Sitting of 11 May 1998

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

    Sentencing
    Mr. Desmond Swayne: If he will introduce mandatory minimum sentences for burglars convicted of a third offence. [40263]
    The Parliamentary Under-Secretary of State for the Home Department (Mr. Mike O'Brien): Ministers in the Conservative Government said that the implementation of section 4 of the Crime (Sentences) Act 1997 depended on the Prison Service's capacity and available resources; we agree with that.
    Mr. Swayne: Will the Minister confirm that the average sentence for a third-time burglar is a mere 20 months? Does he believe that that provides adequate protection for the public, many of whom are of very modest means and have had their homes wrecked by such people?
    Mr. O'Brien: The courts increasingly regard those who have repeatedly burgled domestic premises as very serious offenders, and the average of the tariffs that are being imposed is increasing. It is clearly right to send a message on the issue, but the Conservative Home Secretary, the right hon. and learned Member for Folkestone and Hythe (Mr. Howard), refused in March 1997 to set any date for implementing section 4. His press statement said:
    "None of the provisions of the Crime (Sentences) Act 1997 have immediate effect. No dates have yet been set for implementation."
    The Conservatives said that they would deal with the issue as soon as Prison Service resources allowed; we have increased those resources
    Mr. John Greenway: Why is the Minister so reluctant to implement the mandatory sentence for persistent burglars? Is it because he does not really believe in the concept; because he and the Home Secretary have failed to persuade the Chancellor to provide the money for the prison places; or because he knows only too well that, far from burglars being locked up under mandatory sentences, they will be let out under the Government's plans for early release, so instead of being behind bars, they will be free to burgle again?
    Mr. O'Brien: The hon. Gentleman is guilty of mere posturing on the serious issue of crime. The nearest that the Conservatives ever got to saying when they would implement section 4 was when they said that if, for example, they could implement it by October 1999, it might have some effect after 2001. If section 4 is the Conservatives' acid test on sentencing, they did not seem in a rush to implement it, did they?
    We put resources into the Prison Service that the previous Government did not even have there. We will take no lessons from the Tories on crime. Our Crime and Disorder Bill will be tough and effective, where the Tories merely postured.

    WPC Fletcher
    Mr. Tam Dalyell: Pursuant to his oral answers of 30 March 1998, Official Report, columns 887–88, on WPC Fletcher, what discussion he has had with the Secretary of State for Foreign and Commonwealth Affairs on those matters which have made the investigation into the murder of WPC Yvonne Fletcher more complex than was originally expected; and if he will make a statement. [40265]
    The Secretary of State for the Home Department (Mr. Jack Straw): I have written to my right hon. Friend the Foreign Secretary, bringing to his attention the concerns expressed by my hon. Friend on 30 March. I have also informed my right hon. Friend of the latest position on the police investigation, including the pursuit of inquiries in Germany, which are of course the responsibility of the Commissioner of Police of the Metropolis.
    Mr. Dalyell: What did the Foreign Secretary say? Given the grave doubts of Colonel George Styles, the senior ballistics expert of the British Army, of Hugh Thomas, the consultant surgeon in Belfast, and of Bernard Knight, the distinguished Home Office pathologist, none of us can be surprised that the inquiry is taking so long; but as it is indeed taking so long, how can it form any basis for a policy of sanctions against Libya, as it is only slightly less dubious than the inquiry into Lockerbie?
    Mr. Straw: My hon. Friend will understand that my responsibility in this matter arises from my role as the police authority for the Metropolitan police, and that I have none for sanctions against Libya. This is a complicated inquiry, and I know that my hon. Friend has been generous about the efforts that have been made by the Metropolitan's assistant commissioner, David Veness.
    Mr. Tony Baldry: How can the House feel confident that any information provided by Foreign Office Ministers is based on their having read all the relevant cases? Will the Home Secretary take it from me—a former Foreign Office Minister—that the only reasonable inference that can be drawn from recent events is that no Minister in the Foreign Office is reading his or her boxes?
    Mr. Straw: I do not accept that for a moment. I know that my right hon. Friend the Foreign Secretary takes the Lockerbie inquiry very seriously indeed.

    Prisoners
    Mr. Richard Allan: What estimate he has made of the number of prisoners who have (i) drug and (ii) mental health problems. [40266]
    The Minister of State, Home Office (Ms Joyce Quin): Research undertaken for the Prison Service by the Institute of Psychiatry suggests that around 28,000 prisoners, including those on remand, have drug and mental health problems of some kind. Those studies were carried out some time ago, however, and the Office for National Statistics has been commissioned to carry out a new survey of the prevalence of mental disorder in the prison population of England and Wales. My hon. Friend
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    the Under-Secretary of State for the Home Department, the hon. Member for Knowsley, North and Sefton, East (Mr. Howarth), will announce further initiatives on tackling drugs in prisons.
    Mr. Allan: Does the Minister share the concern of the chief inspector of prisons about the number of mentally disordered offenders who are inappropriately held in prison? Does she agree that the way in which to tackle that is to consider the point at which individuals are taken into custody? Have the Government any plans to improve the training of custody sergeants and, in particular, their liaison with national health service psychiatric services?
    Ms Quin: The hon. Gentleman makes an important point about trying to divert from the prison system people who would be inappropriately held. We are considering the kind of measures that he mentioned, but the number of people who have been transferred from the Prison Service to mental health establishments of various kinds has risen markedly, particularly over the past year. That is encouraging: we seem at least to be starting to tackle the problem, although I certainly agree that we can do a lot more.
    Mr. Martin Linton: Has my hon. Friend seen the latest Home Office research figures showing that half the people arrested for shoplifting, and a quarter of car thieves, tested positive for heroin? Will she ensure that, in order to test increasing anecdotal evidence that many people start taking drugs while in prison, the next Home Office research includes not only those who are arrested, but those who leave prison?
    Ms Quin: Existing research does not back up claims that more people leave prison with a drug addiction than enter prison with one. It is rather the opposite, although the figures are not nearly as low as we would like. However, my hon. Friend makes an important point about the number of arrestees who test positive for drugs. That is one reason why the drug treatment and testing order included in the Crime and Disorder Bill is so important.
    Sir Brian Mawhinney: The Minister knows that, like her, I have been visiting prisons up and down the country. Is she aware that governors have been telling me that up to 40 per cent.—or perhaps more—of the prisoners in their prisons are on drugs, and that most of those drugs are brought in by visitors? Many governors tell me that they do not have the resources to create an adequate barrier against the inflow of the drugs—[Interruption.] Perhaps the Minister would like me to wait until the Home Secretary finishes briefing her before I complete my question.
    If the Government do not want to be seen as complacent, will the Minister give an undertaking that every prison in the country will have enough resources for one proactive and one passive drug dog to fight the insidious inflow of drugs?
    Ms Quin: I think I can answer a question without the right hon. Gentleman's patronising comments. As he pointed out, I have visited a large number of prisons, where I, too, have discussed with governors and prison staff the issues that he has raised. There are 168 active dogs in prisons and 26 passive dogs, which are

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    particularly good at detecting drugs brought in by visitors. Some of those dogs are used for clusters of prisons, where two or three prisons are situated close together. We are continuing—and, I believe, making more effective—the prison drugs strategy started by his Government. As I said earlier, further announcements will be made about that in due course.

    Young Offenders
    Mr. Graham Stringer: What progress he has made in implementing his plans to tackle crime among young people. [40267]
    The Minister of State, Home Office (Mr. Alun Michael): We are making a great deal of progress on tackling crime among young people. The White Paper "No More Excuses" includes proposals to reduce delay, to nip things in the bud and to achieve better co-ordination of youth justice services. The Crime and Disorder Bill is making progress in Committee. The process of appointment to the new youth justice board has started. Even in advance of legislation, much can be done. More than 100 courts have started or are planning fast-track schemes for young offenders, compared with only eight when we came into office.
    Mr. Stringer: I thank my hon. Friend for that answer. I am sure that my constituents welcome the progress that is being made. Given that much crime is carried out by 10 to 16-year-olds, and that a significant proportion of that is perpetrated while they should be at school, will he join me in welcoming the proposals of the social exclusion unit to give the police powers to pick up children off the streets who should be at school?
    Mr. Michael: I certainly welcome the work of the social exclusion unit and the Prime Minister's strong backing for its recommendations this morning. The chapter that refers to a joined-up problem says that nearly half of all school-age offenders have been excluded from school, and that a quarter truanted significantly. Different Departments are corning together to address the problem together.
    Miss Anne McIntosh: Does the Minister accept that there is some merit in the 110-day rule which applies in Scotland, whereby offenders not brought to trial within 110 days of being committed to trial are set for ever free? That has won the support of the local probation service in North Yorkshire. If he agrees, will he approve my private Member's Bill?
    Mr. Michael: We have a better Bill, the Crime and Disorder Bill, which addresses the whole problem comprehensively. The hon. Lady is right to say that we should consider what happens elsewhere, including Scotland, to learn the lessons of what has worked. Such solutions do not always translate to England and Wales, but we certainly have examined the situation elsewhere. We are achieving much positive progress, as I said in my first reply.
    Sir Brian Mawhinney: Given that the hon. Gentleman is the Minister responsible for the police, how could he give the answer that he gave
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    to the hon. Member for Manchester, Blackley (Mr. Stringer) without embarrassment? He told the House that he is happily conniving with the Secretary of State for Education and Employment to send hard-pressed police around the streets like pied pipers of Hamelin, rounding up 1 million young people and taking them back to school, when 900,000 of them will walk out the next day and 100,000 have only one or two hours education a week, so they have no school to go to. The Minister is putting no pressure on the Labour education authorities that have the responsibility. When is he going to get serious on behalf of the police and start taking firm action to address these problems?
    Mr. Michael: That was pathetic. The title of our White Paper was "No More Excuses", and we are taking no more from that lot opposite. They got a bloody nose because of the daft proposals that they came up with in the past. The right hon. Gentleman should read the Police Superintendents Association press release welcoming what we proposed today specifically because it recognises the need not for a problem to be offloaded on to the police, but for the police to work with schools, education authorities and health services. Together we will solve the problems that he and his colleagues failed to tackle when they had the opportunity.

    European Police Co-operation
    Mr. Ben Chapman: If he will make a statement on recent discussions with his European counterparts on police co-operation. [40268]
    The Minister of State, Home Office (Ms Joyce Quin): My right hon. Friend and I last met all our European counterparts to discuss police co-operation at the Justice and Home Affairs Council meeting on 19 March. A report on the outcome of those proceedings was given in a reply to a question from my hon. Friend the Member for Slough (Fiona Mactaggart) on 8 April.
    Mr. Chapman: Does my hon. Friend agree that it is only by co-operation with our European partners that we can tackle organised crime? Organised crime knows no boundaries, and it needs to be tackled at least on that basis. That is particularly relevant in the drugs context, and it is important that we lay stress on it during the remainder of our presidency.
    Ms Quin: I agree very much that organised crime and measures to combat drugs trafficking are important issues for co-operation and joint work with our European Union partners. We are extending that work to discussions and co-operation with countries from central and eastern Europe that are applying for membership of the European Union. That work is not greatly reported, but it is important.
    Mr. A. J. Beith: Is the Minister aware that, although we strongly support the development of co-operative work through Europol, the progress of that work could be impaired by the continued existence of a wide legal immunity, which does not apply to British police officers, but which sets Europol in an unfortunate

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    position above the law? We ought to ensure that Europol is in a clearly legally defined position so that we can increase the amount of work it does on our behalf.
    Ms Quin: The right hon. Gentleman is making a false comparison; Europol is not an operational police force, but is simply a co-operative and intelligence-gathering body. None the less, one of the priorities of the UK presidency is to get Europol up and running, so we are urging those countries which have not yet ratified Europol to do so as soon as possible.
    Mr. Dale Campbell-Savours: When the Minister meets her European counterparts, will she ask them how effective they find national identity cards in dealing with crime throughout western Europe? When they tell her, as they repeatedly will, that the cards are extremely helpful, will she commission a report on the introduction of such cards in the United Kingdom?
    Ms Quin: Those issues are always discussed and under consideration, but they are not frequently the subject of discussions among European Union Ministers, which are much more focused on matters such as the action plan against organised crime, where we can all co-operate and there are not such important different national practices.
    Mr. John Wilkinson: Does the hon. Lady agree that part of the problem with controlling organised crime, especially within continental Europe, is the effect of the Schengen agreement, which was undertaken by certain main European Union countries and which did away with border controls between them? Is it not time that she, through the European presidency that her Government so proudly hold, asked the European Union to re-examine the issue of border controls? Unless member states are far more effective than they are today in controlling the movement of criminals, even Europol and co-operation will not curb the activities of the Mafia and organised crime from central and eastern Europe.
    Ms Quin: One of the achievements of this Government—one of which the previous Government would not have been capable—was to get a sound legal basis in the Amsterdam agreement for the operation of our own border controls. The countries that form part of the Schengen system agreed that system between themselves and they are entitled to do so, but they certainly feel the need to take measures together and to step up co-operation against crime.

    Restorative Justice
    Mr. Ross Cranston: What assessment he has made of the effectiveness of restorative justice. [40270]
    The Minister of State, Home Office (Ms Joyce Quin): We believe that restorative justice ensures that young offenders face up to their behaviour. Measures in the Crime and Disorder Bill and our proposal for reform of the youth court are consistent with its underlying principles.
    Mr. Cranston: I thank my hon. Friend for that answer. She will know that the research of the Thames Valley restorative justice scheme shows that the rate of reoffending among the young people dealt with there is 3 per cent., whereas the normal rate is more than 30 per cent. I congratulate Ministers on introducing the Crime and Disorder Bill, which provides the legal framework for restorative justice. Will my hon. Friend, however, urge police forces throughout the country seriously to consider using restorative justice in their own area?
    Ms Quin: My hon. Friend mentions the Thames Valley scheme, which has served as a good example for many other areas to follow. There are also good examples in the diversion unit in Northamptonshire and in the West Yorkshire probation service. Such measures are becoming much more widely accepted, and the partnerships in the Crime and Disorder Bill and measures such as the reparation order will give a boost to that approach to justice.
    Mr. Nick Hawkins: Does the Minister agree that, where restorative justice may be extended, great care must be taken to ensure that it is used only in appropriate cases? Constituents of mine were recently involved in a case that was dealt with by Thames Valley police, and were very unhappy with the way in which restorative justice was used. I have written to the chief constable. Will the Minister consider the correspondence that I will send her, which shows that restorative justice does not always work very well?
    Ms Quin: I cannot comment on specific examples, but the Home Office will be keen to receive that information. Restorative justice must be used sensitively. I endorse the hon. Gentleman's points, particularly regarding the need to avoid causing further suffering to victims. We have to be careful in our use of restorative justice. None the less, it has been shown to be mutually beneficial in a number of cases, and we want to build on that.

    Secure Accommodation
    Dr. Lynne Jones: If he will make a statement on the availability of locally based secure accommodation for young offenders. [40271]
    The Minister of State, Home Office (Mr. Alun Michael): An initial review of all forms of juvenile secure accommodation has been undertaken by the youth justice task force established by the Home Secretary and as part of the comprehensive spending review. As promised in the White Paper "No More Excuses", it is our aim to sort out the present incoherent system of secure accommodation.
    Dr. Jones: I wanted to ask this question because of written remarks made by one of my local police inspectors, who despaired at the repeated release on bail of a hard core of juvenile offenders, whom his officers were arresting weekly and sometimes even daily, because of a lack of secure accommodation to which they could be sent. Does my hon. Friend accept, first, that there is a shortage of such accommodation, and, secondly, that rehabilitation is assisted if youths are detained close to

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    home? If so, will he take urgent action to improve the supply of locally based secure accommodation for young offenders?
    Mr. Michael: My hon. Friend raises several important points. The existing system is incoherent and, as she pointed out, there is a shortfall in the number of places. Offending while on bail can be tackled in a number of ways, including bail support and replacing the repeat cautioning system with a final warning so that there is intervention, rather than allowing cases to drift.
    We want to target secure accommodation where it is needed. The previous Government failed to provide the number of places identified as necessary in 1991 and left us an incoherent state of secure accommodation, which we are now tackling.
    Mr. Ian Bruce: The hon. Gentleman is keen on rhetoric, but what about resources? Will he confirm that, since they came to power, the new Government have enabled only six new places to be provided by local authorities? Where's the beef?
    Mr. Michael: The hon. Gentleman should direct any remarks about rhetoric rather than action to the previous Home Secretary. Since the general election, we have tackled the whole youth justice system. We have authorised the refurbishment of six places in one unit within the spending limits allowed by the previous Government, who failed over nine years to produce the number of places that were needed. [Interruption.] The hon. Gentleman ought to look elsewhere for the answer to his question, rather than playing silly tricks. I know that a thumb and five fingers make six—that is about the limit of his contribution to youth justice policy.
    Dr. Brian Iddon: Would my hon. Friend be surprised to learn that purpose-built accommodation for young offenders was provided in my constituency at great cost, but, because it was never licensed and the previous Government cut local authority expenditure, after a few years of using that accommodation as a children's home, Bolton local authority was forced by that Government to sell off the property?
    Mr. Michael: That comes as no surprise. When the Conservatives were in government, I found them unwilling to listen to practical ideas about how to stop youngsters offending, and about managing secure accommodation. My hon. Friend gives us an example of what they achieved during their 18 years.

    Closed Circuit Television
    Mr. John Bercow: If he will make a statement on the use of CCTV in combating crime. [40272]
    The Parliamentary Under-Secretary of State for the Home Department (Mr. Mike O'Brien): This Government are encouraging the use of CCTV as part of a comprehensive approach to tackling crime and disorder. As well as the proven value in town and city centres, we are encouraging innovative and flexible use of CCTV so that we can learn the lessons of what works.
    Mr. Bercow: I thank the Minister for that reply. Will he confirm that, whereas the former Government provided £15 million a year for the use of closed circuit television cameras to fight crime in 1994–95, 1996–97 and 1997–98, the Labour Administration have slashed the sum available to a mere £9 million, of which only approximately £1 million, as Library figures demonstrate, is available for new schemes? Is that not a scandalous breach of the Minister's party's commitment to fight crime, and further proof that this Administration are a purely penny-pinching Government?
    Mr. O'Brien: The hon. Gentleman should be aware that the Conservative Government left no provision at all for CCTV next year. It is right that we have a budget of £9 million this year to support CCTV. The previous Government made commitments that exceeded the budgets available, so the bulk of this year's money will go towards honouring those commitments. One million pounds will go to new schemes. Substantial coverage of town centres, often by Labour councils, has been achieved; we are now seeking wider coverage than the previous Government envisaged, as part of our overall anti-disorder package.
    I note that the hon. Gentleman thinks this subject important. There are five bids for Home Office funding under the fourth round of challenge funding for the Buckinghamshire area. Why has not the hon. Gentleman written in support of any of them?
    Mr. Bill O'Brien: Will my hon. Friend take it from me that the support given by the previous Government to CCTV in my constituency was nil? We appreciate the support that we have received for Wakefield CCTV from the current Government. Will the Minister take note of the urgent need for more resources to be channelled into CCTV in small towns, and around schools and other public buildings? Will he in future give priority to small urban areas?
    Mr. Mike O'Brien: My hon. Friend is right. My home town of Bedworth also found that the Conservative Government failed to provide for CCTV in its area when it put in a bid to that Government; but the Labour council there and local traders got together and funded it themselves. A large number of town centres have already been covered. Indeed, Buckingham, in the constituency of the hon. Member for Buckingham (Mr. Bercow), opened a scheme in the town centre after the general election last year. Now, as my hon. Friend suggests, we want to concentrate on integrating CCTV with other crime reduction measures, to make a success of the policy.

    Young Offenders
    Mr. John Smith: What steps he is taking to ensure that there is early intervention with young offenders to prevent reoffending. [40273]
    Mr. Colin Burgon: What steps he is taking to ensure that there is early intervention with young offenders to prevent reoffending. [40275]
    The Secretary of State for the Home Department (Mr. Jack Straw): As part of their youth justice programme, the Government have a number of measures

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    in the Crime and Disorder Bill to ensure early intervention to stop offending behaviour. These measures include the final warning scheme for those above the age of criminal responsibility, the child safety order and local child curfews, both for under-10s, and parenting orders in respect of young offenders of any age. District-based crime prevention strategies and youth offending teams will provide a new focus for local action to reduce youth crime.
    In addition, as my right hon. Friend the Prime Minister announced this morning, we shall be taking new powers in the Crime and Disorder Bill to allow the police to return truants to their schools or to another place of safety designated by the local education authority.
    Mr. Smith: I am grateful for that reply. Members of the Dinas Powis neighbourhood watch scheme will be especially grateful. I met them last week, and they raised this very issue with me—reoffending by youngsters. The Home Secretary's reply deals precisely with that. Does he agree, moreover, that parents should take greater responsibility for the actions of children who offend?
    Mr. Straw: Yes. On the specific point that my hon. Friend raises, we believe that parents should take much greater responsibility for offences committed by their children. That is why the Prime Minister spelled out today the importance of parents accepting responsibility when their children truant. In addition, the Crime and Disorder Bill will give the courts clear powers to make parenting orders in appropriate cases.
    Mr. Burgon: Recently, the Home Secretary had the chance to visit the Wetherby young offenders institution to see the excellent work done there. I wonder what representations were made to him about mixing young offenders with juveniles in certain circumstances. How will he address the concerns that may have been drawn to his attention?
    Mr. Straw: I did indeed visit the Wetherby young offenders institution just 10 days ago. I saw there the excellent work done by staff and volunteers, and was able to open the first Young Men's Christian Association centre in a prison in this country. The Prison Officers Association branch at Wetherby raised with me the issue of mixing juveniles with young adult offenders. There is no mixing in residential accommodation. There is some mixing in education and health care, and we are considering whether we can reduce that further.
    Mr. Edward Gander: Does the Home Secretary realise that the Glen Parva young offenders institution straddles the boundary between my constituency and Blaby? Will he make arrangements to visit it soon? The Home Secretary knows that, recently, Glen Parva received a very unfavourable report from the chief inspector of prisons. It is a sad place, which needs to do a great deal better, and I am sure that, if the Home Secretary were to give personal encouragement by making a visit and seeing the place for himself, that would do a great deal to help prevent people from returning for a second visit.
    Mr. Straw: I should be happy to visit Glen Parva, and will do so as soon as I can.
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    Obviously, the overall resources available to the Prison Service are an issue, and we are seeking to increase them. However, interestingly, similarly resourced young offenders institutions have very different outputs. On the one hand, we have institutions such as Glen Parva, which has had a history of difficulties; on the other, we have institutions such as Lancaster Farms, which, with no more resources, does much better and is able to ensure much lower levels of reoffending. What is important for the Prison Service is that we try to learn from the best institutions and pass on the lessons learned to the less good institutions.
    Sir Brian Mawhinney: Is the Home Secretary aware that, this morning, his Minister of State, the hon. Member for Cardiff, South and Penarth (Mr. Michael), told a conference in Wales:
    "Criminal justice is about punishing criminals",
    just three weeks after he told my hon. Friend the Member for Hertsmere (Mr. Clappison) that, under the present Government, people who were sentenced to six months would spend only six weeks in custody? Will the Home Secretary encourage his Ministers to stop saying whatever they think people want to hear, and to get down to addressing the real issues which will help young people not to reoffend?
    Mr. Straw: Criminal justice is indeed about punishing criminals. For a moment, I thought that perhaps one of my right hon. or hon. Friends was off message at the conference in Wales, but they said exactly the truth—of course criminal justice is about punishing criminals.
    I believe that the right hon. Gentleman was referring to the detention curfews which we are planning for short-term prisoners in the last few weeks of their period of custody. Part of the purpose is to ensure that there is a proper transition between custody, where every decision is taken for the prisoner, and life outside, where the prisoner must start to take his or her own decisions. One matter that the previous Administration failed wholly to address was the unacceptably high reoffending rate, especially for inmates of youth offending institutions. We are tackling that by electronic tagging and by introducing the welfare-to-work scheme from within the YOIs.
    Mr. Chris Mullin: Does my right hon. Friend agree that prevention is better than cure; that it is more cost-effective and efficient to divert vulnerable groups of young people away from offending before they start offending; and that, although some excellent schemes exist for that purpose, they are hopelessly underfunded—often on a hand-to-mouth basis? Does he agree that it would be a far cheaper, more efficient and more worthwhile investment to divert young people away from likely offending, rather than having to spend a lot of money later on locking them up?
    Mr. Straw: My hon. Friend is entirely right. Interestingly, the research on the effectiveness of the previous Administration's safer cities programme shows that money invested in target hardening and in diversionary schemes has a much higher payback in terms of cost-effectiveness than some other schemes. We therefore intend to pursue sensible schemes for prevention, but we must ensure that there is effective punishment when an offender fails to be diverted and commits serious offences.

    Prisoners (Drug Testing)
    Mr. Nigel Evans: What representations he has received relating to the testing of prisoners for drug use. [40274]
    The Parliamentary Under-Secretary of State for the Home Department (Mr. George Howarth): We have received representations from hon. Members and others. As part of our continuing commitment to tackling the problem of drugs in prison, I can announce that a revised Prison Service drug strategy will be published tomorrow, and I shall place a copy in the House of Commons Library.
    Mr. Evans: I am grateful for that response, and I hope that, as part of the new package, some of the measures that I shall suggest will be considered. Will the Minister confirm that the drugs industry is booming in British prisons, and that prisoners find it as easy to get drugs in prison as they do outside? Will he consider the increased use of sniffer dogs in all our prisons, more random testing of more prisoners, including at weekends, and the use of sniffer dogs whenever visitors come into prisons? The hon. Gentleman would no doubt agree that a great quantity of drugs is getting into our prisons via visitors. If there is any suspicion, visitors should be searched.
    Mr. Howarth: It would be premature to say what will be in the new strategy to be published tomorrow. The hon. Gentleman has touched on several matters that we need to address and that the previous Government addressed—first, reducing the supply of drugs in prisons; secondly, by various means, reducing the demand for drugs; and, finally, reducing the damage to health that often accompanies drug abuse, whether in prisons or elsewhere. Too many drugs are getting into prisons and, through such a strategy and a new focus, we hope to start tackling the problem, which we acknowledge is extremely serious.
    Mr. Paul Flynn: Does my hon. Friend recall, under the previous Labour Government, two cases in the county of Gwent where defendants who were found guilty of serious repeat offences argued that they should not be sent to prison because, the previous time they were in prison, they became addicted to heroin? They succeeded in avoiding prison sentences because the Prison Service could not provide a prison that was free of illegal drug use. That is scandalous. What is the Government's target percentage of prisons that will be free of illegal drug use by the end of this Labour Government's first term of office?
    Mr. Howarth: My hon. Friend should not always accept a defence plea as justification for what did or did not happen during a prison sentence. Of course there are problems of drugs in our prisons; I say that quite sincerely. It happened under the previous Government and it is happening under this Government. We have examined the problems closely and seriously, and there is no evidence to support my hon. Friend's contention that a shift takes place from cannabis smoking to taking heroin. He may have heard some anecdotal evidence to support his contention, but the statistics do not show that that is happening.
    Mr. Alan Clark: Does the Minister agree that the one thing of which his Department is terrified is a prison riot, and that the Department will go to any lengths to avoid one? The surest way of causing a riot is to eliminate and ban drugs, and the easiest way to prevent one is to keep prisoners in an amiable—relatively speaking—and docile condition by allowing the free circulation of narcotics in prison. The Minister may well be serious and sincere in his contention that he is trying to wage a war on drugs in prisons, but, if he looks more closely at the Prison Service, he will find that in many institutions their circulation is encouraged.
    Mr. Howarth: If the right hon. Gentleman has any evidence to support that contention, I should be grateful if he would give it to me. I am not aware of any prison governor or prison institution that actively encourages drug taking in prisons. The right hon. Gentleman, as a former Minister, should have more sense than to peddle such stupid arguments in the House of Commons. It is simply not true, and it is about time that, at his advanced age, he grew up.
    Ms Beverley Hughes: Although compulsory testing is important in this battle, if we are to break the obvious and very strong link between drugs and crime, it is equally important that treatment be made available. Can my hon. Friend assure me that adequate treatment will be available in prisons for those prisoners who are found to be addicted to or abusing drugs?
    Mr. Howarth: Yes; I can give my hon. Friend that assurance. More than 60 treatment programmes already exist in our prisons, ranging from detoxification to various kinds of counselling. We want to build on those programmes. For instance, we want to introduce voluntary testing units to as many prisons as possible. Through measures in the Crime and Disorder Bill, such as testing and treatment orders, we hope to divert some addicts, in suitable cases, out of the prison system altogether.
    Mr. Humfrey Malins: The Minister will clearly agree that it is both desirable and essential to stamp out completely the use of illegal drugs in prisons, but does he believe that it is possible?
    Mr. Howarth: It is certainly an aim to which we would all, I hope, subscribe. I want the strategy that we shall announce tomorrow to make it possible to reduce those numbers. I do not know whether any prison system in the world could claim to be entirely drug-free. If there is one—and it offers the prospect of a decent regime—I would be more than happy to consider it.

    Café Bar Licensing
    Ms Gisela Stuart: If he will review current licensing arrangements to provide for café bar licensing. [40277]
    The Parliamentary Under-Secretary of State for the Home Department (Mr. George Howarth): My hon. Friend wil be aware that, last week, we announced that there will be a review of the licensing system. As part of that review, I shall look at existing licensing provisions for café bars.
    Ms Stuart: I thank my hon. Friend for that answer. I believe that the Birmingham magistrates licensing courts committee is the largest in the country, and this is an important issue for a city such as Birmingham that has many overseas visitors. Can my hon. Friend give me an idea of the time scale for that review? When will we be able to give the Birmingham magistrates courts committee a more concrete reply?
    Mr. Howarth: I am afraid that my hon. Friend will have to wait a little longer before she can give the Birmingham magistrates courts committee a more concrete reply. With co-operation from the industry, magistrates and others, including the police, we hope to modernise the licensing system—while balancing that with a proper and responsible approach to protecting neighbourhoods that are often plagued by disorder at chucking-out time.

    Beat Police Officers
    Mr. Simon Hughes: What is the Government's policy on the subject of the future deployment of police officers on the beat. [40278]
    The Parliamentary Under-Secretary of State for the Home Department (Mr. Mike O'Brien): The Government will continue to do all that they can to relieve the police of unnecessary bureaucratic burdens and to encourage chief constables to put more officers back on the beat. However, the deployment of officers on the beat or to other duties remains a matter for chief constables.
    Mr. Hughes: Is not the fact that, in the past year, there was a reduction of 600 police officers on the beat in the capital the best evidence that the Commissioner of Police of the Metropolis was correct when he said, about 10 days ago, that there was no possibility of any significant increase in the number of police officers on the beat under current arrangements? Do the Government have a policy of putting more police officers on the beat throughout the country, and do they accept that, unless they increase the money available to police forces, the number of officers on the beat will continue to fall, contrary to the public wish?
    Mr. O'Brien: Crime in the metropolitan area has fallen by 6.1 per cent., and that is a tribute to the Metropolitan police. The Met has more officers per person than any other area. Total revenue for the Metropolitan police rose by 3.7 per cent.—or by £70 million—to £1.7 billion in 1998–99. That is a healthy rise at a time of restraints on public spending, and includes an extra £151 million in recognition of the Met's distinct national and capital city functions. We need to ensure that there are enough officers on the beat to fight crime. That is our objective,
    16
    but it is not a totem in itself. We must ensure that the officers are there for a purpose, and that purpose is to fight and reduce crime.
    Fiona Mactaggart: Will my hon. Friend join me in congratulating my local police force in Slough, which, through good management and the introduction of sectoral policing, has been able to increase the number of police officers on the beat? Will my hon. Friend play his part in making that more possible by reducing bureaucratic demands on the police force so that more police officers can get out and do their job on the streets?
    Mr. O'Brien: I agree entirely with my hon. Friend that we need to ensure that we free up officers for front-line duties. For example, joint performance management schemes between the police and the Crown Prosecution Service have improved the preparation of case files and helped to reduce the number of forms. We hope that further opportunities will arise to reduce the administrative burdens on the police so that we can get more police officers where they belong, which is out on the beat.
    Mr. Damian Green: The Minister is keen to have more police officers on the beat, but, when it comes to specifics, he tries to hide behind the chief constables. Will the Minister give the House a target for the number of extra police that the Government wish to see on the beat by the end of this Parliament?
    Mr. O'Brien: Perhaps the hon. Gentleman should abide by the commitments of the Conservative party. We have honoured all the spending commitments of the previous Government and are seeking to use those resources more effectively. The Conservatives are always wind and fury on policing. However, when it comes to police numbers, the previous Conservative Home Secretary promised to create 2,000 extra officers. In the last year of the Conservative Government, he delivered 295 fewer officers. Overall, between 1992 and 1997, net police numbers fell under the Conservatives by 765. The Met lost 1,961 officers. That is what the Conservatives did for policing.

    Juvenile Crime
    Angela Smith: When pilot areas for youth offending teams will be selected. [40279]
    The Minister of State, Home Office (Mr. Alun Michael): I am delighted to say that we have received 46 expressions of interest, from which we will shortly select eight areas to pilot the new youth justice measures, which are contained in the Crime and Disorder Bill. The youth offending teams will be piloted in each of those areas.
    Angela Smith: I thank my hon. Friend for that answer. Is he aware that his decision will be welcomed by local authorities, given that the role of the youth offending teams will complement the roles now played by local authorities in terms of community safety? When the pilot areas are announced, will guidelines be issued to them to ensure that those involved work closely with local authorities?
    Mr. Michael: Yes, indeed. I am aware of the enthusiasm among local authorities. The enthusiasm of local authorities and the police for the proposals in the Crime and Disorder Bill is striking. The requirement to undertake a crime and disorder audit and create a partnership to tackle crime and disorder in every part of the country is widely welcomed, and will fit well with the youth offending teams in the strategy to reduce youth crime.
    Mr. James Clappison: Will not the work of the youth offending teams be completely undermined by the dishonesty of the sentencing system, which means that a sentence of six months' imprisonment means only six weeks inside? Is not what the Home Secretary has just said about giving prisoners the opportunity to prepare themselves for release extraordinary when we bear in mind the fact that prisoners are released after serving only half their sentence? Is that not long enough for the Home Secretary? Is not the message that the Government are sending out that sentences do not mean what they say and that, under new Labour, "If you do the crime, you won't get the time"?
    Mr. Michael: The answer to the hon. Gentleman's question is no. It was a singularly unintelligent question, because he failed to listen to my right hon. Friend's answer. We are saying that we need to manage the transition from prison back into the community in such a way that people do not take up the pattern of crime in which they were indulging previously. The Conservative Government signally failed to deal with that issue. The hon. Gentleman has failed to address the points made by my right hon. Friend the Home Secretary and the subject of the question, which are that the Government are tackling youth offending while the Conservative Government did not do so for more than 18 years.
    Mr. Phil Sawford: Does my hon. Friend agree that it is a bit rich for the Conservative party to criticise sentencing procedures when only one in 50 crimes resulted in convictions during the time the Conservatives were in office? It is not good enough to criticise our record, when we are taking up the entire issue of youth crime through the Crime and Disorder Bill.
    Mr. Michael: Frankly, Conservative Members are undergoing a probationary period as an Opposition. They are not doing very well so far—they need more supervision—but the transition from government to opposition does not seem to suit them. We are dealing with the issues that have been left untouched for so many years.

