; [12999]

  (2) what is the estimated quantum of financial payment due to Kock Hightec by or on behalf of New Millennium Experience Company in relation to the millennium dome exhibition; [12995]

  (3) if he will list the terms and conditions of contract between the New Millennium Experience Company and Koch Hightec regarding (a) termination and (b) breach of contract. [12996]

  Mr. Mandelson
  The information sought is commercial in confidence and falls within that category of exemptions provided for in the Code of Practice on Access to Government Information (which applies equally to the Government's non-departmental public bodies and agencies). I consider that disclosure could harm the competitive position of the companies concerned and could be disadvantageous to the New Millennium Experience Company in any future competitions for contracts where the equipment, goods or services sought might be similar, in any way, to those covered by the contracts referred to.

  Mr. Marshall-Andrews
  To ask the Minister without Portfolio on whose behalf he holds the single share in New Millennium Experience Company. [12994]

  Mr. Mandelson
  I hold the sole share of the New Millennium Experience Company Ltd. on behalf of the Government.

  Mr. Marshall-Andrews
  To ask the Minister without Portfolio (1) when the New Millennium Experience Company will publish its next set of accounts; [13001]

  (2) when the New Millennium Experience Company will place interim company accounts in the Library. [13002]

  Mr. Mandelson
  The New Millennium Experience Company (NMEC), then named Millennium Central Limited, became operative on 12 February 1997 when its first Board meeting was held. On the same date the shares of the company were transferred to the then Chancellor of the Duchy of Lancaster and the company became subject to the normal controls applied by the Government to non-departmental public bodies (NDPB). The NMEC is required to produce its first Accounts and Annual Report for the period 12 February 1997 to 31 March 1998 and to submit them to the Shareholder by 30 September 1998. In line with policy applying to all NDPBs, the NMEC's Accounts and Annual Report will be published and copies will be placed in the Library of the House.
  534
  Mr. Marshall-Andrews
  To ask the Minister without Portfolio (1) if he will set out the tendering procedures which applied to the appointment of Birdair as contractors for the millennium dome project; [12997]

  (2) if he will set out the tendering procedures which applied to the appointment of M and C Saatchi as contractors for the millennium dome project. [13000]

  Mr. Mandelson
  The procedures applied to the Birdair and to the M & C Saatchi contracts were those which the New Millennium Experience Company (NMEC) is required to adopt for the procurement of all contracts for equipment, goods or services and which apply to all non-departmental public bodies. The NMEC must seek to obtain the best value for money, and must award contracts on a competitive basis unless it can show in a particular case that it can achieve better value for money by not doing so, or there are other compelling reasons for not doing so. The NMEC must also comply with European Community Directives governing tendering and contractual procedures and with any additional guidance that the Shareholder, or the Millennium Commission under the terms of its grant, may issue.

HEALTH

  NHS Trusts
  Ms McCafferty
  To ask the Secretary of State for Health what criteria govern the qualifications and experience required for membership fo NHS trusts. [13820]

  Mr. Milburn
  The Government's new criteria are designed to make boards more representative of the communities they serve and to encourage more National Health Service users and carers to become board members. Candidates should live in the area served by the trust, and demonstrate a commitment to the NHS and to the local community.

  Mr. Drew
  To ask the Secretary of State for Health in respect of which projects the extra money made available for the NHS in the 1997 Budget has been allocated. [13828]

  Mr. Milburn
  The additional resources will be used to help hospitals cope with emergencies, reduce delays in discharge, support primary, community and social care services to keep people out of hospital where possible and begin to restrain the growth in waiting lists. The resources represent an investment for the long term in making the whole health and social services system work better in the future.

  Mr. Skinner
  To ask the Secretary of State for Health if he will make a statement on the regional distribution of the extra funding which he is providing for the NHS over the winter period. [13835]

  Mr. Milburn
  Distribution to the eight regional offices has been made on a basis pro-rata to the allocations that their health authorities received for 1997–98. This has given fair regional shares within which the resources can be targeted quickly at areas with greatest need.
  535
  Mr. Mitchell
  To ask the Secretary of State for Health what proposals he has for removing the market forces factor from NHS financial allocations. [13838]

  Mr. Milburn
  We acknowledge that there are concerns in the National Health Service over the way the current market forces factor (MFF) operates.

  We have asked the new Advisory Committee on Resource Allocation to undertaken a full review of the staff MFF.

  For 1998–99 the staff MFF component of the weighted capitation formula has been modified.

  GP Commissioning Guidance
  Mr. David Taylor
  To ask the Secretary of State for Health if he will make a statement on GP commissioning guidance for 1998–99. [13830]

  Mr. Milburn
  In early September, we published guidance on the new approach to commissioning for 1998–99. This marked the transition from divisive, bureaucratic contracting out to a new co-operative approach. This will pave the way for a White Paper which will replace the internal market with a framework for quality and fairness.

  NHS (East Surrey)
  Mr. Blunt
  To ask the Secretary of State for Health if he will make a statement on NHS provision in East Surrey. [13831]

  Mr. Milburn
  The provision of NHS services in East Surrey is a matter for East Surrey Health Authority to determine. They do this by working with local general practitioners, NHS trusts, other agencies and local people to ensure that national policies are implemented in a way which is sensitive to local needs.

  Barnsley Hospital
  Mr. Illsley
  To ask the Secretary of State for Health what representations he has received regarding the proposed private finance initiative refurbishment of catering facilities at Barnsley District General Hospital. [13832]

  Mr. Milburn
  The Outline Business Case to refurbish catering facilities at Barnsley District General Hospital was approved on 13 October. The Trust is now seeking to attract private sector capital for this scheme under the Private Finance Initiative and will advertise in the Official Journal of the European Communities within the next month.

  Dental Services
  Mr. Gordon Prentice
  To ask the Secretary of State for Health what response he has received to his investing in dentistry initiative; and when he will allocate the funding earmarked for the programme. [13833]

  Mr. Milburn
  Since the extra £9 million under the Investing in Dentistry initiative was announced in September, we have received eleven requests for funding from health authorities. Funds are being allocated as decisions are made on each proposal submitted.
  536
  Mr. Gill
  To ask the Secretary of State for Health what representations he has received from the Shropshire health authority regarding NHS dentistry in South Shropshire. [13843]

  Mr. Milburn
  None.

  NHS Bureaucracy
  Mr. Lepper
  To ask the Secretary of State for Health what action he is taking to transfer money from NHS bureaucracy into patient care. [13834]

  Mr. Caplin
  To ask the Secretary of State for Health what are his priorities for reducing bureaucracy in the NHS. [13837]

  Mr. Milburn
  On 22 May, we announced a programme of measures to reduce management costs by £100 million this year. We will shortly announce further target reductions for 1998–99.

  As part of our plans to replace the internal market, we are looking at the scope for further management costs saving.

  Local Health Strategies
  Dr. Starkey
  To ask the Secretary of State for Health what action he is taking to promote local health strategies in respect of public health. [13836]

  Ms Jowell
  Our forthcoming Green Paper,Our Healthier Nation, will emphasise the need for action at all levels-individual, local, and Government-to bring about improvements in health. Local level is where national policies are translated into practice. Joint working will be crucial to help us achieve the goals for improving health.

  NHS Surgeons
  Mr. Flynn
  To ask the Secretary of State for Health what new proposals he has to identify incompetence among NHS surgeons. [13839]

  Mr. Milburn
  The law bringing into force the General Medical Council's professional performance procedures, which affect all doctors, was implemented on 1 July 1997 and we will shortly be issuing guidance to the National Health Service on its role in these procedures.

  In addition, the Chief Medical Officer has written to all Chief Executives and Medical Directors of NHS trusts asking them to ensure that they have effective procedures in place for doctors to report their concerns about the conduct, performance or health of medical colleagues. This builds on the General Medical Council's guidance in Duties of a Doctor which requires all doctors to:
  "act quickly to prevent patients from risk if you have good reason to believe you or a colleague may not be fit for practise".

  The effectiveness of these new procedures will be kept under review.

  Tobacco Advertising
  Mr. Syms
  To ask the Secretary of State for Health when he expects to publish the White Paper on the intended banning of tobacco advertising. [13840]
  537
  Ms Jowell
  The White Paper on tobacco control, which will include plans to ban tobacco advertising, will be published next year.

  Waiting Lists
  Mr. Chidgey
  To ask the Secretary of State for Health what actions he plans to take to reduce waiting lists in Winchester and Eastleigh in the next 12 months. [13841]

  Mr. Milburn
  We expect health authorities and trusts to work together to reverse the trend in runaway growth in waiting lists and times that we inherited from the previous Government. This will take time but the extra £269 million we have re-assigned for the National Health Service in England for 1997-98, the extra £1 billion for next year announced by my right hon. Friend the Chancellor of the Exchequer in July and the further cuts in NHS bureaucracy to be announced shortly will help.

  Rev. Martin Smyth
  To ask the Secretary of State for Health if he will make a statement on the pattern of waiting lists throughout the United Kingdom, indicating the top three regions and specialties where the lists are greatest.

  Mr. Spring
  To ask the Secretary of State for Health when he expects to meet his targets to reduce NHS waiting lists. [13812]

  Mr. Milburn
  In England we inherited runaway growth in waiting lists from our predecessors. The £269 million we have re-directed to the National Health Service in England for 1997-98 and the extra £1 billion for next year announced by my right hon. Friend the Chancellor of the Exchequer in July will help health authorities and trusts to begin to restrain that growth. The latest available information about waiting lists in individual regions and specialties is contained in "Hospital Waiting List Statistics: England (Resident Based) Quarter ended 30 June 1997", copies of which are available in the Library. Questions relating to Wales, Scotland and Northern Ireland are matters for my right hon. Friends the Secretaries of State for Wales, Scotland and Northern Ireland, respectively.

  Trust Mergers
  Mr. Rooney
  To ask the Secretary of State for Health what advice he has given to health authorities on mergers of trusts. [13842]

  Mr. Milburn
  Mergers between National Health Service trusts are a matter for local consideration. Each proposal will be considered on its individual merits, taking into account the views of local people and staff.

  I announced on 22 September that, if they are to proceed, trust mergers must show demonstrable improvements in patients services and will be expected to deliver a minimum of £½ million savings in bureaucracy within the first two years.

  Smoking
  Mr. Campbell-Savours
  To ask the Secretary of State for Health what estimate he has made of the cost to the NHS of smoking. [13844]
  538
  Ms Jowell
  Based on 1992 figures, the Health Education Authority's report "The Smoking Epidemic-A Prescription for Change", estimated that the annual cost to the National Health Service of treating smoking-related diseases is £610 million. However, we understand that the Health Education Authority intend to publish more up-to-date figures shortly.

  Bedblocking
  Mr. Amess
  To ask the Secretary of State for Health if he will make a statement on his proposals to tackle problems associated with bedblocking. [13845]

  Mr. Boateng
  There is nothing new about problems around hospital discharge and "bedblocking" and it is crucial that hospitals and social services departments work together to ensure that integrated and sensitive hospital discharge arrangements are in place for people with longer-term care needs. We recognise that much hard work has already gone into improving joint working in this area, but believe that there are still improvements that can be made in most places. As one part of the concerted effort my right hon. Friend the Secretary of State for Health has asked the National Health Service, social services and housing departments to tackle the pressures on health and local authority services which we expect as winter approaches, we expect hospital discharge arrangements to deliver an effective and timely outcome for patients, particularly for those who need community care support.

  My right hon. Friend the Secretary of State for Health has written to Chairmen of health authorities, NHS trusts and leaders of councils outlining our plans for the extra £269 million funding for the NHS in England which was announced on 14 October. The new money is a key step in the Government's strategy to provide better care for older people for improving collaborative working between health and social care services and by tackling winter pressures in the NHS. One of our three priorities for the new money is the provision of more rehabilitation and recuperation services, home care and extra places in care homes to reduce delays in discharging patients from hospital.

  In addition to tackling difficult and sort-term problems we are determined in the medium and longer-term to ensure that such problems do not constantly occur and to help all concerned to improve their work across the boundary between health and social care. We will also be issuing revised guidance on hospital discharge procedures.

  NHS Staff Safety
  Mr. Darvill
  To ask the Secretary of State for Health what action he is taking to improve levels of safety for NHS staff. [13846]

  Mr. Milburn
  The Government place a very high priority on the safety of National Health Service staff. The NHS Chief Executive has written to health authority and NHS trust chief executives asking them to place issues of health and safety at the top of their agendas; the NHS Executive has also sponsored a series of Health and Safety roadshows for NHS senior management. We will be encouraging and promoting the formation of networks for the exchange of good practice in this area.
  539
  The Government have issued guidance to the NHS on ways to cut down on attacks on staff in accident and emergency departments. Also, the Health and Safety Commission will publish "Violence to Staff in Health Services: Guidance on Assessment and Management" before the end of the year, covering all parts of the NHS. The forthcoming NHS Charter will stress patients' responsibilities as well as rights, including the responsibility not to assault NHS staff. Those who assault staff should be appropriately punished.

  Racism
  Mr. Chaytor
  To ask the Secretary of State for Health what action he is taking to tackle racism in the NHS. [13847]

  Mr. Milburn
  We announced a programme of concrete measures to tackle inequality, discrimination and racism in the National Health Service in recent speeches made to Unison on 7 October and to NHS leaders at the launch of the Commission for Racial Equality's "Leadership Challenge" in the NHS on 21 October. We have also put extra funding of £200,000 into specific activities to combat racism.

  Welfare-to-work Scheme
  Mr. Brady
  To ask the Secretary of State for Health what guidelines he has set out regarding the participation of health authorities and trusts in the Government's welfare-to-work scheme.[13825]

  Mr. Milburn
  We are currently consulting with the Department of Education and Employment to consider the most effective way in which the National Health Service can play a useful role in providing employment opportunities for the unemployed. As the largest employer in Europe, we expect the NHS to play a significant role in the Welfare-to-Work initiative.

  Cold-related Illnesses
  Mr. Evans
  To ask the Secretary of State for Health (1) what have been the excess winter treatment rates for cold-related illnesses in hospitals in(a) Lancashire, (b) Cornwall, (c) Tyneside and (d) Suffolk for (i) in-patients and (ii) out-patients for each of the last 10 years; [14260]

  (2) how many people in (a) Lancashire, (b) Cornwall, (c) Tyneside and (d) Suffolk received treatment by NHS doctors for cold-related illnesses in (i) December 1996 and (ii) January 1997; and what was the average figure for these months in each of the last 10 years; [14261]

  (3) how many people in (a) Lancashire, (b) Cornwall, (c) Tyneside and (d) Suffolk received hospital treatment as (i) in-patients and (ii) out-patients, for cold-related illnesses in (1) December 1996 and (2) January 1997; and what was the average figure for these months in each of the last 10 years. [14262]

  Mr. Boateng
  For the purpose of these questions "cold-related illnesses" have been defined as pneumonia, influenza, bronchitis and hypothermia.

  The information available is shown in the attached tables. Information is available only for hospital in-patients and is collected by health authority. Health
  540
  authority boundaries may not coincide exactly with county boundaries. The latest information available is for the year 1994–95. Information prior to 1989–90 is not held in comparable form.

  Information is not collected specifically on "excess winter treatment rates" but figures are provided for July and August each year for comparison with December and January.

  "Cold related illnesses" admitted to hospital by primary diagnosis and selected health authority of residence; Estimated number of Finished Consultant Episodes (FCEs), ordinary admissions and day cases combined, NHS hospitals.

  Source:

  Department of Health, Hospital Episode Statistics (HES).

  ICD9 Codes: Pneumonia 480–486, Influenza 487, Bronchitis 490–491, Hypothermia 991.6.

  Data in these tables are grossed for both coverage and unknown/invalid clinical data.

  Lancashire

  Month

  Pneumonia

  Influenza

  Bronchitis

  Hypothermia

  Total

  July 1989

  128

  1

  42

  0

  171

  August 1989

  122

  2

  39

  0

  163

  December 1989

  343

  49

  81

  4

  477

  January 1990

  200

  12

  71

  4

  287

  July 1990

  151

  2

  42

  0

  195

  August 1990

  105

  1

  35

  0

  141

  December 1990

  227

  2

  62

  5

  296

  January 1991

  214

  3

  48

  9

  274

  July 1991

  132

  0

  26

  0

  158

  August 1991

  120

  1

  27

  0

  148

  December 1991

  213

  7

  50

  1

  271

  January 1992

  223

  9

  45

  4

  281

  July 1992

  93

  0

  44

  0

  137

  August 1992

  105

  0

  15

  0

  120

  December 1992

  185

  2

  26

  2

  215

  January 1993

  187

  2

  41

  5

  235

  July 1993

  128

  0

  22

  0

  150

  August 1993

  117

  0

  12

  2

  131

  December 1993

  248

  28

  53

  4

  333

  January 1994

  266

  5

  53

  7

  331

  July 1994

  125

  1

  19

  0

  145

  August 1994

  129

  0

  30

  1

  160

  December 1994

  285

  3

  53

  6

  347

  January 1995

  265

  2

  47

  5

  319

  July 1990 to January 1994 Blackpool, Wyre and Fylde DHA, Preston DHA, Blackburn, Hyndburn, Ribble DHA, Burnley, Pendle and Rossendale DHA, West Lancashire DHA, Chorley and South Ribble DHA.

  July 1994 to January 1995 East Lancashire DHA, North-West Lancashire DHA, South Lancashire DHA.

  Cornwall

  Month

  Pneumonia

  Influenza

  Bronchitis

  Hypothermia

  Total

  July 1989

  44

  0

  5

  0

  48

  August 1989

  19

  2

  5

  0

  25

  December 1989

  155

  46

  25

  5

  230

  January 1990

  71

  6

  8

  0

  86

  July 1990

  37

  0

  7

  0

  44

  August 1990

  27

  0

  7

  0

  34

  December 1990

  69

  0

  26

  6

  101

  January 1991

  82

  1

  20

  2

  105

  July 1991

  56

  1

  12

  0

  69

  August 1991

  49

  0

  2

  2

  53

  541

  Cornwall

  Month

  Pneumonia

  Influenza

  Bronchitis

  Hypothermia

  Total

  December 1991

  74

  3

  10

  3

  90

  January 1992

  84

  7

  9

  2

  102

  July 1992

  42

  1

  2

  1

  46

  August 1992

  36

  1

  7

  1

  45

  December 1992

  61

  0

  7

  8

  76

  January 1993

  58

  2

  8

  1

  69

  July 1993

  51

  0

  4

  0

  55

  August 1993

  43

  2

  4

  1

  50

  December 1993

  90

  8

  5

  1

  104

  January 1994

  78

  4

  3

  1

  86

  July 1994

  38

  0

  9

  0

  47

  August 1994

  42

  0

  6

  0

  48

  December 1994

  71

  2

  6

  0

  79

  January 1995

  87

  0

  5

  5

  97

  Cornwall and Isles of Scilly Health Athority.

  Suffolk

  Month

  Pneumonia

  Influenza

  Bronchitis

  Hypothermia

  Total

  July 1989

  68

  0

  6

  0

  75

  August 1989

  43

  0

  4

  0

  47

  December 1989

  159

  28

  8

  8

  202

  January 1990

  125

  6

  10

  1

  143

  July 1990

  125

  6

  3

  0

  70

  August 1990

  39

  0

  3

  0

  42

  December 1990

  145

  4

  22

  3

  174

  January 1991

  162

  5

  20

  8

  195

  July 1991

  52

  0

  22

  0

  74

  August 1991

  39

  1

  19

  0

  60

  December 1991

  107

  2

  31

  6

  146

  January 1992

  103

  1

  24

  4

  132

  July 1992

  48

  0

  10

  0

  58

  August 1992

  41

  0

  11

  1

  53

  December 1992

  77

  1

  25

  8

  111

  January 1993

  85

  0

  34

  2

  121

  July 1993

  62

  0

  7

  9

  69

  August 1993

  49

  0

  34

  0

  83

  December 1993

  91

  6

  17

  2

  116

  January

  108

  0

  18

  4

  130

  July 1994

  44

  0

  14

  0

  58

  August 1994

  70

  0

  4

  1

  75

  December 1994

  134

  2

  17

  4

  157

  January 1995

  100

  1

  7

  4

  112

  July 1989 to January 1993 West Suffolk DHA and East Suffolk DHA. July 1993 to January 1995 Suffolk DHA.