    Football Policing
    l8. Mr. Peter L. Pike: What representations he has received on charges to football clubs for policing in relation to football matches. [40280]
    The Parliamentary Under-Secretary of State for the Home Department (Mr. George Howarth): My right hon. Friend the Secretary of State has asked me to
    18
    congratulate my hon. Friend the Member for Burnley and the Prime Minister's official spokesman, who is also a Burnley supporter, on the club managing to stay up this season.
    Two letters have been received recently from my hon. Friend, on behalf of Burnley football club, about charges for policing at matches. I understand that discussions between the police and the club on charging levels are continuing, with a view to reaching an amicable solution. I hope that my hon. Friend will shortly find that that has happened.
    Mr. Pike: In response to my hon. Friend's opening remark, I congratulate my right hon. Friend the Secretary of State on Blackburn Rovers qualifying for Europe by the skin of their teeth yesterday.
    The problem is that charges for reserve and off-ground policing proposed for next year by Lancashire police for Nationwide league clubs such as Burnley are not acceptable because those clubs are struggling to survive. Burnley, which is one of the best-supported teams—certainly in the second division—could not afford to meet the proposed costs.
    Mr. Howarth: My hon. Friend is well aware that discussions are taking place, and I am sure that the points that he has made will be taken fully into account before a solution is arrived at. I am confident that the talks are making progress, and I hope to report that there will be a solution in the near future.

    Fire Services
    Mr. John Cryer: What plans he has to review the Fire Services Act 1947. [40281]
    The Parliamentary Under-Secretary of State for the Home Department (Mr. George Howarth): My hon. Friend will be aware that we recently received the community fire safety task force recommendation, and work to implement its implications is on-going. We hope to make a lot of progress in this area.
    Mr. Cryer: Will my hon. Friend look again at the idea of having a complete review of the 1947 Act? A review would mean that the special services performed by the fire service would be taken into account and more resources would be provided for it, which would mean that current resources would be ensured for ever and a day.
    Mr. Howarth: My hon. Friend will appreciate that the fire service share of total standard spending for England in 1998–99 has been increased by 4.8 per cent., which compares favourably with the previous three years, when it was 4.2 per cent., 1.5 per cent. and zero per cent. I intend that the priorities of the fire brigade should be properly reflected. In the spirit of central and local partnerships, we are discussing with fire authorities and others the difficulties faced by the fire brigade, but my hon. Friend can rest assured that this service, which performs well, will be given proper priority by the Government.

    Fatal Road Accidents
    Mr. John Hutton: What plans he has to review the current law relating to the sentencing of drivers responsible for fatal road accidents. [40282]
    The Minister of State, Home Office (Mr. Alun Michael): The whole House understands the devastation and misery caused to any family when members of the family die in a road traffic crash. Severe penalties are available for situations in which the death is the consequence of fault or of the deliberate actions of another person.
    Mr. Hutton: I thank my hon. Friend for his reply. Although I acknowledge the severity of sentences to deal with dangerous driving, will he look again at the sentencing options available to the courts to deal with death as a result of careless driving? Will he especially find time to look again at the recommendation of the 1988 North committee report that road traffic offences legislation be amended to allow magistrates courts to take into account the consequences of carelessness, which can result in the death of an innocent pedestrian?
    Mr. Michael: The North report concluded that it would be wrong to visit on a driver severe penalties for tragic consequences. It recognised the difficulty of dealing with a case in which the tragic consequences might be much greater than the culpability of the offender. However, I undertake to keep this area of policy under review. We certainly return to the North report, which was a helpful investigation into the handling of the issue.

    Community Sentences
    Mrs. Helen Brinton: What proposals he has to ensure that there is an effective range of community sentences available to the courts. [40283]
    The Minister of State, Home Office (Ms Joyce Quin): The Crime and Disorder Bill contains proposals that will increase both the range and the effectiveness of community sentences available to the courts. The effectiveness of community sentences will also be enhanced by implementing recommendations from the probation inspectorate and by the lessons to be drawn from the community sentence demonstration projects, which have recently been conducted in Teesside and Shropshire.
    Mrs. Brinton: I thank my hon. Friend for her reply. Does she agree that prison is not the answer in every respect, and that the answer could be to build public confidence in community sentencing and to take a judicious view of electronic tagging? With the range of measures available, we might have an effective alternative to prison.
    Ms Quin: The new community orders in the Crime and Disorder Bill and an increased use of electronic monitoring will provide sentences that can be used for people who have committed crimes but for whom prison is not the most appropriate form of punishment. The probation service could do a great deal—indeed, probation services around the country have shown themselves willing to do that work—to learn from the "what works" initiative and to introduce challenging, effective and demanding community punishments.

Points of Order
3.30 pm
Mr. Michael Howard: On a point of order, Madam Speaker. Today, the Prime Minister made the most extraordinary intervention in the arms for Africa affair. Last week, the Foreign Secretary told the House that, if the United Nations embargo had been breached, it was "a very serious matter" and dismissed suggestions that military intervention might be consistent with Government policy as
"wildly out of touch with reality"—[Official Report, 6 May 1998; Vol. 311, c. 726–27.]
Today, however, the Prime Minister made precisely that suggestion, and apparently argued that the end justifies the means.
For the Prime Minister to intervene in that way, when a Customs and Excise investigation into possible criminal charges is still under way, is both astonishing and unprecedented. In those circumstances, have you, Madam Speaker, had any indication that the Prime Minister or the Foreign Secretary—or perhaps both, if their attitudes are to be reconciled—intends to make a statement to the House to clarify those vital matters?
Mr. Dennis Skinner: On a point of order, Madam Speaker.
Madam Speaker: Is this a related point of order?
Mr. Skinner: Yes. When you, Madam Speaker, answer this specific point of order—
Mr. A. J. Beith: It is not a point of order.
Mr. Skinner: It is probably not, but that is a matter for the Speaker, not for me.
Will you, Madam Speaker, take into account the fact that we do not really need lessons from that discredited bunch opposite about arms and all the rest of it? They were experts in trying to cover up the truth about arms to Iraq, and that applies to most of the Cabinet at the time, so let us get things into perspective. Let us also bear in mind the fact that the same secret services could have been in the same pockets—
Madam Speaker: Order. I am not allowing a debate on this matter. I am fully prepared to answer the right hon. and learned Member for Folkestone and Hythe (Mr. Howard). If I take another point of order, it must be related and I must be able to deal with it. I expect it to be so.
Mr. Nicholas Soames: Further to the point of order raised by my right hon. and learned Friend the Member for Folkestone and Hythe (Mr. Howard), Madam Speaker. Hansard shows that, when the Foreign
22
Secretary answered a private notice question in the House last week, I asked him to examine carefully the files from the Ministry of Defence and possibly the Department for Trade and Industry relating to Sierra Leone, and he said:
"I cannot speak for other Ministers or Ministries, but it is not my view that there are substantial files on the matter elsewhere."—[Official Report, 6 May 1998; Vol. 311, c. 728.]
That is clearly incorrect. Will you ask the Foreign Secretary to take the trouble to come to the House, explain away that inaccuracy and say exactly what happened?
Mr. Paul Flynn rose—
Madam Speaker: I shall take one more point of order on that matter.
Mr. Flynn: It is on another matter.
Madam Speaker: In that case, I must deal with the original point of order that was put to me by the right hon. and learned Member for Folkestone and Hythe (Mr. Howard).
I have not been informed by any member of the Government that he or she seeks to make a statement on the matter referred to today. I barely need to remind the House that the Prime Minister will be at the Dispatch Box and accountable for what he has said on Wednesday. I have no doubt that Opposition Members will question him on that matter.
I should say to the hon. Member for Mid-Sussex (Mr. Soames) that I have not had a chance to look at column 728 of Hansard, but I shall do so. He is aware that the Foreign Secretary and all Ministers are responsible for the comments that they make, but I am sure that those on the Treasury Bench heard what he said.
I now call Mr. Flynn on a separate point of order.
Mr. Flynn: On a point of order, Madam Speaker. You and your predecessors have always ruled that supplementary questions to oral questions must be related to the original question on the Order Paper, and you have silenced hon. Members who have raised matters that were not relevant to the original question. I appeal to you to consider using your power in defence of Back Benchers. I am asking you to intervene not in the daily political point scoring, but in the questions from serious Back Benchers who genuinely seek information on important matters. Should not they be entitled to an answer from the Minister involved that relates to their question? Will you study the final two answers to Question 12 today and consider preventing Ministers from avoiding answering oral questions by giving them an opportunity to answer properly the questions that have been put to them?
Madam Speaker: That was a very original and splendid point of order. I always expect supplementary questions to relate to the substantive questions, and I certainly expect Ministers to tackle them and to give a proper answer. [Interruption.] I am told that someone will be disappointed: I hope that it will not be the Speaker.

Orders of the Day

  Competition Bill [Lords]
  Madam Speaker: I have selected the amendment in the name of the Leader of the Opposition.
  3.36 pm
  The President of the Board of Trade and Secretary of State for Trade and Industry (Mrs. Margaret Beckett): I beg to move, That the Bill be now read a Second Time.
  I am proud to be able to stand before the House to move the Second Reading of the Competition Bill. This is yet another example of the Government's delivering quickly on their manifesto commitments. We are a Government who are clear about our aims, in contrast to the years of drift under the Conservative party.
  It is par for the course for a Labour Government to act in the public interest and in the interests of consumers. The precursor to the Monopolies and Mergers Commission was established under the Attlee Government of 50 years ago, so it is fitting that it falls to this Government to modernise and update it. For close on 10 years under the previous Government, the need for and the content of such a Bill were discussed. Indeed, in the year before the last election a draft Bill was published and widely welcomed by, among others, the then Labour Opposition. However, absolutely nothing happened, and the right hon. Member for Wokingham (Mr. Redwood), in his search for any portmanteau criticism, has the cheek to accuse us of dithering.
  The Bill will radically reform and strengthen our laws to deal with cartels and with abuses of a dominant position in the marketplace, such as when firms act together to limit choice for customers or to raise the price they face, or both. It is a Bill for consumers, for business and for jobs. It is another step in the creation of strong markets that will make Britain a more competitive economy.
  Strong competition in our domestic markets makes for strong British companies that are able to compete and succeed in the global marketplace. It provides a spur to companies to innovate and invest, and builds up the competitiveness that safeguards and creates jobs. As my right hon. Friend the Chancellor of the Exchequer told the European Union in his employment action plan, competitive markets are crucial to creating sustainable jobs in the United Kingdom.
  Mr. John Redwood: I am grateful to the right hon. Lady for trying to make clear her intentions in the legislation. As she wants it to be tougher than the present law, will she tell us what current legal business practices she hopes and expects the Bill to make illegal?
  Mrs. Beckett: The right hon. Gentleman has repeatedly asked me and the Director General of Fair Trading such vague and wandering questions. As the director general has told him in correspondence in answer to his many questions, the Bill sets the framework in which to inhibit
  24
  anti-competitive behaviour and the abuse of dominant market share. No one can be expected to give case-by-case definitions, especially not a Minister.
  Mr. John Bercow: Why not?
  Mrs. Beckett: Because these are matters for the Director General of Fair Trading. That is the Bill's purpose. It is the way our system has always worked and, I hope, always will.
  Mr. Chris Mullin: Does my right hon. Friend accept that, for many of us, the Bill's acid test will be whether it addresses the sort of abuse that has been taking place in the national newspaper market, with which I am sure she is familiar? The present Office of Fair Trading seems powerless to deal with that. Can she say whether the Bill will make a difference to such abuses? If it does not, we shall have to go back to the drawing board to look for some means to make the Bill effective in dealing with what I think most people understand to be a clear and gross abuse.
  Mrs. Beckett: I am grateful to my hon. Friend for his intervention. I intend to deal later and at greater length with that matter. My answer to my hon. Friend is entirely consistent with my response to the intervention by the right hon. Member for Wokingham. I can certainly say that the Bill strengthens competition law. I shall return to that. My hon. Friend asks whether it will deal with a specific case. It is impossible to give such an answer, and I shall give an analogy to explain why.
  In its wisdom, Parliament has decided that it is illegal for one person to murder another. However, a Minister may have to respond at the Dispatch Box to an inquirer who asks, "Murder is illegal, and that man Jones is charged with murdering Mrs. Smith. I believe that he is guilty. Can the Minister assure me that, as a Bill has been passed and murder is illegal, Mr. Jones will be found guilty of the crime and sent to gaol?" Of course, a Minister can give no such assurance. It is for the court, judge and jury to decide. Similarly, under the Bill, decisions in specific cases are matters for the independent regulator. I shall return to that matter, and I hope that I shall be able to satisfy my hon. Friend.
  Mr. Bercow: Will the Minister give way?
  Mrs. Beckett: Perhaps the hon. Gentleman will forgive me if I do not give way, as I intend to return to the matter later.
  Mr. Dale Campbell-Savours: I have heard my right hon. Friend's argument before. I heard it in 1980 from Ministers in Committee on the Bill that became the Competition Act 1980. If it was good enough for the Tories then, I cannot see why it is not good enough for them now.
  Mrs. Beckett: I am grateful to my hon. Friend, as I am sure are Opposition Members, for his elucidation.
  The Bill is a good measure, and not just for Britain's competitiveness, although that is of huge importance to us all. It benefits ordinary families, as customers and as taxpayers. Customers lose when firms rig the markets

  25
  against them. Competition is vital to ensure choice and value, and weak competition law means lower quality at higher prices. Anti-competitive behaviour hits ordinary people and imposes extra costs on family budgets. It hits families as taxpayers.
  A secret cartel between laboratory equipment manufacturers was recently broken up by the Office of Fair Trading. As the Director General of Fair Trading said, in the end taxpayers and consumers had to foot the bill for that cartel, because it rigged the market against the hospitals and public bodies that it supplied, as well as against its other buyers. Business and consumers deserve better than that, and they will get a better deal from the Government and the Bill.
  Mrs. Gwyneth Dunwoody: Will my right hon. Friend be kind enough to make it clear that the predatory pricing that was employed by some bus companies, which resulted in the immediate bankruptcy of responsible companies, would not be possible under the legislation, and that the Office of Fair Trading would have the right to take immediate action and would not have to wait until, unfortunately, the deed had been done?
  Mrs. Beckett: My hon. Friend gives the excellent example that I had intended to quote. Under the present law, while investigation is being undertaken, the Director General of Fair Trading cannot take action. For precisely the reasons that my hon. Friend gives, that will not be the case under the Bill.
  At present, our competition regime is often bureaucratic and ineffective, as my hon. Friend the Member for Crewe and Nantwich (Mrs. Dunwoody) has just pointed out. The powers to investigate and to uncover evidence even of seriously anti-competitive behaviour are weak. Even when the evidence has been obtained, lengthy and cumbersome procedures have to be followed before such behaviour can actually be stopped.
  Nor are there any financial penalties for anti-competitive behaviour—only for breaching court orders once they are obtained—and therefore no real deterrent. Even the most blatant cartels can get away with little more than a slap on the wrist. The laboratory equipment companies to which I referred were not fined by the court because, under our present law, they could not be. They had to promise simply not to do it again. All that will change with the Bill.
  Not only is our present law weak and ineffectual, but its methods and approach differ from those of European Union competition law, so UK companies that are large enough to be affected by the EU regime face differing laws, a differing approach and potentially differing judgments on the same competition issues. That means more bureaucracy as well as a sort of double jeopardy.
  Therefore, as we promised in our manifesto, both because it is right in itself and because it will simplify the competition regime for British business, the Bill introduces a prohibition-based approach to competition law. That will not only modernise our law, but bring it more into line with the prohibition-based regimes that already operate in the EU and in much of the Organisation for Economic Co-operation and Development. That approach will itself be a far more effective deterrent against anti-competitive behaviour.
  Mr. Bill O'Brien: Is my right hon. Friend aware of the concerns of people who have made progress
  26
  in innovation and design, and of the concerns of the Anti Copying in Design Company, which feels that the protection that it needs to ensure that its members can continue to bring forward new designs and innovations is being undermined because of the lack of support or protection under the Bill? Does she accept that we welcome the Bill, but that we believe that there are areas where further protection should be given to individuals who are trying to bring forward new design and innovation?
  Mrs. Beckett: I understand my hon. Friend's point. Indeed, I share the concern that he and others have expressed about the effect of such behaviour. Obviously, that matter will be explored in Committee and in other discussions on the Bill. I say simply that we do keep the matter under review. We are in discussion with people who have those particular concerns. We are not, however, minded at present to put such a measure into the Bill, because it is very much a matter of the handling of intellectual property and, as such, its ramifications are much wider than the ambit of the Bill. Also, of course, there is other legislation, such as the trademarks legislation, which can deal with the issue, but we do keep the matter under review, and I am sure that my hon. Friend will ensure that it is discussed as the Bill continues through the House.
  Mr. Paul Flynn: My right hon. Friend has been exceptionally kind in giving way. Will she examine medicinal drugs as a special case, recalling that 10 times more people are addicted to medicinal drugs than to illegal drugs and that, every year, five times more people die from the use of medicinal drugs than from illegal drugs? Would she not regard it as an error if we allowed supermarkets to sell medicinal drugs to children at a lower price, which will increase the dangers of those drugs? Is this not a case where the need for open competition is secondary to the needs of public safety?
  Mrs. Beckett: That, too, is an interesting, but, if my hon. Friend will forgive my saying so, slightly separate point, although I recognise that it arises under the issue of how we deal with over-the-counter medicines, to which I will also refer later. I say simply that the concerns that he raises are, properly, health and public policy concerns. Whether they should be dealt with during the handling of the Bill is another question. It is a matter of how the sale of medicines is controlled and how it is supervised, which arises wherever and at whatever price such medicines are sold.
  Mr. Simon Hughes: Will the right hon. Lady give way?
  Mrs. Beckett: All right, but I must get on afterwards.
  Mr. Hughes: I appreciate the right hon. Lady's giving way.
  On a point linked to that raised by the hon. Member for Newport, West (Mr. Flynn)—I heard what the right hon. Lady said—will she at least clarify the Government's present policy on independent community pharmacies? Given the amendment that was passed against the Government's wish in the House of Lords, can the Government say now that, irrespective of references by

  27
  directors to the restrictive practices court, it is the Government's policy that, irrespective of the main thrust of the Bill, provision will be made to protect community pharmacies against the rigour of a derestricted market? Is that the Government's policy or not?
  Mrs. Beckett: If I had had fewer interventions, I might have got further into my speech, and the hon. Gentleman would have had the answer that he seeks. I shall return to the issue later in my speech. I hope that that is not too far away.
  There are two principal prohibitions in the Bill. They are modelled closely on the competition rules contained in articles 85 and 86 of the treaty of Rome, which means they can be interpreted consistently with their EC models. The first prohibition introduced by the Bill will outlaw anti-competitive agreements or practices. The current restrictive trade practices legislation was passed in the 1950s and has become ineffective and outdated. Under that legislation, even the most serious cartels can carry on for years. In another recent case, a market-sharing and price-fixing cartel of ready-mixed concrete companies was finally dealt with in the courts more than nine years after first being investigated.
  Of course, not everyone attaches the same high priority to protecting competition. We have heard a number of scare stories claiming that the Bill will interfere with perfectly harmless business practices; no doubt that will be explored as the Bill goes through the House. Of course, the new prohibition will not apply at all to harmless agreements; it is the present legislation which ties up many such agreements in legalistic knots. I am told that currently well over 10,000 agreements have had to be registered with the Office of Fair Trading, although they are not significant in competition terms. About 6,000 of those have been added to the register since 1989. All that is unnecessary work for the authorities and for business.
  The prohibition will focus on agreements that actually damage competition. We recognise that some agreements that are restrictive can nevertheless have beneficial effects overall, so the Bill sets out the criteria on which such agreements may be exempted. Some categories of agreement will be exempted on a block basis; others may be exempted individually. Added to that, any agreement that is already exempted under article 85 will automatically be exempted from the new prohibition. That should keep regulatory burdens to a minimum, and it further demonstrates the value of a domestic prohibition operating consistently with EC rules.
  The second prohibition will outlaw abuses of a dominant market position. The present laws for investigating abuses by monopolies will continue to be useful in some limited circumstances in the future, but they have serious weaknesses. They provide little or no deterrent against dominant companies that bully their competitors and exploit their customers. Serious anti-competitive behaviour by monopolists can go unchecked throughout often lengthy investigations, while competitors can be forced out of business.
  My hon. Friend the Member for Crewe and Nantwich referred to Southdown Motor Services, which was driven out of business by the anti-competitive actions of a rival company, even while the OFT was investigating its
  28
  complaints. It was said at the time that the case illustrated the need for a power to grant interim relief during investigations, but, by then, the damage had already been done.
  As there are no powers to impose penalties at the end of investigations, firms that are damaged by proven anti-competitive behaviour can get no recompense. The new prohibition will put right those shortcomings.
  The Bill comes to this House with a third prohibition, added in the other place. It relates to the issue raised with me by my hon. Friend the Member for Sunderland, South (Mr. Mullin)—the prohibition of abuse of dominance specifically targeted at the newspaper sector. Much that has been written about this issue is just plain wrong. At the outset, the allegation was extensively made that the Bill weakened the law on competition—in particular, that it weakened the law as it would apply to newspapers owned by Mr. Rupert Murdoch, and that it did so because of the Government's desire to favour Mr. Murdoch. Understandably, that aroused great concern. Unfortunately for the merits of that argument, the Bill strengthens competition law across the board, not only for the newspapers, and it does not in any way, shape or form discriminate in favour of Mr. Murdoch or in favour of any other newspaper proprietor or group.
  In strengthening competition law, the Bill strengthens the law against predatory pricing and other abuses of a dominant market position, whatever the market. Article 86, which the Bill follows closely, prohibits a dominant market position being abused by the use of predatory pricing—so, too, will the Bill. Clause 60 states explicitly that, in interpreting those terms in all markets covered in the Bill, our law must follow European jurisprudence and have regard to clarifying policy statements from the European Commission.
  In previous court cases, for example—particularly that of Tetra Pak—the European Court of Justice ruled that predatory pricing should be presumed if prices were shown to be below the average variable cost of production. It would be a mechanistic test, without any requirement to prove intent—which, of course, contrasts with the current position, in which the director general has to seek to demonstrate intent if predation is to be proved.
  Conduct is to be regarded as predatory even if prices are above average variable costs, but still below total average costs, if it can be established that the purpose of that conduct is to eliminate a competitor. That principle, too, will apply under the Bill, as will the principle that dominance exists when a company is shown to be able to act independently of its competitors.
  Therefore, although those matters can and will be considered in Committee or on Report, I hope that the House will accept as mistaken the first underlying premise of the case that some have made—that the Bill weakens competition law.
  Several hon. Members rose—
  Mr. Tam Dalyell: I understand that one really will have to brood over Hansard before understanding the matter fully. However, before we go any further, I should like to ask whether the links between the markets in which, for example, BSkyB operates and the market for daily broadsheet newspapers are sufficiently close to constitute special circumstances,

  29
  justifying the application of article 86 in relation to defendants holding dominant positions. I realise that it is a delicate question, but I wonder whether the Secretary of State will comment on an issue with which she is familiar.
  Mrs. Beckett: As my hon. Friend is aware, I must be wary of being drawn into the issue of the merits of any specific case that is yet to be decided. However, I think that he also knows that it has been ruled in case law that an abuse existed when success or strong market share in one market was said to have put a particular company in a position to use its market strength in that market to undermine behaviour in a separate market. Some of the issues have therefore been considered, and there are examples in which such a position has been thought to create prima facie evidence of something that should be investigated.
  Mr. Quentin Davies: At the beginning of the debate, why was the right hon. Lady so coy and evasive in answering the question of my right hon. Friend the Member for Wokingham (Mr. Redwood), who asked whether the Bill will in any way specifically strengthen competition policy? She would not answer that question. Now, however—10 minutes later—she is telling the House that, in one sphere of predatory pricing, the Bill will strengthen competition policy compared with the previous regime. She cannot have it both ways. Will it or will it not?
  Mrs. Beckett: With respect to the hon. Gentleman—he clearly was not hanging on every word of the right hon. Member for Wokingham in quite the way that I was—that was not what the right hon. Gentleman asked me. Undoubtedly and clearly, the Bill will strengthen competition law.
  Mr. David Winnick: I notice that there is absolutely no mention of the position of Mr. Murdoch and The Times in the amendment tabled by the official Opposition, which is interesting.
  Does my right hon. Friend agree that what is really required is effective legislation? From her comments, one hopes that the point will be taken that it is wholly undesirable that The Times should deliberately undercut other broadsheets, undoubtedly to drive them out of business. Although no action on the matter was taken by the Conservative Government—who never dreamed of taking such action—one hopes that action will now be taken by a Labour Government. If the situation continues, The Independent will go out of business—which would not be desirable if that happened purely and simply because of pricing mechanisms and undercutting by The Times.
  Mrs. Beckett: Again, I must not be drawn on the merits of a specific case, especially one on which the Director General of Fair Trading has recently invited input from those who are complaining. The director general is currently considering whether, even under present legislation, some of the matters to which my hon. Friend referred should be investigated. The Bill certainly strengthens the director general's effectiveness in those and other matters.
  Mr. David Chidgey: The President of the Board of Trade will accept that this is a complex area and
  30
  that I will have to study what she has said in Hansard in more detail, but is she not concerned that the former Director General of Fair Trading, who is universally recognised as a formidable legal expert in such matters, said that the amendment that she referred to was essential to prevent the predatory practices of which she spoke? Does it not occur to her that, even if the amendment proves to go further than necessary, having it in the Bill will give us the belt and braces that we may well need? Does it not concern her that Mr. Murdoch is apparently happy with the Bill without the amendment, but unhappy with it as amended?
  Mrs. Beckett: I do not know what gives the hon. Gentleman that impression. I am afraid that I am not familiar with Mr. Murdoch's thoughts on the matter. Of course, I have the utmost respect for my noble Friend Lord Borrie—indeed, we have sought his advice, and taken it, on previous occasions—but, sad to say, it is not given to all of us in this vale of tears invariably to agree, and, on this occasion, we are not wholly persuaded that the amendment is appropriate, for reasons that I shall give later.
  Mr. Giles Radice: Is my right hon. Friend saying that, if there is a case of predatory pricing in the newspaper industry, as in other industries, the combination of clause 18, which concerns the abuse of a dominant position, and clause 60, which brings British law into line with European case law, will be sufficient to deal with it? Will she confirm that, in accordance with Pepper v. Hart, her statement today would be taken into account in a court of law if there were any ambiguity about the legislation?
  Mrs. Beckett: I can certainly confirm the latter point: Ministers' statements would indeed be taken into account by the courts. I can also confirm that the combination of clause 18, with its prohibition of abuse, and clause 60, which brings European jurisprudence into effect here, makes the Government believe that the Bill is already so strengthened that, even if there were no other defects in the amendment made in another place, it would not be necessary in order to make for sound and strong competition law.
  Mr. Bercow: The right hon. Lady is coming under fast and furious attack from Labour Members. I ask her to comment not on the merits but simply on the facts of the case. Will she confirm that the profits from the television interests of News International, including BSkyB, do not in any way subsidise any of its newspapers? That is the fact of the matter, for the confirmation of which, from the mouth of the President of the Board of Trade, I and the House would be immensely grateful.
  Mrs. Beckett: I am afraid that I will have to disappoint the hon. Gentleman. Whether that is a fact is not a matter for me in the context of this debate. I specifically declined earlier to be drawn into a discussion of the structure of the companies owned by Mr. Murdoch, and I do not intend to be tempted into one now. I will simply say that the Bill strengthens competition law, and the possibility of action against predatory pricing in any market. European jurisprudence and case law also cast light on the way in

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  which these matters might be examined in different markets. Further than that I am not able or prepared to be drawn.
  Mr. Bercow: The right hon. Lady should be.
  Mrs. Beckett: If the hon. Gentleman really thinks that, he has not the faintest understanding of the role of a Minister who is dealing with legislation of this kind—although that will probably never be of any consequence.
  In some quarters, the question whether the Bill weakens competition law—the premise on which the original debate began—seems to have become less important. The debate became inflamed by suggestions that the Bill was being used specifically to advantage Mr. Murdoch. I hope that I have comprehensively knocked those allegations on the head. Some have moved on to suggest that the Bill should be a vehicle specifically to disadvantage him.
  To all who may stray towards advocating that point of view—whether or not they are my right hon. and hon. Friends—I must say in all sincerity that that is not the purpose for which we were sent here. We were sent here to make good law, sound law and fair law, to the best of our ability and understanding. We were certainly not sent here to do special favours for any individual or group; but nor were we sent here to use the vehicle of law to single out any individual or group.
  I am advised that the amendment made in another place is unworkable in law and practice, and there is a basic flaw in the case put by those who advance its merits. That flaw is simple and clear, but seems not to be addressed by the vast bulk of the arguments in favour of the amendment. It is this: in the end, these matters fall to the judgment of the independent competition authorities, such as the Director General of Fair Trading, and the Monopolies and Mergers Commission. Under the law as it stands, as we propose it and as the amendment that was carried in the other place proposes, what matters in the end is the judgment of the Director General of Fair Trading.
  Mr. Redwood rose—
  Mr. Chidgey rose—
  Mrs. Beckett: Let me make one more point.
  I accept that some of those who have followed the matter closely recognise that that is the case. Consequently, attempts have been made—no doubt they will continue to be made as the matter is examined in detail in Committee—to redefine the law specifically relating to newspapers, in order almost to direct the judgment of the director general in the matters under discussion.
  Again, that will be no easy task. Cross-subsidy, special promotions and special agreements are rife in the newspaper industry: they always have been, and probably always will be. There has seldom been a better example of the danger of throwing the baby out with the bath water. In fact, it is precisely because it is so difficult to define these matters in legislation that the ultimate test lies in the judgment of an independent regulator.
  Mr. Chidgey: The right hon. Lady is absolutely right to say that these matters fall to be determined by the
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  Office of Fair Trading. However, does she accept that the two previous cases brought to the OFT—I am sorry to return yet again to News International, but it is a case in point—failed in the final analysis? I understand from the former director general that those cases failed not because there was no case to answer, but because legislation failed to give enough clear guidance to the director general. That is precisely why there is a call for the Bill to include specific and clear guidance. Does not the Secretary of State accept that the OFT must have guidance to allow it to perform its correct function?
  Mrs. Beckett: With respect to the hon. Gentleman, let me remind him that some of those who wish to focus on that particular case argue that the behaviour to which objection has been taken is, in their judgment, proven to be predatory, because it has continued for a considerable time. They argue that that makes the matter different. If it makes the matter different, it makes the matter different; that does not necessarily substantiate the case that the law cannot deal with it in some way.
  As I mentioned a moment ago—it is one of the reasons why I am being, I hope, sufficiently cautious in what I say—the director general has asked for information that may substantiate a complaint. While he is still considering the issues, it is too early to say that he is not able to deal with them under existing law. We do not argue that. All we argue is that, if the existing law is too weak in a variety of ways, the Bill strengthens it in a variety of ways. There is nothing in the argument that the Bill makes the position worse. There is substantial evidence to suggest that it strengthens the position.
  As I said when the hon. Member for Eastleigh (Mr. Chidgey) intervened previously, there is a separate problem with the amendment carried in another place. Unlike the Bill's basic provisions, which seek to prohibit illegitimate behaviour by dominant players, the amendment applies to any conduct, legitimate or illegitimate, that may reduce the diversity of national newspapers by reducing competition. A strong newspaper that, by good journalism, establishes a good circulation and so prevents, or reduces the chance of, new entrants, or endangers the survival of failing papers, would fall foul of the amendment. That runs the risk of artificially freezing the newspaper industry as it stands.
  As practically any established national newspaper will hold substantial market power—the test proposed in the amendment—the regulator would be given almost unlimited power to intervene to regulate the national newspaper market. The amendment ends up by being based not on anti-competitive behaviour but on giving the state the power to control how national newspapers behave. We believe that the amendment is either contrary, or not related, to the Bill's aims, so the Government must seek to remove it.
  A second, much publicised issue will be thrashed out in Committee: the resale price maintenance of over-the-counter medicines.
  Mr. Redwood: I am grateful to the President of the Board of Trade for giving way before she moves on from these interesting exchanges on the so-called Murdoch amendment. I was grateful to her for helpfully spelling out more of the thinking behind how the rules and the law would apply. Can she give us just one more piece of

  33
  guidance? I appreciate that she does not want to answer about whether a particular newspaper sold at a particular price on a particular day of the week is or is not predatory. However, if a newspaper, or any other company, decides to sell its product on one day at a much better discount than it sells it in the rest of the week, will her test on the relationship between price and cost apply to the average over the week or day by day? It is most important for newspapers to know that before the law comes into being.
  Mrs. Beckett: That is a most interesting question, and I am sure that the director general is puzzling over it even as we speak. I do not intend to pronounce on it, because it is exactly the sort of question that he has to assess and is paid to judge, and which I am specifically paid not to try to judge but to pass to him, as I do.
  Mr. Ian Bruce: Will the right hon. Lady give way?
  Mrs. Beckett: I should be grateful if the hon. Gentleman would be brief, as this is about the 16th intervention.
  Mr. Bruce: The right hon. Lady has been very generous. I have a general point that concerns a genuine request for information. The all-party European informatics market group has done several studies of regulation, particularly of telecommunications. We and industry keep coming to the conclusion that the Government should give regulators a general power. That coincides with what the European Union and the Government are trying to do. The Bill has more than 110 pages of complicated clauses, and is likely to catch the unwary. The more that is written, the more loopholes are created. That allows those who want to use predatory pricing to find loopholes. Surely it is better for the Government to give general rather than specific powers.
  Mrs. Beckett: That is precisely what we have done. The Bill's length results from the range of issues with which it deals. Its whole purpose is to set the right framework of law within which an independent regulator can operate. The hon. Gentleman's strictures about the dangers of writing too much in detailed definitions should be applied to those seeking to amend the Bill; their amendment would create the dangers to which he referred. We do not believe that that is the case with the Bill as presented to the House.
  On the issue of resale price maintenance of over-the-counter medicines, the purpose and effect of the amendments carried in the other place are to remove price fixing in the sector from competition scrutiny, either under the relevant existing law, or under the prohibition in the Bill, until 2004. I am aware of and sensitive to the fears that have been expressed by pharmacists for their future if resale price maintenance is abolished, and more than conscious that those anxieties are bound to find an echo in the House. However, I hope that hon. Members on both sides of the House know that the Director General of Fair Trading and bodies that have investigated the issues in some depth, such as the Consumers Association, do not agree or accept that all small pharmacies depend on the maintenance of such a price regime. They argue, first, that there are better ways of targeting any support that small pharmacies need and, secondly, that fixing prices for medicines is an extra charge on those who need them most.
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  The restrictive practices court exists precisely in order to examine such arguments and decide whether an exemption continues to be justified. In the amendments carried in another place, the House is being asked to accept that these businesses and they alone should be able to fix their prices without any possibility of review by the competition authorities for several years hence. The Government are not persuaded by those arguments.
  Mr. William Cash: Will the right hon. Lady be kind enough to comment on the problems of doctors' surgeries in rural areas? As she knows, there is a monopoly that prevents people from being able to practise within one mile of an existing pharmacy. Will she consider making an amendment to the Bill to deal with that long-standing and completely unnecessary monopoly?
  Mrs. Beckett: With respect, no. The hon. Gentleman makes an interesting and important point about a matter that is much discussed—indeed, when I was shadow Secretary of State for Health, I was involved in discussing it—but it is not a matter for the Bill or for me. It is a matter of general health policy and how that should be decided.
  Mr. Simon Hughes: The right hon. Lady was good enough to say that she would come to this matter, and she has given a clear answer. I realise that the matter is one which crosses Departments, involving not only the Department of Health, but the Scottish Office, the Welsh Office and the Northern Ireland Office, but will she at least give the House the Government view that retaining a network of community pharmacies is as much Government policy as retaining a network of community doctors and community dentists?
  Mrs. Beckett: Yes. I am grateful to the hon. Gentleman because, in asking in that question, he has anticipated my speech by about one and a half paragraphs.
  There is no doubt that the Government strongly support and care about community pharmacies. As I am sure the hon. Gentleman is aware—or perhaps, given his constituency, he is not—many small rural pharmacies already receive support under the Department of Health essential pharmacy scheme. My right hon. Friend the Secretary of State for Health has made it clear how important community pharmacies are to his vision of health in the next century.
  There is no doubt that the Government support and are a strong defender of rural or community pharmacies. However, we are extremely mindful that, if critics of the present regime are correct, all families—especially many low-income families—are paying an artificially high price for their medicines. A recent Consumers Association survey of 2,000 people showed that 13 per cent. were unable to afford certain medicines. A report commissioned by the community pharmacy action group estimates the cost to the consumer of keeping resale price maintenance for over-the-counter medicines at between 6p and lop per week.
  That does not sound like much, but I am advised that it amounts to £180 million a year; therefore, if the amendment were to stand, the cost to the consumer over the five years in which investigation of the matter was debarred would be more than £900 million. That is a

  35
  substantial sum in anybody's language. It is the argument that people should not be required to pay that sum which leads to the view the Government take on the matter.
  By contrast with the current regime, the powers of investigation and enforcement in the Bill are unquestionably tough—and rightly so, if they are to provide an effective deterrent and to enable the worst offenders to be rooted out and dealt with. The vast majority of businesses work hard to be competitive, and they and their customers deserve effective protection from the few who cheat and bully.
  Once the prohibitions are in place, anti-competitive agreements and abuses of dominance will be unlawful from the outset. There will be the possibility of financial penalties of up to 10 per cent. of UK turnover for the worst offenders, and the director general will be able to impose interim measures to bring to an immediate stop seriously anti-competitive behaviour while a full investigation is carried out.
  While the director general will have primary responsibility for enforcing the new regime, as under the current monopoly laws, the utility regulators will have the same powers as the director general within their special areas so that they can bring their expertise to questions of competition law in the sectors that they regulate.
  The director general will have rights to demand information. Where there are reasonable grounds, he may make unannounced visits to the premises of suspected infringers to seek evidence of cartels or other anti-competitive behaviour. In certain cases, he will be able to obtain a warrant allowing forcible entry. In normal circumstances, the director general will not need to use those powers to get the information that he needs, but cartels are, by nature, secretive and cautious, so strong powers are necessary to root out the worst offenders and to ensure that evidence can be obtained before the relevant documents can be hidden or destroyed.
  While the director general will be the principal means of enforcement, the Bill also introduces important new rights for firms and customers who have been on the receiving end of anti-competitive behaviour. Companies and individuals who have been harmed by infringements of the prohibitions will be entitled to seek damages in the courts.
  Obviously, such a tough regime must go hand in hand with fairness and transparency to command confidence, so it must go hand in hand with the safeguard of a full right of appeal. Appeals against the director's decisions will be made to an appeals tribunal established within a new body—the Competition Commission—and further appeal on points of law or the level of penalty can be made to the Court of Appeal. It is also important that consumers should have a clear voice under the new regime, so that they and organisations representing them will be able to appeal to the Competition Commission against decisions made by the director general.
  It is vital that decisions made by the director and the tribunal are clearly explained, so they will have to publish reasoned decisions, which will serve to explain more widely the application of the prohibitions.
  The director and the regulators are already working jointly on guidance and will publish guidelines for their own sectors to cover a wide range of issues, such as the
  36
  definition of relevant markets and the behaviour that is likely to infringe the prohibitions. The guidelines will be in place well before the prohibitions come into force, to give businesses the maximum opportunity to adapt to the new rules. We will also table amendments to the Bill to help businesses make the transition to the new regime.
  Mr. Andrew Miller: I am grateful to my right hon. Friend for giving way. I have been listening carefully to her remarks. The factory outlet village in my constituency, which has attracted 3 million consumers in its first year of operation, has expressed the fear that the draft guidelines will impose constraints on its business. Will my right hon. Friend give assurances that, if it is clear that the consumer has expressed a choice by making purchases in certain venues, those institutions will be properly protected?
  Mrs. Beckett: I know that my hon. Friend will understand that I cannot comment on the circumstances of a particular factory shop. It is clear in the Bill and the guidance that the measures are intended to prohibit anti-competitive behaviour, but corresponding offsetting benefits can be taken into account. The Bill allows for the exclusion of circumstances such as those mentioned by my hon. Friend.
  Mr. Oliver Letwin: Will the right hon. Lady give way?
  Mrs. Beckett: No, I had better finish, Madam Speaker, or you will have me thrown out of the Chamber for taking too long.
  Most agreements that would have to be registered under existing legislation, but are made after Royal Assent will no longer need to be notified to the Office of Fair Trading. Information on that will be made available soon.
  Harmless behaviour will not be caught by the prohibitions in the first place, and smaller firms will benefit from the provisional immunity from penalties for minor agreements and practices.
  The Bill's general approach of controlling behaviour only when it is anti-competitive is one which we intend also to apply—although with certain changes in procedure—to so-called vertical agreements, whereby firms make arrangements with others up and down the supply chain; for example, with suppliers in one direction and retailers in another. For example, a retailer agreeing to specialise in selling just one manufacturer's product would be a vertical agreement.
  The majority of vertical agreements do not give rise to competition concerns, but the mechanism could in principle be used to rip off customers. Here, too, it is the practical effects of such agreements which matter. Elsewhere in Europe and in this country, these issues are under continuing study to see whether and, if so, to what degree block exemptions or other special treatment may simplify this area of the law—a matter on which we are still consulting. What matters is protecting the customer from exploitation while minimising the hassle for efficient businesses competing fairly in an open marketplace.
  There has been widespread consultation about the Bill and a wide general welcome for its approach—from the business community, from competition lawyers and from bodies such as the National Consumer Council.

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  The view of Her Majesty's Opposition is still unclear, however. Not for the first time, some confusion reigns. The shadow President of the Board of Trade has tied himself and his party in knots. To be fair to him, aligning our law with EU law probably unhinges him a bit to begin with, but in the summer he was against the Bill, in the autumn he was against some of it—but not the bits that his party kept promising to do—and now: well, I am not at all sure where he stands now.
  Where do the Tories stand on paralleling article 86 on abuse of a dominant market position or on predatory pricing? Some of his Front-Bench colleagues have said they will support Lord McNally's amendment, but the right hon. Member for Wokingham has opposed introducing the prohibition on which it is based, and the Conservative amendment says nothing about it. Although he is on record as opposing that part of the Bill, he is supposed to be in favour of unfettered competition—although he may or may not support the Bill in general.
  Almost the entire Tory motion is about restricting competition—about keeping price controls for over-the-counter medicines—and it seems to be all about health policy, not about competition policy at all, yet the company that has most publicly challenged price fixing in OTC medicines is headed by a Tory Back Bencher and senior campaign adviser to the Leader of the Opposition, the hon. Member for Tunbridge Wells (Mr. Norman)
  What is also surprising about the right hon. Gentleman's approach is that, when the Tory party had responsibility for these matters, they proposed, in their draft competition Bill last year, exactly the same approach as this Government are advocating—allowing the present proceedings to continue, but giving the practice an extended transitional exclusion if the courts confirm that the practice is, after all, considered to be in the public interest.
  I am afraid that there is no consistency and no policy behind the Opposition's approach to the Bill: there are only opportunism and irrelevance. The benefits of our proposals are clear, and they have been widely welcomed. They will deliver modern and effective competition law, which works in harmony with the European rules with which so many of our companies are already familiar.
  We have carefully balanced stronger powers to investigate and crack down on anti-competitive behaviour, on the one hand, with proper safeguards and a full appeals procedure on the other. We have consulted widely and listened carefully to the comments that we have received. The net result is a Bill which will strengthen our competitiveness and bring major benefits to consumers and business alike.
  Indeed, only last month the Director General of Fair Trading referred a suspected cartel on route sharing and fare fixing arrangements in bus transport in the north-west to the restrictive trade practices court for investigation. When doing so, he commented that the investigation could have been conducted far more quickly had he had the strengthened powers of investigation provided under the Bill, and that, under this legislation, not only would such agreements be prohibited but those party to them could be fined.
  The changes that the Bill brings are important, and they are long overdue. I commend the Bill to the House.
  4.28 pm
  Mr. John Redwood: I beg to move, To leave out from "That" to the end of the Question, and to add instead thereof:
  "this House declines to give a Second Reading to the Competition Bill [Lords] because the Government has failed to spell out the consequences for a whole range of business that will result from this legislation, and specifically has failed to tackle the problem of independent community pharmacies; expresses its concern at the decision of the Office of Fair Trading to commence legal proceedings to end retail price maintenance on over-the-counter medicines at a time when the Government is already seeking to review this agreement in the Bill; notes that the loss of retail price maintenance on over-the-counter medicines could lead to the closure of many independent community pharmacies, an outcome which would seriously undermine the Government's health strategy and increase the burden on GPs; and calls on the Government to ensure that a nationwide network of community pharmacies remains in place to serve the needs of the community, in particular the elderly, the infirm and mothers of young children, before proceeding with the Bill."
  I am grateful to the President of the Board of Trade for setting out what she thinks the Bill is about. It will be our task, now and in Committee, to try to help her thinking a little more, because the Bill is a muddle, a rag bag, a mess, a mint with a big hole in the middle, a Bill in search of a policy.
  I remind the House that I have declared two interests to the Registrar of Members' Interests: first, I am married to a senior executive of British Airways; and, secondly, I write an occasional column for The Financial Mail on Sunday. In view of the exchanges during the speech by the President of the Board of Trade, I am relieved that it is not an occasional column for The Times or The Daily Telegraph. I assure the House that of course that will not influence my decisions on the Bill, which will be motivated by the general public interest.
  The President of the Board of Trade provides good evidence of a Government out of control of their policies. That is topical, because we see a Foreign Secretary who does not know what is going on in Sierra Leone and a President of the Board of Trade who probably had some papers on the Sierra Leone issue but who would doubtless tell us that she, too, knew nothing about it. Now here the right hon. Lady is, in charge of a piece of legislation that simply does not answer the most elementary of questions about the impact that it would have were it to complete its passage through Parliament.
  The President of the Board of Trade is unable to tell us whether the Bill would make some practices in the newspaper industry legal or illegal. She is unable to tell us whether many industries and their practices will be exempted. She is unable to tell us how the Bill would be applied, were it to become law, and she tries to delegate everything to the Director General of Fair Trading.
  It is not the task of the House to enact very general rules and to pass them all to quangos or to Brussels for their implementation. It is the task of the House to consider the issues, to consider whether the law is adequate or needs improving, and to spell out to businesses and individuals in this country the impact of any proposed changes to the legislation.
  The President of the Board of Trade began by congratulating herself on the speed with which she was moving to implement the manifesto pledge. I am surprised that she should draw attention to the timetable issue; in fact, the Bill has been considerably delayed. On three

  39
  separate occasions we were alerted to the return of the Bill to the House for its Second Reading, and each time we were disappointed. It has eventually emerged today. The right hon. Lady might like to tell us whether that was the result of pressure of other business; I suspect the reason was that she and her colleagues were finding it extremely difficult to come up with any answers to the many questions that I—and industry and commerce—have laid before her.
  Those questions are perfectly reasonable. Is the practice that we are following reasonable? Could it continue? Will the existing relationships between pubs and brewers continue or be changed? Are the existing arrangements for newspaper distribution reasonable, or will they be disrupted or changed by the Bill? If the right hon. Lady cannot answer those simple, legitimate concerns of all those businesses, why is she returning the Bill to the House in this state now? Why does she not spend a little more time reconsidering the matter and trying to answer some of those fundamental points before bringing legislation before the House?
  Mr. Mullin: Will the right hon. Gentleman answer one simple, legitimate concern? Does he think that the Bill should outlaw the practice of predatory pricing in the national newspaper industry—and if he thinks it should, does it?
  Mr. Redwood: I think that the current legislation makes predatory pricing—in the newspaper industry or any other industry—illegal, and I think the Bill, amended or unamended, would also make it illegal. In the Opposition's view, the issue is not whether the law makes predatory pricing illegal, but whether a case of predatory pricing can be brought and sustained under any version of the law—old or new.
  That is why the exchanges with the President of the Board of Trade were both important and unsatisfactory. As I said to her, I was genuinely delighted that she went some way to clarifying how predatory pricing would be judged in that very sensitive case, but she did not deal with the most important question: is it reasonable to sell a newspaper at a very attractive price on one day of the week and at a higher price on other days of the week—will she average out the price or consider it day by day? Unless she can answer that question, we must assume that she is trying to duck the question which most interests many of her Back Benchers and which will most interest many people outside the House as they read their daily newspapers tomorrow.
  Mr. Dalyell: How does the right hon. Gentleman answer his own question?
  Mr. Redwood: I have already answered the question. I do not believe that a case of predatory pricing has been proven, and I am not proposing a change in the law. Her Majesty's Opposition are happy with the law as it stands, before the President of the Board of Trade blunders in with her new legislation. We made our own statement of what the law should be when we were in government. We left a mechanism for deciding predatory pricing cases. Cases were brought. No predatory pricing was found.
  40
  If there is now new evidence suggesting that there is predatory pricing, the case should be brought to the competition authorities and properly investigated.
  My answer to the hon. Gentleman is clear: we would keep the law as it stood. We think that, in regard to newspapers, the issue concerns proof, evidence and opinion about the nature of such practices, rather than the adequacy of the legislation. For that reason, my hon. Friends and I will not support the amendment in the Bill as it stands: we will leave it to the Government to try to sort out the mess that they have created by trying to change the law.
  Mr. Ian Bruce: As my right hon. Friend said earlier, the Government must have a shopping list of the practices that they hope would be outlawed under the Bill, but we have not been given it. The Minister for Competition and Consumer Affairs told us before the general election that, when he became Minister, he would slash the prices of white goods and brown goods in the shops by Christmas, because terrible things were happening that did not allow a competitive market. We have not heard even that from the Minister recently.
  Mr. Redwood: My hon. Friend is right. Many people were disappointed that the Minister did not keep his word on so crucial an issue. The Bill will be another example of Labour Ministers saying one thing and delivering something entirely different.
  Mr. Bercow: Can my right hon. Friend name a single Government Back Bencher who has this afternoon supported the position taken by the President of the Board of Trade on predatory pricing? If he cannot, does he agree that the debate provides further confirmation of the fact—to which the hon. Members for Walsall, North (Mr. Winnick) and for Linlithgow (Mr. Dalyell) bear witness—that the Labour Benches are still peppered with the representatives of old Labour who loathe anyone who is entrepreneurial enough to make a profit in a free market?
  Mr. Redwood: With the single amendment that I did not hear any Labour Member support the Government on predatory pricing in the newspaper industry, I would agree with my hon. Friend, who makes his own point.
  Mr. Winnick: Do I take it that the right hon. Gentleman is satisfied with the way in which The Times undercuts other broadsheets? If so, he should spell that out. There is great dissatisfaction among Labour Members and in the country about what is happening. Is the right hon. Gentleman indifferent to the way in which The Times is undermining and undercutting its rivals?
  Mr. Redwood: In due course I shall make a positive suggestion about what the Government could do. It is not the job of the Opposition to settle such matters. It is the job of the President of the Board of Trade. I am unhappy to discover today that it is yet another piece of her job that she does not want to do. She finds it too difficult, so she is trying to put up smokescreens and delegate the matter to a new authority.
  Mrs. Beckett: I do not know whether the right hon. Gentleman was not listening to his own words, but I noticed

  41
  that, in answer to my hon. Friend the Member for Sunderland, South (Mr. Mullin), he said that he had an opinion but that the matter was one for the competition authorities. That is precisely what I said. It is the responsibility of the Secretary of State and the director general respectively.
  Mr. Redwood: It is incumbent on a Government who propose a new law and a new set of rules to set out the rules that they want implemented. The previous Government did set out the rules under which such cases would be judged. For that reason I was quite in order to say what I did, which is entirely different from the proposition that the right hon. Lady is putting to the House for her new legislation.
  Mr. Mullin: Further to the comments of the hon. Member for Buckingham (Mr. Bercow), does the right hon. Gentleman accept that what interests us is not people making a profit in a free market, but people making a loss in a free market, for five years? Although the accounts of News International are not particularly transparent, the chairman of News International told me that the loss so far from the company's involvement is approaching £75 million.
  Mr. Redwood: The hon. Gentleman has made his own point. He clearly has his own disagreement with the Government, of which we shall hear more later.
  The right hon. Lady and her colleagues have claimed that the legislation is necessary in order to create symmetry with European law. It has been said that the Government believe that there is a great practical advantage in ensuring that the United Kingdom domestic provisions are interpreted so as to avoid inconsistency and potential conflict with the Europe-wide prohibition.
  At first, I thought that that was the Government's main intention. However, when I read the Bill, I discovered that it, and the proposed British law, will differ from European law in three important respects. That was confirmed by the Minister of State in another place. The Government have issued all sorts of conflicting statements about whether our law will be subsumed by European law, whether they will adopt European law here, or whether there will be two parallel—and perhaps conflicting—systems.
  I shall trouble the House with several quotes from the Government on this subject. On one occasion, we heard:
  "We are not importing the EC system 'lock, stock and barrel'".
  That implies that there will be two bodies of law and the potential for conflict and disagreement will remain. In another statement, we heard:
  "Business can look to EC jurisprudence as a guide to how the UK prohibitions will be interpreted".
  That suggests that the laws will not be exactly the same, but, if we get one right, we will probably get the other right also. In a more detailed statement, a Minister said:
  "The language in subsection (2) of the governing principles clause"—
  of this legislation—
  "is very tight and does not enable those applying the prohibitions any discretion to depart from EC jurisprudence".
  42
  That means that the laws are exactly the same and that the purpose of the legislation has been met. In a fourth statement, a Minister said:
  "Those applying the prohibitions will therefore be under a `continuing' obligation to seek no inconsistency with EC jurisprudence in the process of making such extractions. It will simply not be possible to make an unqualified transposition in all cases."
  Those are four very different statements from the same Government. We could perhaps understand Ministers becoming muddled about such a complicated matter and making slightly different statements. However, the extraordinary thing about these statements is that they come from the pen or the lips of the same Minister: the Minister for Trade and Competitiveness in Europe, Lord Simon of Highbury. It is even more stunning that those four conflicting views about how the two types of legislation and jurisprudence will work are advanced in the same letter from Lord Simon of Highbury.
  The Bill was meant to sort out that problem. Ministers warned of tension or conflict between European jurisprudence and British competition law, so they advocated introducing a British law based on European models, in order to alleviate such conflict. We have now learnt from the Minister that the two jurisprudences are deliberately different in three areas, and that, in the other areas, the Government may not import the European system lock, stock and barrel or they may frame the legislation very tightly. The Government may follow the EC jurisprudence, or they may say that that is not possible in all cases.
  What a complete muddle. It is a charter for lawyers and for chaos and confusion throughout British industry. Pity the poor business man who is trying to sell in a very competitive market, with sterling too high, interest rates run by the Government's monetary committee and manufacturing in recession. He must now face another massive complication in the form of this muddled legislation. If the Bill is passed unamended, he will not know whether he is operating under European or British law on any occasion.
  In Committee, we shall want to know what the Government's policy is. How much overlap will there be? When will European law apply and when will the new British law apply? Can businesses have a guarantee that, if they meet the British requirements, they cannot violate the European requirements? Will Ministers give businesses an indemnity so that, if they meet the British requirements, they will be free of the consequences of any action in Brussels? Surely Ministers owe businesses that reassurance at least if they must go through the hassle of trying to comply with this very complicated new legislation.
  The Government seem to take delight in plunging business into uncertainty. Not happy with imposing £25,000 million in extra taxes over the lifetime of the Parliament and not happy with creating boom and bust at the same time—boom for services and bust for manufacturing, with manufacturing in recession—[Interruption.] Labour Members think that it is funny that manufacturing is in recession. Many manufacturers in this country not only want the Opposition to speak on their behalf but want the Government to do something for them, because the Government's policies have led to misery. The hon. Member for Hemel Hempstead (Mr. McWalter) still thinks that that is a source of fun, and I hope that it is noted in Hansard.

  43
  This legislation will create uncertainty, but the terms of our amendment are very clear. We have much sympathy with the 184 hon. Members—mainly Labour and Liberal Members—who are concerned about the Bill's impact on retail pharmacies. The right hon. Lady said that I must be in a muddle as I—a strong and committed supporter of competition—am saying that, on this occasion, I support the current practices in the pharmaceutical industry regarding the retail distribution of over-the-counter medicines. I see no conflict in that position. The Government whom I used to support were happy to strengthen competition in all sorts of ways using existing legislation, while at the same time sustaining the over-the-counter medicine arrangements. I think that that is the right approach.
  Mrs. Beckett: The right hon. Gentleman overlooks the fact that, when the Conservative party considered competition legislation, it proposed precisely the approach that the Government have adopted: allowing the proceedings in court to continue. The director general first announced that he was planning to examine the matter in 1995, and the case has been running since October 1996. The Government of which the right hon. Gentleman was occasionally a supporter thought that that was the correct course of action—and it is the same course that we are now pursuing.
  Mr. Redwood: We did not introduce legislation that would clearly make that practice illegal, and cancel it by virtue of primary legislation. I never supported the proposals to rebase our competition law in such a fundamental manner. Officials proposed this sort of Bill when I was competition Minister, and I shall tell the right hon. Lady why I turned it down. I refused to introduce it to the House of Commons because no one could answer adequately what impact it would have on all sorts of businesses, such as retail pharmacies. I thought that it was much better to examine competition issues, case by case, through a proper inquiry by the established authorities, so that they could be considered at a measured rate and people could have a chance to adjust to any changes.
  Mr. Bercow: Will my right hon. Friend take this opportunity to abandon self-effacement for a moment and confirm that the difference between the right hon. Lady and him is simply stated? As a Secretary of State and as a junior Minister, he was in charge of his officials, whereas the right hon. Lady is told what to do by hers—that is the difference.
  Mr. Redwood: The other problem is that, when they are told what to do, Ministers do not always heed those words because they have not read the documents. That is a great problem.
  Mrs. Beckett: Speaking of reading documents, will the right hon. Gentleman be kind enough to explain to the hon. Member for Buckingham (Mr. Bercow) and to the House why they both fought the last election on a manifesto that said that a Conservative Government would introduce legislation of the kind that we are discussing?
  Mr. Redwood: If the right hon. Lady checks the manifesto that I issued in the constituency of Wokingham,
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  she will find no such reference. I also reassure the right hon. Lady that no Conservative Minister would have introduced legislation that was in the same appalling state as this Bill. No Conservative Minister would have come to the House without knowing the answers to fundamental questions about the impact that such legislation will have on brewers, petrol filling stations and other businesses that we believe will be damaged by the Bill.
  Mr. Letwin: Does my right hon. Friend agree that the President of the Board of Trade gave an important answer when she said that she estimated that the effect on pharmacists would be about £900 million? Does he agree that the right hon. Lady owes the House a further explanation regarding whether she believes that that is the super-profit currently being made by pharmacists or whether the legislation will have a severe impact on their sustainability?
  Mr. Redwood: My hon. Friend listened acutely to the remarks of the President of the Board of Trade. She implied that the Government intend to damage gravely the cash flow and profitability of retail pharmacies. That is confirmed by the Minister in another place who has admitted on the record that pharmacies will close if the legislation is passed unamended. That is why the Opposition will vote tonight in support of a reasoned amendment.
  Mr. Ian Bruce: Will my right hon. Friend give way?
  Mr. Redwood: I should like to finish my point, if I may.
  If Labour Members examine carefully the terms of the early-day motion—which many of them signed—they will see that I have used the same language in the Opposition amendment. We would be delighted to welcome all 184 of those Labour and Liberal Members into the Opposition Lobby in support of a motion that they have already signed up to. I can reassure them that my right hon. and hon. Friends will be in the Opposition Lobby in large numbers to add their votes and voices to those of the 184 Members who have already signed the early-day motion.
  I am a realist, and I would be extremely surprised if all 184 Members decided to vote again for something that they have already signed up to in an early-day motion. However, I ask the press and the public carefully to read the record. If they do so, they will see that there is a majority in the House in favour of treating retail pharmacies rather better than the President of the Board of Trade is suggesting. If we add the votes of the Conservative Opposition to the 184 names—allowing for any double counting—on the early-day motion, there is a majority in the House against the Government's proposals for retail pharmacies.
  I see the Government Whip at last becoming interested in my remarks. The hon. Gentleman knows the arithmetic as well as I do. I trust that, before the debate ends, the President of the Board of Trade will ask one of her junior Ministers to give the House some hope that the plight of retail pharmacies will be recognised before the Bill completes its progress through Parliament.
  Dr. Stephen Ladyman: The hon. Member for West Dorset (Mr. Letwin) referred in an intervention to the £900 million extra charge to the

  45
  consumer—something to which my right hon. Friend the President of the Board of Trade also referred. Is it not true that the majority of that £900 million goes into the pockets of large retailers and supermarkets, which benefit also from retail price maintenance? What would the right hon. Gentleman intend to do about that? Does he think that that is a correct use of the public's money?
  Mr. Redwood: I have explained that the Opposition are very worried about smaller and rural pharmacies, and quite a lot of that £900 million goes to them. It is up to the hon. Gentleman and his party to explain what they will do if they put unamended legislation on the statute book and many pharmacists go out of business or change the nature of their business, thereby removing an important service in each of the communities affected. If we have a truly listening Government, and if they are still spending money on focus groups, I am sure that those groups will tell them that such a service in each community is valued and that it would be a foolish Government who went ahead pig-headedly and decided to eliminate such an important service in many communities.
  Mrs. Beckett: It seems that the right hon. Gentleman has entirely lost track of his argument. The Government are not outlawing retail price maintenance. We are merely saying that the matter should continue to be considered and discussed by the proper authorities—as opposed to the amendment that the right hon. Gentleman is defending, which would not allow the matter even to be considered for the next six or seven years. We are talking not of abolition but about allowing the matter to go to the proper authorities for them to judge. Why is the right hon. Gentleman against that? He is supposed to be in favour of competition.
  Mr. Redwood: It seems that the right hon. Lady does not understand her proposed legislation. If the Bill is enacted unamended, the sort of pricing behaviour that we are discussing will be illegal, in a way that—[Interruption.] The Minister says that there is an exemption, but it is made clear that that will be temporary. The words of the exemption do not even guarantee the position of the retail pharmacist. I have specifically asked the Director General of Fair Trading for reassurance. He has replied in ambiguous and opaque language, implying that there is no intention to guarantee five years for retail pharmacists.
  Mr. Ian Bruce: It is clear that my right hon. Friend has a grasp of the Bill that Labour Members do not. The President of the Board of Trade was clear that a dominant company—for example, British Steel—if it were running at a loss, would automatically be acting in an anti-competitive way. Surely that means that, when the Government allow the pound to become uncompetitive, and British Steel, which is exporting, has to operate at a loss and sell its products at a loss, the company will have to make employees redundant because of losses and long—
  Mr. Deputy Speaker (Mr. Michael Lord): Order. The intervention is far too long.
  Mr. Redwood: I accept your wisdom, Mr. Deputy Speaker. However, I think that my hon. Friend was
  46
  making a cracking good point. He is saying that it is possible for a company to be dominant in the United Kingdom market only to be driven into massive losses because of the Government's economic policy, and then having inspectors calling, jemmying open the door, and saying, "You are guilty of anti-competitive practice." That would be most unfair, and I hope that Ministers will consider the matter.
  Mr. William Cash: Will my right hon. Friend give way?
  Mr. Redwood: I must make a little more progress.
  The purpose behind the Opposition's amendment is clear: it is to allow all those who signed the EDM a further opportunity to vote for their principles and beliefs. It provides all Labour Members with an opportunity to join in the debate, as it will be fully in order for them to make the case for their local pharmacies. Moreover, it provides us with an opportunity to highlight the problems that such businesses will face.
  Pharmacies are not the only businesses that are likely to be badly affected by the Bill. The Government are still in a great muddle over vertical agreements—for example, the sort of agreements that exist between brewers and pubs, between oil refiners and filling stations and between car manufacturers and car distributors, to name but three important industries.
  The Government imply that they wish to exempt such vertical agreements, but they still have not been able to produce clear language in the Bill to that effect. There is something in general terms in schedule 13, but industry wishes to see these matters dealt with case by case in the Bill so that it does not have to live in legal uncertainty about business practices.
  It was disappointing that the President of the Board of Trade was unwilling to specify, in response to my opening question, one existing business practice that she would like changed as a result of the Bill. That is what business is asking about. Car manufacturers need to know whether their existing distribution arrangements are legal and satisfactory. So do brewers and the publicans. It is no good the right hon. Lady saying that it has all been settled in Brussels, because, as she knows, in the case of the publicans and the brewers, there have been various cases in Brussels. One of the most recent judgments made it clear that there must be an investigation case by case, brewing business by brewing business. That means that the brewing industry continues to live in great uncertainty.
  Why are the Government unable to make up their mind on any of these things? Why cannot they say that they think that the pubs are getting a bad deal and that they want legislation that hits the brewers? Equally, why cannot they say that existing arrangements have been arrived at fairly, that they will be endorsed and that security will be written into the Bill? We shall be giving Ministers further opportunities in Committee to try to put these matters right.
  Mr. Cash: As for the possibility of amendments in Committee, my right hon. Friend may have heard my earlier altercation with the President of the Board of Trade about doctors' surgeries that supply prescriptions and the nonsensical and indefensible one-mile monopoly rule, which prevents fair competition in rural areas where there