  Tyneside

  Month

  Pneumonia

  Influenza

  Bronchitis

  Hypothermia

  Total

  July 1989

  91

  7

  14

  1

  113

  August 1989

  70

  0

  7

  0

  77

  December 1989

  196

  21

  18

  3

  239

  January 1990

  123

  4

  10

  2

  139

  July 1990

  86

  4

  7

  0

  97

  August 1990

  90

  0

  8

  2

  100

  December 1990

  128

  1

  8

  3

  140

  January 1991

  156

  4

  12

  5

  177

  July 1991

  112

  2

  9

  9

  123

  August 1991

  89

  0

  4

  1

  94

  December 1991

  221

  12

  11

  4

  248

  January 1992

  215

  24

  14

  4

  257

  July 1992

  107

  0

  3

  0

  110

  August 1992

  64

  1

  5

  1

  71

  December 1992

  159

  0

  6

  2

  167

  January 1993

  160

  1

  13

  1

  175

  542

  Tyneside

  Month

  Pneumonia

  Influenza

  Bronchitis

  Hypothermia

  Total

  July 1993

  120

  3

  1

  0

  124

  August 1993

  96

  1

  5

  0

  102

  December 1993

  161

  25

  15

  4

  205

  January 1994

  189

  10

  10

  3

  212

  July 1994

  104

  1

  8

  0

  113

  August 1994

  129

  0

  3

  1

  133

  December 1994

  175

  1

  9

  7

  192

  January 1995

  199

  1

  3

  8

  211

  July 1989 to January 1994 Gateshead DHA, Newcastle DHA. North Tyneside DHA, South Tyneside DHA.

  July 1994 to January 1995 Newcastle and North Tyneside DHA, South of Tyne DHA.

  Blood Donation
  Dr. Harris
  To ask the Secretary of State for Health what plans the National Blood Authority has to introduce a system of informed consent for blood donors, with particular reference to use of blood in(a) the private sector and (b) through overseas sales. [15586]

  Mr. Boateng
  Information for blood donors explains that donations are primarily used for National Health Service patients but that reasonable requests for blood for patients in the private sector are met and that blood products are sold overseas when demand in this country has been satisfied.

  Dr. Harris
  To ask the Secretary of State for Health if the National Blood Authority is required to hold an open annual general meeting. [15578]

  Mr. Boateng
  This is not currently required. We are considering the preparation of Regulations to extend the list of bodies to which the Public Bodies (Admissions to Meetings) Act 1960 applies.

  Dr. Harris
  To ask the Secretary of State for Health if the recommendations made by Professor John Cash on the future of the National Blood Service will be the subject of further consultation; and if he will make a statement. [15575]

  Mr. Boateng
  Professor Cash is carrying out a clinical review of the blood services for Merseyside and the surrounding area. We will consider next steps when we receive the report.

  GP Fundholding
  Dr. Tonge
  To ask the of State for Health how many patients were referred by fundholding GPs to the private sector for secondary health care in the last year for which figures are available. [14831]

  Mr. Milburn
  In 1996–97, general practitioner fundholders spent £71.5 million (2.7 per cent. of their total expenditure) outside the National Health Service.

  A circular covering the priorities and planning guidance for 1998–99 requires health authorities, general practitioner fundholders and trusts to explore the scope to make maximum cost effective use of local NHS capacity before contemplating recourse to private sector hospital providers and, where care is nonetheless commissioned from private hospitals, to report the reasons to the regional office.

  Health Service Managers
  Dr. Tonge
  To ask the Secretary of State for Health how many NHS manages have had their jobs redesignated onto nursing or medical pay scales since 1 May. [14833]

  Mr. Milburn
  The information requested is not collected centrally.

  NHS Spending
  Mr. Malcolm Bruce
  To ask the Secretary of State for Health what is his current estimate of the annual real increase in NHS spending for each year from 1978–79 to 1998–99; and if he will make a statement. [13234]

  Mr. Milburn
  [holding answer 4 November 1997]: The answer is set out in the table.

  Real growth in NHS total expenditure (England)

  Gross expenditure

  Net expenditure

  Year1

  Real growth2 £ million (1996–97 prices)

  Percentage real2 growth

  Real growth2 £ million ((1996–97 prices)

  Percentage real2 growth

  1978–79

  615

  3.2

  299

  1.6

  1979–80

  368

  1.8

  332

  1.7

  1980–81

  2,065

  10.1

  1,979

  10.1

  1981–82

  505

  2.2

  437

  2.0

  1982–83

  412

  1.8

  364

  1.7

  1983–84

  341

  1.5

  230

  1.0

  1984–85

  567

  2.4

  492

  2.2

  1985–86

  59

  0.2

  56

  0.2

  1986–87

  1,068

  4.4

  903

  3.9

  1987–88

  1,138

  4.5

  1,036

  4.3

  1988–89

  1,121

  4.2

  890

  3.5

  1989–90

  193

  0.7

  206

  0.8

  1990–91

  1,016

  3.6

  1,078

  4.1

  1991–92

  1,864

  6.4

  1,841

  6.7

  1992–93

  1,611

  5.2

  1,712

  5.9

  1993–94

  181

  0.6

  170

  0.6

  1994–95

  1,184

  3.6

  1,259

  4.1

  1995–96

  639

  1.9

  564

  1.7

  1996–97

  224

  0.7

  203

  0.6

  1997–983

  584

  1.7

  615

  1.9

  1998–994

  402

  1.1

  547

  1.6

  11978–79 to 1996–97 are outturn figures, 1997–98 is forecast outturn and 1998–99 is planned expenditure.

  2 Using GDP deflator of 2 July 1997.

  3Forecast outturn for 1997–98 includes the extra resources announced for this winter on 14 October.

  4 Planned expenditure for 1998–99 includes the extra £1 billion announced at the 2 July Budget.

  Private Finance Initiative
  Mr. Boswell
  To ask the Secretary of State for Health what progress is being made to increase capital spending in the NHS through the private finance initiative. [14062]
  544
  Mr. Milburn
  The prioritisation of major acute hospital Private Finance Initiative projects and the passing of the National Health Service (Private Finance) Act 1997 in July have resulted in the first two major PFI schemes at Dartford and Gravesham (£115 million) and Carlisle (£87 million) reaching financial close. The other 13 prioritised PFI projects are in the process of having timetables agreed to ensure they all reach financial close by the end of 1998.

  Overseas Travel
  Mr. Malcolm Bruce
  To ask the Secretary of State for Health if he will list each of the overseas trips made by himself and other members of his ministerial team since 2 May, specifying in each case(a) the participating Minister or Ministers, (b) the destination of the trip, (c) the purpose of the trip and (d) the cost of the trip; and if he will make a statement. [15220]

  Ms Jowell
  Information on the dates, destinations, purpose and cost of overseas visits made by my right hon. Friend and ministerial colleagues since 2 May 1997 is shown in the table.Secretary of State for Health: None
  Minister of State for Health—Alan Milburn: None
  Minister of State for Lords—Baroness Jay: None.

  Minister of State for Public Health—Tessa Jowell

  Date

  Destination

  Purpose

  Cost £

  3 June 1997

  Amsterdam

  Travel with EU Ministers

  1,217

  4 June 1997

  Luxembourg

  EU Health Council

  1,490

  9 July 1997

  Brussels

  To discuss tobacco advertising

  494

  26-28 September 1997

  Italy

  Pontignano conference and relations in Europe—welfare reform, single currency and relations in Europe

  273

  30 October 1997

  Brussels

  To meet Members of European Parliament

  275

  Parliamentary Under-Secretary of State—Paul Boateng

  Date

  Destination

  Purpose

  Cost

  4-6 June 1997

  Brussels

  European Social Services Conference

  950

  16-18 June

  Brussels/ Vienna

  Council of Europe— Family Affairs

  1,300

  26-28 September

  Italy

  Pontignano Conference

  Full cost not yet known

  23-25 September

  Brussels

  International Young Peoples Conference

  Full cost not yet known

Preamble
The House met at a quarter past two of the clock: The LORD CHANCELLOR on the Woolsack.
Prayers—Read by the Lord Bishop of Birmingham.

Lord Jacobs
Sir David Anthony Jacobs, Knight, having been created Baron Jacobs, of Belgravia in the City of Westminster, for life—Was, in his robes, introduced between the Lord Wigoder and the Lord Steel of Aikwood.
Lord Naseby
The Right Honourable Michael Wolfgang Laurence Morris, having been created Baron Naseby, of Sandy in the County of Bedfordshire, for life—Was, in his robes, introduced between the Lord Pym and the Lord Weatherill.

Lord Newton of Braintree
The Right Honourable Antony Harold Newton, OBE, having been created Baron Newton of Braintree, of Coggeshall in the County of Essex, for life—Was, in his robes, introduced between the Baroness Platt of Writtle and the Lord Dixon-Smith.
The Duke of Northumberland—Took the Oath.

Foreign Language Tuition
2.50 p.m.
Lord Quirkasked Her Majesty's Government:
What action they will take to increase the learning of foreign languages.
The Minister of State, Department for Education and Employment (Baroness Blackstone): My Lords, all secondary school pupils in England and Wales are required to learn a modern foreign language. In 1996, 437,000 15 year-olds attempted a GCSE in a modern foreign language. We continue to support language learning through grant-in-aid to the Centre for Information on Language Teaching and Research. Under the specialist schools initiative 47 secondary schools have been designated language colleges, and more are planned.
Lord Strabolgi: My Lords—
Noble Lords: Order! Order!
Lord Quirk: My Lords, I am grateful to the Minister for that encouraging reply. However, does she share my concern that we still in this country teach only one foreign language to any serious degree or to any great numbers, and that since 1992, despite a general and very much welcomed increase in the stay-on rate for 16 year-olds, the numbers taking foreign languages after 16 has actually declined absolutely during that period? Perhaps I may therefore refer the Minister to three relevant initiatives in the July White Paper (Excellence in Schools, paragraphs 4.14, 7.35, and 6.32). I ask in consequence that the Government ensure that those 47 specialist language schools to which the Minister referred, which are happily well distributed regionally, will share their enthusiasm and expertise with neighbouring schools; that independent schools do likewise for state schools in their area; and that business partners like Rover-BMW do something to urge upon youngsters the importance for their careers of language proficiency, if only for job mobility in the single market?
Baroness Blackstone: My Lords, the noble Lord made a number of points. Let me begin by saying that while the vast majority of pupils study French in our secondary schools (last year 324,000 children entered for GCSE in French) there were also 130,000 examination entries in German and 40,000 in Spanish. There are 19 languages recognised in the national curriculum, of which eight are EU languages, and there are 11 others, including Arabic, Bengali, Gujurati, Hindi, and so on. There is a broad range. I very much endorse what the noble Lord said about the role of the 47 specialist schools. It is important that they work and collaborate with other schools in their communities, and perhaps support children who may not go to those schools but who discover that they have a particular propensity for modern language learning and want to study languages, and are therefore able to do some of their courses in those specialist schools. On the business sector, it is very much up to employers to decide what skills they want from their employees. I am sure that there will be more employers wanting to take on employees in the single market who are proficient in a European language.
Lord Strabolgi: My Lords, I apologise to the noble Lord, Lord Quirk. I should like to ask my noble friend who has talked about the secondary stage what the Government are doing to expand the teaching of modern languages at the primary stage? Is she aware that in France at the ages of seven and eight schoolchildren learn one modern language and that at nine and 10 they can take a second modern language? Are the Government going to try to attain that sort of standard in future?
Baroness Blackstone: My Lords, there has been an increase in the number of primary schools able to teach a foreign language. I think about 20 per cent. of primary school pupils are getting some exposure to modern language teaching at the primary level. It would be desirable were we able to increase that proportion, but we have to take into account the resources needed to do that.

83
There would be considerable resource and organisational implications. We do not currently have enough language teachers, so we would have to start a major language teacher training programme. There is a shortage of language teachers at the secondary stage, which the Government inherited and are trying to address. It is important that we get that right before we embark upon a big expansion in primary schools. I note what my noble friend said about its desirability.
Baroness Hooper: My Lords, given that after English Spanish is the second most spoken language in the world and Portuguese is the third, as a first language, will the Minister assure us that sufficient emphasis will be given to those languages in the national curriculum?
Baroness Blackstone: My Lords, both Spanish and Portuguese are listed as national curriculum languages. It is up to the schools, their governing bodies, and teachers in discussion with parents, to decide which languages they shall teach. There has been a growth in the teaching of Spanish. I do not believe that many pupils at the secondary stage learn Portuguese. However, as I said, it is a matter for the schools to decide which languages they want to promote. There is a long historical tradition of pupils learning French. The French are still our nearest neighbours.
Lord Hooson: My Lords, as one who learnt English, as did many others in Wales, as a second language at primary school, perhaps I may reinforce the suggestion that it would probably be a good investment for this country, even at this stage, to ensure that the teachers are available to teach a foreign language at primary school, because it is so much easier for the pupils.
Baroness Blackstone: My Lords, I strongly endorse the fact that learning a foreign language early is a good idea, because young children pick up languages quickly. We have to have continuity between primary and secondary schools, which means that we have to be sure that the language a child has learnt in the primary school is the same as the languages taught in the secondary school to which it goes. Otherwise, we shall find ourselves in the situation where children are being asked to start all over again at the secondary level. That is the kind of considerable organisational problem which would have to be addressed.
Lord Taylor of Blackburn: My Lords, is my noble friend aware that in the good and balmy days of education in the 1970s, under an enlightened chairman and progressive education authority—namely, Blackburn—we started a primary project of having peripatetic language teachers going around to all our schools? All the schools in that enlightened authority managed to get a reasonable amount of foreign languages taught within the primary sector. Does she contemplate that it will ever be possible to achieve that again?
Baroness Blackstone: My Lords, let me congratulate my noble friend on the enlightened policies of the local
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authority with which he was associated. There is a wish to try to develop language schools in primary schools, but it is important to ensure that what we are doing at the secondary stage is adequate. There has been a slight drop in the number of students taking A-level languages over the past couple of years. We need to get that back up. It is a matter of where our priorities lie.

Devolution
2.59 p.m.
Lord Ellenboroughasked Her Majesty's Government:
Whether they have any proposals for a referendum to be held on the establishment of a parliament for England.
The Parliamentary Under-Secretary of State, Home Office (Lord Williams of Mostyn): My Lords, we have no plans to establish a separate English parliament or to hold a referendum on the matter.
Lord Ellenborough: My Lords, I thank the Minister for that rather predictable reply. Does he recognise that the unity of the UK is imperilled by growing English awareness of and resentment at the discrimination shown by the Government? Why is England alone not offered any form of comparable home government? Why was England not consulted about any other aspects of devolution in other parts of the UK? Why are the Government treating England not so much as a nation but as a group of regions?
Can the Minister say whether, once a Scottish parliament has been established and the Welsh assembly set up, assuming that it ever is, it is the Government's intention that there should be 110 Scots and Welsh MPs voting on English domestic affairs, not just for this Parliament but for the whole of the next Parliament also?
Lord Williams of Mostyn: My Lords, I am glad that my Answer was predictable. It may derive from the proposition that I do not believe that at the last election the political platform of any party put before the electorate was that there should be a parliament for England. It bears repetition that this Government are fully committed to the continued integrity of the United Kingdom. We believe firmly and strongly that the devolved—
Lord Hailsham of Saint Marylebone: Assemblies!
Lord Williams of Mostyn: My Lords, I am obliged to the noble and learned Lord, Lord Hailsham, who always helps me on these occasions. We believe that the devolved assemblies willcontribute to that continued integrity. England is in no way being disregarded or overlooked.
Lord Ewing of Kirkford: My Lords, will the Minister accept that I share his commitment to the integrity of the United Kingdom? As a Scotsman, I ask a Welshman why the English want a referendum on a parliament for England when they already have one.
Lord Williams of Mostyn: My Lords, as a Welshman replying to a Scotsman, I cannot pretend to understand the unfathomable depths of the English mind.
The Earl of Lauderdale: My Lords, will the noble Lord—
Lord Carter: My Lords, perhaps we should take a question from the Cross Benches.
Lord Hylton: My Lords, is it not the English regions rather than England as a whole which stand in need of democratic institutions to control their numerous quangos and so forth?
Lord Williams of Mostyn: My Lords, there is a vast amount to be done to control the quangos set up and abused by our predecessors—if I may respectfully suggest it. That is why the Government have indicated their intention in due time to hold referendums on establishing directly elected regional assemblies in England, as the noble Lord, Lord Hylton, so rightly observes.
The Earl of Lauderdale: My Lords, do the Government intend to go ahead with the Welsh Assembly in view of the fact that they received only a 0.6 per cent. yes vote and only half the people voted?
Lord Williams of Mostyn: My Lords, it was not a 0.6 per cent. yes vote; it was 50.3 per cent. I hate to be careful about these things. It was perfectly plain, as was anticipated by many of us, that the Welsh electorate, being calm, unflustered and unhurried, took a mature decision to indicate what was appropriate; namely, a vote yes. I am pleased to think that the Conservative Opposition will be fighting the election so that they may have Conservative members in the new successful Welsh assembly.
Lord Dean of Beswick: My Lords, is the Minister—
Noble Lords: Lord Dean!
Lord Bruce of Donington: My Lords, does the noble Lord agree that, before we contemplate the setting up of another parliament, it would be wise to make sure that our own Parliament in Westminster ceases the process of losing its powers, which it has been doing for many years? Would it not be wise to restore some power to Westminster?
Lord Williams of Mostyn: My Lords, it is right that both Houses of Parliament are susceptible to useful reform, and we have that very much in mind.
Lord Dean of Beswick: My Lords, is the Minister—
Lord Mackay of Ardbrecknish: My Lords, perhaps I may help the Minister by reminding him that his own Government have decided that the Scottish body ought to be a parliament and not an assembly. Secondly, if we are to have referendums for various bodies to be set up in the regions of England, can we see the detailed legislation before the referendums and not have weeks passing with no sign of a Bill as is the case in respect of the Scottish and Welsh referendums?
Lord Williams of Mostyn: My Lords, these referenda, or referendums, as people will keep calling them—wrongly, I believe—must be looked at with great care. I am not sure whether it is the policy of the Conservative Opposition to have a referendum on the Treaty of Amsterdam. They have been a little silent on the matter lately. I take the noble Lord's point and, as always, will be eager to co-operate with him and the noble Lord, Lord Roberts of Conwy, whom I should have welcomed earlier as he will be dealing with constitutional and devolution matters in your Lordships' House. It is a great pleasure to all of us, myself in particular, to be able to welcome him.
Lord Dean of Beswick: My Lords, is the Minister—
Lord Simon of Glaisdale: My Lords
Lord Carter: My Lords, my noble friend Lord Dean has been trying to ask a question for some time. Perhaps we can then move on to the next Question.
Lord Dean of Beswick: My Lords, is the Minister aware that I feel it a great privilege to be one of the few Englishmen allowed to ask a question today on an English matter? Is the Minister also aware that I am one of those who look askance at the suggestion of holding a referendum in England on devolution, bearing in mind the shambles in Wales when only 50 per cent. voted, producing an extremely narrow majority after hyperactivity from the minority in Wales who were in favour? If the Government have any intention of holding a referendum in England, will the Minister do his best to dissuade them and persuade them to do away with this very expensive toy?
Lord Williams of Mostyn: My Lords, I am aware that the noble Lord looks askance at various things on various occasions. I do not agree with his description of the result in Wales. It was a majority of 50.3 per cent. after a very deeply considered argument and debate which has extended for about 50 years.
Lord Simon of Glaisdale: My Lords—
Lord Carter: My Lords, we are in the 17th minute and we should move on to the next Question.
Lord Simon of Glaisdale: My Lords, would not
Lord Carter: My Lords, perhaps the noble and learned Lord, Lord Simon of Glaisdale, would not mind giving way. We are now in the 17th minute of Question Time and it is time to move on to the third Question.

Legislation: Statements of Purpose
3.8 p.m.
Lord Lester of Herne Hill Lord Lester of Herne Hill asked Her Majesty's Government:
Whether they will instruct government departments and parliamentary counsel, when preparing legislation, to make clear the intention of Parliament by including statements of purpose as recommended by the Committee on the Preparation of Legislation (the Renton Report, Cmnd 6053, 1974-75).
Lord McIntosh of Haringey: My Lords, I welcome this Question. I regret only that we cannot do justice to it in the limited time available for Starred Questions. Perhaps the noble Lord will consider seeking an opportunity for fuller debate when the Government have had an opportunity to respond to the proposals of the modernisation committee.
Legislation should be as clear as possible, including a statement of purpose, which may sometimes assist clarity but not always. There are dangers. If the statement has legal effect and covers the same ground as later detailed provisions, there is a risk of real or apparent inconsistency. If the statement is not intended to have legal effect, the courts may give it some effect with unintended results. The Renton Report therefore concluded that purpose clauses should be used only "selectively and with caution" and the Hansard Society's 1992 report concluded that they should,
"not be adopted as a general practice".
Lord Lester of Herne Hill: My Lords, I thank the Minister for that open-minded and constructive Answer. In using the word "constructive" I do not intend some not-very-funny legal pun. Does the Minister agree—I believe that it follows from what he said—that it is important to ensure that the law is made as accessible as possible to the citizens and the courts, and that one useful way of doing that is by using a purpose clause, as was done, for example, in Section 1 of the Arbitration Act 1996, which is a rare and outstanding example? Will the Minister also agree with the noble and learned Lord, Lord Goff of Chieveley, in his Wilberforce Lecture last year, when he said:
"Even today, it is very difficult for us to persuade our draftsmen to adopt a more open-textured form of draftsmanship designed to identify the underlying principle"?
Lord McIntosh of Haringey: My Lords, I did not say, and the Government do not think, that there is never any advantage in purpose clauses. But there have been very few of them and I believe the noble Lord will agree that for every one that does work there are probably several that do not. The risk of confusion from having a separate statement on the same point is great. That is why both the committee of the noble Lord, Lord Renton, and the Hansard Society argued against it being a general practice.
Lord Mackay of Ardbrecknish: My Lords, does the Minister recall that a considerable amount of work has been done on proposals to simplify legislation and to
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make it more readily readable for the ordinary person and not just lawyers? That is an important way forward. Will the Minister agree with me further that the judgment in Pepper v. Hart means that the gloss, so to speak, put on legislation by Ministers at Dispatch Boxes in both Houses can be prayed in aid in order to understand what the Government intended in framing legislation?
Lord McIntosh of Haringey: My Lords, yes, of course, the pressure for clearer legislation must and will continue. There is no party political point in that regard. In relation to Pepper v. Hart, I remind the noble Lord that when the House of Lords decided that in November 1992, their Lordships said that courts should look at parliamentary materials when (1) legislation is ambiguous, obscure or leads to an absurdity; (2) the material to be relied on is a statement by a Minister; and (3) the statement is clear. Ministerial statements are not always clear.
Lord Renton: My Lords, is the noble Lord aware that too often the intention of Parliament must be inferred from the mass of detail in statutes, much of it being merely hypothetical? That recommendation referred to in the noble Lord's Question was perhaps the most useful and important recommendation made by our committee. I express the hope that the noble Lord will bear that in mind in order to achieve clarity for the benefit of the users of legislation.
Lord McIntosh of HaringeyMy Lords, I am delighted to have the noble Lord in his place and I pay tribute to his work and determination over the years. I am aware that his committee put forward the view that on occasion legislation should be declaratory rather than detailed, as is the case in many other countries. The noble Lord has put forward that view on a number of occasions since then. However, I do not believe that it has gained general acceptance. Most people think that it is more important for legislation to be precise and for Parliament rather than the courts to have the last word, so to speak. That is the risk of legislation which is purposive rather than detailed.