  47
  are pharmacies on the one hand and doctors' surgeries on the other. Would my hon. Friend—unlike the President of the Board of Trade—be good enough at least to consider proposing the abolition of that indefensible monopoly?
  Mr. Redwood: We shall certainly be probing in Committee, as my hon. Friend would wish, to ascertain the Government's intentions on all these matters. However, our immediate worry is about the plight of existing retail rural pharmacies. Any changes in the current arrangements would need to be based on our being reassured that a proper service could be applied in each rural area, and that there would be sensible transitional arrangements of the sort that my hon. Friend would no doubt wish to see.
  The House has already had some substantial exchanges on the Murdoch amendment, but, as the President of the Board of Trade still does not seem to know exactly what the Opposition's position is, I shall set it out briefly again and offer a proposal. Our view is that the Bill did not need the amendment that was passed in another place to make predatory pricing in the newspaper industry an offence. We believe that both old legislation and proposed legislation, unamended, do the job. However, we see that there are considerable tensions and worries in the newspaper industry, which have been voiced by hon. Members on both sides of the House.
  We know that The Daily Telegraph does not wish to see the amendment that was passed in another place remain in the Bill. There is a good article about that in today's edition. However, it is worried about the pricing behaviour of its principal rival, The Times. We know that the position of The Times is that it is not cross-subsidised in any way from BSkyB, as some people allege. Those at The Times say that they are offering decent price promotions, which represent good sense for their business as well as being good for those who buy The Times. We know that The Independent is worried about the pricing behaviour of at least one and perhaps both of those other national newspapers, as it, too, fights for a share of that prestigious but competitive market.
  Before we get into more deep discussions on those matters in Committee, the President of the Board of Trade should invite in representatives of those three newspapers—and, indeed, of any other legitimate interest that might want to talk to her—and ask them for their views on how competition law in this area should be carried forward. She should explain what the Bill will achieve and what the consequences will be.
  The right hon. Lady looks shocked at the thought that she might do some work for a change, but it would be most valuable if she invited those people in and listened to their views.
  Mrs. Beckett: The right hon. Gentleman does not have the faintest idea of the role of a potential Secretary of State for Trade and Industry. The Director General of Fair Trading is already consulting those interests, inquiring into their position and seeking information from them. It is not my job to do the director general's job, as the right hon. Gentleman seems desperate to do.
  Mr. Redwood: If the right hon. Lady were not proposing to change the law, I would accept that answer;
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  indeed, I would not urge her to meet parties to a competition dispute under existing law in such a way, unless there were special circumstances. This issue is different. She is comprehensively and radically legislating on competition matters when there is a big row in the newspaper industry, in the House of Commons and among the wider public on those newspaper issues. It is incumbent on her to listen to the views of the participants in the dispute and to explain what she intends under the Bill.
  I repeat that it was most welcome that the right hon. Lady told us a little more about how she wanted the Bill, should it go through the House, to be interpreted on the crucial issue of predatory pricing. She has given us half the story; surely she can give us the rest. She must tell us exactly how the formula will apply, and I advise her to listen to at least three of the newspapers and any others with a strong view before she finalises arrangements. She cannot wash her hands of the matter: she wants to legislate; she says that the current law is wrong; she could meet the requirements of Labour Members on those and other matters, if she wanted to do so. I hope that she will think again after the debate in the privacy of her office, because I have offered her a sensible proposal for carrying the matter forward and for avoiding too much heat, but not much light, in Committee.
  I pass briefly to a few remaining matters, the first of which is the Bill's establishment of the Competition Commission to replace the Monopolies and Mergers Commission. We have several worries about that body. First, we want to know, from the right hon. Lady's winding-up speech or in Committee, more about whether the Government intend to keep the many good and talented staff at the MMC and to transfer them en bloc, or to sack them and start again with a new team of officials.
  Why does the right hon. Lady need 50 more officials to run the new regime than ran the old? We were told that the old regime was muddled, fussy and too complicated and that the new regime would represent a great simplification. We shall probe why the new body will have the traditional mergers function of the MMC and an appeal function. We suggest that there is something difficult in having the appeal function and the normal review function vested in the same body, and we want satisfaction on that important matter.
  In Committee, we shall also probe Ministers on concurrent powers between the Director General of Fair Trading and the utility regulators. Ministers might agree that there is still a lot of muddle and confusion over who will do what and when under the new legislation, and we shall offer opportunities through probing amendments to clarify their thinking and to reassure the various regulators that at least the Government know what they should and should not do.
  We are concerned about proposed powers of enforcement and fines. I am pleased that the Government have clarified that the 10 per cent. of turnover will apply only to United Kingdom turnover, not to global turnover. That is progress, but such a fine would be large for a retrospective infringement where a business was doing something that was legal under the old regime. The Government should look again at the transitional period, because people may inadvertently fall foul of what the right hon. Lady now says is designed to be a stronger competition regime than the old one. The retrospective element in the Bill is invidious and damaging to British

  49
  business and, given that it has been allied to such a high fine—typically, annual profits in a good year—Parliament should think again.
  Powers of entry are draconian. They would be reasonable for chasing serious criminals or drug barons, but the Government should think again about having such severe powers in respect of people who are running businesses and trying to do their best in what they take to be the business and the public interest. I remind hon. Members that clause 62(6) states:
  "Any person entering premises by virtue of a warrant under this section, may take with him such equipment as appears to him to be necessary."
  It is not difficult to conjure up all sorts of unfortunate images of what might be necessary to break open doors, safes and filing cabinets to get to the necessary paper.
  We are worried about the impact on public and private sector costs, and want more information on how much the new regime will cost the Government to run. A bigger and more expensive quango will replace the existing body. I fear that it will be much more complicated than the right hon. Lady has given us to believe, and may need many more staff than she has forecast. With a prohibition regime, all sorts of people will seek guidance and advice: they will be worried sick that their premises may be broken into or that they may be subject to a large fine.
  More important, the compliance costs on the private sector have been grossly understated in the compliance cost assessment that accompanies the Bill. We are told that the non-recurring compliance cost for British business and commerce is between £2.6 million and £4.4 million. Does the right hon. Lady accept that practically every British business of reasonable size will have to seek a great deal of expensive legal advice? Each business will have to go through corporate agreements and many contracts and ask whether they comply with the new legislation. For each complicated and sophisticated business, that work could run into thousands of documents, and many will have to turn to expensive competition lawyers for the reassurance that they seek or to be told how to amend those agreements. Ministers have no idea of the amount of work that they are giving people.
  Mr. Bercow: My right hon. Friend has put his finger on a matter of the greatest importance to business, with whose interests, after all, the Bill is supposed to be concerned. Does he agree that we have further cause for concern in the light of the dramatic upward revision of the estimated costs since the right hon. Lady's original statement on the matter last August?
  Mr. Redwood: My hon. Friend is right to say that the Government are trying to make their estimates more realistic, but they are still out by a big margin. I have spoken to many businesses over recent weeks about this and other matters. They told me that they are already embarking on an extremely expensive exercise. Those businesses are not trying to be anti-competitive; they have negotiated complex arrangements with partners, counter-parties and other companies, and they now find that they need a great deal of legal advice.
  I hope that hon. Members will agree in Committee that it would be welcome if more rapid progress could be made on problems through the competition machinery. It would be progress if businesses could be reassured that they would be told much more quickly than under the old regime whether what they were doing was reasonable and
  50
  whether it met the requirements of the Bill. Swifter justice would go a long way to dealing with the sense of injustice felt by various companies.
  The cable industry, for example, has concerns about current competition matters. I put it to the industry that many of them would be best dealt with by quick answers rather than by different laws. The industry agreed: it would like changes to the Bill, and I said that I would urge swifter justice, which would undoubtedly help. I hope that that will be built into the Bill.
  In this Second Reading debate, my hon. Friends and I are asking what all this is for and what it will do. The President of the Board of Trade says that we need a more competitive market. Why cannot we create one under existing powers? She could review more industries and practices with a view to making the market more competitive. Will the Bill make the water industry competitive, for example? That industry has very little competition at the moment. Will it open up more public sector activities to market tests? That would be a good way to develop more competition, but not one that the Government are currently planning to follow.
  Does the right hon. Lady wish to break the current arrangement for car distribution, petrol retailing, newsagents and newspaper distribution, pubs and brewing? She will not tell us. We need to know before the passage of the Bill is completed. We need to know exactly how the Bill could make our markets more competitive, and who will be affected.
  We have had one piece of legislation from the DTI team proposing a minimum wage without saying at what level the wage will be set or who it will affect—a piece of legislation with no heart. We now have another piece of legislation with nothing of substance behind it. We are told that it will make the world more competitive, but the Government cannot say how or why. We have a lot of work to do in Committee.
  5.10 pm
  Mr. Clive Soley: I support the Bill, which is a positive step forward. It provides a framework for competition to be decided; it is not, as the Opposition seem to think, an opportunity simply to list everything that can be ruled out as anti-competitive. It is a framework by which the Office of Fair Trading and the new Competition Commission can decide policy in terms of competition law. That is precisely what we should be discussing, rather than a long list of shopping expeditions, which the shadow Secretary of State seemed to want to discuss.
  I want mainly to discuss clause 19, which was added in the House of Lords by Lord McNally, clauses 18 and 60, and, to a lesser extent, clause 46, which has some bearing on the issue.
  The issue relates to the fact that Rupert Murdoch has cut the price of The Times on Mondays with the apparent intention of driving The Independent out of business. I have little doubt that Rupert Murdoch would like to get rid of The Independent, and that he has The Daily Telegraph in his sights. However, it is one thing to believe that, but quite another to prove it. The House of Commons has a duty to structure the law in such a way that, where there is a serious challenge to competitive behaviour in the newspaper industry, it allows all newspapers to be judged on the same basis.

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  Much as I dislike Mr. Murdoch and his practices, and what he has done to the newspaper industry, not least to the free and diverse nature of the news service in this country, I do not believe for a moment that he is the only threat to press freedom in this country or the world. Hon. Members who remember my Freedom and Responsibility of the Press Bill five years ago will know that I have argued before that, by the early part of next century, most of our national and international news production and distribution will be concentrated in the hands of about half a dozen owners. That should seriously concern us all.
  The issue in this Bill is twofold: first, whether clause 18, as adjudged by clause 60, will deal effectively with the price cutting of The Times on Mondays—
  Mr. Radice: And on Saturdays.
  Mr. Soley: Yes, and Saturdays—secondly, whether there is a better way to deal with the media.
  As I have been saying for weeks, excited as I was at first by the possibility of stopping Rupert Murdoch cutting the price of The Times in order to get to The Independent—I thought that the Bill might achieve that—I must conclude that, with or without clause 19, the Bill will not have that effect unless the Director of Fair Trading judges that the practice of cutting the price of The Times will lead to the demise of another newspaper—in this case, The Independent. That will be hard to prove. Indeed, it will be harder to prove now that The Independent has been bought by Mr. O'Reilly.
  I also doubt whether, if the provision is to be used effectively, it could catch a number of other newspapers that do something similar. For example, The Daily Telegraph provides free copies in hotels, and the Daily Mail and other newspapers of that type provide free copies on airlines. Thus, the four big newspaper owners in Britain already use price-cutting techniques to take over their competitors' market share. If they already do that within existing competition law, it follows that Rupert Murdoch will probably succeed in continuing his price-cutting practice unless we have additional evidence.
  One or two of my hon. Friends have told me that Rupert Murdoch has said in the past that he would like to knock The Independent and The Daily Telegraph out of business. However, saying that is different from having it in writing and being able to prove it in a court of law. I am therefore not convinced that clause 19 will change Mr. Murdoch's ability to cut the price of The Times on Mondays and Saturdays.
  Perhaps the strongest argument in favour of the Bill is that News International seems worried about it and about clause 19. It has been worried for some months now, partly because of the Chris Patten affair and partly because of the growing concern of newspapers generally that Rupert Murdoch is getting too powerful. Some of his activities have been very dubious, not least his support of the Chinese communists. He has not hesitated to knock the BBC off Star Television, or to stop the publication of a book by his company in order to please the Chinese communists.
  I am reminded that, in his university days, Rupert Murdoch was a communist and had a bust of Lenin in his room. In my experience, most young authoritarian
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  communists end up as old conservatives. It is a traditional pattern, and I have seen it happen many times in my political life. That definition fits one or two Opposition Members.
  Having made one or two strong criticisms of Rupert Murdoch, I reiterate that it should be no part of our agenda to target particular individuals or companies. Let no one get the idea that, if we stop Rupert Murdoch's price-cutting activities, some other newspaper groups would not do exactly the same if they thought that they could get away with it. We must not lose sight of the fact that the ownership of national and international news production and distribution is becoming increasingly concentrated. I am pleased to say that some News International senior executives agree with me that that is a danger.
  The issue is whether we can have a competition law that deals with the newspaper industry.
  Mr. Ian Bruce: The hon. Gentleman is making a powerful argument, in his own terms, about control of the printed media. However, has not Rupert Murdoch shown that, in the three competitive fields of satellite, digital terrestrial broadcasting, which has just been introduced, and cable, he has been able to get a virtual monopoly, while being fully regulated by the ITC and others?
  Mr. Soley: He is not regulated in the newspaper industry. The whole of the News International board, including Rupert Murdoch, turned up at a recent Press Complaints Commission annual jamboree a few days ago at the London Aquarium. The main item of discussion was whether there were more sharks in the aquarium or watching from the outside. The general view was that there were probably more sharks watching the sharks.
  The serious question is how we should regulate the media. I mentioned clause 46 earlier because it sets up the new Competition Commission, which takes over the powers of the old Monopolies and Mergers Commission. Those who argue that the newspaper industry should be included in the Bill note that paragraph 22 of schedule 7 sets up a panel of persons to look at newspaper ownership. That is taken on board by the Monopolies and Mergers Commission. The powerful point is that that has not worked either. A small number of people have greater control not just of the printing of news but of production and distribution: it involves the Reuters of this world as well as the newspapers.
  The Tetra Pak judgment has interesting implications for newspapers and other organisations that use price-cutting mechanisms. I thought at first that it would stop the price cutting that has gone on for five years, which, as my hon. Friend the Member for Sunderland, South (Mr. Mullin) rightly pointed out, is the strength of the case against Rupert Murdoch's practice of cutting the price of The Times. That judgment examines the average variable cost, and, over a five-year period, that practice has clearly resulted in a loss. The problem is whether it is a loss leader within the existing company.
  If that practice is to be stopped by an amendment, it would have to be more specific than new clause 19, and would have to name not only an industry but a particular practice, which would mean going down the road that the shadow Secretary of State suggests, of a shopping list of offences that we want to stop. Competition legislation cannot be framed in that way. New clause 19 does not add anything to the Bill, so it is redundant.

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  Although I appreciate that it is not an area of responsibility for the Secretary of State, we should concentrate on how we regulate the media. Whether it is through a communications Bill or a media Bill is a matter of choice, but I have no doubt that we need to take tougher action when predatory pricing in newspapers or in other areas of the media reduces the amount of variation in the news market. If we allow ownership to continue to be concentrated in the hands of a few people, as it has been in the past 20 or 30 years, we shall damage and endanger our democracy.
  As I said in an article a few days ago, I believe that such a Bill should deal with ownership, and should make a clear statement about media freedom. Clause 1 of such a Bill should provide a defence of press freedom: privacy, harassment, accuracy and ownership could be dealt with in subsequent clauses. Our competition law enables the Monopolies and Mergers Commission, soon to be the Competition Commission, to deal with mergers, but it does not provide for a variety of ownership of the press beyond what it is now. That is where we are stuck at the moment. Allowing a particular owner to change the price of one of his products will not make a significant difference to the freedom of the press.
  The solution to this problem is a separate Bill dealing with press freedom, ownership and other regulatory mechanisms. The media are a dramatically growing new industry that affects the quality of our democracy and the political life here and in other countries. I am increasingly concerned about the proposal to attach clauses or amendments to competition law to achieve another end: that of media freedom.
  If we believe that media freedom is important—I certainly do, and have been arguing it for many years—we need a Bill designed to achieve that end. We do not need a shopping list of practices that should be against the law. We should not devise a law that provides such a list and then be surprised when we find that we have not caught everything we should have caught, or that practices we had not thought of have got through.
  My right hon. Friend was right to make that point. The essence of the Bill is to provide a framework in which any individual or organisation can refer a practice to the Director General of Fair Trading, who will make a judgment on whether that practice should be stopped.
  Clause 18, read in conjunction with clause 60, in effect brings in the Tetra Pak judgment, because it relates to European law. News International may decide that the risk of prosecution under clause 18 is too great, and will stop the price cutting. New clause 19 would not alter that. All the lawyers I have asked about this matter put it in the balance, and said that it might go one way or the other. The board of any company, such as News International, would have to decide whether to go to court to fight the case or to change its practice. I hope that News International will change its practice.
  Although I want a media Bill such as I have described to protect and enhance press and media freedom in this country, the four big press groups could also come up with their own code, and state clearly that they will adhere to it. Such a code should contain a provision on the importance of diversity in the press. It is naive to expect News International to knock on my door offering to produce such a code, although I have had an exchange of letters recently in which I put it to them yet again that they should consider doing so.
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  Last week was typical. Four papers were in gross breach of the Press Complaints Commission code by their coverage of the Mary Bell case, their story about Joanna Lumley, and, perhaps worst of all, the story in the Daily Mail on Wednesday accompanied by a picture of a four-year-old girl with her name underneath it. The story was about her grandmother having her mother sent to prison. A four-year-old girl should not have to go to nursery school with that on the front page of a national tabloid. If the Press Complaints Commission does nothing about such gross breaches, we still do not have the right balance between press freedom and press responsibility.
  The Bill is essentially about competition. It tries to establish a level playing field in the newspaper industry and elsewhere. It should not be a battle against one particular newspaper owner, even though he has done a great deal of damage. When I read the Daily Mail, I realise that there is not an awful lot to choose between that group of newspapers and News International: it is just as inconsiderate about the effect of its behaviour on others, not least on that four-year-old child. We should consider introducing a communications or media Bill that protects and enhances press freedom, and imposes a certain level of responsibility.
  Under this Bill, News International will have to decide whether to fight it out in the courts with the Director General of Fair Trading if he challenges the price cut on Mondays and Saturdays, as I hope he does. That decision will have to be made, whether or not new clause 19 is included in the Bill.
  5.27 pm
  Mr. David Chidgey: I congratulate the hon. Member for Ealing, Acton and Shepherd's Bush (Mr. Soley) on a thoughtful and wide-ranging speech. I support and understand some of the sentiments that he expressed, particularly about a media Bill, but our major problem is that the Government show no sign of making time in their business programme to debate that issue.
  I welcome the intentions behind the Competition Bill. I support the prohibition approach and the strength and powers of investigation for competition authorities. It is a sound step forward. The Bill provides the opportunity for fundamental reform of competition policy, which is well overdue. It provides the means to set down the same set of rules on competition throughout the nation states of Europe. A single set of rules operating across Europe is an essential ingredient of a fair and efficient single market.
  I also welcome the incorporation of articles 85 and 86 of the treaty of Rome into United Kingdom competition law. Direct prohibition of restrictive agreements and cartels, and the prohibition of abuse of a dominant position, are two key ingredients of modern competition law.
  When it comes to the detail of the Bill, my welcome starts to fall a little flat. The Government's proposals for reforming competition policy have some fundamental weaknesses and flaws.
  People seem unsure, there is even dithering, about whether the Bill should prohibit vertical agreements, and if so which ones. The Bill does not seem to take account of the fact that, if such agreements were excluded en bloc, the legislation would immediately be at variance with that in the rest of the European Union. In addition, such an

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  exclusion of vertical agreements could undermine a key principle of the single market—the freedom of trade across state borders.
  There are proposals to exclude en bloc from prohibition organisations with professional rules, but there has been no proper consideration of restrictive practices. The extension of investigative powers goes well beyond those contained in articles 85 and 86 of the treaty of Rome, and that poses some threat to civil rights. Those are just some of the Bill's flaws, and they need to be probed and clarified. I shall return to those issues in detail.
  The Government take pride in believing that they consult. That is for them to say and for us to hear. They say that they have had about 150 responses to date on their consultation paper on the Bill. That is welcome. However, the key question is what impact the wisdom and experience of industry and commerce has had on the framing of the Bill. The reforms in competition policy that it will introduce are likely to be in place for at least 20 years, and industry and commerce will have to live with the results. It is vital that their views are heeded as the Bill progresses.
  The Bill started life in the other place, which is a common practice for technical, complex Bills. The fact that it started life there is not encouraging because it may demonstrate the ability of this House. It has been subjected to intense scrutiny before coming here, and amendments have been incorporated with all-party support. They include those that deal with retail price maintenance of over-the-counter medicines and with predatory pricing in the newsprint media.
  I emphasise that those amendments had all-party support. Some Labour Members voted against the Government Whips' instructions. It is reported that, when one such Labour Member was asked on Radio 4 why he voted in favour of the famous new clause 19 on predatory pricing, he said, "I listened to the argument." That could be something new. Perhaps if the House subscribed to that idea, it would make our debates more interesting, although perhaps not as lengthy.
  I shall later go through some of the arguments and build on the comments by the President of the Board of Trade to try to take us further on the question of the prohibition of anti-competitive practices in the print media. For the moment, I shall examine in detail some of the proposals that will be presented in Committee, especially on vertical agreements.
  Two or three areas need to be examined, because they illustrate the problems that we shall face in examining the Bill's detail. Agreements between manufacturers and retailers for after-sales services or the extension of warranties have obvious benefits for the consumer. However, agreements that deny consumer choice or which artificially maintain high prices are clearly against consumer interests, and the Bill must deal closely and directly with such anti-competitive agreements. They should not be excluded en bloc.
  Mr. Tim Boswell: Does the hon. Gentleman agree that an examination of the Liberal Democrat amendment on this matter makes it clear that Liberal Democrats deplore the absence of an explicit prohibition of vertical agreements? It is not clear from the
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  context that there is to be some kind of saving in the cases to which he refers, including those that he regards as beneficial to consumer choice. Is the position of the hon. Gentleman's party at all clear on this matter?
  Mr. Chidgey: I am fairly confident that my party's position is clear, but I am rather doubtful about the Government's position. I should like to tease that out, and perhaps my following comments will convince the hon. Gentleman.
  In the Sunday papers, the continuing scandal of the over-pricing of family saloon cars in the United Kingdom compared with other European countries was writ large. According to European Commission figures—not to any newspaper editor, whether with News International, as in this case, or with any other group—Ford, BMW, Peugeot, Fiat and Nissan all charge British consumers up to 40 per cent. more for family cars than they would pay in other European countries. The trick seems to be to restrict the production of right-hand drive vehicles for the United Kingdom market, and to argue that the difference in price is due to the extra cost of making a limited number of such vehicles compared with the left-hand drive European standard.
  I am sure that no hon. Member or anybody else would believe for a second that the production of a right-hand drive version of a family saloon adds 40 per cent. to the price, or that it costs up to £4,000 more to produce a right-hand-drive vehicle which is sold not just in the United Kingdom but in many other markets. The simple truth is that European manufacturers are selling in the UK at the highest prices that the market will stand. Those prices are controlled by a vertical agreement through a network of dealerships and franchise holders who are contracted to deal in the products of only one manufacturer.
  That is a classic case of vertical agreements acting against consumer interests. No wonder that one manufacturer was alleged to report, "It's wonderful. We are making more out of England than ever." In the £200-billion-a-year European motor industry, British customers are being ripped off on a massive scale. An anti-competitive vertical agreement that allows that to happen must be covered by the Bill's prohibitions.
  We have already debated the issue of manufacturers supplying retailers with their products as long as they sign up to conditions. It cannot be right for the Bill, through omission, to allow some manufacturers and suppliers of designer clothes and accessories to prevent retailers, and especially supermarkets, from offering those goods at a discount. To their credit, some supermarkets have found alternative supplies of well known branded designer clothes, which they offer at a discount; but they should not be forced to take such measures to get around anti-competitive agreements. Similar problems arise with brewers' chains, petrol stations and particular oil companies.
  Dr. Nick Palmer: Is there not some confusion between the terms "anti-competitive behaviour" and "anti-competitive agreements"? In many of the cases that the hon. Gentleman mentions—for instance, car manufacturers—it is not clear that the manufacturers have made formal or informal agreements among themselves to behave in a certain way. They do not have to do that:

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  a manufacturer can be sufficiently anti-competitive on his own. There is a problem with legislation of the type that we are debating. Ideally, we should give the regulator the power to attack anti-competitive behaviour, even if the practice has not been agreed with anybody else.
  Mr. Chidgey: The hon. Gentleman makes an interesting point, and I accept much of what he says. I reinforce his comments by saying that I think that Volkswagen was fined some £60 million recently by the EU for prohibiting its dealers from selling cars in, I think, Italy, and possibly Austria, at prices that were much lower than in Germany.
  There is a powerful anti-competitive network, and we should be able to deal with it by way of competition policy. It is important that the uncovering of such practices should not be left to the chance of an investigation instigated by a complaint to the Office of Fair Trading. Our policy should make it clear that such anti-competitive practices are prohibited by law.
  I want to deal briefly with professional rules. A number of organisations have shown concern about the way in which those are dealt with under the Bill. I should perhaps declare an interest, as I am a fellow of several engineering institutions, although I receive no particular financial gain from that; in fact, it costs me quite a lot in subscriptions. Nevertheless, in case anyone should be in any doubt about my advocacy on this, I declare my paid-up membership to several well-known engineering institutions. They are concerned, as are a number of other professions.
  The rule books for accountants, lawyers, engineers and other professions are made by their professional bodies, using powers under legislation. Some of those rules, such as the separation of clients' money, the need for qualifications and the commitment to good practice, are essential to protect the public. I do not think that anyone would argue that they were not in the consumer's interests. However, other rules, which restrict advertising or the display of prices, or which set minimum fees, regardless of the service level provided, are clearly anti-competitive.
  The manner in which the Bill deals with professional rules will require close scrutiny in Committee. At present, the definition of the professions are prescriptive, and do not take account of all the bodies that are affiliated to a particular profession. The professional bodies in, for example, optometry and optics have voiced strong misgivings about the Bill, as has the engineering profession. It is a particular problem that the Engineering Council, which is recognised by Government as the voice of engineering, and which maintains a national register of about 30,000 professional engineers, finds that many of the members on the register would not be covered by the Bill's current definitions.
  The engineering profession has, through the council, established three grades of professional engineer: chartered or incorporated engineers, and engineering technicians. The Government have a memorandum of understanding with the Engineering Council. They recognise its authority to represent the whole profession, so it is only logical that the definitions that the council uses for engineers and that are already recognised by Government should be those in the Bill. I cannot understand why the Government seek to find new definitions for something that is already agreed at that level.
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  I move on to the issues to do with predatory pricing in industry, because I fear that other hon. Members will want to contribute—at length, I am sure. So far, there has been much debate on predatory pricing. We need to examine more closely the Government's approach to the issue and their rejection so far of clause 19, which aims to ensure that we maintain a high-quality newspaper print industry. It seems that clause 19, as amended in the other place, specifically prohibits predatory pricing by national newspapers.
  The Government, today and at other times, have made it clear that they intend to remove the clause, on the basis that it is unnecessary and unworkable. For some months, they have insisted that the Bill is up to the task without a specific prohibition. The UK is fortunate in the breadth and scale of its national newspapers. No other country in the western world can boast some 10 national newspapers available on breakfast tables everywhere, every morning.
  The diversity of our newspapers and the range of opinions they hold have created and supported burgeoning journalistic skills, attracting the best in that profession. We are very lucky. We should consider the sector sacrosanct from monopolistic tendencies, as the hon. Member for Acton and Shepherd's Bush said.
  Not so long ago, the chairman of News International said that, within the next 10 years, the UK newspaper industry could support only three national titles: The Sun, The Times and the Daily Mail. It will not escape hon. Members' notice that two of those titles are already owned by that gentleman, which does not say much for competition 10 years hence.
  How is it that an industry with an annual revenue of about £700 million could support only three major titles? Perhaps the gentleman concerned meant that he wanted to have three titles to maximise profits in the industry, and that he would prefer it if those three titles were in some way owned or controlled by himself.
  Just think for a moment what the impact would be of having just three national papers for hon. Members to fight over in the Tea Room every morning. Just think what it would be like to have just one third of the newspaper journalists sitting in the Press Gallery every day—I do not think that we would notice the difference today—all under the control of one or two organisations, and all under pressure to spout forth just one or two opinions.
  Without effective competition laws, that could be the state of our newspaper industry within a few years. I understand that the total revenue from national newspapers is about £700 million a year, yet the cost of production and distribution is put at some £750 million a year.
  Mr. Mullin: For broadsheets.
  Mr. Chidgey: I confirm what the hon. Gentleman says—for broadsheets. By comparison, industry sources estimate that the revenue of The Times is £80 million per year, but it costs £140 million a produce it—an annual loss of £60 million.
  As a further graphic example, The Times on Saturday is sold for 40p, yet the industry reckons—
  Mr. Radice: It now costs 50p.
  Mr. Chidgey: Is that not interesting: it has suddenly gone up to 50p? Could this debate have motivated that price rise?
  Dr. Ladyman: The hon. Gentleman mentions predatory pricing, as have other hon. Members, but clause 19(2)(b) restricts
  "other action which may reduce the diversity and independence of the national newspaper press".
  Does he share my concern that that is a catch-all that could prevent newspapers from introducing features that might increase their diversity and allow them to establish themselves in the marketplace differently?
  Mr. Chidgey: I am grateful to the hon. Gentleman. The whole point is to allow the Office of Fair Trading to examine the action by an individual newspaper, to find out whether the intent behind that action is predatory. This is where we look to the Director General of Fair Trading to have available to him a broad scale of options, to ensure that he can properly examine attempts to introduce predation within the business.
  It seems that the Government's argument is that there is no case to answer on predatory pricing, and that the inclusion of specific prohibitions are politically motivated. How can the Government argue that, under current legislation, the OFT has failed to bring a successful case against News International on the basis that there was no case to answer?
  Surely it must be true, as Lord Borrie, a former Director General of Fair Trading and a learned colleague in the other place of the Minister for Competition and Consumer Affairs, has said, cases brought to the OFT have failed not because there was no case to answer, but because the legislation was not adequate for the OFT to pursue the case. That is precisely why we need something as specific as clause 19: to demonstrate the clear will of Parliament, and to give the director general the guidance that he needs.
  It is a bit rich to say that clause 19 is politically motivated. If people are going to say that, let us remind ourselves how undignified it is to see successive Prime Ministers anxiously beating a path to Mr. Murdoch's door, seeking his endorsement before elections. That is a bit more like political motivation. Let us remember the headline the day after the 1992 general election in The Sun: "It Was The Sun Wot Won It." Is that how we want our newspapers to be run? Is that how we want our policies to be made in this place, and our general elections to be decided—as a result of the voice, power and opinion of one or two newspaper owners, whether they own News International or any other company?
  The Government argue that clauses 18 and 60, together with European jurisprudence, provide all the protections that are needed in the Bill, but other legal advice argues that they do not. In particular, European judgments concern predatory pricing by firms already in a dominant position. Look at the detail. Look at the wisdom of other advocates who have considered this matter in detail. The Government also argue that clause 19 is unworkable and will prevent newspapers from competing, but surely
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  the essence of competition between newspapers should be their quality and diversity, not the cover price regardless of the cost of production.
  Clause 19 takes nothing away from other parts of the Bill—indeed, it may serve as belt and braces should the need arise. If there is any doubt about the need for it, I ask hon. Members to take account of the point I made in an intervention—Mr. Murdoch is happy with the Bill without clause 19, but, we are reliably told, most unhappy about the Bill with it.
  At the very least, the Government should recognise that the weight of different legal opinion proves the uncertainty of their case. There is a clear need for guidance in the Bill to prohibit predatory pricing. As it stands, clause 19 is that guidance. If the Government are not convinced, and are genuinely concerned about prohibiting predatory pricing, they must propose something better.
  5.50 pm
  Mrs. Gwyneth Dunwoody: My right hon. Friend the President of the Board of Trade said that our function is to create good legislation. I hope that that definition will not do her too much harm with some of her colleagues, because it is fundamental to the job of the House of Commons.
  I listened with great care to the points made by my hon. Friends and other hon. Members about the freedom of the press. I wholly agree that it is quite wrong that predatory pricing, in any form, should be used to drive out an opponent. I do not care whether we are talking about buses, newspapers or sweet manufacturers: I am angry at the idea that someone can use unfair and dishonest means to drive a competitor out of business simply because the law does not give sufficient power to control such behaviour either to Parliament or to the institutions that act on its behalf. I found that unacceptable when it involved bus companies, and I find it equally unacceptable with newspapers. Therefore, my instinct is that clause 19 should stay in the Bill as a belt-and-braces measure.
  I have a different concern—that the Bill does not go far enough in another way. Motor car companies have already been mentioned this afternoon, and I want to refer urgently to the problem facing Rolls-Royce in my constituency. We talk happily about the way in which we at least try to ensure open competition between one company and another, but we do not seem to take a view, as a Parliament, on concentration of the powers of certain large industries in the hands of one or two companies.
  Two German motor car manufacturers are fighting over the body of Rolls-Royce like jackals over a fallen buck. It is offensive to me that the work force have no clear view what their future will be. They do not know which of the two companies will be responsible for them. The very management that have special responsibility for controlling the company and for putting it on the market in such a manner are not only not giving a clear statement to the work force; they are not taking a clear position that reflects the interests either of the British people or of their own shareholders. It is extraordinary that a major manufacturer such as Vickers is happy to make two different recommendations, within a short period, to its shareholders about the sale of a major company such as Rolls-Royce. Apparently no one can intervene.

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  I want to ask my right hon. Friend a series of simple and straightforward questions. Will she bring into her Department those directors of Vickers who seem incapable of behaving in a responsible and respectable manner and ask them precisely what they intend for the future of this last remaining British motor car manufacturer? Will she ask them how they can reconcile a position in which two large German manufacturers will have total control over a very high-class industry—the top echelon of the motor car industry—without any attempt to discuss what that means for competition and for jobs in the United Kingdom?
  Will my right hon. Friend find out from those other companies that are making obvious threats—for example, a Financial Times headline on 10 May said, "BMW repeats threat to disrupt R-R Motors"— precisely what they are talking about and how they intend to use their industrial muscle to modify, in any way, the sale of Rolls-Royce? How can it be right that this one high-quality product is put in such a position that something as basic as the supply of its engines can be in doubt? How can one company say that, because of an argument taking place in the European Court over the ownership of the name, it would be prepared to withdraw the supply of engines and, presumably, allow the factory to close until an alternative supply was found? Why is it that no British Minister has so far considered that issue to be of any interest?
  On 7 April 1998, the Department informed me, in answer to a parliamentary question, that it had paid more than £6 million to a German company, £1.5 million to an American company and more than £1 million, £400,000 and £300,000 respectively to other foreign motor car companies to come to the United Kingdom to set up a manufacturing operation, while standing calmly aside and watching the destruction of what was originally one of the most remarkable types of motor car, synonymous as it was with luxury and craftsmanship? If the Bill is to be as effective as we have been told this afternoon it will be, and if it is capable of protecting the legitimate industrial interests of manufacturing industry, why have we heard nothing so far from the Department about this thorny and difficult question? I find that unacceptable and deeply worrying.
  We are talking not about two particular companies, but about such a concentration of power in German hands that it will give them complete control of whole sections of the motor car industry. The point made earlier about the 40 per cent. price difference between cars bought in the UK and the same cars bought in other European Union countries will be as nothing in the future, when one or two large motor car manufacturers will be able to decide not only the type of model, but where it is made, how many jobs it will generate and what sort of future, if any, the motor car industry will have in Britain.
  I ask my right hon. Friend to use her powers to call in the people I have mentioned and teach them responsibility, some sort of commitment to their own work force and the need to protect those jobs now.
  5.58 pm
  Mr. Martin Bell: I am grateful for the opportunity to speak in this debate. I shall be brief. I was once a journalist, for quite a long time; I am now a lapsed journalist, but I want to talk a little about matters that I know about.
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  The issue is important. We are not debating protectionism; nor are we trying to defend the weak against the strong, or The Independent against The Times. Newspapers can and must take care of themselves in the open market. The Bill is about fair competition; the McNally amendment is about fair competition. The Bill is surely about preventing one individual—a pre-eminent, even dominant, player in the market—from becoming a monopolist in that market.
  We should give the mogul his due. He revolutionised newspapers in the United Kingdom. He made possible The Independent, which he is now apparently trying to kill. He has done the state some service. Yet he has now mounted a five-year campaign to drive other newspapers out of the market—not only the threatened The Independent, but The Guardian, The Daily Telegraph, and all the rest. Only the Daily Mail is perhaps beyond his reach. To accomplish his goal, he has had the power of profits generated in another market—satellite television, in which, in some areas, he enjoys a type of monopoly position—and has had special privileges. Favours were sought; favours were given; favours were exchanged; telephone calls were made.
  On both sides of the House, a myth grew up that a United Kingdom general election cannot be won without the party winning it having the favour of one of Mr. Murdoch's newspapers—The Sun. I think that that is manifestly false. Labour would have won the general election, and the Conservatives would have lost it, whether The Sun had supported the Labour party, the Conservative party, the Liberal Democrats or the flat earth party.
  Mr. Murdoch—the McNally amendment is very much about Mr. Murdoch—is not a British citizen and does not run a British company. He has great power. It is the independent view—if there may be such a view—that Mr. Murdoch's power has increased, is increasing, and should be diminished. We have a chance through the amendment to diminish it, or at least to rein it in.
  There surely is and has been in this country such a thing as a culture of greed. There was a culture of greed in our body politic, and the electorate dealt with that at the general election. If they had not, I would not be here, quite by chance.
  There is also surely a culture of greed in our newspaper industry, in which nothing matters but the bottom line, and in which the front page is adjusted to accommodate one man's commercial interests. The acquisitions of his publishing house are adjusted to accommodate his commercial interests.
  The answer lies with us. We can do something about it. There is such a thing as an overriding public interest. Hon. Members can defend it, and I think that the people who sent us here demand that we should.
  6.1 pm
  Mr. Giles Radice: I am glad to be called to speak after the hon. Member for Tatton (Mr. Bell).
  I support the Bill, which is a good one and will improve competition. I understand the problem faced by Conservative Members—who, before the general election, proposed a draft Bill, on which this Bill builds. They committed themselves in their general election manifesto to such a Bill. Therefore, the arguments that we have heard today from them are mostly specious.