Ex-Prisoners of War: Payment Claims
3.13 p.m.
Lord Sempill Lord Sempill asked Her Majesty's Government
Why they will not pay to British officers who were prisoners of war between 1939 and 1945 the money which was deducted from their salaries during their captivity.
The Minister of State, Ministry of Defence (Lord Gilbert): My Lords, as I told my noble friend Lord Mason on 24th July, my honourable friend the Parliamentary Under-Secretary of State, after detailed consideration of this very difficult question, found that the contemporary evidence relating to pay deductions for officer prisoners of war and protected personnel during the Second World War and to the repayments

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made to them after the war did not support the claims being made for further refunds and he consequently found no basis to re-open the issue. At that time I placed a copy of the full report of the review in the Library of the House.
Lord Sempill: My Lords, I thank the Minister for that reply. However, is he aware that that most recent review makes no reference to either of two submissions made by Group Captain Ingle on 1 1 th December 1995 and 31st March 1996, submissions whose evidence were key to that review being reopened? Further, does not the Minister consider it improper that following the previous government's decision to review that new evidence, not one meeting between representatives of Justice for Prisoners of War and the newly appointed Ministry has taken place?
Lord Gilbert: My Lords, I am quite sure that my honourable friend took account of all the representations that were made and to which the noble Lord refers. It is only fair to point out that there is not unanimity on these matters, even among former prisoners of war. The noble Lord, Lord Campbell of Alloway, has very kindly allowed me to use his name to pray in aid precisely that thought. He wrote to The Times on 9th August, saying:
"Brigadier Davies-Scourfield's letter … suggesting that many ex-PoWs are embarrassed by attempts to squeeze money out of the Government, reflects the broad and informal consensus of those of us at Colditz, as expressed at a recent annual meeting of our association".
Lord Campbell of Alloway: My Lords, is the noble Lord aware that according to Goering's evidence at Nuremberg, if Germany had won the war the Geneva Convention would have been denounced and our lot would have been slave labour or extermination? In those circumstances, is not our salvation sufficient recompense for a basketful of Lagermarks?
Lord Gilbert: My Lords, while I would not always choose to follow the noble Lord in the precise language he uses, I am grateful to him for the sentiments he has expressed.
The Earl of Carlisle: My Lords, does not the noble Lord feel rather saddened and, indeed, ashamed that he has to come in front of us on this day of all days—Armistice Day—and tell us that he cannot give justice to 8,000 surviving British officer prisoners of war? Is he further aware that the case will probably arrive on the desk of the European Court of Human Rights? Is he further aware that those honourable gentlemen, with their backs to the wall and believing in the justice of their cause, will fight to the end? Can the Minister not cut the Gordian knot?
Lord Gilbert: My Lords, all I can say to your Lordships is that this very sad question has been considered at great length by governments of both colours in the past. It is not the case that all prisoners of war did not receive refunds. In fact, quite a lot of them did. As your Lordships will be aware, under practices in place at the time all individual records were
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destroyed some six years after the war and it is now quite impossible to job back and treat individual cases. If you do not treat individual cases, you are bound to get jealousies and people saying that others have been treated over-generously.
Lord Burnham: My Lords—
Lord Peyton of Yeovil: My Lords, before my noble friend intervenes, perhaps I may doso because I am rather close0r to this issue than he is. As one of those who enjoyed or endured a rather long spell of German hospitality, perhaps I may take the opportunity to tell the Minister that I believe it is far too late to job backwards. We are really arguing about trifles. This matter should enjoy a very low place in the Government's list of priorities, if any at all.
Lord Gilbert: My Lords, I am much obliged to the noble Lord.
Lord Burnham: My Lords, in the light of the noble Lord's statement, which I believe to be generally accepted, that it is virtually impossible to distinguish to whom individual payments should be made, although the Germans themselves may be able to do so, is it not possible and desirable for an appreciated sum of money to be handed to charities such as SSAFA or the British Legion for use for deserving ex-prisoners of war or other people?
Lord Gilbert: My Lords, I am happy to bring the noble Lord's suggestion to the attention of my honourable friend.

Plant Varieties Bill
3.20 p.m.
Read a third time.
Lord Carter: My Lords, I beg to move that the Bill do now pass.
Moved, That the Bill do now pass.—(Lord Carter.)
Baroness Anelay of St. Johns: My Lords,I should like to take this opportunity to thank the noble Lord, Lord Carter, for his courtesy during the passing of the Bill and, in particular, for the work which he did between Second Reading and the Committee stage in hearing representations from my noble friends and also from organisations outwith this House. As a result of that process, I believe that amendments have been made to the Bill which mean that it has been greatly improved. I should also like to thank my noble friend Lord Lucas for his work on Second Reading; and, indeed, my noble friends sitting behind me for their assistance. I have in mind my noble friends Lady Trumpington, Lord Skelmersdale and Lord Howe.
I should like to thank those organisations which have submitted evidence throughout the proceedings on the Bill—for example, the NFU and BARB—all of which

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have been most helpful during the course of our discussions. We have consistently supported the objective of the Bill; namely, to implement the 1991 revisions to the UPOV convention. We welcome its passage through the House.
Lord Beaumont of Whitley: My Lords, I made no secret of the fact on Second Reading that I thought that the Bill was actually a part of a whole series of moves towards privatisation of intellectual property and the increasing patenting of things of a nature which should not be patented, but that it was really rather too late to do anything very much about it. However, as we have this rather unfortunate Bill and such an unfortunate situation, I should like to pay tribute to the way the Government have dealt with it; the way they have amended it; and the way they have speedily passed it through this House. It means that we shall not have to spend too much more time on the matter.
Lord Carter: My Lords, I am extremely grateful to the noble Baroness, Lady Anelay, and the noble Lord, Lord Beaumont, for their kind words. I believe that the noble Baroness has already thanked all those that I intended to thank, so she has saved me that task. We are pleased with the Bill's progress. It is a highly technical Bill and I should like especially to thank the noble Baroness for her most helpful and constructive assistance. I speak from my own experience when I say that this is not the easiest piece of legislation to read and understand. The noble Baroness came into the proceedings, which were new to her, in Committee. I am extremely grateful to her for the valuable contribution she has made.
On Question, Bill passed, and returned to the Commons with amendments.

Firearms (Amendment) Bill
3.22 p.m.
Lord Williams of Mostyn: My Lords, I beg to move that the Commons reasons be now considered.
Moved, That the Commons reasons be now considered.—(Lord Williams of Mostyn.)
On Question, Motion agreed to.

MOTIONS ON CONSIDERATION OF COMMONS REASONS FOR DISAGREEING TO CERTAIN LORDS AMENDMENTS
[The page and line refer to Bill (12) as first printed by the Lords]

LORDS AMENDMENT
1 After Clause 1, insert the following new clause:
DISABLED PERSONS: EXEMPTION
(".—(1) The authority of the Secretary of State is not required by virtue of section 5(l)(aba) of the 1968 Act for a person to whom subsection (2) applies to have in his possession or to purchase, acquire, sell or transfer a pistol chambered for 22 or smaller rim-fire cartridges if he is authorised under the Act to possess, purchase or acquire that weapon subject to a condition which complies with subsection (3) below.
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(2) A person to whom this section applies shall be a registered disabled person who has a physical disability and is approved by the Secretary of State.
(3) A certificate granted under subsection (2) above shall be subject to the condition that—

(a) the weapon is stored and used only at premises designated by the Secretary of State; and

(b) possession of the weapon outside such designated premises shall be permitted only for transfer to and use at premises at which a shooting competition is taking place on such conditions as the Secretary of State shall specify.")

The Commons disagreed to this amendment for the following reason:
1A Because they do not consider it appropriate for the Bill to provide for any special exemptions to apply to the prohibition of small-calibre pistols.

MOTION MOVED ON CONSIDERATION OF COMMONS REASON
Lord Stoddart of Swindon 1B Lord Stoddart of Swindon rose to move, That this House do insist on their Amendment No. 1 to which the Commons have disagreed for their reason numbered 1A.
The noble Lord said: My Lords, I tabled the Motion to enable your Lordships to have a further debate on the issue of disabled pistol shooters following the rejection by the other place of our amendment passed on Report, and to enable this House, if it so wishes, to insist upon its amendment.
I should like to emphasise, once again, that the amendment does not undermine the central principle of the Bill. It will in no way lessen public safety. The amendment will enable disabled pistol shooters to continue with a sport which is therapeutic and will enable them to continue to compete in the sport, including major international competitions.
The debate in the other place on your Lordships' amendment was spirited, sensible and cross-party, although I am bound to say that the weight of vocal opinion was heavily in favour of our amendment. Both the Conservative and Liberal Democrat spokesmen on home affairs supported the amendment. I also have to point out that the balance of argument was, in my view, heavily in favour of our amendment. Moreover, believe that, if all those who voted had listened to the debate, the outcome of the Division might have been different.
The arguments in favour of the amendment have been well rehearsed in both Houses, so I shall not repeat them in detail. However, in summary, they are as follows. Disabled people derive not only pleasure but also therapeutic value from target pistol shooting. They cannot possibly be considered a risk to public safety. That point was conceded by the Minister in reply to a Question tabled by Mr. Robin Corbett, when he said: "I did not suggest that disabled shooters were a threat to public safety." Therefore, we have it on the Minister's authority that disabled people constitute no threat. However, disabled people will be denied the opportunity to compete in paraplegic games and ordinary competitions where they can compete on equal terms. Pistol shooting is most appropriate for disabled people because they cannot handle shotguns and rifles. Finally, pistols would not be held at home but at safe, secure locations. Those were all the arguments that we

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considered on Report and which were found to be acceptable; indeed, your Lordships supported the amendment.
It is doubly galling for disabled people that provision is to be made at Manchester for pistol shooters from abroad to train and compete, whereas British competitors will be debarred. The Government have suggested that it is difficult to justify isolating one group such as disabled shooters. However, as the right honourable gentleman Mr. Alan Beith pointed out in another place, there are particular reasons for special treatment of disabled shooters because they cannot easily transfer to another sport.
Another relevant point made in the other place by my honourable friend Frank Cook was that public opinion has swung considerably since we started debating the issue of firearms. The latest public opinion poll shows 56 per cent. support for disabled pistol shooters being exempted from the ban on handguns. Indeed, my own experience confirms that result. I took part in a BBC 2 television "Close Up West" programme and later in a radio phone-in which revealed heavy support for this amendment.
Before I put the Motion to the House and, indeed, the next one on the Marshalled List, I should point out that I pondered long and hard on the matter but finally came to the conclusion that I owed it to the disabled shooters and to British international sportsmen to leave no stone unturned in my efforts to assist them. Some people say that we should not challenge a decision of the House of Commons, but I believe that we should. We should not run away from our responsibilities. I hope that we shall not do so this afternoon. Perhaps I may explain why.
First, there is a free vote on the issue. It is a free vote as was pointed out by the Opposition Front Bench on Report. Indeed, this free vote was included in the Labour Party manifesto. Therefore, if you like, it has the authority of the people. I repeat: it is a free vote, and we should keep that fact very much in mind. Secondly, under the 1911 and 1949 Parliament Acts, this House is entitled to insist upon its amendments. That is the law, that is the constitution. In any meaningful, bicameral system, both Chambers have rights and duties which they should exercise and discharge without fear or favour.
Neither Chamber should be subjected to threats of retaliation, nor should such threats be given in to if they are made. However flawed the present composition of the House of Lords may be thought to be, the House of Lords is the only second Chamber we have. There is no other. It is this Chamber which can make the bicameral system work. If it does not make it work, this is not a proper bicameral system. This House is therefore duty bound to ensure that the bicameral system works, especially when the interests of ordinary people, and especially those of disadvantaged people, are not properly considered and rights long enjoyed are trampled underfoot. I hope that that is what this House is about.
If noble Lords are not prepared to insist on legal and constitutionally proper amendments on appropriate occasions, the House of Lords ceases to be a second
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Chamber of Parliament and relegates itself to a mere consultative council. For the reasons I have stated, I believe that this amendment should be insisted upon and I hope I shall have the support of your Lordships. I beg to move.
Moved, That the House do insist on their Amendment No. 1 to which the Commons have disagreed for their reason numbered 1A.—(Lord Stoddart of Swindon.)
3.30 p.m.
Lord Harris of Greenwich: My Lords, I will, if I may, in no spirit of discourtesy to the noble Lord, Lord Stoddart, speak only once on the two amendments that he has put before us. I do not propose to discuss the merits of either of these issues because that was done during the Report stage of this Bill in this House only a few days ago. The issue before us today is a simple one; namely, whether we are prepared, as a non-elected House, to reject the views of the elected House on an issue which clearly appeared in the Labour Party's general election manifesto. The view of the House of Commons on this question is absolutely clear; the Lords' amendments were rejected on a free vote by majorities of 132 and 136. In my view it would be entirely wrong for this House to give any support to the proposition put forward by the noble Lord, Lord Stoddart of Swindon. The House should be absolutely clear that the effect of either of these amendments being carried will be to kill this Bill. Are we seriously contemplating killing a Bill of this sort—
Noble Lords: Oh!
Lord Harris of Greenwich: My Lords, I hope I may continue the argument. Are we seriously contemplating killing a Bill of this sort which appeared in the election manifesto of the present Government? In my view that would be wholly wrong in principle. My noble friends and I, and indeed my colleagues in the House of Commons, on free votes, voted in different Lobbies. I think that in all the circumstances that was entirely right. However, it is the clear view of my colleagues today that it would be wrong for this House under any circumstances whatever to support the noble Lord, Lord Stoddart of Swindon, in the Lobby. Accordingly, we shall vote against these amendments if they are pressed.
Lord Windlesham: My Lords, it is hard to think of any ground less well suited to potential confrontation between the two Houses than a Bill which prohibits the private possession and use of handguns and does so in the interests of public safety. Like the noble Lord, Lord Harris of Greenwich, I wish to address my remarks to both the amendments and to speak only once as a result because they raise the same fundamental issue which the House must decide this afternoon.
The starting point is that all handguns, irrespective of their calibre and irrespective of their ownership, are highly dangerous instruments. They are portable; they are lethal; they are easily concealed. Moreover, they can be stolen, and they are stolen. On the statistics available to the Home Office for the most recent 12 month period, nearly 400 recorded incidents of theft of legally held

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handguns were reported to the police. That is almost certainly an underestimate because we know that by no means all criminal acts come to the notice of the police. On those figures alone, in more than one incident per day, sometimes involving more than one weapon, handguns were transferred from legal to illegal possession.
A further point that I suggest we should keep in our minds is a fundamental one; namely, that it is a fallacy to believe that certification procedures—certificates issued after inquiries often made by the police—render it possible to exclude those people who are not fit to have access to firearms or to ammunition. One of the most telling of all Lord Cullen's findings in his report on the Dunblane shooting was that,
"no certain means of ruling out the onset of a mental illness that gives rise to danger, nor of identifying those whose personalities harbour dangerous propensities"
has been found. He continued,
"On this ground alone it is insufficient protection for the public" —
mark those words—
"merely to tackle the individual rather than the gun".
I greatly regret that on an issue of this sort, with unwhipped votes, Divisions in both Houses have been conducted largely on party lines. As one of the few on this side of the House who voted against the exemption for competition pistols at Report stage on 16th October, I urge the House now to accept the Commons' reasons for disagreeing both with that decision and the amendment which is now before us concerning the disabled
I hope I may add a further comment on a personal note. The only reason I abstained in the vote at Report stage on the exemption for the disabled was the moving speech by Lord Crawshaw. We had had a long, almost a lifetime's friendship dating from the time of the accident—when we were both undergraduates—which led to his lifelong disability. It is tragic that Lord Crawshaw died over this past weekend and therefore we shall not hear his modest, persuasive and entirely honest voice in this debate today.
Lord Howell: My Lords, I wish to take up that final point and pay my tribute to Lord Crawshaw and to the contribution he so movingly made during our considerations of the Bill. Like the two previous speakers, I intend to speak once. As I have other Committee duties I must attend to later, I trust that I shall be excused if the discussion on these amendments lasts longer than I anticipate.
The first amendment we are discussing was one that I was privileged to move when it was accepted by this House. I make no complaint at all about my noble fiend Lord Stoddart taking it over, as it were, because once an amendment is accepted it becomes the property of the House. In considering the decision of the House to overturn the Lords' amendments, we must acknowledge the full debate which took place on our amendments in another place, which lasted for more than three hours. There can be no complaint about the attention which the Commons gave to the Lords amendments.
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Regretfully, I have found the Government's arguments totally misplaced and unconvincing. They have not moved one iota since taking a decision on coming into office to impose a blanket ban on all gun shops. However, that is not a consideration before us today. The merits of the amendment passed by your Lordships' House remain unassailable. I shall shortly comment on two aspects, although I think that it would be totally wrong to go over all the ground again.
We have provided the Commons with the opportunity to consider our thoughts and our amendments and to think again. It has done so. I do not believe that it would now be right constitutionally or in terms of practicality to challenge the Commons further. I would not seek to divide the House today. Apart from the constitutional position—it was well stated by the noble Lord, Lord Harris—there is another practical consideration which I commend as a politician, if I may say so, to my noble friend Lord Stoddart. My noble friend asks us to vote again today and to take the serious risk of defeating two amendments which we have previously carried. I cannot believe that that would advance the cause which he and I have in mind. I prefer that our previous victories stand alone so that they can be referred to in due course. As I believe we must, we can ask the Government to come back to these matters, for example, as we approach the Commonwealth Games in Manchester, when undoubtedly there will be matters for further consideration.
I agree, too, that although the Government have not moved, public opinion has moved. I endorse totally the figures given by my noble friend Lord Stoddart that in a Mori poll held in the past three or four weeks 56 per cent. are shown to believe that shooters for the disabled should be exempt from this ban. Sixty-one per cent. thought that supervised training sessions with 22 calibre pistols should be allowed to qualify Britons to take part in the Commonwealth Games and the Olympic Games. That proves that at the end of the day common sense and logic eventually surmount blanket emotionalism, however much that emotionalism can be understood. We have seen recently other examples of that. It is my regret that such common sense and logic have not yet overtaken the Government, to the detriment of disabled shooting clubs and considering the severe damage that will be done to our Commonwealth Games and Olympic Games prospects.
I have a few comments on issues arising from what the Minister said in another place in resisting the amendments. There have been exemptions. It is wrong to say that there will be no exemptions granted; that this is blanket legislation. Exemptions were granted for the 14th European Pistol Championships. As we know, they are proposed for the Commonwealth Games in Manchester.
It is not the case that exemptions have not been granted. We would all agree that our police force has to have pistols, as do the Armed Forces and similar security organisations. Exemptions are properly guaranteed for them. We are told by Ministers that the weapons would have to be stored in one place and would become a difficult security risk. That is true whether they are stored in police stations or at security

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headquarters. The same arguments could apply as regards the disabled and the Commonwealth Games and Olympic centres of excellence. The same secure arrangements could be made as are made in the other places mentioned.
Finally, since the Government give exemptions for gun events to take place at the Commonwealth Games and Olympic Games, those events will not be prejudiced. We have argued that before. I shall not go over the ground again except to say that I am sorry the Government do not accept the wisdom of the British Olympic Association and people such as myself. We know perfectly well that if we put our gun shooters in this position it will be to the detriment of any future attempt to hold the Olympic Games in this country. Those arguments still stand. Nevertheless, despite my firm belief that the arguments remain unassailable, there are new considerations today. I think that the wisdom of this House would be best met by accepting the decisions of the Commons on these two amendments.
3.45 p.m.
Lord Simon of Glaisdale: My Lords, the Bill is put forward in the interests of public safety. Having listened to most moving addresses at an earlier stage—and again today—by the noble Lord, Lord Stoddart, your Lordships made an exception. It is not claimed that that exception derogates from the purpose of the Bill; namely, public safety. That was expressly disclaimed by the Minister in another place.
It is said that these weapons might be stolen. Presumably the Minister took that into account. In any case, the amendment makes provision for safe custody of the weapons of these unfortunates in whose interests your Lordships passed the amendments.
I respectfully agree with the noble Lord, Lord Stoddart, that there is no constitutional reason why your Lordships should not insist on the amendment which commended itself to your Lordships understandably at the earlier stage. It is said that the Commons is the elected Chamber. So it is, but election is not the sole source of political legitimacy. In any case, the Commons was not elected in order to deprive a disabled person of the only sport in which he can compete with his hale fellows.
It is said that if your Lordships insist, the Bill will be lost. That is not so. There is an alternative: that since it is a government Bill the other place in the interests of saving the Bill does not go on insisting against your Lordships' view. That happened once before. Your Lordships may remember the Further and Higher Education Act. It was notable because the noble Lord, Lord Belstead, then the Leader of the House, took charge of it in your Lordships' House and gave a most notable parliamentary performance. It was only at the very last stage, by an amendment at Third Reading, that your Lordships managed finally to carry the amendment which vindicated academic freedom. The Government were then faced with a choice. They resisted up to the last moment and went on resisting in the Division Lobby. But rather than lose the Bill, rightly, they
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accepted your Lordships' view. That could well happen and, in my respectful submission, should happen on this amendment.
Lord Campbell of Alloway: My Lords. with respect to the noble and learned Lord who has just spoken, I do not believe that it is conceivable in these circumstances that the Government will think again or accept our amendments in order to save the Bill. It is simply not conceivable. The doing away with all handguns was a Labour manifesto commitment. It was subject to a free vote, which was taken.
To what purpose do we insist? Having supported the noble Lord, Lord Stoddart, on amendments throughout the Bill's passage, I am in a very different position to that of my noble friend Lord Windlesham. However, come to the same conclusion, for the reasons given by other noble Lords. There is no point in confrontation on this matter.
I agree with the noble Lord, Lord Stoddart, in relation to the bicameral system: it is our duty to make it work. To support this amendment, and to insist, as the noble Lord suggests, is to throw a proverbial spanner into the works.
Lord Ewing of Kirkford: My Lords, it is always a great pleasure to follow the noble Lord, Lord Campbell of Alloway, and the noble and learned Lord, Lord Simon of Glaisdale. The noble and learned Lord, Lord Simon of Glaisdale, and myself have been on the same side on many issues during my time in this House. There are issues that torture politicians. Two that have tortured me during 27 years in both Houses of Parliament have been war—that in the Falklands, followed by the Gulf War—and the firearms Bill with its origin in the massacre at Dunblane. I have kept my counsel on the firearms Bill. I came to the firm conclusion early on that nothing I could say would bring comfort to the parents of the children who were butchered in that massacre. I have always acted on the principle that if you cannot say anything to help, for God's sake do not say anything to hinder.
I have deliberately abstained on every vote taken on the firearms legislation. For 12 years I was Thomas Hamilton's Member of Parliament. Stirling was part of my parliamentary constituency before the boundary commission changed the boundaries in 1983. Every Saturday morning when I held a surgery in Stirling, the first person to turn up was Thomas Hamilton. So no one knows, understands or tries to understand Thomas Hamilton more than I do. It is against that background that I address the House today and crave your Lordships' indulgence for the few thoughts that I want to share.
I remember Thomas Hamilton in 1971 as a youth and community worker in Dunblane, which was not part of Central Region at that time but part of Perthshire. It had its own town council. A horrendous argument broke out in the town, one half of the community wanting to be rid of Thomas Hamilton and the other half wanting to retain his services. The half that wanted to retain Hamilton's services won the argument. That was the origin of the whole problem that we are discussing

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today. Sir Alec Douglas-Home, a late revered Member of this House, was then the Member of Parliament representing Dunblane. Hamilton came to see me, complaining about his perceived problems there. I sent him to see Sir Alec, who explained to him that he did not become involved in disputes between two factions in a community for the simple reason that one could not win. I learnt a great lesson from that experience.
As time went on, Dunblane was brought into Central Region. Central Region took the decision not to allow Hamilton to use its schools. He appealed to the ombudsman, who ruled in his favour. Central Region had no alternative but to give Hamilton the use of schools in Dunblane for his youth clubs.
My reason for explaining all this is that in my humble opinion, honestly and sincerely expressed—I am in a minority of one—the Dunblane situation has been completely misread. Hamilton's perceived problems were all based in Dunblane. They were not firearms problems at all. They were perceived as related to the town; everything that happened to Hamilton had the Dunblane background to it.
On that tragic morning in March, 20 months ago, Hamilton could have got out of bed, left his house in Stirling, walked two minutes round the corner and seen one of the largest primary schools in Central Region. He could have butchered 600 or 700 children. He did not. He got into his car and drove seven miles to Dunblane. If those children had been standing at a bus stop that morning, he would have mown them down in his car. What should we have done then? Banned all cars? Of course we should not.
Lord Hailsham of Saint Marylebone: Just sit down!
Lord Ewing of Kirkford: My Lords, wish that the former Lord Chancellor would control his emotions.I am just as entitled to express my views in this House as he is. I have kept my counsel on this issue for 20 months now. I deeply resent the interventions from a seated position of a legal luminary who should know much better than to interrupt in that way. I knew this man well; I knew many of the parents of those children well. It ill becomes the noble and learned Lord to interrupt in such an ill-mannered way. I am emotionally involved in this issue.
Lord Hailsham of Saint Marylebone: So I see.
Lord Ewing of Kirkford: My Lords, what position does that bring me to in the debate? I am naturally tempted to support my noble friend Lord Stoddart. However. I have seen all the publicity; I have listened to the parents; I have watched the agony through which those parents, grandparents and all the relatives have gone. I have come to the firm conclusion that, despite my own deeply held personal views, it would be a major mistake if this House were to divide on the proposition put by my noble friend. Despite what the noble and learned Lord, Lord Simon of Glaisdale, said, I do not believe that we should run the risk of losing the Bill.
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The people of Dunblane and the gun clubs in Callander and around Dunblane believe that the Bill is the answer to the Dunblane massacre. I am not sure about that. I recall the comment of Benjamin Jowett that Parliament by legislation cannot make men moral. I am not sure that legislation makes men moral. I am sure that it would be an unmitigated mistake if the House were to divide today, the Government were to be defeated and the Bill lost. My initial reaction was to abstain. As is my wont, I have changed my mind. I appeal to my noble friend not to divide the House; but, if there is a Division, I shall support the Government.
4 p.m.
Lord Henley: My Lords,I intend to be brief and, like other noble Lords, I shall speak to both amendments together.
I thought that the speech of the noble Lord, Lord Stoddart, was commendable and I find myself in considerable agreement with much, if not all, of it. It is one that will bear close study and I recommend that noble Lords should read it in Hansard tomorrow.
I believe the noble Lord was right to refer to the balance of argument in another place, where even one of those who spoke against the amendments described himself as being in a very small minority. Most of the argument in another place, from both sides of the House, was in favour of the amendments.
Like the noble and learned Lord, Lord Simon, I do not agree with the noble Lord, Lord Harris, that it would kill the Bill if this House were to agree to the amendments. That would obviously not be the case: it would give the other place a chance to think again. There is any amount of time between now and the end of the Session.
Nevertheless, I do not think that this is an occasion on which this House should press its views on another place. There was a debate in another place. Despite what I feel about the balance of argument, there was a free vote and it was decided by fairly large majorities—quoted by the noble Lord, Lord Harris—not to agree with this House. I do not believe it would serve any purpose for us to ask the other place to consider these matters yet again, even though we are still not satisfied with the arguments that have been put before us. I shall recommend to those on these Benches that we should not support the noble Lord, Lord Stoddart, should he press the amendments to a Division.
Lord Monson: My Lords, I believe it is time that a contrary view was heard. Perhaps I may try to answer some of the critics of this Motion, which I fully support.
To the noble Lord, Lord Windlesham, may I point out that the second amendment covers only 300 to 400 highly talented sportsmen and sportswomen who would have to go through the most rigorous selection procedure before they were allowed to handle pistols. I therefore do not believe that Lord Cullen's cautionary words apply to them.
May I point out to the noble Lord, Lord Harris of Greenwich, that, excluding Ministers, 83 per cent. of honourable Members knowledgeable and interested

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enough to speak in the debate in another place supported your Lordships' amendments. They included Conservative, Labour and Liberal Democrat honourable Members. It can safely be assumed that many of those who voted against the amendments had heard scarcely a word of the arguments.
In response to the noble Lord, Lord Campbell of Alloway, it is not the case that the Government propose to ban all 22 pistols. There are already many exemptions, so the amendments do not introduce a new principle into the argument.
I am sure that all noble Lords would agree that people should not be deprived of freedoms which they have enjoyed for 150 years or more unless there are solid, practical reasons—as opposed to emotional reasons—for doing so. Bearing in mind the cast-iron safeguards incorporated into the amendments, I submit that there is no solid, practical case for a ban where these two limited and deserving categories are concerned. I therefore fully support the Motion.
Lord Clifford of Chudleigh: My Lords, I am grateful for having had the opportunity to listen to some balanced speeches in your Lordships' House. On 16th October this year the late Lord Crawshaw, who has already been mentioned, spoke of his ability to use a shotgun or a rifle. He said that there was a problem in doing so when wheelchair bound; it was all a question of balance. I am afraid that the noble Lord, Lord Williams, was somewhat dismissive and almost derisory when he said that even Lord Crawshaw admitted that he could use a rifle and a shotgun. He failed to tell the House that Lord Crawshaw had said that there was an imbalance to the extent that the rifle or shotgun nosedived. That is very uncomfortable and awkward for someone in a wheelchair. It is a dangerous situation which is not experienced with a pistol. With a pistol, the wheelchair-bound and the able-bodied can compete on equal terms, which is not the case with a rifle or a shotgun.
I should like to congratulate the noble Lord, Lord Stoddart, on being an honest man. At Third Reading he said that, if the other place refused to accept our amendments, he would present them once again to this House. I fear that there are certain people in a senior position in the other place who are not as honest as the noble Lord, Lord Stoddart, who sits on the Labour Benches.
Noble Lords may recall that another sport has been in the newspapers recently: Formula One racing. That sport is associated with smoking cigarettes. As far as the Government are concerned, cigarette advertising is legally acceptable, in the best interests of the public. I wonder how many Formula One racing drivers there are-10, 50? No, there are four in this country. I wonder how many people die from smoking cigarettes each year? According to the Department of Health 121,000 people died in 1995-1996. I admire the Government for sticking up for the minority. but what about the 5,000 disabled pistol-shooters who, as we have heard before, have won many medals? We should bear in mind that cigarettes kill: disabled people do not.
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The Labour Party Manifesto promised a free vote on the Bill. In common decency, and in the light of our belief that we represent a civilised society which cares for minorities and their feelings, let us not give the disabled the opportunity to name Westminster not the Houses of Parliament but the Houses of hypocrisy. I support the Motion.
The Earl of Stockton: My Lords, I wonder whether this Chamber has seen a more abject group of hypocrites than the two Front Benches of your Lordships' House for many a year? It is well known, as was said by the noble Lords, Lord Stoddart and Lord Howell, that the pistol shooters of this country are responsible people. That is why those noble Lords tabled the amendments they did at an earlier stage of the passage of this Bill in your Lordships' House. Those shooters are responsible people, taking part in a responsible sport, to which they address themselves responsibly and, I might add, represent this country. How is it therefore that suddenly they are billed as the villains of the piece?
In the passage of this Bill through your Lordships' House and another place how much have we heard about the illegal firearms that are in the possession of people in this country? The most conservative figure that I have come up with, presented to me by the Superintendents' Association, is that there are 2.5 million illegally owned firearms in this country, of which 600,000 are automatic or semi-automatic weapons. Why therefore do the present Government and the past government spend their time chasing responsible, sensible people who use pistols—no doubt in due time they will chase responsible people who use rifles and shotguns—while accepting that they can do nothing to stem the tide of illegal firearms and automatic weapons? Can the Minister say how many people were killed in London in the past six months by the use of legally owned firearms and how many by the use of illegally owned firearms? Your Lordships will find his answer a very convincing reply.
Lord Swansea: My Lords, I shall be brief. I want to support the Motion of the noble Lord, Lord Stoddart. The Government are trying to work a colossal con-trick with this Bill. They are trying to make out that they are improving public safety, but they are doing nothing of the kind, as the noble Earl, Lord Stockton, pointed out.
The Bill is an insult to the integrity of legitimate shooters; it is an insult to the intelligence of Parliament and of the British press; it is an insult to the intelligence of the British people. The Government are deluding themselves, Parliament and the British people that they are improving public safety. They are not. Legitimate shooters pose no threat. They indulge themselves in a harmless recreation of punching holes in paper targets. But there is a vast, unknown number of weapons held illegally by the criminal classes. If the Government really want to improve public safety, they should go after them and not penalise legitimate shooters.
We heard only yesterday about a murder committed in north London, no doubt by an illegally held pistol. That will continue, so the sooner this abominable Bill is repealed, along with its equally abominable predecessor, the better.
4.15 p.m.
Lord Pearson of Rannoch: My Lords, of course I support the amendments moved so lucidly by the noble Lord, Lord Stoddart of Swindon. I should like to press the Government on one point that they made at the last stage of our debate on this unfortunate Bill. They said that their legislation for the disabled is designed only to allow the disabled to draw level with those of us who are fortunate enough not to be disabled. That is one of the reasons they gave for not allowing this amendment when we last debated it.
I feel that that philosophy is at the least a little shaky. However much we wish it were otherwise, and however much we legislate to make it otherwise, the disabled can never enjoy all the activities which we take for granted. The new, caring Labour Government therefore are guilty of a degree of hypocrisy in not allowing your Lordships' amendments to stand when instead they remove from the disabled one of the few activities which allows them to compete equally with the rest of us and in fact "draw level with us" in the broadest sense of that expression.
Nor can the amendment be called a wrecking amendment. Both this Bill and its predecessor from the previous government were supposed to be about improving public safety. But as other noble Lords have said, we have it on the word of the Minister himself in the other place—I quote again because it is important—
"I did not suggest that disabled shooters were a threat to public safety".
All the Government have to do to meet the spirit of their Bill and their commitment to disabled people generally is to accept the amendment of the noble Lord, Lord Stoddart.
Lord Williams of Mostyn: My Lords, the approach of my noble friend Lord Stoddart to this matter is that of the purist. He did not like the previous Bill introduced by the previous government and he does not like this one. I have acknowledged that I recognise his stance.
The fact is that we are dealing now with two amendments and not, as some speeches seemed to indicate this afternoon, with the principle of either Bill. When this Bill came to this House in June from another place, we were all well aware of the enormous strength of feeling for a complete ban on handguns. As the noble Lord, Lord Campbell of Alloway, pointed out only this afternoon, as did other noble Lords, on a free vote held on 11th June in another place there was a majority of 203 votes in favour of such a ban. Both the amendments today are utterly at odds with the strength of views of the other place. I shall be obliged to speak twice, but some of the remarks I make on this first amendment may be relevant to both.
I venture to suggest that this is a matter of serious constitutional importance. The Government have never intended deliberately to disadvantage disabled shooters by this Bill. Our intention is that of consistency. I am told that there are around 374,000 registered disabled people, all of whom under this amendment would be eligible to apply for a firearms certificate. It is impossible to say how many would wish so to apply, but our position is plain—as plain as the position adopted by the noble Lord, Lord Stoddart.
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Our position is that we do not wish to see exemptions for any groups of target shooters. Those who have previously legally used target pistols must change to other firearms if they wish to continue to practise the sport. I appreciate that there are differences between the different disciplines. I pay tribute to the contribution made by Lord Crawshaw on another occasion, and I indignantly repudiate that I treated him with any disrespect; quite the opposite. I am happy to say, as I did then, that his contribution was moving and informed. Nevertheless, it did not persuade my mind.
As I have said on earlier occasions, I appreciate that some disabled shooters may have difficulty in switching to long barrel firearms; not everyone will enjoy shooting with air pistols or muzzle loading pistols. I do not accept that any therapeutic value that handguns may bring to some disabled shooters, or the sense of well-being, which I recognise, that success in international target pistol shooting competitions may bring to both disabled and able bodied competitors, can outweigh the enormous benefits of removing handguns from our society. We believe that the benefits of this ban to public safety cannot be overestimated. The lessons from Dunblane and Hungerford must never be forgotten.
There are some exemptions in the 1997 Act to allow handguns to continue to be held. They are all for professional, humane or other narrowly defined purposes. Not one is for target pistol shooting.
Of course the Government will keep under review this Bill, should it become law, as well as the earlier Act which our predecessor government introduced, and indeed firearms legislation in general. It is the Government's duty to ensure that all new and existing controls are necessary. If they are not, we shall need to bring back to this House in due course further legislative proposals for change.
As far as concerns this amendment, I believe that the right step for this House is not to insist upon it. When the House divided on the amendment at the Report stage, there was a majority of only 19 votes in favour of its addition to the Bill. This amendment was rejected by another place last week by 136 votes, on, I respectfully remind your Lordships, a free vote. It is a very clear message from the elected Members of the other place on this issue. Given that strength of view, and expressing as I do the regard I have for this place, though I have been here for fewer years than many of your Lordships, I respectfully suggest that this unelected House might now agree with the elected Members of that other place.
Lord Stoddart of Swindon: My Lords, I fear that I must take a few minutes to reply to the debate. I thank all noble Lords who have taken part in it, on whichever side of the argument they may have been. It has been a good debate.
The noble Lord, Lord Harris, asked whether we are prepared to set aside the view of the Commons in a matter which has been put before the electorate at a general election. As I explained—and I repeat--the manifesto states clearly that there will be a free vote;

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that is, a free vote of Parliament, not just the House of Commons. Therefore, this House is just as entitled to have a free vote as the House of Commons.
With regard to the constitutional side of the argument, the noble and learned Lord, Lord Simon of Glaisdale, put the matter absolutely right. He said that there was no constitutional reason why we should not insist on amendments. Indeed, he cited the precedent of your Lordships insisting on academic freedom. Your Lordships were right to insist on academic freedom. Why. then, are we taking away the freedom of disabled pistol shooters to continue with the sport they have enjoyed for a long period of time? If it is right to insist on an amendment for one freedom, it must be right for another freedom.
I very much appreciated the tribute of the noble Lord, Lord Windlesham, to Lord Crawshaw. We are extremely sorry that he has passed away. The noble Lord mentioned 386 handguns that had been stolen. That is very small beer. I have to tell him that those handguns were stolen from individuals, not from secure accommodation, where the pistols of disabled people would be held. Furthermore, he must take into account that Lord Cullen, who heard all the evidence, did not recommend a total ban on handguns. If we are citing Cullen, let us take account of what he said. He did not want a total ban on handguns.
My noble friend Lord Howell criticised the Government's stance on this matter. I agree with him. I am only sorry that he cannot support the Motion. I hope that he will reconsider his attitude.
My noble friend Lord Ewing made an interesting speech. He gave a moving review of what happened in Dunblane and of Hamilton's background. In fact, he confirmed more than anyone else has done, because of his close knowledge of the situation, that the massacre at Dunblane was the result of the warped mind of a single individual and not because of handguns generally held. He confirmed in one short speech everything that those of us who have been opposed to the legislation have been saying—that is, Dunblane was the act of a madman and handgun owners should not therefore be collectively punished because of him. I thank my noble friend Lord Ewing for confirming that, although I regret that I shall not be having his support.
The noble Lord, Lord Henley, is ducking out of it. That sums up what is wrong with the Opposition. They have no guts. That is what is wrong. I hope they will soon recover their guts. The British constitution depends on strong government and on a decent and strong Opposition. I am sorry that the noble Lord has not seen fit to recommend to his noble friends that they support the Motion.
The noble Earl, Lord Stockton, asked my noble friend the Minister, who is a decent and gentle man, how many illegally held handguns there are. It was noticeable that my noble friend did not reply. He could not reply because he does not know. There are tens if not
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hundreds of thousands of illegally held handguns. Yet here we are, dealing with a few disabled people and taking away their sport, while leaving tens if not hundreds of thousands of illegally held handguns in the hands of criminals. That is one reason why noble Lords, in spite of the advice they have received from their Front Benches, should support the Motion.
My noble friend says that I am a purist. What is wrong with being a purist? Does anyone find anything wrong in that? He says that he is a purist, too. That makes two of us. I did not expect that he would support my Motion, although people are sometimes converted on the road to Damascus or elsewhere. However, I fear that he was not.
When, under the previous Tory Government, we were dealing with the Firearms (Amendment) Bill and I was on the other side of the House I said that noble Lords should insist on their amendments. It would be seen as hypocritical if I did not do the same now with a Labour Government—my own Government—in office. There is too much hypocrisy around at the present time and I am not prepared to add to it. I ask the House to insist on their amendment to which the Commons have disagreed.
4.30 p.m.
On Question, That the House do insist on their Amendment No. 1 to which the Commons have disagreed for their reason numbered 1 A?
Their Lordships divided: Contents, 36; Not-Contents, 161.