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  The hon. Member for Tatton has just raised the predatory pricing issue. I do not believe that the Bill's passage is the occasion on which to deal with the wider Murdoch issue—the fact that News International has too large a share of the United Kingdom newspaper market, and that that gives Murdoch too much political power—although I certainly agree with the hon. Gentleman's comments on that issue. We will have to consider also wider issues of press freedom—about which my hon. Friend the Member for Ealing, Acton and Shepherd's Bush (Mr. Soley) has been such a notable advocate.
  The Bill's passage is also not the occasion on which to comment on The Times, or the fact that—although it has some good writers—it is no longer a paper of record. Nor is it the occasion on which to say that The Sun occasionally has a malign, xenophobic influence. I always find it an irony that a newspaper owned by an Australian-American should be so consistently unpleasant about Germans, French, Italians and Spaniards. However, the Bill's passage is not the occasion to discuss that.
  We are dealing with a specific issue—predatory pricing. I believe that there is a prima facie issue of predatory pricing in the broadsheet market. Over five years, The Times has consistently priced below cost, and often considerably below cost. Currently, it cuts prices only on Monday and Saturday—although, as it has been raising prices on those days, the campaign against such pricing has had some effect. Nevertheless, such pricing has meant that The Times runs consistently at a loss.
  The Times's pricing is not only a marketing mechanism but a deliberate strategy of predatory pricing. The purpose of the pricing seems to be to undermine The Independent, to put it out of business, and then to attract some of its readers so that The Times might be able to overtake The Daily Telegraph. Certainly there is a prima facie case. I agree that that must be proved—which is the purpose of the Office of Fair Trading. It has not been proved so far, but, of course, the matter has not been examined since 1994, which was quite a long time ago. As has been said in this debate, it may be that some of the predatory practices are used not just by News International.
  Let us be clear about it: there is danger in such predatory behaviour. If one newspaper is knocked out, the market will be less diverse than it was. Moreover, such behaviour will have an effect on all newspapers in the broadsheet sector, as each of them must react to action of The Times, thereby taking money out of the broadsheet market. Consequently, there will be not only less profit but less money to spend on journalists and on improving the product's quality.
  Predatory behaviour also makes it more difficult for new newspapers to enter the market, as they will have to pay the extra costs of below-cost pricing. That is what makes it so bad for competition.
  Mr. Ian Bruce: Hon. Members seem to be concentrating on a very narrow issue. Nevertheless, will the hon. Gentleman help me with an issue that I find difficult to understand? On several occasions, The Times has almost gone out of business. Is the hon. Gentleman saying that a newspaper that may go out of business if it does not take competitive action—thereby pushing someone else out of business, so that there is room in the
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  market—should always be attacked by the Government? Surely the great difficulty for any competition regulator will always be in deciding whom he should back in such battles.
  Mr. Radice: I agree that the issue is complex, which is why I said that there is only a prima facie case of predatory pricing. As I do not have all the figures—I do not think that anyone has them all, because News International is not at all keen to provide them, although we have asked—I cannot prove the case. The matter will therefore have to be examined by the Office of Fair Trading.
  Mr. Bercow: Will the hon. Gentleman give way?
  Mr. Radice: No. I should like to develop my argument, as my speech will be very short.
  The question for Labour Members—for all hon. Members—is whether the Bill will deal with the predatory pricing issue. The Lords made their amendment—which is now clause 19—because the majority of those voting there did not believe that the Bill did the business. Lord Borrie—who is a distinguished member of the other place, a Labour party member and, as a former Director General of Fair Trading, a great expert in such matters—took the view that the existing powers had to be strengthened. Given earlier decisions on predatory pricing, that may very well have been so.
  I asked Lord Borrie whether he thought that this Bill did the work. He was uncertain about that, but he did not believe that it would. He thought that there should be a special clause dealing specifically with the newspaper industry.
  I am sympathetic to clause 19, and certainly to the idea behind it. It is difficult to argue that we cannot deal specifically with the press when the mergers legislation has specific provisions for the press. The argument therefore does not stand.
  Perhaps the Bill is too broadly drafted, and gives too much power. As my hon. Friend the Member for South Thanet (Dr. Ladyman) said in his intervention, the Bill gives very wide powers, which will have to be examined. We will have to examine also the Government's argument on the matter, which was made clearly for the first time only today. In the House of Lords, the Government did not set out their position.
  Mr. Letwin: Will the hon. Gentleman give way?
  Mr. Radice: Yes, all right, but I thought that Conservative Members were not particularly interested in this argument, which is largely among Labour Members.
  Mr. Letwin: I am grateful to the hon. Gentleman, who is making a considered speech of great interest. If, as he said, Lord Borrie was right, and the Bill without clause 19 did not do the business in the newspaper industry, is he maintaining that it does the business in other industries; and, if so, what is the salient difference?
  Mr. Radice: No; I think that the hon. Gentleman misunderstood me. I said that existing legislation did not

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  do the business. We must consider whether the Bill would enable the Office of Fair Trading to deal with predatory pricing in the newspaper industry.
  The position was first properly set out this afternoon, and I congratulate my right hon. Friend the President of the Board of Trade on that. As I understood her, she said that clause 18 set out certain conduct, including predatory pricing, that would amount to an abuse of a dominant position. She went on to link that to clause 60—I do not suppose that the right hon. Member for Wokingham (Mr. Redwood) is too keen on that clause—which sets out various ways in which the principles of European legislation are to be brought into British law.
  The principles are laid down by treaty and by the European Court of Justice, and any decision of that court must be taken into account, not only in British courts but by the Office of Fair Trading. The court must also have regard to any relevant decision or statement of the Commission.
  I am not a lawyer, but it seems to me that the Tetra Pak case set a tough legal test for predatory pricing. The ruling was:
  "Where an undertaking fixes its prices at a level below average variable cost, it is to be conclusively presumed that the undertaking's purpose was to harm its competitors."
  That would catch News International.
  A Library research paper tells us that one legal test in the Commission definition of what constitutes a dominant position is
  "whether the company enjoys economic strength which enables it to prevent effective competition through its power to behave independently to an appreciable extent of its competitors, customers and consumers."
  That is precisely what News International has done. It has been able to act independently by using its profits from elsewhere, including perhaps satellite television, to subsidise and cut the cost of The Times, in order, over a long period, to knock out one of its competitors and overtake The Daily Telegraph, presumably knocking that out in turn at a later stage.
  For the first time, I have understood that the legislation contains what could be a powerful mechanism for dealing with predatory pricing, if such pricing is proved. It is good that the Government have set out their case, because they certainly had not done so before, and people, including me, were going around saying that the Government had not done enough on the issue.
  The case that has been set out can be quoted in a court of law and used by the Office of Fair Trading, following the Pepper v. Hart case; that may not have the strength that I attribute to it, but it certainly shows that what Ministers say about legislation can be taken into account in the courts if there is any ambiguity about the law.
  We should consider my right hon. Friend's statement very carefully. I certainly intend to get the best possible legal advice on the matter, although I hasten to say that I do not intend to pay for it: I hope to get some free advice. I want to consider carefully what happens in Committee and then to decide what action, if any, to take on Report. In the meantime, I shall take great pleasure in supporting the Bill in the Lobby.
  6.14 pm
  Mr. Alan Clark: I am sure that we all have much sympathy with the President of the Board of Trade. She is faced with an extraordinarily muddled Bill, and many of the large body of supporters behind her do not like many of its provisions; they have given vent to that feeling in many interventions, to which she responded most graciously. I do not even blame her for running away from the Chamber—she has been absent for some time—so as not to have to put up with any more comment on this peculiar Bill.
  The right hon. Lady is in such a muddle because the Bill, particularly clause 19, embodies a paradox. A monopoly is considered undesirable because it overcharges its customers; but now, all of a sudden, we are being told that a monopoly is dangerous and undesirable because it may undercharge its customers.
  Labour Members, greatly assisted by their allies in the press, spent a great deal of time in the previous Parliament holding up to opprobrium the syndrome of fat cats and the way in which the privatised industries kept putting up their margins and overcharging. Now, all of a sudden, many of them appear to be protesting about undercharging. It is small wonder that the President of the Board of Trade, when questioned in any detail, takes refuge in delegation to the Director General of Fair Trading. She says that she seeks endorsement for the principle only, and that all the little detailed questions will be settled by the director general.
  The hon. Member for Sunderland, South (Mr. Mullin) asked my right hon. Friend the Member for Wokingham (Mr. Redwood) what he would say to the fact that The Times has lost/spent £75 million on undercharging. My answer to that question would be, "Thank you very much," because undercharging, as the hon. Gentleman calls it, is a transfer of wealth from the supplier to the consumer; so what do we have to complain about?
  Mr. Mullin: It is a question of motive. If Mr. Murdoch is donating £75 million to the consumer out of the goodness of his heart, we can all celebrate and hope that the largesse will continue indefinitely; but if, by any chance, his intention is to put his rivals out of business and then increase his prices in order to get back all that he has lost and a great deal more, that is not so desirable from the consumer's point of view.
  Mr. Clark: I am delighted to have drawn the hon. Gentleman. He says that it is a question of motive; in other words, the judgment is subjective. I do not want to trust the Secretary of State, or anyone else, with a subjective judgment on what Mr. Murdoch's motives are.
  Dr. Ladyman: To judge from his comments, I can only assume that the right hon. Gentleman intends to support the Bill, because it takes out the subjective questioning of people's intent and replaces it with a mechanistic system for determining whether predatory pricing is occurring.
  Mr. Clark: I am grateful to the hon. Gentleman for enlightening me about an aspect of the Bill that I had not yet observed, but, in the time-honoured phrase that I always use when my constituents ask me whether I intend to support or to oppose any measure, let me say that I intend to listen to the debate.
  Mr. Letwin: Does my right hon. Friend agree that, if the defence put forward by the hon. Member for South

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  Thanet (Dr. Ladyman) were correct, the Bill would mechanistically outlaw all firms that were making a loss, and would therefore outlaw a great part of British manufacturing industry?
  Mr. Clark: That might be the case, and that is the great vulnerability of the argument.
  The hon. Member for Sunderland, South is by no means a sinister individual—he is most gifted, sensible and creative—but he has introduced the sinister concept of motive, which is entirely subjective. The hon. Member for Cheshire, wherever it is—[HON. MEMBERS: "Tatton."] The hon. Member for Tatton (Mr. Bell) was hot on it too, but we do not want to bring motive into our debate or our judgment.
  I draw the House's attention to clause 19, which is the kernel of the Bill. It refers to
  "Any conduct on the part of one or more national newspaper".
  The President of the Board of Trade demolished that concept quite effectively. However, in subsection (2), it continues:
  "Conduct may, in particular, constitute such an abuse if it consists in

  (a) any of the forms of conduct specified in section 18(2);

  (b) other action which may reduce the diversity and independence of the national newspaper press".

  What on earth would the House be doing if we decided to interfere in the diversity and independence of the national newspaper press? We do not interfere much in the diversity and independence of the defence industry, or the automobile industry. In fact, we encourage standardisation, mergers and a diminution in the number of individual trading elements.
  All of a sudden, we have been asked to decide that we must take great care of the
  "diversity and independence of the national newspaper press".
  That is a function of the peculiar relationship that most of us have with journalists, to which I shall turn in a couple of minutes. First, however, let me discuss the issue of underpricing. We have talked about how deplorable it is that existing newspapers should be underpriced, but what about a new newspaper? That would certainly increase diversity and independence.
  Let us suppose that Mr. Murdoch—I am afraid I cannot avoid mentioning his name—decided to introduce a new newspaper, and to make it as much like The Sun as possible, which would not be difficult, as the ingredients of luddism, class war and soft porn are not hard to replicate. He could present his new tabloid to the public at just 5p. What would we do about that? Would that be caught by the Bill? Surely not, for he would be increasing the "diversity and independence" of the national newspaper industry.
  I cite that example simply to illustrate the idiocy of trying to tamper with the market system. Labour Members are trying to tamper because, for some reason, they suspect the motives involved and want to impose their own subjective judgments.
  Mr. Radice: I think—at least, I hope—that the two main parties share the view that predatory pricing, if it can be proved, is not a good thing. Indeed, it was
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  outlawed, as far as I know, by the Competition Act 1980, which was introduced by the Government of which the right hon. Gentleman was such a distinguished member.
  Mr. Clark: I think that the hon. Gentleman is a lawyer—
  Mr. Radice: No; of course I am not.
  Mr. Clark: The House will note the vehemence of the hon. Gentleman's rejection of the profession to which I have been proud to attach myself since passing the Bar finals in the late 1950s.
  I do not think that there is much case law on predatory pricing and what cases there have been have proved exceedingly difficult. Quite honestly, I think that there is no such thing, and I reject the concept. I know that it may have been embodied in some statute at some point, but nothing much has happened as a result. If predatory pricing means discounting, I am in favour of it, and so must be almost any consumer.
  I return to the peculiar motivation that affects us because of our relationship with journalists. We know that all newspapers—even such high-minded organs as The Independent, whose imminent death must owe as much to the extraordinary boredom it generates in its readers as to the price differential between it and The Times on Saturdays, and even such pretentious organs as The Guardian—in their different ways, use deception, short cuts and censorship of their staff.
  We in this place stand in great awe of journalists, but are they not often victims of their squalid and unfulfilling life styles and their dependence on alcohol and narcotics? They should be objects of our sympathy, and we should commiserate with them. I do not say that we should feel particularly friendly towards them but, equally, I deplore the idea that we should regard them with suspicion or hostility, because many of them are objects of pity who have to trade constantly in a commodity that they must distort. They have to exclude the truth, and even their own words are constantly tortured, riddled and excised by sub-editors.
  Mr. Keith Simpson: Are my right hon. Friend's comments about the ladies and gentlemen of the press based partly on his own experience of writing a column for a Sunday newspaper? Is this the applied side of his political experience?
  Mr. Clark: All hon. Members have multi-faceted characters. One of our advantages, or so we are often told, is our ability to inform our comments in the House from our personal experience. If my hon. Friend chooses to interpret my behaviour in that way, far be it from me to correct him.
  I revert, finally, to Mr. Murdoch, and the extraordinary way in which the House—and practically everyone in politics—is obsessed with him. At any given moment in history a particular villain in the media—a press lord or tycoon—has been subject to excessive attention from the House. It may have been Lord Harmsworth, Lord Northcliffe or Lord Kemsley; it certainly was Lord Beaverbrook, who was an object of great opprobrium in the House for many years.

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  Beaverbrook made Governments, undermined Governments, entered the Cabinet in the coalition Government, fancied himself displacing Churchill as Prime Minister at one point, and shamelessly used his papers as a political organ to advance his ambition. And what happened to Lord Beaverbrook? He has disappeared; his family has disintegrated. One of the few remaining scions is the constant subject of pointless pursuit by an hon. Member who sits over there in glasses and whose name I cannot remember—[HON. MEMBERS: "Pendle."] It is indeed the hon. Member for Pendle (Mr. Prentice), who is always telling us that Jonathan Aitken, Lord Beaverbrook's sole remaining descendent in public life, should go to prison.
  What has happened to the rest of the Beaverbrook empire? What has happened to The Express and The Sunday Express and the whole of the Beaverbrook structure? It has all disappeared. If hon. Members are patient enough, they may well find that the same thing happens to our present bogey man.
  Clause 19 is absurd. It is inconsistent and contradictory, and it is little more than an attempt at censorship by the back door.
  6.28 pm
  Mr. Chris Mullin: It is always a pleasure to follow the right hon. Member for Kensington and Chelsea (Mr. Clark). I do not think that he knows it, but he is on the Government's side, because they take the same position on clause 19, which they did not put into the Bill and which they will take out. I accept the argument that it is not wholly logical. I think that I caught him saying that we should not interfere with the free market. We are talking not about that but about the subversion of the free market.
  I and most Labour Members believe in a regulated free market, while the right hon. Gentleman believes in a rather freer version of it than do most of us. That may be a fundamental philosophical difference between us, but in this case we are in favour of the free market and do not think that one exists. We are anxious for the Bill to rectify the situation.
  I support the broad aims of the Bill. There may again be a fundamental philosophical difference between most Labour Members and most Opposition Members, but it is wholly desirable that United Kingdom competition law be brought broadly into line with European competition law. I listened carefully to my hon. Friend the Member for Ealing, Acton and Shepherd's Bush (Mr. Soley) but, with the greatest respect, although there may be a place for a media Bill one day, we do not have one; we have only this Competition Bill. We must take our chances where we can get them, and that is here. We must not allow ourselves to be diverted.
  The acid test of the Bill, as I said in an intervention on the President of the Board of Trade, is whether it will stop the practices in which the Murdoch press and others—I accept that others have behaved in the same way—have engaged fairly systematically—in the case of the Murdoch press, absolutely systematically—since September 1993. From the fact that the Office of Fair Trading has examined
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  the matter three times, it is clear that existing law is hopelessly inadequate. As my hon. Friend the Member for Chester-le-Street remarked—
  Mr. Radice: North Durham.
  Mr. Mullin: I beg my hon. Friend's pardon; time moves on. The effect of predatory pricing so far has been to remove £100 million from the broadsheet market and threaten its diversity. It has also had some impact on the tabloid market, which has not been much mentioned.
  On whether the Bill will achieve the effect that I and many others want it to achieve, I have an open mind. I could be persuaded. As the right hon. Member for Kensington and Chelsea said, proving motive is a hopeless way of going about things unless one is fortunate, as with the case of Tetra Pak and one or two other key European judgments, in finding documents that demonstrate motives. I do not think that we will find the smoking gun in this case. However, the world is not short of ex-Murdoch executives. I have had the benefit of speaking to one or two of them. Some have told me that they heard the man himself talk about sinking rivals; they heard the words from his own lips. I accept, however, that no one is going to put his thumbprint to an affidavit confirming that.
  It is not very constructive to dwell on motive, but we should be under no illusions about how the Murdoch empire operates. I agree there have been similar media moguls in the past. Lord Beaverbrook was mentioned. He was a monster, and I like to think that most of us who are unhappy about how the Murdoch empire operates would have held a similar view on Beaverbrook if we had been around.
  Mr. Bercow: Does the hon. Gentleman agree that, if it is Mr. Rupert Murdoch's intention to destroy all his competitors, he has singularly failed to do so, given that there has been a 14 per cent. expansion of the broadsheet market in the past six years? Does that not suggest either that his interpretation of Mr. Murdoch's motives is wrong or that Mr. Murdoch has been unsuccessful?
  Mr. Mullin: I can say only that Mr. Murdoch is working on it. It may well be that he will allow one or two to live. It gives me no comfort that the one that he has mentioned might live is the Daily Mail. I am not all that bothered about his motives, even if they are as pure as the driven snow; it is their effect that interests me.
  The right hon. Member for Kensington and Chelsea asked what we were doing interfering in the world of newspapers. We have to interfere to a limited extent to ensure diversity, which is the lifeblood of democracy. There is an obligation on Parliament to do that. It is not for us to interfere in which individual owns a particular newspaper or which editorial opinions he or she advances, but to lay down general ground rules that ensure that we have diversity, which is a precondition for democracy, is a perfectly honourable ambition. That is the extent of our legitimate interest in this debate.
  A number of red herrings have been raised. Perhaps Mr. Murdoch's name has been mentioned too much. Someone in high places told me the other day that, if the intention of those who are sceptical about the Bill is to get Murdoch, this was not the place to do it. It is not my

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  intention to do that. I do not flatter myself or my colleagues with the power to do so even if we thought it desirable. If we were introducing a Bill to deal with him, predatory pricing would be ninth or 10th on the list of possible measures. I can think of many other things to consider if the glorious day ever dawned when we had a serious conversation with Mr. Murdoch about his modus operandi.
  Let us disregard the idea that it is all about Murdoch; it is not. Any company that engages in such practices—as some others have, though mainly in response to the newspaper price war triggered by News International—should be affected by the Bill. When one company has 33 per cent. of the national newspaper market and 28 per cent. of the broadsheet market, it is inevitable that its name will crop up more than that of anyone else, but this is not about singling out, or getting vengeance on, any individual or company.
  It is sometimes said that this is all about saving The Independent, but it is not. If The Independent were to go down the plughole—I hope that it will not—there would be a variety of reasons, one of which might be the price regime introduced by the price war. This is not the right place to go into the other reasons. It is not about saving The Independent.
  My hon. Friend the Member for North Durham (Mr. Radice) and I have taken a close interest in the matter and we have talked to representatives of most of the interested parties, including News International. News International put to us a couple of arguments that it is only fair to address. First, it says that what it has engaged in for the past five years is a reasonable commercial strategy whose object is to make it a market leader. It did not give a precise figure, and I am not sure that it necessarily knew one, but when I asked how much the strategy had cost so far, the chairman of the company replied that he had read reports that it had cost around £150 million but that something less than half that was the amount. That is where I get my figure of £75 million for the pursuit of this reasonable commercial strategy.
  Unfortunately, News International's accounts are not sufficiently transparent for us to be able to tell whether the sum is £75 million or a much larger one. If it has cost only £75 million so far, it had better produce some figures that can be independently verified. However, as I said, such is the nature of News International's financial arrangements that that is quite difficult to do.
  The second argument that News International advances is that others do it. I quite agree, and where others do it, they should be stopped, too—we should have a level playing field.
  The third argument is that any consideration of the cost to News International should take into account the fact that increased circulation has enabled the company to increase advertising revenue and that therefore the losses are not as great as some have alleged. I accept that, and it is a reasonable argument; however, News International representatives told us that losses were about £75 million, which I assume takes into account any gains in advertising revenue, so, although I do not necessarily accept the figure given by News International representatives, it provides a good starting point and makes it clear that the strategy is being subsidised—funded from god knows which part of the empire.
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  There are several remedies to the problem that most people agree exists. I welcome the provisions that give the director general, or whoever is in charge of investigating, interim powers to stop the practice of predatory pricing. One of the difficulties is that any court case arising from the Bill could last three or four years and the companies under threat might disappear before the case was resolved, so interim powers are needed. I also welcome the fact that there are serious penalties.
  I accept that clause 19, regrettably, is defective, but we should be grateful to Lord McNally and his allies, because, by inserting that amendment in the Bill, they have forced the Government and the House to think seriously about predatory pricing. To that extent, we should not be churlish, but be grateful to the other place for highlighting an extremely important issue.
  There are two potential remedies. One is to amend clause 18, inserting the terms of the Tetra Pak judgment, which is the standard European case on this issue. The Government say that doing that would narrow, rather than widen, the scope of the Bill. As my hon. Friend the Member for North Durham says, the Government draw our attention to clause 60, which, they say, taken with clause 18, would resolve the problem. I wish the Government had drawn our attention to clause 60 a little earlier in our proceedings, but I am grateful that they have done so. I am attracted by their argument and will think seriously about it and take independent advice. I agree that it is perfectly possible that it provides a solution to the problem.
  The second potential remedy is to include in the Bill a specific reference to newspapers. My right hon. Friend the President of the Board of Trade said that she is not keen on doing that, but there is a precedent—the Fair Trading Act 1973 does exactly that. The answer to the question, "Why newspapers?" is as I said when responding to points made by the right hon. Member for Kensington and Chelsea: with all due respect to the present owners of The Independent, newspapers are not cans of baked beans, or packing cartons, which were the subject of the Tetra Pak judgment; newspapers are the lifeblood of democracy, and that is the case for including specific reference to newspapers in the Bill.
  Dr. Ladyman: Clause 19(3) already contains a reference to newspapers. Is it not possible that that might limit the scope of the Bill, because it would not be possible to take into account the fact that the person doing the predatory pricing might own other media interests, as indeed does the gentleman most often mentioned in our debate?
  Mr. Mullin: Yes, that is perfectly possible, and it is another matter on which I intend to take advice, which is why I shall not come to any firm conclusion this evening. We are in no great hurry: there is at least a month to go before Report is concluded, and, by that time, it will have been possible to take advice from people more expert than me and to ensure that one does not have to be wholly dependent on the advice offered—with, I am sure, great good will—by Her Majesty's Government.
  The other reason given for there being no specific reference to newspapers is that that is not done in other countries—the law with which we are seeking to align ourselves does not make such reference. I acknowledge the truth of that, but we have Murdoch and they have not.

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  I want to be convinced. The Bill is basically good and it contains many good things, but I am absolutely clear in my mind that we have to be convinced that it will put a stop to what is currently going on in the national newspaper industry—not only in the broadsheet market, but in the tabloid market as well—because it is dragging the whole industry down, sucking out profits and the capacity for investment. That will have serious consequences in the end, so, before giving approval to the Bill in its present form, the House must be convinced that the problem will be addressed.
  I listened carefully to what my right hon. Friend the Secretary of State said, and I know that she does not want to get involved in particular cases, but I believe that we could hear something firmer than we have heard from the Dispatch Box today and I shall be on the lookout for such sentiments as the Bill wends its way through its Committee and Report stages.
  6.45 pm
  Mr. Ian Bruce: I am grateful to be called so early in the debate, and to follow the hon. Member for Sunderland, South (Mr. Mullin). It was interesting to hear him say that, at least on this occasion, he is in favour of free markets—
  Mr. Mullin: Regulated free markets.
  Mr. Bruce: I am sorry—I am sure that we will all read Hansard to find the exact words he used. I was certainly touched by what I thought he said.
  I am not sure whether I need to declare an interest. I have no interest in newspapers, but, as I intend to speak later about regulation of the electronics industry, I shall declare that I am a paid adviser of the Telecommunications Managers Association, although I have not been briefed by the association on this Bill; nor am I speaking on its behalf in any way.
  It is strange to sit listening to what the Government appear to be saying about the Bill. When they were in opposition, it was clear that they perceived certain evils in the free market which, when they were in government, a competition Bill would be brought in to address, yet, however much we have tried to tease it from the Government, we have not heard a word about the list of evils with which they are planning to deal. We have heard hon. Members on the Liberal Benches and on the Government Benches—the two may be one and the same—speak about a particular evil they perceive within the newspaper industry, but they are all of one view that the Bill does not deal with that evil. That is strange. We need from the Government a list of what they are trying to do.
  I spent this weekend in Romania, speaking to the people there about democracy and how democratic institutions can help to ensure that the people and the Government stay in touch with one another. On those occasions, one is always keen to tell people that a democratic institution is not a magic bullet that cures all the problems of the world.
  However, listening to hon. Gentlemen so far and, I am sure, hon. Ladies later—I am sorry; hon. Ladies and Gentlemen so far, as we have already had an hon. Lady speak—one has to conclude that they believe that the Government can intervene effectively to regulate the
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  markets to some public good. They are muddled in their thinking and need to define what they are trying to achieve and what the problems are. In that way, we can have a sensible debate in Committee and determine whether the Bill as drafted will allow a regulator to do what the Government intend it to do. Conservative Members may support some of the Bill's proposals.
  In the summer, the refrigerator in my flat in London broke down. Many of my constituents voted Labour in the general election and no doubt they had heard, as I had, the hon. Member for Edinburgh, South (Mr. Griffiths), now the Minister for Competition and Consumer Affairs—whom I am glad to see in his place—making loud claims for a reduction in the price of electrical goods, particularly white goods. Colleagues told me that there would be a 30 per cent. reduction. The Minister should listen to me, as I am referring to his claims, but he is clearly being briefed about what he should have said.
  I was disappointed because I had to buy a new refrigerator, and, when I went to the shops, I found that I had to pay a price that, because of inflation, was a little higher than it had been under the previous Conservative Government. I thought, "If only I had been able to wait until Christmas, I could have got the 30 per cent. reduction." I checked the price of the refrigerator after Christmas, and it was in fact higher. Inflation was continuing to rise and there was no magic bullet to reduce prices, which the Minister for Competition and Consumer Affairs had promised consumers, who want measures to reduce prices, not to support a newspaper that nobody wants to read. The great reduction in prices promised by the Minister—I am grateful that he is no longer chatting—to the country and to the House did not occur.
  When Ministers were members of the Opposition, they had to buy their own refrigerators, but one of the perks of government is that free fridges are installed in Ministers' rooms in the House and in their Government offices. I am not impugning their characters, because that perk was enjoyed by Ministers in previous Governments, but often refrigerators provided by the Government are installed in Ministers' homes.
  Mr. Bercow: I am listening with rapt attention to my hon. Friend's contribution, but, to avoid doubt, will he clarify that he is not for one moment suggesting that the Minister for Competition and Consumer Affairs is planning to share the contents of his fridge with those dissident Labour Members who are threatening to vote against the Bill?
  Mr. Bruce: I am sure that my hon. Friend knows that Ministers are always generous to Opposition and Government Members who visit them in their rooms. I would not impugn the Minister's reputation by suggesting that he would be doing anything other than providing normal hospitality. I understand that the Government put aside money for that purpose. None of us would suggest that that was a problem.
  Mr. Mullin: When I last visited a Minister at the Department of Trade and Industry—which was not long ago—I was offered a glass of red wine from a bottle labelled "Redwood".
  Mr. Deputy Speaker (Sir Alan Haselhurst): Order. If the debate continues along this line, we will all begin to feel thirsty.
  Mr. Bruce: I am already feeling thirsty, and I was about to say that, if we continued along this line, I would be called to order because the debate was going wide of the mark.

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  Competition is an important subject, and we have heard almost nothing about it today. I was somewhat surprised that no hon. Member mentioned the costs that are imposed on the Government, because their buying mechanisms are not subject to competition.
  I was planning to decorate my flat, which is in a block where I believe the President of the Board of Trade owns a flat, which she does not occupy at present, and where my right hon. Friend the Member for Wokingham (Mr. Redwood) also used to have a flat. I was able to find out in the marketplace what it would cost to have my flat decorated—about £1,300. My wife, who is very canny, said that that was too much, and asked me to decorate it myself. I found that I was able to save about £450 a day by doing my own decorating, so perhaps I was efficient. That, as I am sure the House already knows, compares with the £76,000 that the President of the Board of Trade had to pay. It is important that we consider how to achieve value for money and competition.
  I am worried that the Government have not tried to analyse the problems. I have often suggested that the Government should learn from the mistakes that Conservatives made in office. Why should this Government make the same mistakes? One of our mistakes was that we responded to reports about how pubs and breweries operated in the marketplace by deciding to intervene. We told the breweries that it was anti-competitive to own so many pubs and to have tied agreements, and so on. Our intervention was intended to help pubs, small breweries and consumers—everybody except large breweries was supposed to benefit—but everybody complained about the results. Complaints were made, in particular, by the owners of small pubs and people who were thrown out of work because they were the tenants of large brewery chains. The intervention had many bad effects.
  The Government should go through the list of measures that are under consideration, and examine which industries will be caught by the Bill. In Committee, we should discuss in detail how the Bill will operate. It is no good our introducing a law and saying that somebody else will decide how to operate it. We can decide how a sensible regulator should operate that law. Of course, the Minister cannot say exactly what will result from having an independent regulator, but we ought to analyse what we are trying to achieve.
  Dr. Ladyman: I hope that the Government will turn their attention to brewers and public houses in the not-too-distant future. The problem was not the previous Government's intentions when you started to reform competition in that industry, but that you lost your bottle halfway through and cobbled measures together, which was when things went wrong.
  Mr. Bruce: You, Mr. Deputy Speaker, never lost your bottle, and the previous Government did not. They ameliorated some of the worst aspects of that business. This Government should analyse that and try to come to a sensible view. We are the servants of the people and this is a people's Government. We are trying to achieve what the people want. However, we must be certain what the Bill's effects will be.
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  People want cheaper prices. We are not trying to stop someone giving people a deal on a horrible newspaper. Frankly, all the newspapers that are currently being produced are a load of rubbish, and that industry is going electronic anyway. People want cheaper newspapers, and perhaps competition would force up quality because people would be willing to pay more for a high-quality product. If somebody is foolish enough to want to subsidise a product for five years, we must be careful that the Bill will not affect that.
  The Bill is complex, and if the Committee of Selection wants me to sit on the Standing Committee, I shall have many more opportunities to examine it in detail. I am worried that any dominant company—which could be one that is dominant in a small marketplace such as a village—that takes any action that is part of its normal marketing strategy could be caught under the Bill. I am worried that companies will stop implementing such strategies because they will be over-cautious. They may well be able to go to the competition regulator and ask whether their actions are allowed, but if that costs money, they will not want to do so.
  The Bill may prevent the cautious from taking action, and will certainly catch the unwary. That is so often the problem with legislation. Companies do what they think is a good deal for their customers and try to undercut the market, but find later that they have breached regulations. There is a danger of retrospective charging, so we shall need to look at the problem in great detail.
  We have heard complaints about people charging too much and charging too little. Many manufacturers deliberately impose a high price on their products. I was in Japan with a parliamentary delegation. We took with us some whisky miniatures—
  The Minister for Competition and Consumer Affairs (Mr. Nigel Griffiths): Oh?
  Mr. Bruce: I hasten to add that it was 10 years ago. I believe that the miniatures were supplied by a Government Whip. Everywhere we went during our 10-day stay we gave away these small bottles of whisky to the people we met, and we told them that we could not sell more whisky—one of our most successful exports—to Japan because it was too highly taxed there.
  A retired Japanese diplomat accompanied us throughout our trip. He was very polite, as the Japanese always are, and at the end of our stay, when we had got to know him well, he said that he had listened to us making our pitch to Japanese politicians and business men about the price of whisky being too high in Japan. Not true, he said. "You sell so much whisky in Japan," he said, "because it is the most expensive drink people can buy here." It seems that the Japanese do not buy whisky just because they like it; when they give a glass of Scotch to a customer or friend, they are in effect telling them that they like them so much that they are willing to buy them the most expensive drink on the market. If the price were cut to the level of Suntory whisky, people might buy something else instead.
  Mr. Alasdair Morgan: While the hon. Gentleman is discussing whisky, a subject close to my heart, can he explain why,

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  in the past year, when the Japanese have reduced the duty on Scotch whisky, exports of it to Japan have increased substantially?
  Mr. Bruce: The hon. Gentleman ruins my story—but that was the impression given us by the diplomat. Perhaps he was wrong, but the point that I was trying to make in my long—and I hope amusing—story was that people often decide to sell a product by putting its price up.
  A vehicle produced in France which may be regarded there as a very ordinary one may be sold as a premium product in the United Kingdom, where people will buy cars because they know that they will impress their neighbours by owning, say, an Audi, a Renault or some other continental car. It would be wrong if the Bill caught such activity; it would be wrong if the Competition Commission were able to declare that that was wrong pricing.
  I do not suggest for a moment that we should ignore our duty to consumers to ensure the best deals and prices for everything. Indeed, keeping prices down is more important to me and my constituents than keeping them up. Hence the need to examine this area of the Bill in Committee with extreme care.
  There is a tendency in the House to believe that regulation could sort out the newspaper industry and the so-called predatory activities of Rupert Murdoch. There is already a great deal of regulation of the broadcast media. No one can start broadcasting, by satellite, cable or digital interactive, without first putting in a bid to someone who will examine its quantitative and qualitative aspects.
  Rupert Murdoch does not own the companies associated with him 100 per cent. When he first entered the market, however, the Conservative Government set up clear competition between Sky and British Satellite Broadcasting. I assume that it is now called British Sky Broadcasting so as to avoid changing the letters on the side of vans. Neither company made any money at the outset, and everyone suspected that they would go out of business.
  In the end, Murdoch took over his rival, the squarial disappeared, and British Sky Broadcasting was born. He managed to tie up the contents of his programmes, in the sense that he broadcast movies and sports which he knew the market wanted. He was very clever, and he ended up with the dominant position in satellite broadcasting.
  When cable television entered the market, the Government again set up competition. Operators had to put in bids; we ensured competition with the telecommunications companies. Cleverly, Rupert Murdoch went to the cable industry and said, "I have this product; I can give it to you at a competitive price." He thereby achieved a virtual monopoly of the premium channels going into cable.
  When it came to digital terrestrial, Sky observed another company offering a new product. Somehow Murdoch persuaded the ITC—despite the fact that his licences gave him no such rights—to broadcast his programmes on terrestrial. He convinced the ITC that his bid would succeed because the others lacked a product. Strangely, the ITC decided that he should not be a shareholder, but guaranteed that his products would be used by the successful bidder.
  Therefore, although regulations may be imposed in an attempt to create competition, they can have exactly the opposite effect. They failed in the case of digital terrestrial
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  broadcasting, where healthy competition was intended. Some have suggested that it was all to do with Murdoch's support for the Labour party, but the ITC says that that is nonsense: it acted independently. I have no wish to throw around accusations, but it does make one wonder about Government involvement in such matters.
  I end on the problem of double jeopardy and the regulators. We are to have a Competition Commission, but we already have many regulators—the ITC, the BBC and Oftel are all involved in telecommunications, and a whole string of regulators can be involved in the content of programmes. We must be careful to ensure that someone who believes that he has permission to do something does not discover that, while satisfying the competition conditions, he has fallen foul of one of the other regulators.
  The Government were elected after suggesting that they would reduce the number of regulators in this area to one—yet here is yet another one. They keep setting up more and more regulators, or more powers for regulators, while doing nothing to reduce their numbers.
  We shall have an enjoyable—and unfortunately rather long—time in Committee to discuss these difficulties. It will be interesting to see whether Labour Back Benchers who have appeared today say a word, or whether the bleepers will have done their work. I note a little smile on the face of the Government Whip, who always works charmingly to ensure that these things run smoothly. In any event, we would certainly enjoy any contributions that Labour Back Benchers might care to make in Committee.
  7.9 pm
  Mrs. Linda Gilroy: It is a pleasure to follow the hon. Member for South Dorset (Mr. Bruce). I am one of the 101 female Labour Members, and the second female Back Bencher to speak tonight—perhaps the hon. Gentleman was not present when my hon. Friend the Member for Crewe and Nantwich (Mrs. Dunwoody) spoke.
  A robust competition policy, which the Bill seeks to bring about, is in the interests of consumers, business and the economy generally. It is good for the consumer because it tackles abuses of market power, cartel and other anti-competitive practices that act directly against the consumer interest—especially the interest of poor consumers. By introducing a single competition law and shifting the emphasis to a prohibition-based approach, the Bill should ensure that consumers have the benefit of the lowest possible prices, wider choice and the information on which to base that choice as well as to obtain value for money.
  The Bill is good for business because, in moving to a prohibition-based system, it brings the United Kingdom provisions in line with the treaty of Rome, which has provisions dealing with anti-competitive or restrictive agreements which affect inter-state trade. Those existing European Union provisions already apply to some United Kingdom companies, and they will benefit from a reduced compliance burden. The Bill should also help to avoid inconsistency and potential conflict for them.
  The Bill will be good for the economy, for if we are to be competitive abroad, we must begin with competition at home. Ministers have done a great deal by other measures to tackle the underlying problems that have caused our slide down the Organisation for Economic

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  Co-operation and Development league tables. The Bill is a key part of the programme to halt that decline and put it into reverse. I believe that consumers, business and those who understand the importance of competition to a thriving economy and our quality of life have good reason to welcome the Bill.
  I shall focus on an important aspect of the way in which the Bill will especially help consumers of utility services. In particular clause 54 and schedule 10, give concurrent powers to the sector regulators who are responsible for our utilities.
  As head of the south-west office of the Gas Consumers Council for 17 years before entering the House, I spent the latter years ensuring that the consumer voice was represented strongly in the passage of the legislation to introduce competition in the supply of gas to domestic customers. Competition has delivered significant price reductions to gas customers. The introduction of competition in the supply of electricity to domestic customers will soon achieve reductions for electricity consumers.
  The Bill will give sectoral regulators and the Office of Fair Trading tougher powers to ensure that competition develops and delivers rewards fairly for domestic energy consumers. For the first time, there will be really stiff penalties for companies found guilty of anti-competitive behaviour. Those powers will be balanced by the right of appeal to the new Competition Commission, both for the companies concerned and for individual consumers, and I especially welcome the fact that individual consumers and those who represent them will have access to that process.
  The Bill will continue the present system of so-called concurrency. Under general competition law, the Office of Fair Trading and the individual sectoral regulators already have the power to tackle anti-competitive behaviour. Such powers are not new, but the Bill will add significantly to their effectiveness.
  I am aware that, in another place—and outside this Chamber—some concerns were expressed about those concurrent powers. To those who voice such concerns, I say that it is important to understand the deeply entrenched monopoly practices and legacies that the regulators must overcome to ensure, in particular, that the benefits of competition are brought to the provision of our energy supplies. Of course, we can do much to achieve that through the powers and duties of the sectoral regulators, as outlined in the utilities Green Paper, which is currently out to consultation, but we also need to toughen the role of general competition regulation, to ensure that the full benefits of competition can be brought to consumers.
  The sectoral regulators need all the tools available to them to ensure that we move as quickly as possible from the rather artificial markets that exist at the early stages of introducing competition to the monopoly utility markets, to a position which, as nearly as possible, mirrors true competition. By allowing the sectoral regulators to choose the most appropriate regime—sector-specific legislation or competition legislation—with which to tackle a problem, we can ensure that decisions under the two regimes are consistent, not contradictory.
  If sectoral regulators had to rely on only their specific regulatory rules and licences to tackle the problems of the utility industries, a brake could be placed on competition,
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  with serious implications for innovation. Indeed, the regulated companies could then face double jeopardy: sectoral regulators investigating specific aspects while the Office of Fair Trading investigates the same behaviour under general competition law. If those powers are given concurrently to the sectoral regulators, they can bring their in-depth knowledge and experience to bear on the different sectors with their special characteristics.
  I believe that special features of the utility markets mean that there will be an on-going role for sectoral regulators—increasingly as specialist competition authorities. Many predicted that liberalisation of the utility markets would lead to a competitive position that would achieve the best outcomes in its own right, and that, as time went by, there would be no need for sectoral regulation.
  Several factors differentiate the energy markets from other markets, and will continue to do so for the foreseeable future. In the case of most products we buy, there is a wide choice to suit personal preferences, often involving choices of colour, size, taste and smell, as well as income. By contrast, for domestic energy customers there are, to all intents and purposes, no substitutes for electricity and gas, and very little in the way of product differentiation. That fact raises important equity and economic issues.
  The equity concern that arises from lack of substitutes is that, in order to heat their home, a poor household needs to use broadly the same amount of electricity and/or gas as a richer household that lives in a comparable property and has a comparable heating system.
  Mr. Redwood: I wonder whether the hon. Lady would like to comment on the Government's decision to place a moratorium on new gas-fired power stations. Does she believe that is anti-competitive, and is she urging Ministers to remove it in the interests of increasing competition in the electricity market?
  Mrs. Gilroy: No. That is a matter for the Minister for Science, Energy and Industry, and I think that it is in good hands.
  A poor household needs to use broadly the same amount of electricity to heat their home as does a richer household. Some less well-off households must pay up to nine times as much as richer households to obtain comparable warmth if, as is often the case, they live in housing that has less insulation. Because of those factors, energy expenditure generally forms a significantly larger share of the budgets of the poor—typically in the region of 15 per cent., although I have seen budgets in part of my constituency where as much as £1 in every £4 goes on fuel.
  For better-off households, fuel typically represents 5 per cent. or less of household expenditure. In fact, less well-off households have—as is so often the case with competition, but arguably to a greater extent with fuel—more to gain from competition than better-off households. I am very pleased to note that, on Thursday this week, a conference is being organised by the Right to Fuel campaign, which will consider innovative ideas for ensuring that competition benefits as many fuel-poor households as possible.
  Sometimes, however, competition needs a helping hand—or something stronger—to break down the barriers of old entrenched ways, and the Bill will help to ensure that, when a barrier gets in the way, it can be removed.

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  The economic concern arising from the lack of substitutes is the possibility that sellers of electricity and gas may be able to exercise monopoly power over all customers. In respect of gas, which is the fuel I know best, about 40 per cent. of the price is represented by the cost of transporting the raw material. Transportation is likely to continue to be a monopoly, except perhaps at the margins, and therefore subject to regulation.
  Nevertheless, we must ensure that we come as close as possible to competitive conditions in our energy markets. Firms that thrive more than others must do so because they are more efficient, and prices must send the correct signals for firms to enter and exit the market. With some 40 per cent. of product cost accounted for by a charge for transportation, which is predominantly provided by a regulated monopoly, and the bulk of the remainder of the price being accounted for by a product for which there is little scope for differentiation other than on price, there are significant challenges in ensuring that competition is delivered to gas customers generally.
  Central Government must take responsibility for creating a framework to deal with the distributional effects of market-led policies in our utilities. Although the benefits system may have some role to play, the sectoral regulators also have a role, using appropriate powers to ensure that the most vulnerable customers are protected, while bringing about a reasonably level playing field for new entrants. Similar challenges arise from environmental considerations. A range of regulatory interventions to promote energy efficiency and cleaner energy generation will be needed.
  It is extremely important that the protection of vulnerable customers and the environment is combined with powers that ensure a level playing field for competitors entering and exiting the market. By giving the sector-specific regulators strengthened concurrent powers, the Bill gives them more effective tools to achieve that.
  There must be consistency in concurrency. It will be essential to develop a single set of rules for all the enforcement bodies on how to proceed with competition cases, and to require the regulators to confer about further guidelines on how the prohibitions will be enforced.
  Mr. Bercow: Will the hon. Lady give way?
  Mrs. Gilroy: No. I am almost at an end; if the hon. Gentleman does not mind, I shall finish.
  I understand that a concurrency working group has already been set up, with the Office of Fair Trading and all the sectoral regulators meeting regularly to produce a consistent approach to rules on enforcement and procedure. Such close co-operation bodes well for the future when the Bill is enacted, although I believe that a strong case is advanced for discussion in the Green Paper about merging the offices of gas and electricity regulation.
  As well as co-operation between regulators, all decisions made under the Bill will have to reflect European case law, so that companies will face a similar set of rules whether they operate in the UK alone or across Europe. Provisions for appeal to the proposed Competition Commission add a further safeguard that regulation will be applied consistently.
  The Bill is vital to ensure that the encouragement of competition in our utilities continues. For customers to have an effective range of choice of suppliers and related services in the utility sector, we need companies that can
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  enter the market and compete on a fair basis. That requires an effective regime to deal with anti-competitive behaviour so that the old monopolists cannot force new competitors out of the market by unfair practices such as predatory pricing.
  Utilities are an important sector of our economy. In 1995, they accounted for 4.3 per cent. of our gross domestic product. Britain has led the way in recent years in introducing competition to domestic customers in the sector. Competition has already delivered many benefits.
  Mr. Redwood: We introduced it.
  Mrs. Gilroy: Indeed, and we supported it.
  To continue the process and to meet the challenges of tomorrow, we must ensure that we develop a framework that is an imaginative blend of competition law and sector-specific regulation.
  The Bill is an essential part of bringing that about, through a formula that will allow us to be tough on regulation but determined in the encouragement of competition. I congratulate my right hon. Friend the President of the Board of Trade and her ministerial team on introducing the measure, and I shall take a keen interest in its progress.
  7.23 pm
  Mr. Oliver Letwin: In a rather long debate, we have heard a series of interesting exchanges about predatory pricing—which is described in the Bill as unfair pricing—including a bravura performance from my right hon. Friend the Member for Kensington and Chelsea (Mr. Clark). The debate has illustrated the extreme difficulty of discussing predatory pricing in an assembly such as this, and has shown beyond doubt that the Bill takes us no further forward in the definition of that perplexed term, or in the enforcement of provisions against it—if we are in favour of such enforcement.
  I shall deal with a subject that has been mentioned by Labour Members and is touted by the President of the Board of Trade as one of the great advantages of the Bill, but which has received relatively little attention in the debate so far: the convergence between the proposals in the Bill and the provisions of European Union competition law.
  Many hon. Members have examined Bill in depth, as have those in another place. Detailed inspection of the Bill, for which further opportunity will arise in Committee, reveals that it makes almost no intellectual advance in that complex area—except the purported advance of bringing UK law into harmony with European law. We must investigate whether the Bill achieves a useful purpose by the moves that it makes to bring our competition law into ostensible conformity with articles 85 and 86. I shall concentrate particularly on the provisions on prohibition arising from article 85 and chapter I of the Bill.
  I apologise to the President of the Board of Trade, to the Minister for Competition and Consumer Affairs and to officials if I travesty their actions, but I imagine that, one fine morning shortly after 1 May, the right hon. Lady came into her new Department and told officials that it was essential that all Departments fulfilled their manifesto promises, because the Prime Minister had told her that

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  that must be done by a people's Government. She explained that competition provisions needed total revision because the previous Government had done nothing for competition. I do not believe that there is the remotest truth in that assertion, but it was widely made before the election.
  The new Competition Bill was to transform the situation. The President of the Board of Trade said that it must make the whole of our competition law harmonious with European competition law, because the Prime Minister—or was it the Chancellor of the Exchequer?—had told her the previous day that it was essential that everything should be made harmonious with Europe.
  At that point, I think, the President of the Board of Trade retired to consider other matters, such as how to defend her various Ministers who were under attack from my right hon. Friends and others, and to do other things of greater immediate moment, leaving vast armies of intelligent and learned officials to concoct a Bill that fulfilled the remit of bringing our law into conformity with European law. The chapter I prohibition appears to do exactly that.
  Detailed inspection of the Bill reveals an exemption in respect of what would be described in the old language as restrictive trade practices or, in the new language, as agreements operating against the public interest, if they are conducive to mergers or consolidations. That is extremely interesting. It suggests that, if I am in a particular competitive field, and I want to sign an agreement with my nearest rival—lower down the chain in a vertical agreement, or directly opposite me in a horizontal agreement—I must go through a complex process of obtaining guidance or rulings. I admit to being perplexed about the difference between guidance and rulings, but the Bill provides for that distinction, and I must seek one or the other, or perhaps both, possibly not just from one regulator but from many, because, as the hon. Member for Plymouth, Sutton (Mrs. Gilroy) pointed out, there are concurrent regulators.
  I may spend several years obtaining guidance and rulings from various bodies, to find out whether the agreement or web of agreements that I want to sign would be legitimate. However, I have an alternative. I can avoid all that if I simply agree with my nearest competitor that he and I should join forces by swapping equity, in a purely continental fashion. If he does not like that idea, I can walk into the open market—we still have a free market in our stock markets, until the Government take it into their head to change that—and take over his business. In that way, I miraculously liberate myself from the need for reference to any regulator regarding questions of agreement.
  How does that arise? It arises because, under European legislation—which is not unintelligent in this domain—a presumption was made which, unfortunately, all those learned and clever people who framed this Bill in a United Kingdom context clearly missed. The presumption in European terms is broadly true: if any business object, any industry or firm, that qualifies for attention by the European Commission—DG IV in particular—makes an agreement, because of the structure of the treaties, a consolidation by that party with another party will also come to the Commission's attention as an abuse of
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  dominant position. The structure of the treaty makes it true that only very large firms—firms on almost a world scale—will come to the Commission's attention.
  That is not the case in the United Kingdom. On the contrary, there is a vast amount of clear water—most of the financial side of our industrial activity is in that area—between firms that could sign restrictive agreements and firms that have a dominant position according to anyone's definition, whether it is 20 per cent. of the market or otherwise. By aping European provisions without understanding the logic underlying them, the Bill brings into British law a bizarre position of which I do not believe the President of the Board of Trade is aware—if she were, I cannot imagine that she would support it—whereby very large numbers of very small, fiercely competitive British firms will have a strong incentive to link into increasing industrial consolidations and concentrations.
  We can be sure of only one thing in those circumstances: the provision will reduce diversity and competition, and will tend to reduce pressure for decreases in price and increases in quality. If that is the intended purpose of the Bill under the banner of harmonising with European legislation, the President of the Board of Trade is much less intelligent than I had imagined. I think the right hon. Lady is wholly unaware of that consequence, because she simply asked officials to draft legislation that is in harmony with European legislation—and this Bill ostensibly is—and she is wholly unaware of what firms actually do because she is unaware of how the market operates. That is very unfortunate.
  In the spirit of amity and constructive opposition, I spent some time wondering whether we would be able to cure that extremely large defect in the Bill by introducing amendments in Committee that you and your colleagues in Committee, Mr. Deputy Speaker, would allow as being proper and within the spirit of the legislation. Alas, I do not think that that can be achieved. I hope that the immense ingenuity of my right hon. and hon. Friends will permit such measures to come forward, but I must admit that I am sceptical. I think that the Bill's structure prevents it. It is extremely difficult to see how amendments that are in the spirit of the Bill could conceivably clear the area between small firms and dominant firms in a way that prevents concentrations and consolidations occurring as a means of escaping the Bill's anti-restrictive trade practices aspects.
  If that is the case, I fear that we shall pass into law—the Government will undoubtedly use their majority to do it—legislation whose effects it will take decades to remedy. Large swathes of that part of our industry which is most entrepreneurial and generative of growth in this country will consolidate into large, increasingly sleepy giants under the aegis of an apparently pro-competitive piece of legislation.
  Mr. Andrew Lansley: My hon. Friend's comments are remarkable in their clarity and importance. However, perhaps he could assist me with one matter. Beyond a certain point—by reference to market share or some other characteristic—mergers and acquisitions are the subject of an inquiry by the Office of Fair Trading and, if they are held to act against the public interest, might be the subject of a reference. Am I correct in assuming that my hon. Friend is referring to those

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  immensely important parts of industry that would fall below the market share test or other tests governing mergers?
  Mr. Letwin: I am grateful to my hon. Friend for his characteristically acute question. I agree that the brunt of my remarks so far has been directed at the movement between a very small firm and a firm with less than 20 per cent. market share, if the Commission chooses that as the definition of dominance.
  However, I think the position is slightly worse than that which I have portrayed. Although I may have missed such provisions, I have a strong sense that, because the Bill is based on EU legislation, it is concerned almost exclusively with restrictive agreements and with the abuse of dominance rather than with dominance per se. If that is so, it may be possible for firms to agglomerate even to the point where—to take a ridiculous example—they are 100 per cent. of a particular sub-sector of a market.
  In the past, they would clearly have fallen foul of all sorts of provisions under the Restrictive Trade Practices Act 1976, and the Monopolies and Mergers Commission would have been able to investigate them. However, as long as they tread a thin line between abuse and non-abuse—I refer to the lengthy and wholly useless discussions about unfair pricing, which show clearly how difficult it will be to establish that an abuse has occurred—they may now be able to maintain their existence as a comfortable, sleepy giant. I accept entirely that that is an extreme example.
  Mr. Ian Bruce: My hon. Friend paints an alarming picture. Does he realise what happened when France Telecom, which I believe is the third largest telecom company in the world, announced that it would link up with Deutsche Telekom, which is the fourth largest telecom company in the world? The European Commission said that that was good in terms of bringing Europe together and was clearly not anti-competitive. That is the sort of ridiculous ruling that has been made by the European Commission. A few others have been allowed to enter the market, but that group is so big that they do not have a hope.
  Mr. Letwin: My hon. Friend is quite right: the emergence of Global One, the grouping to which he refers, and of Unisource, its competitor—perhaps erstwhile—are good examples of the tendency among European regulators, following the structure of the treaties, to concentrate on abuse and not on dominance per se.
  That seems to be an extreme argument, and I rest my case with the simple contention that this Bill—if it has a single tendency in the United Kingdom economy—will create consolidation and concentration. That must be the opposite of the Government's intention, and, on those grounds alone, I believe that we should support the Opposition amendment.
  7.36 pm
  Mr. Michael Wills: I shall be brief, as other hon. Members wish to speak in the debate. At the outset, I should declare an interest on behalf of my wife and me in television production, which was my profession before I entered this place.
  I have sat through what is becoming a very lengthy debate and I have heard a great deal of detailed discussion about the Bill—proper and appropriate scrutiny.
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  The debate on the Labour Benches has been constructive, as we recognise the need for legislation. Opposition Members have piled detail upon detail and story upon anecdote—some of which has been entertaining—but I am not sure to what ultimate purpose. Are they trying to improve the legislation while accepting the need for it and its basic principles, or—this seems more likely—are they merely trying to justify maintaining the status quo in the belief that current legislation is as perfect as possible?
  So I shall turn away from the detail to the ultimate objectives of the Bill. I shall remind the House of the broad principles that the Bill is designed to enhance and entrench, and explore why it is so important in modernising our economy. If we are to have a dynamic economy which is quick to succeed in the modern world; which produces sustainable growth and the jobs that this country deserves—which the previous Government signally failed to produce—and which is efficient, productive, adaptable, flexible, creative and innovative, effective competition is essential. I hope that the Opposition agree with that, at least.
  Without effective competition, businesses become complacent and arrogant—their creative juices dry up, and their entrepreneurial vigour ossifies and dies. Few dispute such general, theoretical arguments in favour of competition. However, when it comes to individual businesses in practice, history tells us that the attractions of anti-competitive behaviour often become overwhelming. Economic power, just as much as political power, constantly shifting and flowing, possesses an inevitable tendency to cluster and grow around those who already have it.
  No modern society and no modern economy can afford to allow vested interests to accumulate power against the public interest. In every area where power builds up and clogs the channels of opportunity for individual businesses—just as much as for individual citizens and consumers—we have a duty to act. Companies that abuse a market by means of a dominant market position—and I submit that abuse is the issue here—and businesses that adopt anti-competitive practices barricade the road to a dynamic, efficient economy and thereby harm consumers.
  The Bill is a welcome and much-needed reform of competition law. In its adoption of chapters I and II prohibitions; in strengthening the investigative powers of the Office of Fair Trading—we have not heard much about that from the Opposition—in streamlining procedures to prohibit anti-competitive activity; in providing real deterrents to firms tempted to adopt anti-competitive behaviour; and in providing recompense for those damaged by such behaviour, the Bill will modernise our approach to competition and make it effective. Were we to maintain the status quo, as the Opposition seem to want to do, none of those things would result. I welcome the fact that the Bill will bring our competition policy in line with that of Europe.
  I welcome also the reassurance given by my right hon. Friend the President of the Board of Trade about predatory pricing. Drawing a line between unacceptable predation and keen competition will often be difficult, but it is essential that we do so. It is encouraging that the proposed legislation will provide for tough and effective measures against predatory pricing and the abuse of a dominant position.

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  It is commendable that the Bill possesses potential for further evolution in line with any further European Union legislation and case law. There is a clear need for flexibility and adaptability. If nothing else, rapid technological change means that there must be constant vigilance against new forms of predation, as the debate over Microsoft's position in the United States makes clear.
  The Bill is important, and not only for the practical and detailed reforms that it will introduce. It will also come to be seen as important for the new culture that it creates. With the move from a form-based approach to an effects-based approach will come a sharper and more practical focus on competition instead of the cumbersome bureaucracy of existing legislation. Over the years, as regulators and businesses come to terms with the arrangements, the greater concentration of effort on competition should help the Office of Fair Trading acquire new expertise in understanding markets. The Bill should lead to a more sophisticated understanding of how markets work. The Bill should foster a new culture among regulators and businesses alike that will promote the development of genuine and effective competition.
  The Bill delivers on the Government's manifesto commitment. It provides robust new powers to promote competition in this country. It is a crucial building block in constructing a modern globally competitive economy, and one that will remain so.
  I hope that those who oppose the Bill will keep clearly in their minds what signal their opposition is likely to send. Given that they so signally failed to introduce relevant legislation when they were in a position to do so, despite the fact that there has been a consensus for some time about the need for such legislation, opposition now will send the signal that vested interests will always have friends in the Conservative party—and friends they should have none, anywhere. Vested interests are the enemies of progress, and the Bill will tackle them.
  Labour Members know the right way forward and we shall vote accordingly tonight. I hope that the Conservative party will think again about whether it really wants to vote against a Bill that will play such an important part in modernising our economy.
  7.43 pm
  Mr. Andrew Lansley: I am grateful for the opportunity to contribute to the Second Reading debate. I am surprised by the closing assertion of the hon. Member for North Swindon (Mr. Wills), because I suspect that the Conservative party, during 18 years in government, did more than any Government in living memory to attack vested interests and promote competition. In debating the Second Reading of a Bill concerned with competition policy, the hon. Gentleman made an astonishing assertion. When he reads Hansard tomorrow, he may feel slightly abashed.
  There is a need for competition legislation. I suspect that many right hon. and hon. Members on both sides of the House would accept that the right legislation might have a role to play. It was precisely for that reason, for several years before the most recent general election, that Conservative Administrations worked carefully towards
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  the stage at which legislation could be introduced, principally to reform restrictive trade practices and resale prices legislation. I have no quarrel about that.
  In general, we must wonder whether we have the right piece of proposed legislation before us. I wish briefly to illustrate how many difficulties there are. Perhaps there are enough so that I might share the view of my hon. Friend the Member for West Dorset (Mr. Letwin) that we are entirely justified in seeking to deny the Bill a Second Reading.
  The first problem rests with the overall drafting of the Bill. Precisely for that reason, we arrive at the question whether an article 86 prohibition should be added to the Bill. There have been many difficulties in many places about the definitions of "abuse" and "dominant position". Overall, there is the question whether the drafting of the Bill is good enough.
  I refer the House to the survey in the latest edition of Global Competition Review. Fifty-eight per cent. of the lawyers and 63 per cent. of the economists who responded to the survey stated that they did not feel satisfied that the Bill in its present form was drafted well enough to achieve sufficient clarity and legal certainty. That underlines the question that has been raised about the effectiveness of the Bill as it is.
  I shall not dwell on the question of unfair pricing, but I entirely accept the view of my hon. Friend the Member for West Dorset. I listened with astonishment to some of the exchanges involving Labour Members. No one has the necessary information on which to judge whether there has been unfair pricing in the newspaper market. Even if we apply the Tetra Pak judgment, the question is not confined to the cover price of a newspaper. Account must be taken of the cover price and advertising revenues.
  If a newspaper were cutting its cover price, and as a consequence gained market share and advertising revenue that more than covered the loss of revenue through its reduced cover price, that would be a rational market activity, and would not constitute an abuse or necessarily an anti-competitive practice. It would be a pro-competitive practice. However, I do not have the information on which to base that judgment, and neither, I suspect, do Labour Members. It is the Office of Fair Trading that can acquire that necessary information, and it has done so several times. It is to be hoped that it has that information now. It should be for the OFT to judge under present legislation whether it should initiate an investigation.
  As for the Opposition amendment, it is right to instance the problem for community pharmacies. The hon. Member for North Swindon talked about effects. If the effect of the implementation of the Bill were to diminish the presence of community pharmacies in rural areas, I know how damaging that would be. Outside the context of competition policy, within the national health service, the value of community pharmacists in providing primary care and health information is important and growing. It has been the objective to have pharmacists providing more primary care information, to free general practitioners so that they might engage more in complex diagnoses rather than the provision of basic public health advice.

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  If chapter I prohibition is to be enshrined in legislation, there are several requirements. First, there is the block exemption for vertical agreements. It should be recognised that there is considerable potential value in vertical agreements, not least to consumers.
  Secondly, we need guidelines on the types of provision and conduct that are likely to be regarded as giving rise to anti-competitive agreements, lest we leave companies completely unclear for a long time about the manner in which legislation will be implemented.
  Thirdly, we need de minimis exemptions. I suspect that we are talking of considerably more than the £20 million that applied under restrictive trade practices agreements, and perhaps £50 million or a 5 per cent. market share in the relevant market.
  It can be argued that there is difficulty in determining what the chapter II prohibition means. Mr. Derek Ridyard of National Economic Research Associates states:
  "Look at Article 86 Case Law in Brussels, lots of people have been found to be abusing their dominant position and fined, but without any real explanation as to what is or is not abuse of dominant position."
  Likewise, we should explore the difficulty in the relationship between the prohibition as it affects complex monopolies and the Fair Trading Act 1973, and the interaction between the two. It would be useful if there was a bilateral presumption—one has not so far been offered by the Government—that activity that is regarded as not against the public interest under the Fair Trading Act 1973 should not be prohibited under chapter II prohibitions, and vice versa. We should avoid the double jeopardy of concurrent investigations on those two issues.
  It is important to take up a number of wider issues on Second Reading and in Committee, the first of which is compliance. The President of the Board of Trade talked about the 10,000 agreements under the restricted trade practice legislation, but she did not tell us how many thousands of precautionary notifications are likely to be sought by companies to forestall action, especially under the chapter I prohibition.
  Secondly, the Government propose to take greatly extended powers of investigation and search-and-entry for the OFT, to the extent that one lawyer has been quoted as saying that they are
  "unnecessary, and too much, even if they are used correctly".
  That may be counter-productive, because it may convert the OFT into a body that is considered to have a highly aggressive and adversarial relationship with industry, rather than one that genuinely seeks to assist in the creation of free, fair and competitive markets.
  Thirdly, I hope that hon. Members, notwithstanding the speech by the hon. Member for Plymouth, Sutton (Mrs. Gilroy), share my concern that the extension of concurrent powers to utility regulators could create problems. There could be competing interpretations of the law, a build-up of competing case law with different precedents, and double jeopardy between regulators and the other competition authorities. It would be preferable for the OFT to remain the competition authority for those sectors, and to act alongside the sector regulators rather than separately.
  Will the Bill give rise to a simpler and more predictable competition policy? I suspect not. The President of the Board of Trade has been criticised recently for failing to
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  pursue the predictable competition-based mergers and acquisitions policy that she inherited from her predecessors. I have an interest in that, because I was private secretary to Norman Tebbit when he introduced the Tebbit doctrine.
  Predictability is slowly but surely being undermined. The director general and the seven—at least to begin with—utility regulators, the Competition Commission, the Court of Appeal and the European Court of Justice will be involved. My hon. Friend the Member for South Dorset (Mr. Bruce) reminded us that the ECJ would be operating a law that presumes the protection of a single market and a pro-European Union application, not one particular to United Kingdom circumstances. Nevertheless, it is to be introduced to the United Kingdom domestic context. I should be surprised if all that becomes predictable and simple.
  I want to be brief, to allow other hon. Members to speak, but I must discuss the system of financial penalties, to which no one has referred. Up to 10 per cent. of United Kingdom turnover is cited. [Interruption.] Have I done my right hon. Friend the Member for Wokingham (Mr. Redwood) an injustice? I beg his pardon, because he mentioned it. I was present earlier, but was obviously not paying sufficient attention. If I agree with him, he will forgive me for that.
  Up to 10 per cent. of United Kingdom turnover is cited, but clauses 37 and 39 refer to a system in which that high level of penalty may be applied in ways that we know not of, and by reference to guidelines issued by the director general that would be approved by the Secretary of State, but not referred to Parliament. The Bill does not say how the severity of financial penalty would be related to the relative severity of abuse or of contravention of the prohibition. That is a dangerous structure, and one to be deplored.
  The President of the Board of Trade lauded her achievement in introducing the Bill so quickly. She might have done better to reflect on why it took the previous Government several years to produce a draft Bill in August 1996, and why it differed from this Bill. The draft Bill did not include the general prohibition paralleling article 86. Even though she claims to have produced clear legislation, she must reflect on why lawyers and economists conclude, on balance, that the Bill will not help in that respect. Several issues are yet to be sorted out.
  Those grounds are enough to deny the Bill a Second Reading, and I support my right hon. Friend's amendment. If the Bill is given a Second Reading, I hope that the Minister will have the honesty to admit that there is much more work to be done in Committee.
  7.55 pm
  Mr. David Borrow: I welcome the Bill, which is a long overdue modernisation of competition policy. It is remarkable that the shadow Secretary of State is happy with the status quo: there is clear evidence that, when in office, the Conservative Government were preparing legislation to be introduced had they won the election, and therefore implicitly accepted that the status quo was not satisfactory and that changes were needed.
  Although the official Opposition think that the status quo is satisfactory, representations that I have received suggest that the business community is broadly satisfied with the new framework laid down by the Bill.