Division No. 1

CONTENTS

Allenby of Megiddo, V.

Milverton, L.

Blake, L.

Monson, L.

Broadbridge, L.

Mottistone, L.

Brookeborough, V.

Mountgarret, V.

Clanwilliam, E.

Munster, E.

Clifford of Chudleigh, L.

Park of Monmouth, B.

Congleton, L.

Pearson of Rannoch, L.

Craig of Radley, L.

Rennell, L.

Cross, V.

Renton of Mount Harry, L.

Donegall, M.

Sharples, B.

Exmouth, V.

Simon of Glaisdale, L.

Grantley, L.

Stallard, L.

Harmar-Nicholls, L.

Stewartby, L.

Ilchester, E.

Stockton, E.

Incheape, E.

Stodart of Leaston, L.

Lindsey and Abingdon, E.

Stoddart of Swindon, L. [Teller.]

Liverpool, E.

Swansea, L. [Teller.]

Massereene and Ferrard, V.

Swinfen, L.

NOT-CONTENTS

Acton, L.

Blackstone, B.

Addington, L.

Blyth, L.

Aldington, L.

Borrie, L.

Ampthill, L.

Boyd-Carpenter, L.

Archer of Sandwell, L.

Bridges, L.

Ashley of Stoke, L.

Burlison, L.

Avebury, L.

Callaghan of Cardiff, L.

Barnett, L.

Calverley, L.

Beaumont of Whitley, L.

Carlisle, E.

Berkeley, L.

Carmichael of Kelvingrove, L.

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Carter, L. [Teller.]

McIntosh of Haringey, L.

Chandos, V.

[Teller.]

Charteris of Amisfield, L.

Mackie of Benshie, L.

Cledwyn of Penrhos, L.

McNair, L.

Clinton-Davis, L.

McNally, L.

Coleridge, L.

Mar and Kellie, E.

Currie of Marylebone, L.

Mason of Barnsley, L.

Dahrendorf, L.

Merlyn-Rees, L.

David, B.

Milner of Leeds, L.

Davies of Coity, L.

Mishcon, L.

Davies of Oldham, L.

Molloy, L.

Dean of Thornton-le-Fylde, B.

Montague of Oxford, L.

Desai, L.

Morris of Castle Morris, L.

Dholakia, L.

Morris of Manchester, L.

Diamond, L.

Nelson, E.

Dixon, L.

Nicol, B.

Donaldson of Kingsbridge, L.

Northbourne, L.

Donoughue, L.

Northfield, L.

Dormand of Easington, L.

Ogmore, L.

Dubs, L.

Orme, L.

Elis-Thomas, L.

Paul, L.

Evans of Parkside, L.

Peyton of Yeovil, L.

Ewing of Kirkford, L.

Pitkeathley, B.

Ezra, L.

Plant of Highfield, L.

Falconer of Thornton, L.

Ponsonby of Shulbrede, L.

Falkland, V.

Prys-Davies

Farrington of Ribbleton, B.

Puttnam, L.

Fitt, L.

Ramsay of Cartvale, B.

Gallacher, L.

Randall of St. Budeaux, L.

Geraint, L.

Razzall, L.

Gordon of Strathblane, L.

Rea, L.

Gould of Potternewton, B.

Redesdale, L.

Graham of Edmonton, L.

Rendell of Babergh, B.

Gregson, L.

Richard, L. [Lord Privy Seal.]

Grenfell, L.

Ritchie of Dundee, L.

Hailsham of Saint Marylebone, L.

Robson of Kiddington, B.

Hamwee, B.

Rochester, L.

Hanworth, V.

Rogers of Riverside, L.

Hardie, L.

Roll of Ipsden, L.

Hardy of Wath, L.

Sainsbury of Turville, L.

Harris of Greenwich, L.

Serota, B.

Haskel, L.

Sewel, L.

Hayman, B.

Shepherd, L

Hayter, L.

Simon, V.

Henderson of Brompton, L.

Simon of Highbury, L.

Hilton of Eggardon, B.

Smith of Gilmorehill, B.

Hogg of Cumbernauld, L.

Steel of Aikwood, L.

Hollick, L.

Strabolgi, L.

Strafford, E.

Hollis of Heigharn, B.

Symons of Vernham Dean, B.

Hooson, L.

Taverne, L.

Hoyle, L.

Taylor of Blackburrn, L.

Hughes, L.

Taylor of Gryfe, L.

Hunt of Kings Heath, L.

Tenby, V.

Hutchinson of Lullington, L.

Thomson of Monifieth, L.

Irvine of Lairg, L. [Lord]

Tope, L.

[Chancellor.]

Tordoff, L.

Jacobs, L.

Turner of Camden, B.

Janner of Braunstone, L.

Varley, L.

Jay of Paddington, B.

Walker of Doncaster, L.

Jeger, B.

Walker of Worcester, L.

Jenkins of Putney, L.

Wallace of Saltaire, L.

Judd, L.

Walpole, L.

Kennedy of The Shaws, B.

Westbury, L.

Kirkhill, L.

Whitelaw, V.

Lester of Herne Hill, L.

Whitty, L.

Lestor of Eccles, B.

Wigoder, L.

Levy, L.

Williams of Crosby, B.

Lockwood, B.

Williams of Elvel, L.

Longford, E.

Williams of Mostyn, L.

Ludford, B.

Windlesham, L.

McCarthy, L.

Winston, L.

Resolved in the negative, and Motion disagreed to accordingly.
4.40 p.m.
Lord Williams of Mostyn: My Lords, I beg to move that the House do not insist on their Amendment No. 1 to which the Commons have disagreed for the reason numbered 1A.
Moved, That the House do not insist on their Amendment No. 1 to which the Commons have disagreed for their reason numbered 1A.—(Lord Williams of Mostyn.)
On Question, Motion agreed to.

LORDS AMENDMENT
3 After Clause 2, insert the following new clause:
COMPETITION PISTOLS

(" .—(1) The authority of the Secretary of State is not required by virtue of section 5(1)(aba) of the 1968 Act for a person to have in his possession or to purchase, acquire, sell or transfer a pistol chambered for 22 or smaller rim-fire cartridges if he is authorised under the Act to possess, purchase or acquire that weapon subject to a condition which complies with subsection (2) below.

(2) A certificate granted under subsection (1) above shall be subject to the condition that—

(a) the pistol is used for training in shooting disciplines approved by the International Olympic Committee for inclusion in the Olympic Games; and

(b) the pistol is used by a person approved by the Secretary of State and on the recommendation of a recognised governing body of the sport; and

(c) the weapon is stored and used only at premises designated by the Secretary of State; and

(d) possession of the weapon outside such designated premises shall be permitted only for transfer to and use at premises at which a shooting competition is taking place on such conditions as the Secretary of State shall specify.")

The Commons disagreed to this amendment for the following reason:
3A Because they do not consider it appropriate for the Bill to provide for any special exemptions to apply to the prohibition of small-calibre pistols.
Lord Stoddart of Swindon: My Lords—
Lord Hailsham of Saint Marylebone: Hear, hear!
Lord Stoddart of Swindon: Thank you very much. My Lords, I am sorry to have delayed your Lordships, but I was a Teller in the last Division and it took me a little time to return to my place.
I beg to move that the House do insist on their Amendment No. 3 to which the Commons have disagreed for the reason numbered 3A. This Motion, like my previous Motion on disabled pistol shooters, is tabled to enable further debate on the provision of centres of excellence to enable British competitors to continue to take part in, and to train for, international pistol shooting competitions and to give your Lordships the opportunity to insist on your amendment. I do not think that that will happen, but your Lordships must have the opportunity.
Although the Commons disagreed with your Lordships' amendment, the debate, like that on the amendment relating to disabled pistol shooters, was

109
spirited, sensible and cross-party. However, in my opinion, the balance of argument was on the side of your Lordships' amendment while the Government's attitude remained rigid and unrelenting.
Again, I shall simply summarise the arguments in favour of your Lordships' amendment. First, it seeks to establish a few national shooting centres of excellence to allow competition shooters, identified by national bodies, to train and compete in national and international 22 calibre pistol competitions. Only a relatively few highly motivated and responsible pistol shooters would be involved. Pistols would be kept at centres under safe and secure conditions. The whole system would be under the control of the Secretary of State. Failure to allow British competitors to train and compete not only precludes Britain from pistol shooting events and international competitions but also puts at risk the possibility of hosting international events in this country, including the Olympic Games. We shall have the ridiculous situation where foreign competitors can train and compete in Britain while Britons are debarred.
Opposing your Lordships' amendment, the Minister argued that keeping 22 pistols at safe and secure sites would not give sufficient protection to the public. That is not a convincing argument. The centres would be much more secure than such centres have ever been, and we would all be far more secure than if more lethal weapons continued to be held in private hands. Is it really suggested that MoD arsenals or police weapons stocks are a danger to the public? In any event, would criminals raid secure weapons stores when they can easily buy a gun on the black market? The whole thing is absurd. The argument simply will not wash and, in my view, should be rejected.
During the Commons debate Mr. Frank Cook produced the results of the recent public opinion surveys I mentioned on the previous amendment showing that 54 per cent. of those polled are now in favour of retaining pistol competition shooting. Therefore, your Lordships' amendment is in tune with majority public opinion—not with minority opinion but, I repeat, with majority public opinion. The public take the sensible view that competitions can and should continue, especially since our Prime Minister wishes to improve Britain's presence and influence in the world in every sphere. They see it as a strange paradox that he supports the unnecessary withdrawal of Britain from worldwide competition pistol shooting. The public also see that this may he the thin end of the wedge which will ban all firearms and lead to the complete withdrawal of Britain from international shooting competitions.
In such circumstances I believe it to be incumbent upon your Lordships to insist upon your amendment. To do so would gain support and applause from the public. As I pointed out with regard to the previous Motion, insistence on your Lordships' amendment is perfectly proper in parliamentary terms, retaining the correct balance between both Houses of Parliament yet establishing that the House of Lords is a real and vibrant second Chamber performing its function responsibly and effectively. I did, of course, write that before the last Division. I commend the Motion to the House.
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Moved, That this House do insist on their amendment No. 3 to which the Commons have disagreed for the reason numbered 3A.—(Lord Stoddart of Swindon.)
Lord Monson: My Lords, in replying to the first Motion, the Minister revealed that there were 374,000 individuals registered as disabled. Although I do not think that he was arguing that all, or even most, of them were going to take up, or continue, pistol shooting, it is nevertheless true that a few thousand might well wish to do so. However, in this amendment we are speaking only of between 300 and 400 extremely talented top-ranking sportsmen and sportswomen who can be, and will be, assuming the amendment is agreed to, rigorously vetted. Such rigorous vetting is possible when one is dealing with hundreds rather than thousands of people.
Japan is frequently held up to us by the anti-gun lobby as a shining beacon, despite the widespread corruption and gangsterism in that country. It is true that Japan has very strict anti-gun laws, but even Japan allows the sort of scheme which the amendment proposes for its Olympic and potential Olympic pistol shooters.
Two-and-a-half weeks ago, MORI carried out a poll which revealed that 61 per cent. of the population would like provisions such as these to be accepted. That is no wonder, because we will be the laughing stock of the world if we, alone among civilised countries, do not allow our sportsmen to practise Olympic pistol shooting in this country. I warmly support the Motion.
Lord Pearson of Rannoch: My Lords, I rise to support this amendment briefly. The Minister in another place opined that it would not be safe to keep the weapons involved in secure premises, such as Ministry of Defence establishments and so on. In case the noble Lord on the Front Bench advances the same theory this evening, perhaps I may remind him in his predicament of the disassembly amendment passed by your Lordships in February of last year to the previous Government's unfortunate and misguided Bill. Your Lordships will recall that that amendment would have insisted that the vital parts of a pistol, the slide mechanism or chambers, would be kept in secure premises while the weapon itself would be kept at home. If there were any doubt about the safety of what is proposed by this amendment I believe that that system, wisely approved by your Lordships by a substantial majority, should precisely answer the point.
In support of what I have said, I quote the Cullen Report. On the whole issue of whether or not pistols should be banned, that report concluded that on the whole they should not be. Lord Cullen said he believed that pistol shooting should be made safer "preferably by disassembly". I commend that to your Lordships and support the amendment.
Lord Williams of Mostyn: My Lords, the arguments on this amendment are substantially those that I addressed to your Lordships earlier. I shall therefore accept the advice not to be repetitive or lengthy. We do not want to see any exemptions to the ban on handguns other than those already agreed. This amendment was

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rejected by another place last week by a majority of 132 on a free vote. When it was debated by your Lordships it succeeded by a majority of only 13. We believe that this amendment will prove unworkable and create a significant loophole.
This amendment is not necessary for the purpose of hosting any future Olympic or Paralympic Games in this country. That proposition is simply not correct. The Home Secretary has ample powers under Section 5 of the 1968 Act to give special dispensations to competitors who intend to take part in competitions. As recently as the end of August of this year the Secretary of State for Home Affairs successfully used those powers to allow visiting overseas competitors to participate in the 14th European Police Pistol Championship at Bisley. Very few events will be directly affected by the Bill: six out of 28 Commonwealth Games competitions; only three out of 15 Olympic competitions; and only two out of 15 Paralympic competitions.
A number of your Lordships have dealt briefly with the issue of illegal guns. Of course that is a menace and a vice. This is not the appropriate time for me to address the dangers of those guns, except to remind noble Lords that the penalties for the illegal possession of firearms in this country are very severe: up to 10 years' imprisonment for possession of prohibited firearms. The police and customs rightly continue to attach the very highest priority to tracing and recovering these weapons.
We have considered this matter with care. Without any intended disrespect, we have come to the adamant conclusion that this amendment is not acceptable in the light of the recent history which has brought us to this pass. We believe that a complete ban is the only safe option. I invite your Lordships to concur with that view.
Lord Stoddart of Swindon: My Lords, I should like to thank all noble Lords who have taken part in this debate. As the noble Lord, Lord Monson, points out, by creating a complete ban on handguns this country is likely to be the laughing stock of the world. The noble Lord, Lord Pearson of Rannoch, has pointed out that the opportunity to make matters very much safer in accordance with the Cullen Report was available under the disassembly amendment which he moved and to which the House agreed but did not have the bottle to insist upon.
My noble friend Lord Williams has repeated his arguments. I believe that my noble friend Lord Howell, who is not at the moment in his place, takes the view, which certainly I share, that there is a risk that the Government's attitude will mean that this is a factor in the hosting of future Olympic and perhaps Commonwealth Games.
I have taken into account the result of the previous vote. Nevertheless, I owe it to the competition pistol shooters, particularly those who have written to me, to test the will of this House. I ask that the House do insist on their amendment to which the Commons has disagreed.
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On Question, That the House do insist on their Amendment No. 3 to which the Commons have disagreed for their reason numbered 3A?
4.55 p.m.
Their Lordships divided: Contents, 20; Not-Contents, 151.

Division No. 2

CONTENTS

Berners, B.

Munster, E

Blake, L.

Newall, L.

Carlisle, Bp.

Park of Monmouth, B.

Congleton, L.

Pearson of Rannoch, L.

Cross, V.

Prior, L.

Grantley, L.

Rennell, L.

Inchcape, E.

Simon of Glaisdale, L.

Lindsey and Abingdon, E.

Stockton, E.

Massereene and Ferrard, V.

Stoddart of Swindon, L. [Teller.]

Monson, L.

Swansea, L. [Teller.]

NOT-CONTENTS

Acton, L.

Gilmour of Craigmillar, L.

Addington, L.

Gladwin of Clee, L.

Ampthill, L.

Gordon of Strathblane, B.

Archer of Sandwell, L.

Gould of Potternewton, B.

Ashley of Stoke, L.

Graham of Edmonton, L.

Avebury, L.

Gregson, L.

Barnett, L.

Grenfell, L.

Beaumont of Whitley, L.

Hailsham of Saint Marylebone, L.

Berkeley, L.

Hamwee, B.

Blackstone, B.

Hanworth, V.

Blyth, L.

Hardie, L.

Borrie, L.

Hardy of Wath, L.

Bridges, L.

Harris of Greenwich, L.

Brooks of Tremorfa, L.

Haskel, L.

Burlison, L.

Hayman, B.

Callaghan of Cardiff, L.

Henderson of Brompton, L.

Calverley, L.

Hilton of Eggardon, B.

Carlisle, E.

Hogg of Cumbernauld, L.

Carmichael of Kelvingrove, L.

Hollis of Heigham, B.

Carter, L. [Teller.]

Holme of Cheltenham, L.

Chandos, V.

Hooson, L.

Charteris of Amisfield, L.

Hoyle, L.

Cledwyn of Penrhos, L.

Hughes, L.

Clinton-Davis, L.

Hunt of Kings Heath, L.

Cocks of Hartcliffe, L.

Irvine of Lairg, L. [Lord Chancellor.]

Currie of Marylebone, L.

Dahrendorf, L.

Jacobs, L.

David, B.

Janner of Braunstone, L.

Davies of Coity, L.

Jay of Paddington, B.

Davies of Oldham, L.

Jeger, B.

Dean of Beswick, L.

Jenkins of Putney, L.

Dean of Thornton-le-Fylde, B.

Kennedy of The Shaws, B.

Desai, L.

Kilmarnock, L.

Dholakia, L.

Kirkhill, L.

Diamond, L.

Leathers, V.

Dixon, L.

Lester of Herne Hill, L.

Donoughue, L.

Lestor of Eccles, B.

Dormand of Easington, L.

Levy, L.

Dubs, L.

Lockwood, B.

Elis-Thomas, L.

Longford, E.

Evans of Parkside, L.

Ludford, B.

Ewing of Kirkford, L.

McCarthy, L.

Ezra, L.

McIntosh of Haringey, L.

Falconer of Thoroton, L.

[Teller]

Falkland, V.

Mackie of Benshie, L.

Farrington of Ribbleton, B.

McNair, L.

Gallacher, L.

Mcnally, L.

Geraint, L.

Mar and Kellie, E.

113

Mason of Barnsley, L.

Rochester, L.

Merlyn-Rees, L.

Rogers of Riversid, L.

Milner of Leeds, L.

Sainsbury of Turville, L.

Mishcon, L.

Scotland of Asthal, B.

Molloy, L.

Selborne, E.

Montague of Oxford, L.

Serota, B.

Morris of Manchester, L.

Sewel, L.

Morris of Manchester, L.

Shepherd, L.

Nelson, E.

Simon, V.

Newby, L.

Simon of Highbury, L.

Nicol, B.

Steel of Aikwood, L.

Northfield, L.

Strabolgi, L.

Ogmore, L.

Strafford, E.

Orme, L.

Symons of Vernham Dean, B.

Paul, L.

Taverne, L.

Pitkeathley, B.

Taylor of Blackburn, L.

Ponsonby of Shulbrede, L.

Thomson of Monifieth, L.

Prys-Davies, L.

Tope, L.

Puttnam, L.

Tordoff, L.

Ramsay of Cartvale, B.

Turner of Camden, B.

Randall of St. Budeaux, L.

Walker of Doncaster, L.

Razzall, L.

Wallace of Saltaire, L.

Rea, L.

Walpole, L.

Redesdale, L.

Whitty, L.

Rendell of Babergh, B.

Williams of Crosby, B.

Richard, L. [Lord Privy Seal.]

Williams of Elvel, L.

Ritchie of Dundee, L.

Williams of Mostyn, L.

Robson of Kiddington, B.

Winston, L.

Resolved in the negative, and Motion disagreed to accordingly.
Lord Williams of Mostyn: My Lords, I beg to move that this House do not insist on their Amendment No. 3 to which the Commons have disagreed for their reason numbered 3A.
Moved, That the House do not insist on their Amendment No. 3 to which the Commons have disagreed for their reason numbered 3A.—(Lord Williams of Mostyn.)
On Question, Motion agreed to.

Community Environmental Law: ECC Report
5 p.m.
Baroness Hilton of Eggardonrose to move, That this House take note of the report of the European Communities Committee on Community Environmental Law: Making it Work (2nd Report, Session 1997–98, HL Paper 12).
The noble Baroness said: My Lords, it is my pleasant duty to present reports of two of the inquiries conducted by the Environment Committee of the European Select Committee during the past year dealing with Community environmental law and freedom of access to information.
The report relating to a review of the Community directive on freedom of information on the environment was published nearly a year ago. but discussion has been delayed, first, because of the press of business in the run-up to the election; and, secondly, in the hope that the new Administration would produce their White Paper on freedom of information sooner than now appears likely.
114
We are now promised that the White Paper will he produced before Christmas, but it was my feeling that that was too long a time to wait for the debate.
The report concentrates upon the working of the directive in this country, but we also paid a visit to Ireland, where we were impressed by their arrangements. We make also a number of recommendations to the European Commission which is currently reviewing the directive.
In examining the working of the directive in this country, we were critical of the Department of the Environment, first, for failing to provide an adequate definition of information relating to the environment; and for failing to list, or define, the relevant persons to whom the directive would apply. In particular, we were concerned that the water services companies seemed uncertain that the directive applied to them. It seemed clear to the committee that bodies with "public responsibilities for the environment", and "under the control of public authorities", as the water companies plainly are, should clearly include the regimes of the private utilities.
The Department of the Environment's laissez-faire attitude to its responsibilities for the environment was disappointing. As we say in our report. it has led to a perception that compliance with the regulations may be optional.
More generally, we recognised that there may he justifiable reasons for denying access to information to members of the public. Information may be commercially sensitive, incomplete, or a preliminary draft only may have been prepared, which it would not be appropriate to have in the public domain. However, it was our finding that all too often financial barriers and other excuses were used to deny access to genuine researchers and to those with a concern for the environment.
We applaud therefore the growing tendency of the new Environment Agency, for example, and some of the research institutions to set up a web site to provide information on the Internet. That obviates all the claimed costs, search, analysis, duplication, and so forth, that have provided excuses in the past. We comment also upon the failure of the European Commission to practise the freedom of information that it preaches. That has proved a problem in a number of our inquiries, notably in relation to the Byzantine decision-making process that went into the leg-hold traps saga. The lack of access to Council and Commission documents is a theme pursued in our second inquiry.
Our report on making community environmental law work revisits an area first looked at five years ago under the chairmanship of the noble Lord, Lord Nathan, and was intended to be a review of progress since then. Some major developments have taken place. The European Environment Agency was set up in Copenhagen in 1993. It has made considerable progress in collecting information and disseminating it to members of the European Community. Another major development was the Maastricht Treaty. Qualified majority voting is now standard procedure for environmental legislation. The Amsterdam Treaty

115
continued progress in that direction and the co-decision procedure effectively gives the European Parliament a veto. That is a welcome introduction of democratic processes into environmental law making. Furthermore, a network of national pollution inspectors—INPEL—has been set up and various other regulatory changes have been made. Most of those have led to greater transparency and greater encouragement of members of the European Community to take environmental matters seriously.
The Commission's communication in 1996, its fifth environmental action plan, looks on implementation as having five links in a regulatory chain. We took that model of implementation as the basis for our report. We looked at each link in turn: first, the preparation of policy; secondly, the drafting of legislation; thirdly, practical implementation; fourthly, the stage of monitoring, reporting and evaluation; and, fifthly, the stage of enforcement and systems of ensuring compliance with Community law.
Since our last report five years ago, we recognise that there have been a number of improvements. First, there is the more frequent use of Green Papers so that greater discussion can take place before policy is finally prepared in a draft directive. That has led to more consultation. Furthermore, some of the previous gross errors have not appeared in draft directives in recent years. Secondly, there has been an adoption of internal guidelines within the Commission which has led to more consultation and better co-ordination between the various directorates.
However, we believe that during the pre-legislative stage more thorough and open consultation is needed between NGOs, governments and industry. We again reiterate our disquiet about the secrecy that surrounds the scientific and technical advice on which the Commission develops policy. It is so contrary to normal scientific practice, which depends upon examination by peers and an understanding of the basic data which leads to scientific recommendations. We have commented on that previously in relation to our several inquiries into water directives, where the standards of water quality are essential and where it has been extremely difficult to discover the basis on which draft directives have been produced.
We are also increasingly concerned about the use of a new expression in European vocabulary, "comitology". Many things which the Commission is unable to do. partly because of lack of time or expertise, have led to the setting up of, it is alleged, dozens and possibly hundreds of specialist committees which meet and make formal recommendations, some by qualified majority voting. Their proceedings seem to be wholly opaque and undemocratic. We believe that their membership proceedings and papers should be in the public domain.
The second link in the regulatory chain is the drafting of legislation. We welcome the increasing use of framework directives which have advantages for subsidiarity and existing national arrangements. It is, however, important that they are not drafted so loosely that varying practices develop throughout the Community.
116
The third link in the regulatory chain is that of practical implementation. We strongly support the Commission's proposal that all member states should provide confirmation, article by article, of how their national legislation meets the obligations of directives. This information, too, should be publicly available.
The fourth link in the chain is that of monitoring, reporting and evaluation. In 1992, we had high hopes for the role of the European Environment Agency. It has made rapid progress since its inauguration in 1993 and has produced some interesting Europe-wide data which enables comparisons to be made between countries. However, we would wish to see more formal and effective links with the regulatory committees which advise the Commission. We would wish that the Commission itself took more notice of the proceedings of the agency. We recommend in particular that the reports of the agency should automatically go to the European Parliament as well as to the Commission and Council of Ministers. There is scope for the European Parliament to encourage greater conformity between member states.
The Council of Ministers remains preoccupied with the negotiation of new policies and laws, but in our view it should also regularly review implementation. Perhaps that is a hotter potato for the ministers of the various countries to take on board because they may appear to be criticising other member states. Nevertheless, we believe that it should be a responsibility of the Council of Ministers. We are pleased to note the June 1997 resolution which contains a clear commitment to such a process.
The fifth and final link in the regulatory chain is that of enforcement. In 1992, we were very concerned about non-compliance with directives and Article 169 complaints. Our concern remains. There is a continuing lack of transparency. Complainants are not informed about the outcome of their complaints. We therefore welcome the ombudsman's current investigation into their handling and believe that, in this respect, there should be a greater role for the European Parliament.
The Government have responded to both our reports. In February, the Department of the Environment replied to our report on freedom of information. It was a disappointing and complacent response. It sheltered behind the Commission's current view of the directive and considered that no action was necessary in respect of any of our recommendations except one; namely, the setting up of an independent mechanism to hear appeals relating to the refusal of access to information from public bodies. We hope that the current Government's forthcoming White Paper will encourage a greater spirit of openness in all government bodies.
The response to our latest report was, for understandable reasons, received only last week. It was a more positive response and supports most of our observations. There are encouraging trends. The Amsterdam Treaty emphasises the importance of greater transparency in decision making and the Government agree that the papers of the scientific advisers and committees, about which we have been so concerned,

117
should be more widely available and that there should be greater openness about their membership and results. Time alone will show whether that is the case.
In conclusion, I thank all the members of my committee who have contributed to the reports. They have made my two years as chairman extremely enjoyable. In particular, I should like to express my gratitude to our clerk, Tom Radice, who of course does all the hard work and makes us all appear to be more intelligent and knowledgeable than perhaps we are. I beg to move.
Moved, That this House take note of the Report of the European Communities Committee on Community Environmental Law: Making it Work (2nd Report, Session 1997–98, HL Paper 12).—(Baroness Hilton of Eggardon.)
5.18 p.m.
Baroness Park of Monmouth: My Lords, I feel an agreeable nostalgia as I rise to contribute to the debate because until a few months ago I was a member of the committee which produced the two reports. I had the pleasure of serving its admirable chairman and working with the excellent secretary.
As far back as 1995–96 when the committee was reporting on leg-hold traps. it was expressing concern over the secretive and unrepresentative nature of the working group responsible. In general, the committee questioned the effectiveness of the Commission's internal structure in resolving conflicting policy aims and deprecated the tendency of the directorates general to behave as separate fiefdoms, never consulting each other nor providing information to the NGOs and others who sought it. When we reported on drinking water we could obtain no satisfactory assurances on effective control and audit, still less transparency. The department told us philosophically that it was not obtaining the transparency it would like, but that it was,
"not right to suggest that there is an absolute darkness".
Now, in the two latest reports the same problems recur.
The committee received evidence on the problems of vertical chains within the DGs, inadequate cross links with other DGs on policy and even of a lack of co-ordination within Directorate XI on the environment itself. Those were all familiar problems, encountered over and over again. An excellent example of the dangers of a lack of co-ordination and consultation between the directorates arose over leg-hold traps when DG XI failed utterly to talk to DG I, which proved to have an overriding interest in the context of the World Trade Organisation and the GATT negotiations.
Another aspect of that problem emerged in the evidence given by one NGO before the committee on its last report when we were told that the absence of inter-directorate consultation at the early stages of the development of the proposal of coastal protection had led to its effective blocking at a later stage by DG XVI because it conflicted with that directorate's own regional policy. Greater transparency and a requirement for inter-directorate consultation early on to determine the possible impact of a proposal could have prevented that. There are, of course, only too many examples of
118
ecological damage resulting from a failure to assess beforehand the impact on the environment of a proposal for a dam or a road.
The committee felt also particular concern about secrecy over the membership and agenda of scientific and technical committees, as the chairman has said. Without the scientific data being published, there can be no hope of ensuring quality through peer review, and that is all the more important since it is clear that political rather than scientific considerations, thanks to the lack of transparency, are not unlikely to decide the issue on occasions.
The publication by the Commission of papers provided by their expert advisers might, it was suggested by the department, be helpful. As the European Parliament told the committee in written evidence,
"there is (in the context of Article 169 and the Grievance Procedure) an astonishing degree of interference and non-co-operation by Member States who often appear to display a cavalier disregard for the rule of law which they themselves are hound to uphold".
That was the parliament's view.
However, the unbeatable secret weapon in the Commission's armoury in the battle to achieve transparency which is being fought by the committee, the NGOs and, we hope, governments who wish to know why decisions are taken and on what basis, is a mysterious virus known as "comitology". That is allied to a proliferation of committees. No fewer than 225 committees have been created by the Council of Ministers and 67 advisory committees have also been created. The one thing that rarely seems to emerge from them is a clear and public decision, still less answers to legitimate questions. Files on complaints are closed without the complainants even knowing and the only recourse they have is, only too often, to take the Community institutions to the European Court of Justice through the Article 173 procedure for grievances.
But what is comitology? The word does not appear in either the English or French dictionaries I consulted in the Library. It appears to be a Brussels-created word deriving from the words "comity" in the phrase "the comity of nations", which is defined there in the dictionary as,
"the courteous and friendly understanding by which each nation respects the laws and usages of every other, so far as it may be without prejudice to its own rights and interests".
At paragraph 33, the committee reiterates its concerns about the unwarranted secrecy that surrounds the scientific and technical advice on which the Commission bases its policies and that, in its evidence to the committee, the Commission appeared to rely on the principles of comitology, the procedures of which are not entirely straightforward. That is an extremely restrained comment on a system which embraces advisory committees, management committees and regulatory committees.
In 1995, the European Union budget provided for a total of 333 committees established under the comitology procedure and about 20,000 people are estimated to be serving on them. That is not all. Beside the comitology committees, the Commission itself

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appoints a wide range of outside experts, technical and scientific, to advise it on the development of policy and on legislative proposals. And there are, of course, both horizontal and vertical legal entities. Those are the committees whose agenda and membership are secret and whose lack of transparency so concerns the committee.
What does comitology mean for the Commission? When the committee asked DG XI, the environment directorate, why that secrecy was necessary, it referred to the Council decision on comitology which defines the use of delegated powers by the Commission and says that as regards the issue of transparency for the various scientific and technical committees, each committee would have its own rules of procedure and those would need to be consulted to determine the committee's scope for openness. That ruling clearly leaves it for the committees to make their own decisions on transparency and comitology seems to boil down not to courteous and friendly understanding but to a cast-iron method of ensuring against transparency. Indeed, it is difficult to understand how that can be defended. The committee made a strong and just point that the credibility of advances in scientific knowledge must rely heavily on the open process of peer review, a process which can only be frustrated if those outside the circle of committees are denied access to the data and analysis on which legislative proposals are based and may not even know the names of the scientists concerned.
However, it is reassuring that the Government, in their response to the committee's report, have quoted and supported the provision in the Amsterdam Treaty, after the IGC, for introducing greater transparency, although not, I fear, full transparency; a new commitment to more open decision making; a public right of access to the European Parliament, Council and Commission documents; and the compulsory publication of Council votes when Council acts in a legislative capacity. However, I am not reassured by the fact that each institution is to lay down the rules of procedure regarding access to its documents itself.
Equally, it is excellent news that the Government hope to take further steps during their presidency to enhance the transparency of EU decision making and procedures. Let us hope that that remains high on their agenda and that comitology does not win in the end. A change cannot come too soon. We may even see the word "comitology" drop out of Brussels-speak.
5.26 p.m.
Baroness Ludford: My Lords, it is with some trepidation that I rise to address your Lordships for the first time. However, I feel encouraged not only by the sense of honour that I have in joining your Lordships in this beautiful House but also by the generosity of the welcome extended to me by many individuals from all parts of the House. Even though I am a proponent of reform, that does not obscure my appreciation of the distinction of so many Members of your Lordships' House. Guided by the excellent and efficient attendants and other staff, whom I also sincerely thank, I am even learning to find my way
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round the building. My 11 year-old niece started her new school this term and I have a strong sense of being in the same boat.
I have not matched the speed record of the noble Lord, Lord Higgins, who delivered his impressive maiden speech within 24 hours of his introduction on a social security matter; nor that of the noble Baroness, Lady Amos, who made an excellent contribution to the Second Reading of the Human Rights Bill. But today's debate gives me an opportunity to contribute on topics close to my heart and of which I have some knowledge and experience. An opportunity to bring together Europe, freedom of information and the environment is, for a Liberal Democrat, like being a child let loose in a sweet shop.
I realise that not every Member of this House will share my enthusiastic and pro-European sentiments and I have no wish to be unduly controversial today. But I hope that I shall unite views in my admiration for the work of the European Communities Committee and its sub-committees. I know from my seven years working in Brussels for the European Commission that the committees' reports are extremely well-regarded both for the thoroughness of their evidence and analysis and the intellectual weight of their conclusions.
The two reports today on European environmental law, which are the subject of debate, do not disappoint. However, before I turn to them directly, perhaps your Lordships will indulge my wish to reflect on Europe more generally in the light of today's date, which is, of course, Armistice Day. As a local councillor in Islington, I took part, as I have done every year, in our local Remembrance Day service. I stood this morning on the steps of the town hall for the two minutes silence. As I reflected on both occasions on the debt owed to those who died and particularly as I looked at all the young people present on Sunday, I knew why my European convictions are unshakeable. It is because Europe offers peace and security, and security in its widest sense is the theme running through today's debate.
The attainment of security in Europe needs not only the absence of war and institutional ties to bind nations together but also an open and effective democracy and a safe environment. There will be no future for our planet in generations to come if our stewardship falls short of sustainability. Freedom of information is also a crucial component of security because well-informed and demanding citizens are vital to a flourishing democracy, not a threat to it.
Dictators and authoritarians have over the centuries mistakenly believed that ignorance and oppression were necessary for the maintenance of order; on the contrary, they allow resentment and irresponsibility to fester and undermine the long-term stability that comes from democracy's vigorous debate and acceptance of disagreement and dissent.
The two reports being debated today play a valuable role in bringing home to us just how essential openness and the rule of law are in the European scheme of things. I hope that Ministers and civil servants preparing the anticipated freedom of informational Bill will read

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the report on the directive on freedom of access to information on the environment. It is a very interesting case study for a full freedom of information regime.
The committee concluded that not only the directive and the UK regulations needed strengthening, but also that clear laws need to be backed by a clear commitment by public authorities to removing a culture of official secrecy. The committee says with care that,
"the UK is one of the countries which has had to devote a relatively high level of effort to reforming deep seated practices and attitudes".
Then, in a sentence which is music to my ears, the committee recommends that,
"there should be a more forceful assertion in the Directive itself of citizens' rights and a strong presumption in favour of openness".
But, as happens all too often, Whitehall civil servants who drafted the UK implementing regulations fell prey to the temptations of "gold-plating" EU directives. Poor old Brussels sometimes gets the blame unfairly! In this case the regulations made the UK the only EU member state which lets information-holding bodies like the privatised utilities decide whether they are within the scope of the law, with predictable results given that, as we all know, turkeys do not vote for Christmas.
The committee points out that the European Commission and the European Council are not always good practitioners of open government. Secrecy—and perhaps I would say this as a former official at the Commission—is worst in the Council where, in the committee's words,
"a low level of transparency".
prevails. That phrase surely ranks in the lexicon of euphemisms, along with "economical with the truth".
The Council is co-legislator with the European Parliament. Yet it meets in secret. There is no equivalent of Hansard. We are all familiar with Ministers coming out of negotiations and telling their national media what a great victory they have achieved: they all have, of course. Directives emerge from the scrum too often ambiguously worded and far below the standard of skill of our parliamentary draftsman, such as displayed in the Human Rights Bill.
As has been noted, the Treaty of Amsterdam marks progress on the matters debated today, incorporating sustainable development as a EU objective for the first time and inserting a new article on transparency—not very strong, but a start—giving a right of access to European documents.
It is not healthy for European democracy or for the future of the European Union that European institutions should be remote from Europe's citizens or that the rule of law should be flouted. Our people need to know how they are governed, by whom and from where. They also need to have confidence that everyone is playing by the same rules. We are still too far from those goals. For most people Europe is opaque, confusing and elitist; and words like "comitology" do not help. Indifference, alienation and even rejection will be the inevitable product of ignorance, exclusion and suspicion. Some want that; I do not. As a passionate but candid friend of the European Union, I urge the decision-makers to open up, brush away the cobwebs and let the people in.
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In these two reports and in its work generally, the Select Committee has made a very large contribution towards doing just that. It probes the inner workings of the EU and makes it accessible. Though, in themselves, the reports may not be obvious bedside reading in place of, shall we say, Hello magazine or Motorsport, they facilitate a better-informed press and public and help create that desirable citizens' Europe. The topic of the environment is an excellent vehicle for involving people in the European project, as the Foreign Secretary acknowledged in his speech last week on the forthcoming UK presidency.
I look forward to following the further work of the committee under its skilled chairmanship. I pay tribute to the work of the noble Baroness, Lady Hilton of Eggardon in chairing Sub-Committee C which produced these excellent and informative reports. It is timely that they should be debated on the anniversary of the Armistice, on a day when the security of our continent in its broadest sense is on our minds. I thank noble Lords for their patience in listening to me today. I look forward to playing a full part in the proceedings of the House in the future.
5.35 p.m.
The Countess of Mar: My Lords, it has been a tremendous pleasure for me to listen to the maiden speech of the noble Baroness, Lady Ludford. She speaks from a base of long experience. Indeed, she has been working with Europe since 1979 and her speech contained little flashes of humour which I thoroughly enjoyed. I am sure that all noble Lords will echo my sentiments when I say that we very much look forward to hearing more of the noble Baroness's expertise and humour in the House in future.
I am grateful to our chairman, the noble Baroness, Lady Hilton of Eggardon, for introducing today's debate. For me, membership of Sub-Committee C is both a fascinating and an enlightening experience and her guidance as chairman invaluable. I should like also to say that the noble Baroness's guidance has its own humour. Indeed, noble Lords who listened to the speech made by the noble Baroness, Lady Park, will understand why we need to have a sense of humour.
Each day, decisions are being taken in our name by committees both in Brussels and in Whitehall which affect the environment which we inhabit and which our successors must inherit. As a working farmer, I am very conscious of the environment in which I live and of the effects of decisions that my husband and I make in the management of our little piece of this earth. Noble Lords will appreciate that we have learned from bitter experience the effects of toxic chemicals on my health. That has taught us to exercise caution, particularly where we do not know the ingredients of animal feed or of agricultural chemicals and, therefore, cannot establish their safety. Membership of Sub-Committee C has further opened my eyes to how much we know and, perhaps more importantly, how much we do not know about the ultimate effects of those decisions, most of which are taken behind closed doors by faceless scientists, technicians and bureaucrats.