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  The involvement of European legislation and European law in United Kingdom competition policy is especially welcomed by much of British industry as simplifying the approach to competition through common rules in Europe as within the United Kingdom.
  The Bill puts teeth in competition policy by creating real investigative powers, and powers to intervene when there is evidence of improper competition. As my hon. Friend the Member for Crewe and Nantwich (Mrs. Dunwoody) so clearly showed, the problems of bus privatisation and obvious examples of unfair competition, with which existing legislation fails to deal, would be dealt with by the Bill. It will also bring into force powers for fining those engaged in unfair competition, so companies that can show that they have suffered as a result of unfair competition have redress, which, under existing legislation, they do not.
  The Bill's approach is to be welcomed for those reasons. We often consider competition law in terms of whether it benefits the consumer, but it must also benefit players in the market if we are to have proper competition. Small companies are often hurt by existing legislation: they are put in adverse situations by large companies because they are unable to achieve fairness under existing competition rules.
  We must, however, examine in detail certain areas within the broad framework. I have received representations on the impact of European legislation and case law and British legislation and regulations, and the extent to which we are in danger of operating under two competing legal systems. There is genuine concern about that issue. Much of the business community is genuinely worried about the extent to which there can be quick redress, and whether redress under the new regulations will be expensive. Those matters must be dealt with in detail in Committee.
  I wish to deal with three specific areas of concern. First, I have received representations from the music industry, which is subject to the copyright tribunal under domestic legislation, and is worried about the Bill's impact in terms of a double jeopardy. Other industries are in a similar position.
  Secondly, I wish to discuss retail price maintenance for over-the-counter medicines. About a third of my constituency is rural, and rural communities are worried about the survival of a good network of community pharmacies.
  I accept the argument that competition law should consider whether the restrictive practices court will find, as it did in 1970, that the existing system should continue, and that the retail price maintenance in that sector is justified because it maintains a network of community pharmacies. However, should the court find that it is not justified, the Government still have a responsibility to ensure that a network of community pharmacies continues to exist.
  The £4 million that is given to maintain essential community pharmacies is but a small part of what might be needed if retail price maintenance in that sector were removed. Taxpayers' money should not be used to subsidise large and successful businesses, and consumers should not pay over the odds, but a good network of community pharmacies in rural areas, and in deprived
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  urban areas without ready access to town centres, should be maintained. Although it is not the DTI's responsibility, I hope that the issue will be addressed in due course.
  Thirdly, I recognise that the Bill strengthens the position on predatory pricing beyond the status quo, which the official Opposition find satisfactory. It does so by introducing into British law the findings of the Tetra Pak European Court decision in 1994, which laid down that, if the average variable cost of a product is above the price charged, that clearly shows that there is predatory pricing. Many people are worried that the Bill will not do what was originally promised.
  One argument that has not been tackled this evening is that competition policy should take a common approach across all industries. If we accept that argument, clause 19 should not have been included in the Bill. If we want to take measures to ensure that we have a diverse and free press, it should be done not through competition policy but through some other legislation.
  That issue needs to be debated. I remain to be convinced that the Bill will strengthen competition in all sectors and tackle predatory pricing. If people think that that is the only issue concerning the media in general and the newspaper medium in particular, they are living in a fool's paradise. It is not the main thrust of our concern about how the media are managed, owned and operated in the UK.
  I assume that the Bill will receive a Second Reading. Many issues need to be tackled and debated in Committee, and I hope that the Government will take on board some of the comments that I have made.
  8.4 pm
  Mr. Colin Breed: I am happy broadly to welcome the Bill, which has been a long time arriving in this place. Some of us have been a long time waiting to make a brief speech about it.
  There can be no reason to legislate on competition, other than to deal with the balance between competing businesses and the impact on public interest. It is therefore essential that the notion of "public interest" is properly defined and understood. The public interest test, which should be the most important factor in determining the value, or even the relevance, of the Bill, applies to every sector that has been mentioned this evening.
  The previous Government believed that the market would always sort out the proper relationship between businesses, that, through that mechanism, consumers would ultimately benefit through price reductions, improved services and even product innovation, and that a strong and vibrant economy would be built up as a consequence. In theory, that is perfectly possible. It was applied to the then publicly owned monopoly utilities, which resulted in the exercise that we all came to know as privatisation.
  The theory ran that, if competition was introduced into those trading organisations, they would begin to function more efficiently, and would become much more responsive to their customers. It was rightly recognised that just floating the businesses into the private sector would not automatically introduce competition, but that consumers—and therefore the public interest—needed to be protected, and that it would also promote competition within the industry.

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  I do not have time today to consider in depth the rights or wrongs of privatisation, or whether it succeeded or failed, but there have clearly been great benefits and some disbenefits as those regimes have matured in today's market. Privatisation has provided us with an opportunity to examine in hindsight what we understand to be the public interest. This Bill—and, I suspect, future legislation—can be made more responsive to consumers' needs in both the short and medium term. Trying to predict the long term is impossible.
  It should therefore be expected that competition policy will have to be reviewed from time to time in the light of fast-moving events. Clearly, the narrow interpretation of public interest as relating only to the short-term price of goods and services, without considering the wider implications of competition and monopoly, is insufficient.
  In the absence of a proper definition, may I suggest a few essential elements that must be part of the public interest test, and thus part of how we review this extensive Bill? Those are efficiency and equity; and consistency and certainty. A more realistic view of legitimate public interest can therefore be established, and, most importantly, business can function in a secure and predictable environment.
  The public need to be protected in matters of health and safety, for which it is far easier to legislate, but it is much more difficult to legislate for the wider collective public interest, with which the Bill seeks to deal. It includes the need to counteract anti-competitive behaviour by businesses, and to ensure that all customers and consumers can freely negotiate fair terms with businesses that have or may have a dominant position in the marketplace.
  Just as the appointed regulators have a special role in maintaining a balance between certain businesses and consumers, so the Government, through competition policy, must hold in tension the legitimate commercial aspirations of business and the wider public interest. As the Bill sets out new rules for the regulators in the light of experience since privatisation, it must also address other competition issues in the light of current practice and experience.
  Competition regulation should not merely be about restrictions, but must actively and positively promote effective competition. It should encourage greater efficiency while protecting diversity. It should ensure equity between customers and business, so that the product of efficiency gains is shared fairly between shareholders and consumers. It should promote the use of new technologies, enable new investment to be made and new products and services to be introduced, to the benefit of both big business and the consumer. It should also enable new competitors to enter the market by ensuring that entry barriers are not erected by established businesses to prevent new competition.
  The Bill seeks to replace a considerable amount of current legislation, which I believe has served the public interest reasonably well. Although it is necessary to update existing law, it is vital that we do not abandon the aspects of fair trading and competition that still have a role to play, merely to make the legislation less complicated or to introduce new deregulation for its own sake.
  Some anti-competitive practices have already been highlighted in the debate, and no doubt they will be the subject of considerable discussion in Committee. I place on record my concern that, unless the Bill is more specific
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  about particular industries and services—we realise that some of them are unique in their influence or position in the United Kingdom market—this extensive and comprehensive legislation will be rendered ineffective when tested in the courts, as it surely will be at some time.
  It is impossible to provide a strong and coherent competition framework through a series of general clauses that try to cover every possible commercial activity. Nor would it be sensible to rely solely on the fact that the Bill falls into line with existing European law, most of which is inappropriate and untested in the British courts. The commercial marketplace in this country has developed and progressed along totally different lines from most of Europe, and has been subject to different regulation. In some ways, we are far ahead of Europe; in others, some way behind. Some aspects of our social and community life can be regulated only by discreet and individual attention.
  Our national newspaper industry is unique. It provides us with benefits, but also causes some disquiet. To say that it can be controlled through European legislation alone is naive. Similarly, the growth of food retailing in this country has been an almost overnight revolution. It has developed in a completely different way from European markets, although some, notably in France, are experiencing similar and familiar problems.
  I have no doubt that supermarkets have brought consumers many benefits, with lower prices, greater choice and convenience. Only now are we beginning to experience some of the problems. The dominance of a few large supermarket chains is beginning to have an enormous effect on our communities. That is a good example of the way in which our understanding of public interest has changed. Other considerations must be taken into account when determining what public interest means.
  Lower prices through competition are to be encouraged, but not at all costs. That applies to all competitive markets. A narrowly defined public interest that uses the simple test of low prices as the only measure of whether the public have benefited, especially in the medium term, is unlikely to satisfy the aims of the Bill.
  If the Bill is to achieve its purpose, to ensure that the public interest is protected and enhanced, it will require a degree of bravery and honesty that the Government have not so far shown. They will have to oppose highly skilled, extremely well-funded, and profoundly influential vested interests. They will have to face up to those vested interests on behalf of the whole country. That will almost certainly bring them into conflict with some major commercial concerns, and that may be very uncomfortable.
  The Prime Minister is fond of saying that tough decisions must be made—lone parents know that only too well. The time has come for even tougher decisions to be made in the national interest, and I hope that the Government will not fail the test.
  8.15 pm
  Dr. Phyllis Starkey: Like my hon. Friend the Member for North Swindon (Mr. Wills), I am unsure of the argument that the Opposition have been trying to make, although I have been listening carefully. Unlike him, however, I did not find many of the anecdotes amusing, mainly because they were rather laddish. That is a common failing of Conservative Members.

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  The Bill is eminently sensible. During the debate, the Opposition have been busy manufacturing ever more improbable scenarios to try to show that the Bill poses a great threat to British industry. However, the absence of that threat is shown by the fact that the representative of the Confederation of British Industry who is supposed to be advising them on the Bill has deemed the threat to be so tiny that he is not bothering to be around today: he is on a course and is obviously using his time more effectively.
  Mr. Boswell: The hon. Lady's anecdote about the CBI is interesting, but does she concede that, before disappearing on that course, about which I know nothing, the CBI adviser submitted seven major points of concern that remain outstanding, despite the consultations that the CBI had with the Government on the Bill?
  Dr. Starkey: The CBI provided all hon. Members with a brief. The CBI broadly welcomed the Bill, although it made one or two minor points. That hardly shows that it believes the Bill to be the enormous threat that the Conservative party is making it out to be.
  I shall keep my remarks brief. I merely want to emphasise the positive measures to provide effective competition legislation, and the importance of such legislation for small and medium businesses. Those hon. Members who know my constituency will not be surprised to hear that I am interested in such businesses. Milton Keynes contains a small number of large employers, including foreign multinationals that are active in the town, but the strength of the local economy is the hundreds of small and medium enterprises that have between one and 50 employees.
  I have not visited all the companies in my constituency, but I intend to do so. I have been struck by their ingenuity in exploiting many different markets and in developing new markets. A high proportion, including some of the very small companies, are exporters and export all or most of their products, often into Europe but also to the rest of the world. Those companies, which are incredibly important to the local economy, have two major concerns which will be addressed by the Bill.
  Those businesses, by their very nature, are highly competitive. They are entirely satisfied if they are competing on a level playing field, but they deeply resent larger companies in particular using uncompetitive practices to reduce the advantages of small companies.
  I welcome the proposal in the Bill to enable the Director General of Fair Trading to stop restrictive practices straight away, instead of waiting as long as nine years—as the President of the Board of Trade stressed in her opening remarks—before making a decision, as happened under the previous Administration. Nine years is several lifetimes for small firms. In that time, such firms attempting to compete in a climate of unfair practices would go out of business.
  It is important for small and medium firms to have effective sanctions that can be implemented immediately to stop such practices, and firms that are damaged by them should be able to obtain recompense. Those matters have not been given the prominence that they deserve, because the Opposition have focused mainly on the bits of the Bill that they do not like.
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  Large and small businesses in Milton Keynes will welcome the simplification of bureaucracy, especially the move towards making UK legislation more consistent with that in Europe. As I have said, many firms in my constituency trade extensively within the European Union, and it is incredibly irritating for them to operate one set of rules and regulations in the UK and a completely different set in the rest of the EU. I am sure that they will welcome the move towards making the rules more consistent.
  The previous Government engaged in extensive consultation on competition legislation. The Labour Government have also consulted, but the difference between us and the Conservatives seems to be that, having consulted, the previous Government decided to do nothing, whereas we have decided that it is best to produce legislation that will, for the most part, be widely welcomed by all sectors of business.
  8.21 pm
  Mr. Alasdair Morgan: I shall try to be brief, as many hon. Members wish to speak.
  I suspect that many hon. Members were dismayed by the Bill's size and complexity. In the mid-1960s, one lecture in an applied economics course sufficed to cover the Restrictive Trade Practices Act 1956, a measure that has long since gone the way of all flesh. The increasing complexity of legislation is shown by the fact that about a third of the Bill repeals or amends earlier legislation. Early legislation had little such repeal or amendment. It is incumbent on us as legislators to make sure that we fully understand the consequences of the Bill.
  I shall deal briefly with some selective concerns. I think that the hon. Member for Eastleigh (Mr. Chidgey) mentioned the professions, but apart from that they have not been dealt with in detail. In a debate in the other House, George Bernard Shaw was quoted:
  "All professions are conspiracies against the laity."
  I do not go quite that far, but we must recognise that not all professional rules are introduced for the benefit of the public; some of them are for the benefit of the profession.
  Paragraph 5 of schedule 4 places a duty on the Director General of Fair Trading to keep a list of the rules and to keep it under review. I remain to be convinced about the effectiveness of that procedure. Schedule 4 should contain more about the frequency of the reviews and about the criteria that will be employed in them.
  We need more explanation about the professions that are included in schedule 4 and about those that have been omitted. The National Consumer Council asks why solicitors are included while estate agents are not, although there is a considerable overlap, certainly in terms of the contact that people in those professions have with the public. The Law Society of Scotland asks why notaries public are excluded from the list. They perform important functions in Scotland.
  The subject of community pharmacies has been much canvassed and is potentially serious. I do not agree with the Opposition, whose reasoned amendment suggests that they wish to reject the entire Bill simply because it is deficient on the matter of community pharmacies. Of course, when the Government have a majority of 179, the Opposition have the luxury of being able to say what they

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  want in an amendment because they know that it will not be accepted. As the hon. Member for South Ribble (Mr. Borrow) said, community pharmacies fulfil a real need not only in rural areas but in many urban areas. Services that are not always available from hard-pressed general practitioners, who are inevitably less skilled in such areas, may be obtained from pharmacists. In many areas, the people who are least able to get to a supermarket or to another pharmacy will benefit from local advice. At the most recent meeting of the Scottish Grand Committee, we heard about pharmacies that are closing, so that problem is with us here and now.
  I accept that it could be said that all pharmacies depend solely on profits from the sale of over-the-counter medicines. They are not, but there is no doubt that some large, profitable pharmacies do very nicely, thank you very much, from the vastly inflated prices of over-the-counter medicines. Equally, many small pharmacies in rural areas and in some urban areas are on the margin and inflated profit on such medicines makes the difference between viability and failure. It is valid to argue that artificially keeping up the price of goods is the wrong way to ensure the delivery of a social service.
  The new Government are falling over themselves to keep to Tory spending limits, and they are totally obsessed with the public sector borrowing requirement. Will the Department of Health find the extra money to keep pharmacies going? Some money goes to the essential pharmacies scheme, but I do not think that the Government will find the extra money that is necessary to replace profit support. Perhaps a small anomaly in competition policy would be a small price to pay to keep valuable social services going. It will be too late to fix the problem when the pharmacies close, because they will not reopen.
  Many of us have been lobbied about a matter that I do not think has been mentioned. It certainly came up in debates in the other place on the Bill. It is the issue of look-alike products. Some manufacturers imitate the packaging of a brand leader so that people buy the wrong product. The Government have said that they do not think that that is an apt subject for the Bill and that there are other ways to deal with it. Have they had further thoughts on the matter? It is clear that the industry does not agree with the Government that the existing legal system is satisfactory, despite the judgment in the Penguin v. Puffin case of look-alike biscuits. Many jobs and much investment are tied up in existing brands, and, just as it is wrong for the manufacturers of branded goods to keep prices artificially high through vertical agreements, it must also be wrong for such firms to be undermined by competitors that are almost counterfeiters.
  The Competition Commission will replace the Monopolies and Mergers Commission. The MMC holds hearings in Scotland to take evidence. Will the Minister confirm that the new commission will be enabled to do that?
  On the issue of newspapers and predatory pricing, we heard much about the philanthropy of Mr. Rupert Murdoch in lowering the price of his newspapers. I am sure that that is his main motivation, as the right hon. Member for Kensington and Chelsea (Mr. Clark) implied. We have a slightly different situation in Scotland, because another couple of broadsheets there, The Herald and The Scotsman, have largely been able to keep The Times at bay, but it is a difficult matter. We all recognise that
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  many of these publications operate fairly much at the margins and that the profits to be made are not large, so anything that puts their existence in potential peril is a likely problem.
  The President of the Board of Trade said that the Bill strengthened competition law, and argued with some justification—we have heard contributions to this effect—that the amendment to clause 19 which was added in the other place was badly worded and would prohibit behaviour that was simply part of normal competition. However, if that is true, she has to say—because there is a problem here, which has been graphically described by Labour Members—whether the Bill is strong enough to stop predatory pricing and the other tactics of Mr. Rupert Murdoch. I do not think that that case has yet been made. The Government will have to make that case strongly before hon. Members who feel as I do vote to delete the amendment.
  8.30 pm
  Dr. Ashok Kumar: Thank you, Mr. Deputy Speaker, for calling me on Second Reading.
  I am fully committed to the general principles of the Bill and will vote for it tonight. However, I want to make some general comments and then dwell on two aspects of the Bill that cause me particular concern. The first is the vexed issue of neighbourhood community pharmacies, which have been mentioned by the hon. Member for Galloway and Upper Nithsdale (Mr. Morgan), and the possibility of the end of resale price maintenance on over-the-counter medicine. The second is part II of schedule 4, which attempts to define engineering disciplines, which have been mentioned by the hon. Member for Eastleigh (Mr. Chidgey), the Liberal Democrat spokesman. It is at best confused, and it certainly needs reviewing.
  It is noteworthy that, despite the fact that the last Tory Government spent much time circulating discussion documents on competition issues, in the time they were in power they made no attempt either fully to draft or to enact any legislation to control abuses of market power, cartelisation or monopoly. It is this Labour Government who are doing that and who are standing up for the consumer. For that, they will, in general, be warmly thanked by both consumers and industry.
  That is not to say that there are no contentious issues. In a complex society and diverse marketplace as ours, there are bound to be anomalies. It is on two anomalies that I want to dwell. These issues are not trivial, but important in themselves. They are not aimed at undermining the Bill's central thrust, but they need serious, diligent and robust examination in Committee.
  There is no doubt that community pharmacies are a contentious issue for many people, not least small pharmacists and the people who depend on them. My constituency is largely rural, with a hinterland of small ex-mining villages and market towns. Unemployment is high, and there are many villages where many people are not wealthy and where car ownership is very low. In some villages, about 45 per cent. of people—no more than that—own cars.
  Those villages are located a long way from the main shopping centres. Public transport access to the main towns of Middlesbrough and Redcar can often involve a

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  long bus journey of up to an hour. If local pharmacy services did not exist, a constituent—say, a mother with a child—might have to fork out more than £4 just to get some simple medicine. Luckily, because of the work of successive local health authorities and trusts, aided, I must say, by the local council, almost all those villages have a functioning general practitioner surgery service.
  Those surgeries and clinics are linked to a number of small local pharmacies. All those without exception are fearful of the impact that ending RPM on over-the-counter medicines would have on their shops, on their future and, perhaps more important, on their service to the community. They are concerned that, without RPM, they could lose that vital margin that supports the drug and medicine prescription service to their customers.
  Mr. Letwin: Will the hon. Gentleman give way?
  Dr. Kumar: No. I have a short time, and I know that other hon. Members want to speak.
  The people who will really suffer will be those who most need the services of local chemists: the elderly, mothers with young children, disabled people and carers. By definition, those people are among the least mobile in our community.
  This is not only a local, but a national problem. The community pharmacy action group estimates that, nationally, 3,000 local chemists would have their economic future put in jeopardy. That prediction is based on the conservative estimate that, without some form of RPM, 20 per cent. of customers with access to personal mobility would switch from using their neighbourhood chemist to supermarket chains. That conservative figure is shadowed by what I call a "worst case" scenario, based on an Office of Fair Trading poll, which showed that some 36 per cent. of people are prepared to make the switch to the supermarkets.
  Local pharmacists make a real difference to the work of local GPs and community nurses. They do not act just to make up medicines and sell proprietary drugs. They assist local people with expert help and expert knowledge and give free advice on common health problems. They lighten the burden on already overworked GPs, GP nurses and receptionists. They act as a vital part of the community health network.
  Again, the community pharmacy action group estimates that, if just one tenth of people who treat themselves with medicines that are bought on advice from their local neighbourhood chemists, were instead to go to their GP, an additional bill of some £4.7 billion would fall on the national health service—and that in the crucial sector of local primary health care.
  Those are real fears. I recently spoke to one small pharmacist in Loftus in my constituency about the matter. He said:
  "Over 75 per cent. of my turnover is accounted for by NHS work.
  The profit margins for this work are constantly being narrowed as remuneration packages from the NHS Executive become tighter.
  I am kept afloat by RPM on over the counter medicines, and if that goes then the floodgates will open.
  The concentration of initial sales in the hands of big supermarkets will mean the loss of vital local knowledge, and the loss of personal relationships with people who have come to depend on me.
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  I am also fearful that involvement by the supermarkets could well be aped by smaller discount shopping chains and by newsagents.
  This is something that could well mean the promotion and sale of a cocktail of drugs to local people and the involvement of totally inexperienced people in the sale of medicines and the giving of advice."
  Those are not mere abstractions conjured out of the air by pressure groups, but the views of men and women who are involved in delivering a community service, as well as running a business—people who both employ staff and have the confidence of local people. We cannot afford to lose that.
  The Labour Government are tackling the inherited problems in the NHS that were left to us by the previous Government. The announcements over the past few months, weeks and, indeed, days by my right hon. Friend the Secretary of State for Health have meant a lot for the NHS, for the country's good health and for my constituency in particular. There is no logical reason why those gains for the NHS should be negated by the effects on community pharmacists, such as those I quoted, of ending RPM.
  It is for that reason alone that I urge the Government to think carefully. They should think carefully about the real strength of feeling that was demonstrated by the success of the amendments sponsored and supported by peers of all parties and by Cross Benchers in the other place.
  I totally agree that we should aim for a society where competition is on a level playing field. However, that famous playing field must represent the genuine interests of local people and local communities. In this case, I believe that most people would back the little man or woman and the needs of local communities above the need to conform to rules that merely benefit the multiple trader and the out-of-town hypermarkets—rules that benefit the big boys and disadvantage local communities.
  I want now to deal with another issue, relating to schedule 4, which gives a definition of trades and professions. In particular, I am concerned with the paragraph headed "Engineering", which, as currently drafted, is a dog's dinner. Originally, I thought that I wanted to speak as someone trained as a chemical engineer. That is an important profession serving, disproportionately, successful elements of British industry and technology—elements vital to our economic future. Chemical engineers are the backbone of the chemical, oil, gas and pharmaceutical industries. They also contribute to a successful food industry and help to sustain Britain's process engineering capability. That area of professional engineering is left out of the schedule.
  I had intended to protest about that, but, as I looked through the schedule, I felt more and more that what was needed was not something that might be seen as professional pique; other areas of engineering competence have also been overlooked. Hon. Members who might come from other occupational or professional sectors have as much right as I have to ask for the inclusion of their professions.
  What is needed is a root-and-branch revision of this part of the Bill. I do not think it appropriate to include activities such as forestry, livestock rearing or agronomy under the heading "Engineering". That is absurd. I do not deny that they are important occupations, with their own forms of accreditation, but they are not engineering functions—although they certainly rely on engineers to carry them out.

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  The sensible approach would be to reorder and revise the schedule to make membership of or accreditation to a professional body the qualifying factor. In engineering, 16 distinct bodies are recognised by the charter as representing areas of expertise. A corporate member of one of those institutions can be recognised as fully qualified to practise that profession. He can be viewed as someone working within the discipline of his professional body in terms of competence and knowledge. The law and, indeed, society recognise the standing of the professional engineering institutions. They hold royal charters and often have up to 150 years of experience in upholding professional standards. I suggest that they be viewed as the appropriate qualifying bodies for the purposes of the schedule.
  That leaves those occupations and professions mentioned in the schedule that are not engineering-related. Those such as metallurgy, biochemistry and physics can have wide boundaries, but they should be treated similarly, so that someone's membership of a suitable qualifying professional body becomes the mark of accreditation.
  I will not go into detail now, but under the catch-all heading of ecology, membership of the Royal Town Planning Institute or the Institute of Wastes Management could be relevant. Other academic qualifications cover people offering services as diverse as livestock rearing, agronomy, mineralogy and geology, which I am sure will provide a suitable benchmark for recognising competence.
  When the Bill goes into Committee, those elements should be examined closely. An accurate schedule will prevent heartache later. It will help to prevent charlatans and unqualified people from gulling consumers and small businesses. It will give confidence to those who need professional expertise and guidance so that they can be sure of the qualifications of those whom they might employ or engage. If things go wrong, it will give them the knowledge and comfort that they can seek redress not just through the law, but by bringing an incompetent or fraudulent person to account through action by his professional body.
  I hope that my points about the need to keep a flourishing community sector and the need for clarity in defining professional status are borne in mind by my hon. Friend the Minister.
  8.44 pm
  Mr. Peter Brooke: I congratulate the hon. Member for Middlesbrough, South and Cleveland, East (Dr. Kumar) on an eloquent speech outlining the interests both of his constituents and of his profession. For 18 years before entering this House and joining the Government, I was involved in a small company that employed 10 people when I joined it and 200 when I left. It was the sort of business that the hon. Member for Milton Keynes, South-West (Dr. Starkey) looks at when she goes round her constituency.
  My speech today is a bare-faced bid to serve on the Committee. I make it with no great optimism, as my last two such bids, since I served on the 1996 Housing Bill, have failed. In the last Parliament, my offer to serve on the Crime (Sentences) Bill was rejected by my Whips Office—I suspect on the ground that my voting pattern would not have been wholly reliable. In this Parliament,
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  my offer to serve on the Wild Mammals (Hunting with Dogs) Bill was rejected, presumably on the grounds that my constituency is used more for country sports rallies than for country sports themselves.
  On the basis of the Bill's progress in the other place, where there were only three Divisions in more than four months of debate, the Bill is clearly not wholly controversial. In passing, I have to say that I am not surprised that the Government periodically lose votes in the other place, as I note that on the two substantive Divisions, more than 70 of their Lordships voted in one or other of the Divisions, but not in both. If the Government cannot get their troops into the Lobby, they are likely to lose Divisions. The Bill began in the other place on 30 October and did not leave it until 5 March, since when another two months have elapsed. That suggests that it is one of those Bills about which Mr. Sherlock Holmes might have said, "These are deep waters Watson." Either that or the Government are having some difficulty with their legislation.
  Lord Simon of Highbury alluded on Second Reading on 30 October to the fact that some competition inquiries had taken as long as nine years. Those longueurs seem to have infected the Bill. The scale of support on the Labour Benches for the President of the Board of Trade when she opened the debate suggests that the Government are at least marching towards the sound of gunfire—but I hope that the Treasury Bench will forgive me if I say that the Government have not been marching very fast. Perhaps competition is not as clarion a call for the Government as they would wish us to believe.
  I served on the Committee stage of the 1978 Companies Bill, the last such Bill brought in by Labour before 1997. Both the Ministers who led the Committee are still in the House—the current Minister for the Environment, the right hon. Member for Oldham, West and Royton (Mr. Meacher), and the right hon. Member for Caithness, Sutherland and Easter Ross (Mr. Maclennan), in his prior party guise. There were moments when their utterances served as a harbinger of the comments of my hon. Friend the Member for West Dorset (Mr. Letwin) about the Bill. On our side we were, apart from myself, a distinguished octet. Five of my then colleagues now serve as Privy Councillors in another place, all having served in government. Only my right hon. Friend the Member for South Norfolk (Mr. MacGregor) sits in this House. Sadly, and finally, that notable and idiosyncratic Back Bencher, the late Sir Brandon Rhys Williams, died a decade ago.
  The relevance of that Committee stage was that it sat 24 times for two and a half hours each without ever sitting other than in the morning. It could not be said of the Government Whip that he drove us, as Raymond Asquith said of a chauffeur in the early days of motoring, with the passion of Shelley and the precision of Pope—although I was happy to be reminded through the bizarre suggestion of my hon. Friend the Member for North Swindon (Mr. Wills), who I regret has left the Chamber, that the last Government had not injected dynamism into the economy, of the great late Ian Mikardo's comment on that Committee about the woman who said to the Duke of Wellington, "Mr. Smith I presume," to which he responded, "Madam, if you will believe that, you will believe anything."
  My other aspect of continuity is that more than 40 years ago, in the first year of a postgraduate degree at the Harvard business school, I became saturated in American

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  anti-trust law in a course known by the unlyrical acronym of BRAS—which stood for business responsibilities in American society. Even earlier, I had met Lord Borrie, who was a distinguished treasurer of the National Union of Students when I was an improbable member of the NUS executive.
  This bid to serve on the Bill's Committee stage is effectively a non-speech, but even a non-speech must have structure, and mine has 11 points—reflecting the tendency to see all life through a filter of cricket—although the House will be glad to hear that I have already made the first seven.
  When I spoke on the Finance (No. 2) Bill's Second Reading, I essentially addressed Committee points, although I was not seeking to serve on that Bill's Committee stage. However, I do have a constituency interest in this Bill, which will give rise to genuine constituency points. I have a constituency interest in the Bill not only because I have a business constituency—with as many businesses as households in the W1 postal district, and 50 times as many employees as electors in the City of London—but also because of those who have written to hon. Members about the Bill, to whom other hon. Members have alluded in this debate.
  British Music Rights, to which the hon. Member for South Ribble (Mr. Borrow) referred; the British Brands Group, to which the hon. Member for Galloway and Upper Nithsdale (Mr. Morgan) referred; the Community Pharmacy Action Group, to which almost everyone has referred; and the Association of Solicitor Notaries in Greater London are all my constituents, as are the Worshipful Company of Scriveners, about whom the solicitor notaries wrote. Although the Confederation of British Industry is not my constituent, it is right on the border.
  What the Bill patently needs is highly detailed scrutiny, on the same scale as it received in another place. Although I share with my hon. Friend the Member for West Dorset a concern about how amenable the Bill will be to improvement, given the form that the Government have conferred on it, our job—the Committee's job, if we are privileged to serve on it—is to make it work better than it currently promises to do.
  There is nothing in this speech for the Minister to reply to, not least as my coming on the Committee will not be for him. For myself, I have never served as a Department of Trade and Industry Minister, which in some ways seems the most persuasive credential to put forward in offering myself for the Committee.
  8.51 pm
  Dr. Stephen Ladyman: I, too, shall try to keep my comments brief—largely because many of the points that I had planned to make have already been made, but also because I think that the need for the Bill is self-evident. Our economy operates in a single market. It therefore seems clear that that market should operate within the framework of a single competition strategy—which is essentially what the Bill is intended to provide by bringing us into line with the European Union.
  The Bill would introduce other major improvements to United Kingdom competition law—not the least of which is that it would give officers powers to act immediately
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  when they perceive some irregularity, rather than obliging them to wait for the conclusion of a lengthy investigation. As right hon. and hon. Members have already said, such delay has often led to businesses going bankrupt before they can be helped by regulation.
  The Bill would also improve powers to enforce regulations.
  The Bill's main improvement on current competition legislation—about which the right hon. Member for Kensington and Chelsea (Mr. Clark) seemed to be somewhat confused—is to replace the need to prove intention with a simple mechanistic process in determining issues such as predatory pricing.
  The hon. Member for West Dorset (Mr. Letwin) asked a question on the simple mechanistic process. To answer his question, I simply quote the European Court of Justice's Tetra Pak judgment—which is specifically dealt with in clause 60 and must be considered by both the commissioner and the courts in determining the operation of predatory pricing:
  "Where an undertaking fixes its prices at a level below average variable cost, it is to be conclusively presumed that the undertaking's purpose was to harm its competitors."
  How can one argue that that is not a mechanistic means of determining the existence of predatory pricing?
  Mr. Letwin: I repeat the question: if the European Court of Justice intended—or if the Bill will have the effect of making British courts conclude—that any action in which a firm charges below average variable costs is, ipso facto, unfair pricing rather than pricing that is trying to harm a competitor, will not vast swathes of British industry find themselves, in current conditions, in default of the Bill?
  Dr. Ladyman: I do not accept that argument. The judgment—to complete the argument that I was trying to make when the hon. Gentleman intervened—uses the words "conclusively presumed". There is therefore no question of "on the one hand" and "on the other hand" in the matter. Predatory pricing will be conclusively presumed if the test is met.
  A second passage in the judgment dealt with a second part of the test in determining predatory pricing. The court stated:
  "Where an undertaking fixes its prices at a level above average variable cost but below average total cost, its conduct is to be regarded as predatory only where there is independent evidence"
  of intention.
  I therefore believe that the Bill's other clauses, and the Tetra Pak judgment, will offer adequate protection—which we will undoubtedly scrutinise during the Bill's Committee stage. Nevertheless, I believe that the Bill—by removing the need to prove intent and adopting a mechanistic approach—will considerably strengthen United Kingdom competition law.
  Opposition Members cannot have it both ways. The right hon. Member for Kensington and Chelsea seemed to be arguing in favour of a mechanistic approach. If other Opposition Members want to argue in favour of the opposite approach, they will have to resolve that personal argument among themselves.
  I believe that the Bill's mechanistic approach will also deal with the issue of predatory pricing among newspapers, thereby making clause 19 unnecessary.