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In our report, Community Environmental Law: Making It Work, we agree that:
"Although there have been some welcome improvements, we recommend that the Commission when formulating policy should pursue a more thorough and open process of consultation, which should include non-government organisations".
We express concerns about,
"the unwarranted secrecy that surrounds scientific and technical advice to the Commission",
and we recommend,
"that all appointments to advisory and regulatory committees should be through a fully open process".
Unlike our North American cousins and six other Community members, we have a culture of secrecy in the United Kingdom which seems to pervade the corridors of the Commission. We have been conditioned not to question the decisions taken by the Commission or our national governments, upon the advice of scientists and technicians, simply because we are repeatedly told that they are in a position to give what is called, "best advice". We do not know who those advisors are or what are their interests and affiliations. Any individual or organisation who questions the decisions is frequently categorised as a "crank" or a "trouble-maker"; indeed, I have been given that label.
As we stated in the report:
"Advances in science depend for their credibility upon an open process of peer review".
I would also add that we need to know whether the most recent advances in science have been taken into account during the decision-making process. My personal experience has been that, all too often, scientific advisors appear to be caught in a time-warp of their own experience and do not seem to be prepared to acknowledge that others may have disproved the science which has placed the advisors in their positions.
As is said so often, science is not necessarily about proving that a hypothesis works; it is more about proving that it does not. I believe that we should take new evidence for hypotheses seriously rather than rely on the need for absolute proof of genuineness before current opinion is changed. We should listen to alarm bells. Our recent history is littered with instances where a few brave individuals have sounded the alarm and it has taken years before it is heard. The dangers of asbestos, DDT and other organochlorine pesticides are examples.
As I have suggested, science is not always a discipline which can explain what is happening, or has happened, in absolute terms. During the past 50 years, something like 70,000 man-made chemicals have been introduced into our environment, and despite assurances that they all undergo rigorous assessment by experts before they are licensed for use, there is an increasingly large body of evidence indicating that many, either alone or in combination, are exhibiting signs of subtle, harmful effects upon our environment.
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The Government, in their response to the report, seem not to be totally committed to a spirit of openness. They state,
"On the question of scientific and technical advice, the Government agrees with the Select Committee that it would be helpful if such papers (that is, papers produced for the Commission by its expert advisors) were to be made … widely available. Publication would allow errors of fact and interpretation to be corrected and would allow errors of fact and interpretation to be aired openly. The Government recognises that where committees are established to give the Commission scientific advice, it may also be appropriate for there to be greater openness about the membership and the results of such committees".
For a government committed to openness, I find that response particularly lukewarm. Where we say that the papers "should be published", the Government agree only that, "it would be helpful". Where we express concerns about the,
"unwarranted secrecy that surrounds scientific and technical advice to the Commission",
the Government response is that,
"it may also be appropriate for there to be greater openness".
I am frankly amazed by the Government response to our recommendation that appointments should be made through a fully open process. Does it really matter that the committee meetings are usually attended by civil servants representing the interests of their member state and that personnel may change from meeting to meeting? Surely the rules of procedure are not written in stone. They can be changed. The Government appear to suggest that they will consider the scope for greater openness in these committees as part of their study of possible new initiatives for the forthcoming United Kingdom presidency. May I ask the Minister whether a decision has yet been made and, if so, what it is?
The sub-committee looked into Freedom of Access to Information on the Environment. As the cobbler sticks to his last, I shall reiterate our recommendation that,
"the recitals to the Directive and Article I should contain a more forceful assertion of citizens' rights and a strong presumption in favour of openness",
and,
"The Directive should be clearly revised to establish that human health is within the definition of environmental information".
It is so often the case that emissions, discharges and releases to the environment of potentially damaging substances are followed by reports of adverse effects upon the health of humans who happen, through no fault of their own, to encounter those substances.
Some scientists now agree that chemicals which, under laboratory conditions, do not exhibit any serious effects upon animals or even upon human volunteers may behave differently when released into the environment, or when they combine with other chemicals. We simply do not know enough about the synergistic or potentiating effects of chemical combinations, or their effects upon the human nervous, immune and endocrine systems, as well as the major organs. The fact that a chemical is apparently not carcinogenic and will therefore not kill us in a short

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period of time does not mean that it is safe. Indeed there seems to be an ever increasing section of the population condemned to living in a terrible twilight world of undefined ill health. The sad thing about that is that many of those people are regarded as psychiatric or psychosomatic cases.
While there is a growing body of concerned individuals and organisations who are trying to persuade the Commission and national governments that they should exercise greater caution in the licensing and use of potentially toxic substances, the lack of access to information and the secrecy in the decision-making processes do not serve us well. If only those who indulge in the practice of withholding information on the basis of confidentiality would realise that this immediately raises suspicions, among those who request the information, that they have "something to hide". My own suspicion is that, often, that "something" may be ignorance. Rather than say, "We do not know", or, "We had not thought of that possibility", the "relevant" persons prefer to hide behind a cloak of bureaucratic decisions which they say prevent them from providing the information.
In the context of information relating to the environment I believe that we should never lose sight of the fact that we are only temporary stewards and that our overriding duty is to ensure that we leave this earth either in a better state than we found it in or, at the very least, no worse. On the one hand we have the examples of the middle European countries, where their exploitation of the soil, ostensibly to maximise agricultural production, and their total disregard for the polluting effects of their industries have left a barren, highly toxic legacy and no one knows how long it will take to clear. On the other hand, we have the example of Denmark, which, since 1994, has banned the use of approximately 30 pesticides, many of which are still in common use in the UK. They plan to phase out approximately 100 agrochemicals believed to exert oestrogenic effects by the year 2000, and are now considering the possibility of a total pesticide ban by the year 2010. I am curious that one European Union member state appears to have scientific knowledge that others, including the UK, do not have.
There is a large body of environmentalists who share a concern that the European Union and some national legislative bodies give priority to the survival and growth of industry, particularly the agrochemical industry, at the expense of protection of the environment and its human, animal and plant life. If information relating to these matters was freely given, I am sure that the Government's suggestion that,
"Publication would allow errors of fact and interpretation to be corrected, and would allow for conflicts within scientific evidence to be aired openly",
would dispel much of the doubt and suspicion which presently accompanies much of the current and proposed legislation. We need to know that decisions are based on the full, presently known facts and that, should there be any subsequent evidence which might cast doubt on the basis upon which the original decisions were made, remedial action will be promptly
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taken. A culture of denial is not healthy, the assumption that the majority of the population would not understand, an insult.
I urge the Minister to respond positively to the recommendations in both these reports and to ensure that she and her colleagues in government do not become mired in the desire of particular interest groups to preserve the status quo during the discussions which accompany the production of their forthcoming, and eagerly awaited, freedom of information White Paper. The United States legislation, held up as a model for us, has its limitations. I ask the Minister to try to ensure that this Government do better.
5.48 p.m.
Baroness Wilcox: My Lords, before I entered your Lordships' House I was already familiar with its select committees. Among my colleagues at the National Consumer Council it was recognised that this was not a House of generalists where we were likely to know our subject rather better than the committee, but a House of specialists who could, quietly and with great courtesy, cut to pieces those of us who did not have well researched evidence to back the opinions we were putting before your Lordships. "Well prepare and treat with care" were the watchwords we used.
On entering your Lordships' House I was delighted and not a little nervous when the noble Lord, Lord Tordoff, invited me to join Sub-committee C under the guidance of our most able chairman, the noble Baroness, Lady Hilton of Eggardon, and comprising colleagues whose interests and expertise enliven our deliberations. I am now happily on the receiving end of evidence given by the NCC and other bodies. Although I have served on it for barely a year, I hope I may take this opportunity to express my admiration for the work of the European Communities Committee and particularly for the work of Sub-committee C.
I congratulate the noble Baroness, Lady Ludford, on the confidence she displayed in her subject. Knowing Europe as well as she does, she will have to duck in the coming weeks or she will find herself on one of the committees with us. And very welcome the noble Baroness would be.
I have spent many years promoting the consumer agenda in the European Union across a range of activities wherever we are users of goods or services, whether publicly or privately provided. The environment is such an area. The policies are of great concern to consumers, from water, its safety, availability and regulation—I refer to the most recent inquiry of Sub-committee C—to landfill waste and the implications for householders of the proposed programme curtailment of the simplest disposal option. That is the current inquiry of Sub-committee C.
I hope that your Lordships will agree that our being part of the European Union should mean that British consumers, indeed, all the Union's consumers, of goods and services, especially essential services, have the right to choice, access, information, safety and equity to redress, and that their representatives should be accommodated, included and properly informed.

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Soon our Government will hold the presidency of the Union, and given their commitment to a freedom of information Act in Great Britain this would be a good opportunity to take the lead in ending unnecessary secrecy in the community. Freedom of Access to Information on the Environment would be a good start. Some issues in the report are particularly important. I shall highlight two. First, I refer to the position of public utilities—it was mentioned by the noble Countess, Lady Mar—and the need for them to be more open with their customers. These are often monopoly services. There is nowhere else to go or to inquire. All power is with the provider, for good or bad.
Secondly, there is the continued lack of a proper mechanism for appealing against refusal to provide access to information. It is hopeless to have it in the word but not in the deed—promised but not delivered or, worse, delayed beyond use. An enforceable mechanism across each directorate is needed, and quickly, before all confidence is lost and single issue groups take things into their own hands.
It will help our cause immensely if the Government use the presidency to ensure that consumer bodies are able to make their views known and that the institutions of the Union have to make clear how they have taken the consumer interest into account. The principle of consumer integration needs to be pursued vigorously. In that connection, I suggest that consumer impact statements would benefit us all, written in plain language so that we can know the impact that a course of action will have on each and every one of us across 12 nations—soon to be more.
I turn to the other report, Community Environmental Law: Making it Work. Perfect policy and legislation is of no use if enforcement is weak or inadequate. The time has come for a concerted effort to make enforcement more even across member states. One of the principal aims of the Commission's communication is,
"to ensure a level playing field in the implementation and enforcement of community environmental law".
That is good news. We live in hope.
I believe that a robust mechanism with serious penalties for member states will go a long way to making the Union more relevant to the lives of its citizens. At present the good enforcers—I include the UK—are undermined by some members who seem to see environmental law as aspirational law, rather like the 10 commandments—ideal but mostly beyond the grasp of mere humans.
We are fortunate in Britain that our Government have been taking, and are seen to take, the environment and the laws that will govern our actions as a Union seriously. In the past few days the Government have come forward with a positive response to our report and clearly welcome it as providing support for some of the initiatives planned for our presidency; and for that we are most pleased.
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There are of course questions that we hope the Minister will be able to answer. As regards transparency of scientific advisory committees, should not the Government press for full openness rather than for greater openness? With reference to costs in public interest cases, how soon are the Government likely to arrive at a decision on the funding of public interest cases?
I am hopeful of progress. I believe that the reports have tackled the fundamental consumer issues of access to information and enforcement of law as applied to the environment; I commend them to the House.
5.54 p.m.
Lord Elis-Thomas: My Lords, as an instance of the humour that attaches to the work of our committee, my noble friend Lord Walpole, dared me to say that I now bring gender balance to our debate!
It is a particular pleasure for me to congratulate the noble Baroness, Lady Ludford, on her maiden speech, knowing of her work in local government. She brings to this House experience of the European Commission. Perhaps I may endorse what she said about our study on the freedom of information being a case study for the wider issue. The environment as a policy issue covers all aspects of social and community life. It provides much evidence which is relevant in other fields.
Perhaps I, too, may add my thanks to our chair, the noble Baroness, Lady Hilton of Eggardon, for the way in which she conducts our proceedings in committee. Drawing perhaps on her experience of social control in other fields, she is able to lead us on in that gentle but firm way which we appreciate. I thank, too, our clerk, Tom Radice for bringing his expertise in the environmental field to bear on our work; and to our specialist adviser on the Community environmental law report, Professor Richard Macrory. I remember that he provided us with an audience at one of our committee meetings by bringing his Imperial College students along.
All that indicates the way in which our committee sought to tackle the issue in an expert and detailed way. My text is taken from evidence given in the first report, Freedom of Access to Information on the Environment. It was given by Professor David Rhind, the director general and chief executive of the Ordnance Survey, an organisation which I am pleased to cite since it has saved my life many times in Snowdonia, and I hope will do so again. He instanced one of the major issues in this field: that of environmental variables occurring at national boundaries. In other words, it is the difference between the data and the way in which the data is collected that causes so many of the problems of comparability.
I wish to concentrate my remarks on that aspect of the regulatory chain. I recognise, as did our chairman, that the process of the regulatory chain—that is, the conception, drafting, adoption, implementation, enforcement and assessment of legislation—are all part of that activity. If one link in the chain no longer holds, the whole chain falls apart.

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In the evidence gathered from witnesses, the Environment Agency for England and Wales expressed its strong support for the regulatory chain concept. The Scottish Environment Protection Agency believed that it was important for more emphasis to be placed on evaluating environmental improvement. It was one thing to emphasise procedure but it was important also to consider evaluation.
English Nature supported the need to change the culture to integrate environmental considerations into other aspects of policies so that enforcement was seen as a last resort.
The European Commission highlighted the role of the European Environment Agency in the regulatory chain and I shall speak briefly about the importance of the work of the agency. I was pleased to be able to visit the agency with my noble friend Lady Mar last year. The visit emphasised to us the way in which the agency has developed since a committee of this House first studied it when it was set up. Its role in monitoring and ensuring the comparability of data and the harmonisation of methods of measurement is one that we highlight very strongly in the report, taking that theme from the evidence that we gleaned.
There is a potential, also emphasised by our chair, for the EEA to take responsibility, either as the Commission's agent, or with extended powers for producing implementation reports as required by directives. That is a point that we emphasise.
The European Parliament, through the working document on the implementation of Community environmental policy, which is quoted as one of the appendices to our report, also emphasises the role of the EEA in ensuring comparable data on the overall state of the environment. The importance of ensuring reliability and comparability of data was emphasised by the executive director of the EEA, Sr. Beltran, who said that he worried much more about reliability of information than he did about comparability of information.
So we are dealing with a field in which the European Union is developing and sensitising its own information base and its own approach. Naturally, NGOs in evidence to us, particularly Friends of the Earth and the RSPB, emphasised the importance of taking the monitoring role even further. FoE stressed that it was not enough to examine data in relation to the outputs of the economies—that is, waste and pollution data—but that we should also examine the wider issue of sustainability in relation to measures of inputs of environmental resources to our economy. The European Environment Agency has already shown an interest in that report, in the seminar that it held in March last year. That shows the way in which the whole issue of environmental monitoring is being refined by the agency.
Turning to the idea of strengthening the role of the EEA, there is contention, not least along the lines of subsidiarity. Being a devolutionist, it is a principle that I endorse. However, it is important to ensure, where there are processes of subsidiarity, that there is always comparability of data, so that when subsidiary regional bodies deal with issues relating to environmental assessment and monitoring, the basis of that assessment
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is the same throughout regions. That point was stressed in evidence given to us during our debate emphasising the role of IMPEL—the institute responsible for the monitoring of the implementation of environmental legislation. I try not to use too many acronyms, but IMPEL featured largely in our discussion on implementation. It emphasised that, in its role, it was important that it was seen as networking—a point made by the European Environment Agency in its evidence to us and by others—not only with the topic centres that existed within the agency or with the inspectorates of member state governments, but that is should also integrate its activity with the regional bodies responsible for environmental monitoring.
Commenting on the Government's response, we welcome the Government's commitment to taking forward the agenda of strengthening the role of IMPEL. Will the Minister, in her response, say whether the Government feel that the role of IMPEL requires a greater autonomy or independence from the Commission, which acts as its present support secretariat? Is it not the case that IMPEL, as a professional organisation bringing together the inspectorates of pollution in different member states, would be more effective were its activity to be strengthened by ensuring greater autonomy and, as it were, setting it at greater arm's length from the Commission.
We welcome the Government's positive response to the report, as contrasted with the rather negative response of the previous government to our previous report. Nothing highlights more fully the commitment of the new Government to environmental policy. We look forward to the crowning of the UK presidency at the Cardiff summit, when I hope that some issues of environmental import will be agreed.
6.5 p.m.
Viscount Bridgeman: My Lords, I speak as another recycled member of the sub-committee after four very enjoyable years. I know that our chairman discouraged in advance any compliments; but I should like to pay tribute to the skill, and the pleasure, with which she ran the committee.
I endorse the noble Baroness's remarks about our visit to Dublin, where we found the level of transparency in environmental information very impressive. I suggest that our own Department of the Environment might well take note of that. We also found very effective the ombudsman system based on the Australian and New Zealand models—in which this Mother of Parliaments might take a modest maternal pride.
I was also privileged to be a member of the party from Sub-Committee C which, two years ago, visited some of the countries of central and eastern Europe which seek accession to the European Union: Poland, the Czech Republic and Hungary in the first wave, and Romania, which is some way down the line. I am glad to note that the committee's support for the enlargement of the Community is shared by the Government.

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What struck all of us in that party was the depth at which democracy has taken hold in those countries in a space of less then 10 years since the overthrow of communism, and the intimate knowledge on the part of so many, particularly in the younger generation, of Western institutions and in particular the workings of the EU Commission.
In those countries there is a very genuine desire to enhance environmental standards as soon as practicable. They do of course have a large carrot, since accession to the EU is conditional on some measure of progress in environmental improvement—a matter of which the noble Baroness, Lady Ludford, will be well aware. We very much enjoyed her impressive maiden speech.
But that approach has to be seen against the background of quite dreadful environmental problems inherited from the communist period—for instance, the Black Triangle, on the borders of Saxony, northern Bohemia and Poland, where as a result of lignite burning, trees are dying and children are growing up malformed; or the appalling water pollution in Poland caused by mine workings; or the refinery town of Ploiesti in Romania, where you strike oil at two metres as a result of the fracture of pipes by allied bombing in 1944, with serious implications for water supply and sewerage.
So in their differing degrees there is a real determination on the part of the authorities to recognise and address the environmental problems. They are receiving assistance from a number of quarters. We found the aid provided by the European Commission under the PHARE programme to be on the whole useful and well audited. The European Environment Agency, IMPEL and the European Environment Bureau are playing their part too.
I know that the noble Lord, Lord Walpole, will speak of the work of NGOs. I merely state that NGOs operating in central and eastern Europe have had in many cases to overcome, among other things, a culture gap. since NGOs had no place whatever in the communist administrations. But the NGOs are vital to the progress to be made in raising environmental standards, as are individual government agencies, of which the UK Know-how Fund is a shining example. We found nothing but praise for its hands-on effectiveness—the only criticism being the all too familiar one that it was too small.
All those bodies play their part in assisting the applicant countries with the serious problems—almost all coming down to lack of resources—which they face and in fostering the very real environmental progress that those countries have made.
Let us not forget that it is a two-way process. When Austria and Sweden joined, they brought with them high standards of openness about environmental information; and we found similar isolated impressive instances in Poland, Hungary and the Czech Republic.
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Perhaps I may relate that to the central theme of the debate: the need for greater transparency in the sharing of environmental information and the sanctions which we should like to see in some cases for non-performance. I am, for instance, disappointed that the Government feel unable to accede to the committee's request for the publication of correspondence relating to Article 169 on disciplinary procedures. I suggest that transparency of information goes hand in hand with transparency of discipline.
I, in common with many noble Lords in all parts of the House, share the Government's desire for an early enlargement of the European Union. However, it is incumbent on the existing members of the Union, with their far greater resources, to get their house in order in setting standards—not merely of transparency in exchange of information but in implementation too—which will be acceptable and attainable standards for the countries of central and eastern Europe as and when they join.
It is a cliché of which we are all guilty to say that environment knows no frontiers. However, this is a vital time for the EU as it now exists to make preparations for what we hope will be a common environmental practice and standard by the whole of the enlarged Community.
6.11 p.m.
Lord Walpole: My Lords, as the noble Viscount, Lord Bridgeman, suggested, I intend to restrict myself to a sketch of the role of the environmental NGOs and their input into national and European thinking and eventually into law and monitoring.
I have no financial interest to declare, but I am a long-standing member of CPRE—whose chairman has just left the Chamber, which is a pity—and of the RSPB, though I am in no way involved in their committees or councils.
In this country the environmental NGOs are involved in a wide range of activities, from running nature reserves through monitoring, lobbying and even direct action. But they all have one thing in common: a deep concern for the environment and a breadth of knowledge and expertise not found elsewhere.
For our first report on freedom of environmental information it was the NGOs who told us about the difficulty in identifying "relevant bodies" and finding out what was confidential. They pointed out that, if something was confidential, it took a long time to find out why it was confidential; there was no appeal; and the process was time consuming. They also pointed out the amazing inconsistency in what people charged for the information when it was available. In other words, they were very good at explaining to us the general problems of "people seeking information". It was difficult for us to assess whether the problems were greater in this country or in other EU countries. I suspect that it is easier to find things out in the north of the Union than in the south.

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In the report on environmental law the NGOs really came into their own. It was interesting to note how many statutory and governmental bodies, both here and in the rest of Europe, had a high and positive regard for the work done by the NGOs and their input to environmental thinking. They were certainly consulted at an early stage of policy-making and indeed before directives were issued. Their role in monitoring and data-collecting was much welcomed, but their role in enforcement, other than in giving evidence, was perhaps felt not to be so appropriate—which may not be surprising. Other speakers in the debate have covered enforcement, but we must commend what I still call the Department of the Environment's Wildlife Law Enforcement Group, referred to in paragraph 111.
So far as British NGOs working in Europe are concerned, there is a body of all European NGOs called the European Environmental Bureau, which meets in Brussels. Referring to what the noble Baroness, Lady Park, said, it is supposed to be consulted by DG XI, and we think it probably is. I see that the noble Baroness is not sure, either.
We also considered whether NGOs should receive direct payment for their work and help from Europe, national governments and local government. Perhaps this is too topical a matter to go into in much detail. The committee felt that limited support, with strict safeguards, was appropriate: for instance, help with office space and meeting rooms and a small amount of funding, but not so much as to compromise either side. Perhaps I may give a very parochial example. My own district council in north Norfolk makes plenty of rooms available for meetings for various organisations such as CPRE and tourist and hoteliers' groups and gives very small grants. That is the kind of funding that I believe the NGOs should be given.
Finally, like the noble Viscount, Lord Bridgeman, I believe that NGOs have a very important part to play in central European countries. They are not well known there. It is noticeable that, according to all the supporting Commission papers on Agenda 2000, every potential member in eastern Europe has major environmental problems. There is no doubt about that. It is all very well to say, as some have said, that the problems are not of their making. The problems exist. One of the ways that these countries can begin to assess those problems and remedy them is by using NGOs. We believe that such organisations could and should be supported by the PHARE programme of assistance.
The House should appreciate the amount of work that is done by NGOs and their potential for improving our environment in the UK, the European Union and prospective member countries.
6.17 p.m.
Lord Beaumont of Whitley: My Lords, in making this speech I am discharging a triple role. First, for most of the time I was a member of the sub-committee which produced the reports. Secondly, as my party's spokesman on conservation and the countryside, it is my job to comment from the outside. Thirdly, I am bidding a farewell to the sub-committee as pressure of work takes me on to other things.
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I should therefore like to commence by saying what a pleasure it has been to serve on the sub-committee, with a number of highly rewarding colleagues whose merit can be judged by their contributions to the debate and their wit and good humour, under a firm but always kind chairman, aided by a supremely competent clerk and with a succession of fascinatingly erudite and helpful special advisers. I shall not pretend that I do not welcome my new freedom on Wednesday mornings, but I shall miss the intellectual stimulus that my thraldom provided.
Not only was I a wholehearted subscriber to the reports, but, as my party's spokesman on this subject, I wholeheartedly approve of what they say. I very much welcome the speeches made today, particularly the maiden speech of the noble Baroness, Lady Ludford. I had the pleasure of serving with her on my party's Federal Policy Committee for a number of years. When I heard that she was coming to this House I very much looked forward to it, because I knew that she would have much to contribute. Her maiden speech has given us a foretaste of that.
I single out also, if I may, the contribution of the noble Baroness, Lady Park, whose to the point, pithy and helpful comments hammer home some of the messages which the committee was perhaps slightly mealie-mouthed about putting into the report itself.
It is in the field of the environment more than any other that I welcome the considerable powers of the European Union. The appalling tendency of international bodies at all levels to play into the greedy hands of transnational corporations is to a degree offset by the fact that the EU, as ought to have been expected from the tradition of its member nations but was not inevitable, takes the preservation of the environment and the establishment of a regime of sustainability with proper seriousness—a seriousness, I am glad to say, beginning to be on a par with that with which its members used to fight one another.
Nonetheless, there is a series of possible dangers in the handing over of powers to any bureaucracy. Two in particular are the need to depend on the accuracy of the information which is being fed into that bureaucracy and the need for democracy in the shape of both the European Parliament and the parliaments of the member states to control what is going on.
In a debate last week, and subsequently in Tokyo, we caught some horrifying glimpses of what ill-informed and "I-want-it-now" democracy can do to our plans to save the planet. Too many of the world's powerful nations are behaving like Gadarene swine. The cure for that is, as noble Lords were saying in that debate, "education, education and education".
It must be said that two kinds of education are concerned. One is the kind which spells out the facts of life on this planet and encourages citizens, particularly the young, to continue to absorb those facts. The second is the moral education which encourages them to care for the welfare of their neighbours and indeed of the world. Without being smug, I believe that we can be proud that both forms of education are thriving in this country.

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However, in order for that to continue we must go on doing our bit, and rather more than our bit. And that means, among other things, that where we would like to see uniform action taken by EU nations we must not just sit by if it does not happen. We must go on exerting our influence to see that it does happen and we must if necessary be prepared to take possibly costly unilateral action in order to give a lead.
In the comments of the Government on these reports, such as those in paragraphs 9, 14 and 15 of E/97/C/83, I seem to detect a disinclination to be out there in front. This Government are clearly taking their obligation to be a wholehearted member of the EU seriously. There is less certainty, as I pointed out last Thursday, about their commitment to costly environmental action as opposed to cheap lip service. On these Benches it is the action for which we shall be looking, and we will continue to be grateful for the stimulus to such action that reports like those of this committee and others provide.
6.23 p.m.
Lord Bowness: My Lords, we on these Benches also thank the committee for its work. I thank especially the chairman, the noble Baroness, Lady Hilton, for her full explanation of these voluminous reports and the findings. I take the opportunity also of congratulating the noble Baroness, Lady Ludford, on her maiden speech. I can assure her that we needed no patience to listen and that we look forward to hearing her again when she brings her practical experience of Europe to our debates. I am sure that she will take the opportunity to dispel some of the myths about methods and motives when the occasion arises.
There is no doubt, as has been said, that without the means to implement and enforce, the environmental policy of the Union will be totally ineffective. It is vital also that implementation takes place across the Union in such a way as to complement and not distort the single market. That is particularly important where commercial interests are involved.
It follows that enforcement and monitoring must also be pursued equitably across the Union to maintain a level playing field. Implementation and enforcement in some member states but not others can only lead to dissatisfaction and accusations of unfairness from those affected and a consequent feeling of dissatisfaction with the Union itself and its legislation. My noble friend Lord Bridgeman and the noble Lord, Lord Walpole, referred to possible expansion and new members. If new members are to come into the Union with the enormous problems to which reference has been made, they must do so in the knowledge that the rest of the established members are enforcing environmental policy fairly, uniformly and on the same basis.
The Union clearly has a responsibility to ensure that its legislation is well founded following adequate consultation with interested parties both public and
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private. My noble friend Lady Wilcox referred to consumers. There is a role for the consultating local and regional government through the Committee of the Regions. Clearly, legislation not only needs to be well founded, but also, in so far as this is possible, it must be capable of one interpretation only. Ways of improving the legislation and the drafting need to be examined.
Having said that, while consultation is important, organisations and individuals also need to understand the workings of the Union so that they can make their input at the appropriate stage. It follows that member states have a similar responsibility when converting directives into domestic legislation. They have a responsibility accurately to reflect the directives; and to keep the legislation specific and not complicate it or expand it and then perhaps blame the European Union for any shortcomings which result. At all levels it must be clear who has the responsibility for implementing the legislation and the means for monitoring and enforcing must be put in place, whether it is through the European Environment Agency or other means yet to be devised.
The other report before your Lordships' House tonight follows rather neatly on that point. The Council directive says that,
"access to information on the environment held by public authorities will improve environmental protection".
Not, of itself, I would say, and certainly not without adequate policies of implementation and enforcement such as those we have been discussing.
An examination of the article and the regulations represents an interesting test of the effectiveness of both. The recommendations in the Select Committee report for a review of the article will lead to greater clarity and accountability and the changes to regulations would bring about similar gains. I shall be interested to learn from the Minister her views on comitology. The strictures of Members of your Lordships' House on the lack of information about committees are no doubt justified in some ways. However, before we relish with enthusiasm the implicit criticism of the European Union. we might ask ourselves, even if the membership of our committees is published, in practice how many people know that they exist and how and where they can be contacted.
I thank the noble Baroness, Lady Hilton, and the members of the committee for the reports and look forward to hearing the response of the Minister to the many points that have been raised.
6.29 p.m.
The Parliamentary Under-Secretary of State, Department of the Environment, Transport and the Regions (Baroness Hayman): My Lords, perhaps I may begin by thanking my noble friend Lady Hilton of Eggardon, as many speakers have done tonight. both for her chairmanship of the committee which produced these reports and for the characteristically lucid and

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crisp way in which she introduced tonight's debates. I, too, join in the congratulations to the noble Baroness, Lady Ludford, on what was a well-judged maiden speech. It had wit and some passion as well as experience and expertise. I am sure that those are qualities that made all of us in the House feel that we want to hear a great deal more from her in the future.
The noble Baroness said that the reports with which we are dealing are not immediately recognisable as bedside reading. Perhaps debates in this House on Select Committee reports are also not immediately recognisable as "peak viewing", even for aficionados of the parliamentary channel. However, they deal with extremely important issues. The issues we have been considering today—those of the environment, of the role of Europe and European institutions and of access to information—are central to this Government and their policies.
Perhaps I may deal, first, with the report Freedom of Access to Information on the Environment. The report was published in November last year and the previous government responded in February in terms which, as was clear from contributions to the debate today, were not wholly satisfactory to the committee. This is, however, the first opportunity that noble Lords have had for a debate on this important issue.
The Government are fully committed to a policy of greater openness, including improving the arrangements for access to environmental information. A freedom of information Act was a key pledge in our manifesto. We agree with the well-phrased comments of the noble Baroness, Lady Ludford, about a well-informed citizenship being essential to a healthy democracy.
The Chancellor of the Duchy of Lancaster has signalled that a White Paper containing the Government's proposals for a freedom of information Act will be published before the Christmas Recess. This will set out options for handling access to environmental information in the context of freedom of information legislation as a whole.
Among the issues that the White Paper will deal with, which were raised in today's debate, will be the mechanisms for appeals against refusals to provide information. At present these are only possible through the courts. An appeals mechanism for environmental information is now being considered in the context of wider freedom of information legislation, and the freedom of information White Paper will set out options for an independent appeals procedure on freedom of information issues. The option of an information commissioner could be one way forward.
The Government are determined not to allow abuse of any exemptions to the disclosure of information. The nature of exemptions is being considered very carefully in work on a freedom of information White Paper, and making exemptions subject to a harm or public interest test is an option that is being considered carefully. I hope noble Lords will understand that there is not a great deal more that I can say at this stage. We must all await the White Paper. But I shall ensure that the
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comments made tonight, as well as the comments made in the report itself, are drawn to the attention of my right honourable friend the Chancellor of the Duchy of Lancaster.
We are of course in a different position with the report Community Environmental Law: Making it Work, which was published only in late July and to which the Government have responded last week with a memorandum. On behalf of the Government, I thank the Select Committee for its report, which looks at ways of improving the way European environmental law works across the Community. At the same time I apologise to noble Lords for the fact that they did not receive the Government's memorandum earlier. The noble Baroness, Lady Hilton of Eggardon, was generous about that. I am sure noble Lords will appreciate that the timing of the report's publication, just before the Summer Recess, meant slower than normal progress in the early stages of preparing a response.
The committee's report is wide-ranging, covering all aspects of the process of drafting, implementation and enforcement of Community environmental law. It recognises the improvements that have taken place since the Select Committee last considered these issues, but shows that there is still room for improvement. The report contains a number of what we consider to be useful recommendations for further progress. It is a helpful and timely contribution to the continuing debate. The Government find much to agree with in the report.
The issue of transparency, which was raised by several speakers in the debate, perhaps most notably by the noble Baroness, Lady Park of Monmouth, was rightly highlighted early in the Select Committee's report. Transparency is vital in ensuring that regulation commands confidence and support, one of the keys to improving its effective implementation and enforcement. The Government have made clear their strong commitment to greater openness in the European Union. Speakers will, I hope, welcome the fact that the Treaty of Amsterdam, which resulted from the inter-governmental conference, will help to introduce greater transparency, and for the first time help to give it a firm legal base in the treaty.
These new provisions include a new commitment to more open decision-making; a public right of access to European Parliament, Council and Commission documents; and the compulsory publication of Council votes when the Council acts in a legislative capacity. I was grateful for the welcome given by the noble Baroness, Lady Park, to our decision to take further steps under the UK presidency to enhance the transparency of EU decision-making and procedures. My honourable friend the Minister for Europe gave evidence on these matters this afternoon to a committee of your Lordships' House and, in what I hope is a proper spirit of openness, we shall be providing more details as the negotiations develop during our presidency.

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The importance of consultation while legislation is being prepared was also raised in the report. The Government agree with the Select Committee that there should be full consultation of interested parties on early drafts of legislative proposals. I am glad that the EC Environmental Council's resolution in June, on the drafting, implementation and enforcement of Community environmental law, reinforced this. Legislation on which there has been full consultation from the earliest stages is not only more likely to reach political agreement quickly; it will also be easier to enforce.
In response to the points raised by the noble Countess, Lady Mar, and by the noble Baroness, Lady Park, we have looked carefully at the question of greater openness in EU committees. The Government agree with the Select Committee that it would be helpful if papers prepared for the Commission giving scientific and technical advice on which the Commission draws in preparing and formulating legislation were to be made more widely available. Publication would allow errors of fact and interpretation to be corrected and would give an opportunity for the conflicts which occur within scientific advice to be aired openly. We agree that it may also be appropriate for there to be greater openness about the membership and results of advisory committees.
There is also the question of publicising the membership and results of committees established to assist the Commission in exercising implementing powers—the so-called comitology committees. We learn something new every day. "Comitology", I have to say to the noble Lord. Lord Bowness, is a concept with which I have not had to deal before. The Government believe, for reasons explained in detail in our memorandum, that in most cases different considerations apply. In particular, many of these committees do not provide scientific advice to the Commission. Instead, they are more akin to negotiations between member states. What is important is not which officials attend but what positions the 15 member states adopt. For this reason the Government are currently considering the scope for greater openness of such committees as part of their study of possible new initiatives for our presidency, to which I referred a moment ago. We are currently discussing a number of possible measures with other member states. We will keep the House informed of the measures as these ideas develop.
Turning to the question of transposition of Community law into national law, the Government have given careful consideration to the Select Committee's view that there would be value in having discussions with the Commission in the period between the adoption of a directive and the deadline for implementation by member states. We agree that such a process would help to identify ambiguities at an early stage. On the other hand, there is a potential problem where the member
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states and the Commission have different views about what is required in the national measures. In these circumstances the Government believe that the member state must reserve the right to implement in accordance with its own legal advice. If necessary its interpretation can be tested in the European Court of Justice. It will perhaps reassure members of the committee that, as far as our own practice is concerned, the Government consider that informal consultation with the Commission can sometimes be helpful, and we always keep this possibility in mind. The Government are by no means clear, however, that the balance of advantage lies in the establishing of formal mechanisms across the Community.
The noble Baronesses, Lady Hilton of Eggardon and Lady Ludford, referred to the role of the Council. The Government endorse the Select Committee's view that the Council of Ministers should give more consideration to the implementation of environmental law. The Environment Council discussed implementation issues in June when it adopted its resolution on drafting, implementation and enforcement of Community environmental law. It is likely that these issues will return to the Council's agenda in the context of the further action that was called for in that resolution. We would certainly welcome that.
As regards the role of the European Environment Agency, raised both by my noble friend Lady Hilton and the noble Lord, Lord Elis-Thomas, the United Kingdom is a strong supporter of that agency and agrees that the primary role should remain the provision of information about the state of the environment and related pressures on it in order to inform the development of policy within the Commission and member states.
The EEA has an important role, as many EU policies in the past have not been based on sound science. The EEA is attempting to address that. There has also been the lack of a level playing field as regards the reporting of data by member states under EEA/EU legislation; for example, the bathing waters directive, the standardised reporting directive and so forth. That means that it has been difficult to compare the environmental performance of countries. If the EEA's attempt at harmonisation is successful, that situation should also improve.
The noble Lord, Lord Elis-Thomas, referred to the importance of inspection. The Government believe that consistently high inspection standards across member states are essential in ensuring the full and effective implementation of Community environmental law throughout the Community. The Council resolution asked the Commission to propose minimum criteria or guidelines for national inspectorates, and a paper is currently being prepared by the EU Network for the Implementation of Environmental Law (IMPEL). Our own Environment Agency has been in the forefront of preparing this paper.

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IMPEL was set up as a network of inspectors of industrial installations in order that they should be able to exchange information and expertise, and the Government would not like to see the network move too far away from its core objectives. The Government agree with the Select Committee that it is important for IMPEL to continue to be an independent network of professionals and they share your Lordships' concern that it should not develop into a semi-regulatory body. I can say to the noble Lord, Lord Elis-Thomas, that IMPEL has recently put a new structure in place and its relationship with the Commission is still evolving. We agree that it is important for it to speak with an independent voice.
Perhaps I may now turn to the issue of the confidentiality of correspondence relating to Article 169 issues, raised by the noble Viscount, Lord Bridgeman. The issue is the publication of Article 169 letters, reasoned opinions and responses to them—that is, correspondence which relates to alleged infractions of Community legislation by member states. It is a well established convention agreed between the Commission and member states that such correspondence between the parties should be confidential. Very often it contains unsubstantiated allegations and provisional legal opinions which may be modified subsequently in the light of further information received. Article 169 correspondence forms part of what can be a delicate process which might be prejudiced if both the Commission and member states were having to take a public position at an early stage.
We recognise that the committee's recommendation is a modest one; namely, that the correspondence should be made public only at the stage of a case coming before the European Court of Justice, and therefore retrospectively. Nevertheless, the knowledge that this could happen might influence the Commission or national governments in their drafting of such letters. It could thus inhibit frank exchanges and the possibility of compromise. Indeed, the European Court of First Instance decided in the WWF case earlier this year that the Commission would be justified in refusing to disclose Article 169 correspondence on precisely these grounds, even in cases where a period of time has elapsed since the Commission closed its investigation. Moveover, the point does not concern only environmental law but has to be considered across the whole range of legislation and, as a matter of principle, it goes far beyond the scope of this debate alone. The Government do, however, endorse the Select Committee's welcome for the Commission's decision to make greater use of Article 171, which allows for fines to be levied on member states who fail to comply with judgments of the European Court of Justice. The threat of fines under Article 171 has already proved effective in a number of cases.
I know that the noble Baroness, Lady Wilcox, had a previous engagement. She and, I believe, other speakers raised the issue of the importance of access to justice. To ensure effective compliance with European
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environmental law, it is important that where there are alleged breaches of that law, access to the judicial system should be available to all on a fair and equal basis. The Government are fully committed to this principle. It is already possible for environmental organisations to bring judicial review actions. We are also considering how, in public interest cases, we can deal with any in-built financial disincentive to bringing well-founded cases before the court.
Perhaps I may now turn to the issue of non-governmental organisations, which was raised by several speakers, notably by the noble Lord, Lord Walpole. It is the Government's practice to consult with non-governmental organisations, industry and local authorities on all proposed Community environmental legislation. There is a clear role for responsible NGOs in helping to ensure compliance with Community environmental legislation, as in promoting public debate and concern for the environment generally. Representatives of NGOs meet Ministers on a regular basis to discuss current issues. On European issues, UK representatives of the European Environment Bureau, an umbrella organisation which brings together NGOs from all over Europe, regularly meet environment Ministers before Environment Council meetings to discuss the main agenda items. Ministers find these exchanges of views very useful. The Government will continue to consult and work closely with NGOs.
The noble Lord, Lord Walpole, also referred to the importance and the potential role of NGOs in an enlarged community. The Government are a strong sporter of enlargement. They believe that the Community must make full use of the excellent opportunity it offers to raise environmental standards in Central and Eastern Europe—a point alluded to by the noble Lord, Lord Bowness—and to extend the single market, with its common standards for environmental protection.
We have had a wide-ranging debate tonight. but basically, as the noble Lord, Lord Elis-Thomas, pointed out, we have been reviewing a chain of activity which starts with the drafting of European environment law, moving on to transposition into national laws, turning to monitoring and enforcement by the Commission, and then to the institutions that make the law work within member states (the inspectors of pollution; the courts; the environmental pressure groups). We are agreed that each link of the chain has to be well forged, and that action can be taken to strengthen each link.
It may seem to some that the UK has a good record in implementing EU law, and that further monitoring or enforcing would be unwelcome. It is worth reminding ourselves, however, of the UK's true interests here. We have a very firm and fundamental interest in securing uniformly high levels of observance.
Effective standards of protection across the EU will not be achieved unless there are similar standards of implementation and enforcement. We know that these do not exist at present.

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Variations are recognised, by the Commission and member states alike, as they are also in the Select Committee's report. The Community has already achieved much in environmental protection, and the drive to improve implementation and enforcement still further has a vital role to play. The report from the Select Committee echoes this and I am pleased that in so many ways the Select Committee and the Government have similar views on what remains to be done.
I say to the noble Countess, Lady Mar, that I hope that she has not taken the view that the support of the Government is lukewarm in these areas. There is a great deal of common ground and a great deal that can be achieved. I hope that there is a great deal that can be achieved within our own presidency in order to share the committee's goal of a more effective application of environmental law within the EU.
6.48 p.m.
Baroness Hilton of Eggardon: My Lords, it has been a short but important debate. I am very grateful to all those who have taken part. I join in the congratulations to the noble Baroness, Lady Ludford, for an entertaining as well as informative contribution. I hope that she will join in future debates on the environment in the same manner. I am grateful to the Minister for her informative
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and sympathetic response. I feel some disappointment over the response on Article 169 complaints, but I shall read carefully tomorrow what the Minister said and perhaps my disappointment will be alleviated.
On Question, Motion agreed to.

Freedom of Access to Information on the Environment: ECC Report
Baroness Hilton of Eggardonrose to move, That this House takes note of the Report of the European Communities Committee on Freedom of Access to Information on the Environment (1st Report, Session 1996–97, HL Paper 9).
Moved, That this House takes note of the Report of the European Communities Committee on Freedom of Access to Information on the Environment (1st Report, Session, 1996–97, HL Paper 9).—(Baroness Hilton of Eggardon.)
On Question, Motion agreed to.

Lloyds TSB Bill [H.L.]
Committed to an Unopposed Bill Committee.
House adjourned at eleven minutes before seven o'clock.

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