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  I agree strongly that—as a Government and as a Parliament—we have to examine the framework within which the United Kingdom media operate. I should be very interested to scrutinise a media Bill dealing with the structure of newspapers and other media. There is great demand for such a Bill, but we will not build an appropriate regulatory framework for the media in a Competition Bill, and it is wrong to expect this Bill to sort out all the problems that we think there might be in the newspaper and broadcasting industries.
  Clause 19 not only tries to provide something that the Bill already provides: it would also introduce various dangers—two of which I have already dealt with in interventions earlier in the debate and will not repeat. However, one other possible danger lies in clause 19(2)(b), which states:
  "other action which may reduce the diversity and independence of the national newspaper press".
  That provision might be interpreted as meaning that newspaper bingo, for example, constitutes unfair competition. Newspapers might be taken to task over bingo. You may argue that a law that makes newspaper bingo illegal is inherently a good thing, and I might even agree with you, but I would not agree on the basis of competition law.
  Mr. Deputy Speaker (Mr. Michael Lord): Order. The occupant of the Chair has no view about newspaper bingo. The hon. Gentleman is using the wrong parliamentary language.
  Dr. Ladyman: I am grateful, Mr. Deputy Speaker, and I apologise.
  Clause 19(3) defines "dominant position" only as a company that holds a dominant position
  "in the national newspaper market".
  The subsection would introduce another restriction, as we may want to examine a company's dominant position in the media industry as a whole, including its ownership of other types of media. Clause 19 is not only unnecessary but introduces dangers, and it needs to be removed.
  Like others, I am greatly concerned about community pharmacies. I stress that we are talking about community pharmacies, not rural pharmacies; some hon. Members seem to use the terms as though they are synonymous, but we should not lose sight of the fact that many pharmacies in urban areas also need support. Retail price maintenance is not necessarily the best way in which to help them. The Department of Health has a big task ahead in reviewing the way in which we support pharmacies in locations that may not be commercially viable.
  My right hon. Friend the President of the Board of Trade said that it is estimated that retail price maintenance costs the consumer an extra £900 million. Only a small part of that sum goes to community pharmacies; the bulk still goes to the main hypermarkets and supermarkets. I note in passing that, according to the Library research paper, the Asda supermarket chain made two attempts to break the retail price maintenance agreement and was stopped only by injunctions, so I wonder whether Conservative Members will be entirely unanimous on the amendment tonight.
  Mr. Roger Gale: I do not think that Pfizer in Sandwich, which employs a lot of the hon.
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  Gentleman's constituents and a lot of mine, would be too pleased at the abolition of retail price maintenance. That aside, what will the Bill, which the President of the Board of Trade said was in the interests of consumers, do to protect the small chemists of Thanet?
  Dr. Ladyman: Pfizer, which is my former employer, will not be hurt in any way by the reduction of retail price maintenance, because it will continue to sell through other chains. I agree entirely that the Bill does not introduce the support that is necessary for community pharmacies. My argument is that the Government must give an undertaking that the Department of Health will examine the way in which pharmacies are to be remunerated, then retail price maintenance can go and the consumer will benefit.
  As I understand it, the commissioner will be able to recover fines imposed through the legislation as civil debt. Perhaps my hon. Friend the Minister will comment on that. That may be an important improvement because, whereas civil debts imposed through a court can be enforced across European boundaries, criminal debts, such as fines on companies, cannot. In my constituency, two Swedish companies that were found to be responsible for the Ramsgate walkway disaster are refusing to pay their fines, and there is absolutely nothing that we can to about it. If the Bill remedies that, it will certainly be a great strengthening of competition law and the means by which we enforce it.
  9.3 pm
  Mr. John Bercow: I begin with something that may come as a surprise to the House, and especially to the Minister: I congratulate the Government. I believe that, on one issue, they are right. Indeed, I shall go so far as to employ the term favoured by the Prime Minister himself: they are absolutely right to resist the McNally amendment. I am sorry that the President of the Board of Trade came under sustained assault from Labour Back Benchers, because the Government's position is correct.
  Predatory pricing is already illegal. There have been three recent inquiries into alleged predation, and, on each occasion, it has been demonstrated to the authorities' satisfaction that that predation had not taken place. The hon. Member for North Durham (Mr. Radice) said that the most recent investigation was in 1994. I hope that he will forgive me if I suggest that he is mistaken: an inquiry in September 1996 arrived at the same conclusion as the previous two.
  I wondered which Minister would take it upon himself or herself to upset old Labour by being the bearer of bad tidings about the Government's intentions; the President of the Board of Trade began the bad news, and no doubt the Minister of State will conclude it.
  I was genuinely saddened by the response of the hon. Member for Sunderland, South (Mr. Mullin). I said to him that, if it was Mr. Murdoch's intention to extinguish all his competitors, he had presumably been unsuccessful, because, over the past six years—since the year before the first inquiry—the broadsheet market has expanded by 14 per cent. The hon. Member's response was pitiful: he said that it would take time and that Mr. Murdoch was—I think he used these words—"working on it".

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  Subsequently, the hon. Gentleman said that he was interested not in Mr. Murdoch's motives but in the effects of his behaviour. He cannot have it both ways: the effects have been entirely benign. Labour Members who are opposed to Mr. Murdoch cannot keep shifting the goalposts: the rules are there, the investigations have taken place, and Mr. Murdoch's behaviour has been adjudged to be entirely proper. I hope that the Government will remain firm. The Minister will have some unlikely allies on that aspect of the Bill, if not on others.
  My view on vertical agreements is rather less friendly to the Government. The President of the Board of Trade pronounced on the subject last August. The Confederation of British Industry had said that most such agreements were benign, and the Brewers and Licensed Retailers Association had said that, if the Bill were to scrap the beer tie, it would be "disastrous", with the closure of thousands of pubs and the destruction of tens of thousands of jobs.
  What was the response of the President of the Board of Trade? She said:
  "I see a good case for excluding most"—
  not many, some, or a good proportion, my right hon. and Friends will note, but most—
  "vertical agreements from the scope of the Bill".
  She went on proudly to say that that was
  "something that I know business will welcome."
  It was reasonable to infer from that statement that the Government proposed to define what constituted a vertical agreement and to list the specific agreements currently obtaining that they considered acceptable and which would therefore be excluded from potential discrimination under the terms of the Bill. Despite that statement, made last August, and despite the fact that the Bill received its Second Reading in the other place 193 days ago, and completed its stages there 67 days ago, the Government have still failed to come up with a list. That is a pretty unsatisfactory state of affairs, and I hope—even now, at the 59th minute of the eleventh hour—that the Government will improve on it.
  Several hon. Members have talked about community pharmacies. I agree with those on both sides of the House who have argued for the continuation of existing treatment, but I have an objection to the speech of the hon. Member for South Thanet (Dr. Ladyman), to which I listened carefully. It is not good enough for him to say that he does not believe that retail price maintenance is the only means by which to protect community pharmacies, rural or urban—to argue by advocacy—unless he can argue in favour of an alternative that the Government can reasonably be expected to support and implement.
  In reality, the essential small pharmacies scheme, which is sometimes touted as a saviour for those beleaguered entities, supports only 286 pharmacies. Conservative Members are concerned about the threat to 3,000. In the other place, Baroness Jay of Paddington said that the Government were neutral about the impact of retail price maintenance abolition and the effect of the Bill. I must tell the Minister of State that I am not neutral about the impact on pharmacies in my constituency, and my right
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  hon. and hon. Friends are not neutral, either. We will demonstrate our firm support for community pharmacies by the way in which we vote tonight.
  The hon. Member for Galloway and Upper Nithsdale (Mr. Morgan) raised the important issue of look-alike products. The Government have said that they do not think the Bill is the appropriate place in which to treat that issue. I do not necessarily disagree, but the Minister should know that the British brands group has argued that lookalike products have two effects: they cause confusion, and they allow those who deal in them a free ride on the investment and innovation of other companies.
  Those effects are serious. In a recent survey, 17 per cent. of people said that they had purchased look-alike products by accident, and, in a survey of purchasers of four specific products, between 42 and 52 per cent. thought that the look-alikes were probably or definitely made by the manufacturer whose brand the products resembled. There is a regrettable intention to deceive, and I ask the Minister of State to reflect on a matter that is not a party political issue. The British brands group considers existing remedies inadequate, so, if the Minister considers that the matter cannot be dealt with here, how can it be addressed?
  The Minister of State, Department of Trade and Industry (Mr. Ian McCartney): My hon. Friend the Minister for Competition and Consumer Affairs has met interested parties to discuss the matter. There is no common agreement about the way forward, but we have asked them to come up with proposals to deal with the matter. We are all keen to find a way to prevent individuals, companies or groups of companies from undermining the capacity of other organisations to sell their goods in the marketplace.
  Mr. Bercow: I am grateful to the Minister for his constructive and forward-looking response. I do not want to rehearse the issue further, but I am glad to know that the organisations and spokesmen concerned are still in the tent and discussing future resolutions of the problem.
  Another issue that concerns me and others involves powers of investigation, scope for representation of those who are accused of offences, and fines. The CBI has said that the powers of investigation are excessive. The distinguished firm of lawyers Clifford Chance has said that no case has been made for such greater powers. We are talking about entitlement to confiscate documents and to take away computer records for up to three months. There is a question whether investigators—who, in some cases, must break into properties—may take away original documents that might impact on or damage the businesses that are being investigated. That is a legitimate matter of rights and the balance of what is appropriate. I ask the Minister to respond to that point.
  Mr. Letwin: Will my hon. Friend give way?
  Mr. Bercow: I hope my hon. Friend will forgive me if I do not. Other hon. Members wish to speak.
  I am concerned about proposed fines, the level of which is arbitrary. I ask hon. Members to consider whether it is right to import the criminal law to this area of commercial activity. It may be right, but I am not persuaded. The onus is on the Government—Back Benchers, not just

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  Ministers—to make the case, and it is not clear to me that such a case has been made. People accused of offences should be accompanied by a legal representative to a hearing conducted by someone who is not involved in day-to-day investigation of such cases. If the rights of the person accused are to be protected, it is vital that proper neutrality is established and upheld throughout the process.
  The motives of the Bill may be good, but the content is poor. I judge it so far to be ill prepared and potentially hazardous. As it stands, it is unfit for human consumption, and on that basis I will go with relish into the Lobby to oppose its Second Reading.
  9.14 pm
  Mr. Nigel Beard: It is useful to consider where the Bill fits into the general pattern of economic policy, because it is about more than newspapers.
  Businesses generally react to unregulated markets by curtailing competition to eliminate risks and increase profits. The consequence is limited customer choice and the concentration of market power into fewer and fewer hands. Central planning, nationalisation and detailed regulation have been regarded as answers to the unaccountable power of large monopolies and the adverse consequences of unregulated laissez-faire markets. That approach has proved too cumbersome and inflexible to match the supply of diverse goods and services to the subtle and fluctuating demands of citizens in modern democracies.
  Competitive markets have proved to be the only way to secure an evolving, detailed match of supply and demand. The problem is that some business consolidation and co-operation, though tending to diminish competition, may be justified if an economy is to evolve and grow through improved productivity and innovation. The role of competition legislation is therefore to arrest the natural tendency towards the erosion of competition while leaving adequate scope for businesses to adapt to changing circumstances.
  There is a clear consensus that the Restrictive Trade Practices Act 1976 did not work. It was complex, riddled with anomalies and more a matter of form than of substance. It wasted time and effort without preventing anti-competitive behaviour. The Bill reflects a fundamental change from targeting the symptoms of anti-competitive behaviour, which were often misleading. It sets out clear principles directly related to what it is intended to achieve.
  First, any anti-competitive behaviour should be prohibited. The only basis for commercial advance will therefore be the satisfaction of customer demands. Secondly, it will prohibit any abuse of a dominant market position. It is the abuse which is banned, not the scale of operation. Large enterprises such as British Telecom may build up a substantial market position in Britain so that the home market becomes the launching pad for international competition. If British firms are circumscribed in their scale of operation at home, international competition against, for example, United States and Japanese companies with large home markets will be jeopardised. Those principles are clear and understandable.
  The congruence of the two principles on which the Bill is based with articles 85 and 86 of the European Union treaty mean that satisfying the requirements of United Kingdom legislation will also satisfy European Union
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  legislation. Companies will thus be saved the complexity and expense of satisfying two different sets of legal principles and proceedings.
  I should be grateful if the Minister could clarify whether clause 60 provides for reference to the European Court of Justice for interpretive rulings on points of European law. Can he confirm that it may enable the European Commission to leave to United Kingdom authorities matters that might otherwise have been decided by the Commission?
  The Bill applies across all sectors of business and the professions, which adds to its clarity. The amendment produced by Lord McNally in another place to cover abuse of a dominant position by national newspapers is unnecessary. The Bill unamended is applicable to the circumstances of the amendment, as my right hon. Friend the President of the Board of Trade said.
  The amendment also introduces absurdities into the Bill by prohibiting justifiable actions which, although they might reduce the diversity and independence of the national newspaper press, do so for entirely reasonable purposes. Let us suppose that a newspaper takes up a noble cause that attracts readers, like the Daily Mail's support for the Labour party. Is the Director General of Fair Trading supposed to say, "You cannot do that. Go back to your lost cause, the Conservative party, or the Daily Mirror and The Guardian will be jeopardised"? It is absurd.
  To oppose the amendment is not a matter of caving into press barons. To bolt on amendments for a range of specific industrial circumstances is more likely to confuse the Bill's purpose than to clarify matters. If The Times is guilty of predatory pricing, let the Director General of Fair Trading proceed according to clause 18. I oppose the new and redundant clause 19.
  The Director General of Fair Trading, in implementing the legislation, will be adjudicating issues worth many times more than the awards that may be available in civil courts. When so much is at stake, the incentive to frustrate the regulator by withholding or destroying evidence is great. If the penalties are weak, they will be treated as a licence for malpractice. I note that the Confederation of British Industry has said that the powers for investigation and enforcement are excessive, but it underestimates the strength of the forces likely to be ranged against the legislation.
  No one, least of all members of the CBI, will benefit if the Bill is ineffective because its provisions are unenforceable, or if the penalties have little impact. For the purposes of investigation and enforcement, the Bill has been given sharp teeth. Those teeth will bite when the Director General of Fair Trading has decided to investigate a potential breach of the provisions of the legislation, and when a decision has been made.
  What I do not find clear is the redress available to a third party who has suffered from the anti-competitive behaviour of another company, whose activities have not been investigated by the Office of Fair Trading. Third party rights were mentioned explicitly in the original consultation document, but all mention of third party rights has been eliminated from the Bill. Will the Minister of State clarify the position?

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  The final criterion by which the Bill should be judged is that innovation in goods and services and in business practice should not be impeded. Clause 2(2)(b) speaks of prohibiting agreements that
  "limit or control … technical development",
  but many new technical developments depend on two or more companies bringing together complementary technological expertise to develop a commercially attractive and innovative technology.
  For example, a biotechnology company may develop tests for early diagnosis of disease based on the latest understanding of the human genome, but to be useful that has to be harmonised with electronic instrumentation that will enable the tests to be applied in a medical centre or hospital. Likewise, in modern reprographics, the dyes, inks or films have to fit intimately with the equipment that does the printing, so the two need to be developed together.
  Investment from each collaborator will be significant; they could not responsibly commit themselves to the investment unless they could see a potential advantage. Moreover, the possibility of legal difficulties, added to the inherent risks, will inhibit companies from becoming involved in such developments.
  The European Commission has been hostile to agreements that extend development collaboration to joint production and marketing, but it now sees such early-market joint-venture agreements as far less objectionable.
  I should be grateful for the Minister's reassurance that the sort of block exemption used by the European Commission goes far enough to cover collaboration in the launch and early marketing of innovative products and so will not inhibit innovation.
  The Bill makes the Director General of Fair Trading a very powerful influence on the way in which the British economy is modernised. He should account to the House for the use of the powers conferred on him by the Bill. That might be achieved by the director general appearing regularly before the Select Committee on Trade and Industry, in the same way as the Governor of the Bank of England appears before the Treasury Select Committee.
  The Bill replaces discredited and ineffective legislation with a clear structure for regulating a modern economy at the heart of the European Union. It leaves scope for the economy to evolve and to increase productivity and innovation, while providing the powers to ensure that the law is enforced. It is another major contribution towards modernising Britain, which deserves the whole-hearted support of the House.
  9.25 pm
  Sir Nicholas Lyell: I am grateful to catch your eye, Mr. Deputy Speaker, albeit to speak briefly at the end of this debate and to follow the hon. Member for Bexleyheath and Crayford (Mr. Beard). If he believes his last sentence, he has another think coming, but I hope that, by the end of its scrutiny, the Bill will be a little closer to the utopia that he attempted to describe.
  I must declare an interest as a lawyer. The Bill has been criticised as a potential lawyers' charter. I come from a chambers that specialises partly in competition law.
  112
  I want to make four important points. The Bill constitutes a very important change in the United Kingdom's approach to competition. Hitherto, our approach has been one of liberty, subject only to registration, and one might be attacked if one had registered or failed to register. We now move to the approach of prohibition, which can be drastic unless it is clearly and carefully handled. The previous Government considered that approach carefully, but, as the hon. Member for Bexleyheath and Crayford said, the present Government, for all their hype, have a lot of thinking to do.
  My first point relates to vertical agreements. We must not move from prohibition to the complete exemption of vertical agreements; they must be approached case by case. They are very important to many small and medium-sized businesses. Community pharmacists have, rightly, been discussed at length, and I strongly support our reasoned amendment to try to protect them. However, filling stations, book shops, publicans, travel agents and newsagents all benefit from vertical agreements, which can give them commercial support in circumstances where the law of the jungle might otherwise apply.
  Those agreements have been carefully and effectively policed to a great extent by the common law. The idea that we are entering a brave new world and that those agreements were never regulated in the past by the common law or the Restrictive Trade Practices Acts is mistaken.
  My second point relates to the Competition Commission's appellate role. I make a strong plea for a senior judicial figure to head the commission, particularly with regard to its appellate role. The commission will have to make decisions on complex legal and economic questions; it will have to evaluate oral and written evidence, and its judgments will go straight to the Court of Appeal. If as much of the Bill's contents are left vague as appears will be the case, it is important that the commission is of high quality and is led by someone who not only is an experienced lawyer and judge, but has a background in competition law.
  My third point concerns the interplay of competition and regulation. The Bill provides the opportunity to use two lines of attack. The first is the powers that would normally be used by the Director General of Fair Trading under the Bill, but he is not the only investigatory and enforcement body. All the regulators for telecommunications, electricity, water, rail and gas, including their equivalents in Northern Ireland, will have concurrent powers under the Bill. Businesses, large and small, are entitled to know which way the cat will jump. It should normally jump according to the Bill's provisions. Regulators should not use their existing powers to achieve the same effect that their powers under the Bill would have. The Bill needs to be clarified to show that its powers, which are draconian but accompanied by certain safeguards, will be the usual route adopted—so that those safeguards are heeded.
  My final point concerns clause 60, which requires the director general of the new tribunal to have regard to the judgments of the European Court. Much more needs to be spelt out in this area, although I have no time to go into detail. As the clause states that regard shall be had to "relevant differences" from Community law, why cannot the Bill spell out in detail what those relevant differences are?

  113
  In summary, the Bill needs a great deal of careful scrutiny. Lord Borrie, the former director general, clearly felt himself lacking in power to restrain anti-competitive behaviour by some over-mighty businesses. The Bill certainly gives his successor that power, but the danger is that we may leave too much uncertainty while sacrificing too much of the flexibility that has been one of the key benefits of British competition policy over the years.
  The Government still have much to think out, but our proposals and amendments will be constructive, and I hope that the Government will listen carefully to them.
  9.30 pm
  Mr. Tim Boswell: The choreography of this Second Reading debate—against which background my hon. Friends and I will shortly be voting—has been interesting. The genesis is interesting, too; it is over eight months since the Bill had its Second Reading in another place—virtually the gestation period of a human baby. Given the uncertainty still apparent in the Bill, perhaps the gestation period of an elephant would have been more appropriate.
  The debate has been marked by its intensity and by the terseness of the speeches. More than 20 Back Benchers have spoken, all of them with their own distinctive contributions to make. Had I been a Government Whip, I would have taken some comfort from the fact that the McNally clause—clause 19—and the conduct of the press have taken a front seat, even taking priority over the 184 Back-Bench signatories to the early-day motion about community pharmacies, which perhaps represent a more sensitive issue.
  Let us begin by reminding ourselves, as a matter of common ground, that we all seek competitiveness. We all, at least in principle, accept that competition is the best way to secure it—and the Bill is about how best to secure competition. I have no objection in principle to some assimilation of EU competition law, or to re-examining our law—but it has to be got right. The danger with the Bill, despite its long consideration to date—reference has been made to its longueurs—is that it is still incomplete. Its details have been withheld, and it is not yet sufficiently precise for us to agree to it with any confidence. That is why we shall vote against it tonight.
  Going back to first principles, what we do know is that Lord Simon of Highbury, introducing the Bill in another place, said that it was not only important but complex and technical. This was perhaps a politer version of the apercu of Lord Kingsland, who asserted that the Bill would prove an El Dorado for lawyers. I am not a lawyer; like many others, I am on a voyage of exploration—not for gold but for a simple understanding of the rather awkward legal concepts involved.
  I adopt a good standpoint for a Conservative when I say that, for all its faults, the complex of legislation developed in this country since 1948, under Governments of both parties, to regulate monopolies and mergers and competitive behaviour generally, including restrictive practices, has, broadly speaking, worked. It has been evolutionary, but its general effects have been positive.
  I do not make the logical jump from that to conclude that the legislation was ideal—obviously, deficiencies were apparent, including deficiencies of delay, which have been mentioned—but it is most important that what replaces it is more certain and more effective, not less so.
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  I warn the Government that their besetting sin is that, although they are always strong on aspirations, they are weak indeed on finding means of putting those aspirations workably into practice.
  As someone who has always respected that film of the battle of Arnhem, "A Bridge Too Far", I think the moral for the Government is not simply "a clause too far" but, in the case of this Bill, "a chapter too far" at least. Conservative Members retain toward the Bill not illwill but considerable reservations. Although problems remain—about clarity and penalties, for example—in the chapter I prohibitions on anti-competitive agreements, we have clear reservations about chapter II, on the abuses of dominant position.
  It is still unclear to me—although it may be clear to others—what is meant by
  "the abuse of a dominant position".
  We await the Office of Fair Trading guidelines on that. It is not clear how it meshes with—whether it is con-terminous and identical with—article 86 of the treaty of Rome. How are we to define those awkward concepts of dominance—dominance in what markets, or in what sectors of markets?
  The Government have now usefully clarified that the maximum penalty of 10 per cent. should apply only to turnover in the United Kingdom, so they are not claiming extra-territorial jurisdiction. Nevertheless, how is the relevant turnover to be defined, and are the means of powers of entry, for example, proportionate to the ill that may be perceived to be done, given that these are, typically, legitimate businesses going about their legitimate purposes?
  There is a danger that, despite Ministers' good intention and the safeguards that they have already announced, there will be real difficulties of interpretation, especially for smaller businesses that have not previously traded abroad, which have therefore not been caught by European Union competition law concepts, and which will have to come to terms with them.
  There is a danger that investment or entry to the market will be deterred—the so-called chilling effect on new entrants. For those reasons, the CBI—about whose support for the principles behind the Bill there has been some debate—has proposed a more targeted prohibition. The solicitors Clifford Chance—I suppose, one of the most distinguished practitioners in that area of the law—in a very interesting paper, have argued for a more phased approach, with a bit less big bang. It occurred to me that, if small businesses had to take advice on whether they were compliant, they might well incur three-figure rates per hour such as those that Clifford Chance would charge.
  Leaving that aside, the proposal which Clifford Chance produced is for
  "capping the maximum penalty and delaying third party actions for say 3 years after introduction"
  to
  "give a proper opportunity for the Director General to issue advice and guidance",
  for industry to react and
  "to enable the initial enforcement of the prohibition to be developed under a less penal regime. "
  That is wise advice for the Government.
  I hope that the Government will reflect on the somewhat flimsy basis of "comfort letters" as a safeguard for commercial transactions, because, if a business has

  115
  written to the director and received a letter saying, "We think it is all right," the last thing it wants is suddenly to find itself formally and legally challenged at a later stage; it would be extremely unfair, if not a breach of natural justice, if that happened.
  There are similar concerns about the unanticipated jeopardy for businesses. Let us remember that we are talking about legitimate firms trying to carry out their business which find themselves in a clash of overlapping jurisdictions between regulators. The Government are apparently keen on concurrent powers. Although I believe that, as a general principle, regulators should work together, and, above all, speak to one another, I am attracted to the working principle that one regulator should call the shots at any one time, particularly if it is the industry regulator whose main raison d'être is the regulation of that business, as opposed to general competition regulation. If, however, the industry regulator moves forward to general issues of competition, there should be a proper set of procedures, including appeal procedures, which should be linked in through the Bill rather than operating on a different, and perhaps more administrative, regime.
  I am concerned that, given the Government's present attitudes, they may seek to drag a wider social agenda into competition issues—across the field of utilities regulation. Equally, there are still concerns about clause 60 and the overlap between the EU and domestic regimes. Although I am no lawyer, I think that that applies particularly to the procedural principles of action. Undoubtedly the EU begins with a different tradition—a rather healthy tradition—of administrative law, which has not been so well developed in this country. We must make sure that we are operating along the same lines.
  My abiding fear is that businesses may act in good faith—and may even seek assurance and guidance from the director—yet may find that, because the regulators have a difference of opinion about powers, or because of a difference between the EU and domestic courts, or because other factors do not mesh in this complex domain, they are suddenly caught in a trap. That is not fair, and it is not good for business.
  In that context, we must examine individual sectors of concern. I have already mentioned community pharmacists. There are reservations about vertical agreements in general. We may know that the Government seek to give relief, but we do not know on what basis, or whether it is justified. There are specific problems—for example, for agricultural co-operatives, in which I have a small interest. The British Medical Association has raised concerns.
  Several hon. Members have expressed anxiety about look-alike products. Interesting comments were made by the hon. Members for Middlesbrough, South and Cleveland, East (Dr. Kumar) and for Eastleigh (Mr. Chidgey) about engineers. As an erstwhile livestock rearer and agronomist—although I did not usually give charged advice—I was slightly surprised to find myself relabelled as an engineer. There is something wrong with schedule 4, which must be put right.
  The Government can claim some credit for good intentions. They have introduced, as they tend to do, stakhanovite legislation containing a huge mass of important and difficult concepts that will have to be
  116
  examined in the Committee, on which I hope my right hon. Friend the Member for Cities of London and Westminster (Mr. Brooke) will serve; my right hon. Friend will adorn the Committee with his wit and wisdom and will ensure that we have an interesting and enjoyable time, as well as an intellectually stimulating one. I hope that the Government will not squander the opportunity of introducing good legislation.
  The Government have relied on their consultation exercise, but there does not seem to have been a great deal of follow-through. The wires in the business world are not buzzing with concern about the matter, and they should be. It is important that the issues raised by hon. Members throughout the House are properly articulated and considered in Committee. There is nothing wrong with a Committee stage. No lack of machismo is shown by a Government who are prepared to listen, as I hope the President of the Board of Trade and the Minister of State will do.
  One could compare this legislation with the companies legislation that was introduced in the post-war period. It had a long genesis of two or three years under the post-war Labour Government. We legislate on complex technical issues in too much of a hurry, and we must get this matter right. There is a continuing danger that, although the Government seek to improve competition and reduce costs on business—I think that their compliance figures are implausible—they may create uncertainty for business, the need to seek expensive legal advice, and awkward compliance costs—and that is before an individual business may be caught in the toils of one of the procedures.
  Businesses deserve a degree of stability and certainty that they do not have at present. It is essential that those matters be properly clarified before we can say that the legislation has been secured successfully. We need to set down a marker of concern for the Government tonight. We must signal that, irrespective of the Government's assertions, there is a danger that the Bill will operate perversely against the interests that it claims to promote. That is why we shall reject it in the Lobby tonight.
  9.45 pm
  The Minister of State, Department of Trade and Industry (Mr. Ian McCartney): I congratulate those 23 right hon. and hon. Members who contributed to the debate. It was conducted to among the highest standards of any debate that I have had the privilege to listen to and be part of during 11 years in this place. Of course, there are some obvious exceptions, to which I may refer later—I see the right hon. Member for Wokingham (Mr. Redwood) is in his place. Hon. Members generally made a thoughtful contribution, and I apologise for the fact that time prevents me from addressing many of the technical issues that they raised. Those matters will be debated in Committee. I have been in Committee with the hon. Member for Daventry (Mr. Boswell) on numerous occasions, and he knows that I am prepared to discuss matters in Committee. We shall examine a range of issues in Committee in order to ensure that, when the Bill emerges from Committee, it deserves the support of the House—as it does tonight.
  My hon. Friends the Members for Ealing, Acton and Shepherd's Bush (Mr. Soley), for North Durham (Mr. Radice) and for Sunderland, South (Mr. Mullin) set out their cases with a great deal of clarity and integrity. I welcome their contributions, as well as those of other

  117
  Labour Members. My hon. Friend the Member for Crewe and Nantwich (Mrs. Dunwoody) referred to the proposed sale of Rolls-Royce. I take genuine note of her comments and the spirit in which she made them.
  The Bill will achieve much-needed modernisation and strengthening of our competition laws. It will be a highly effective regime that is tough on cartels and other anti-competitive activities. It fulfils our manifesto commitment fully, effectively and quickly. Reform of the current weak laws is long overdue, and the Bill brings United Kingdom laws up to date after years of indecision on the part of the previous Administration.
  The hon. Member for Daventry expressed his views in a soft and thoughtful manner. However, it sticks in my craw that, although the Conservative party was in power for 18 years and did nothing about competition law for the last 10 years, Conservative Members complain that, in nine months, this Government have proceeded only to the Second Reading of the Bill.
  The fact is that the Bill has passed through its stages in the House of Lords and there has been major public consultation. The matter was considered in a non-partisan manner with the Opposition in another place. We tried to persuade our colleagues to our view and to promote changes that would improve the Bill. No one can say that the Government have sat on their hands in relation to this issue.
  The previous Government did not have the bottle to do something about the difficult questions regarding competition, and they left it to my right hon. Friends and me to deal with. Therefore, I shall take no lessons from the hon. Gentleman when it comes to the timing of this legislation.
  The Bill puts right previous failings. It will give the Director General of Fair Trading the powers that he needs to uncover cartels, abuses and other anti-competitive behaviour. He will have effective powers to stop anti-competitive behaviour quickly and to impose stiff financial penalties that provide an effective deterrent.
  If I understood the right hon. Member for Wokingham correctly, he said that he was basically satisfied with the current regime. We do not agree. The essence of a prohibition regime is that the onus is placed on companies to avoid anti-competitive action. It is not good enough to allow anti-competitive practices to continue until they are reviewed or, to use a better term, found out. That is why the present regime needs reform. Time and again the director general has announced that he has caught up with an anti-competitive practice, such as price fixing in laboratory equipment, only to be able to do no more than ask the parties kindly to stop what they are doing.
  Many hon. Members have talked about vertical agreements. Many of these agreements will automatically be exempt from the prohibition of anti-competitive agreements. The Bill provides that vertical agreements, such as petrol solus agreements and exclusive distribution arrangements that meet the conditions of EC block exemptions, will be parallel exempt from the domestic prohibition. In general, vertical agreements are not anti-competitive. On that basis, there is a case explicitly to disapply the prohibition from vertical agreements to ensure the most efficient targeting of the regime to areas of more serious concern.
  There is already provision in the Bill to make exclusions. We are in discussion with the CBI and other interested parties on whether additional flexibility in the
  118
  Bill would be desirable and how vertical agreements should be defined. I have no doubt that the issue will be discussed in Committee.
  Mr. Owen Paterson: Will the Minister give way?
  Mr. McCartney: The hon. Gentleman may not have noticed that I am still on my feet. I apologise to the hon. Gentleman but time is short. As I have said, we have had a good debate.
  The Government are clear that it is important to have a strong, diverse and independent press. The importance of that is reflected in the special merger provisions for newspapers in the Fair Trading Act 1973, which are there to protect plurality of ownership and diversity of content.
  Let us be clear about the way in which the Bill will work. It will prohibit anti-competitive conduct. Penalties and third-party claims for damages may follow. The Bill is serious and tough. We are not softening the law, as some seem to think; we are greatly strengthening it.
  Clause 60 requires European jurisprudence to be followed. Having taken legal advice, I shall explain what that means. On predatory pricing, in the case of Tetra Pak, the European Court of Justice followed its earlier decision in AKZO that, where prices are below the average variable cost of production, predation should be presumed. In other words, proof of intent is not required. That is indeed an objective test.
  Subsection (2) of clause 60 makes it clear that inconsistency must be avoided in the principles applied by courts in applying the domestic prohibition and those laid down by the European Court and any relevant decision of that court. The principle established in AKZO and Tetra Pak will apply under the Competition Bill. If prices are above average variable costs but below total average costs, conduct is to be regarded as predatory where it can be established that the purpose of the conduct was to eliminate a competitor. The principle established in European case law will apply under the Competition Bill when enacted.
  European jurisprudence makes it clear that dominance means a position of economic strength that enables an undertaking to act independently of competition. Market share does not determine dominance, but it is an important factor. The Commission has made it clear that, although, in general, companies with market shares below 40 per cent. are unlikely to be regarded as dominant undertakings, some undertakings with market shares as low as 20 per cent. may be dominant if the nature and structure of the market enables them to act independently of competition. Clause 60(3) requires our courts to have regard to relevant statements of the Commission in applying domestic prohibition, so the assessment of dominance will follow the EC approach.
  The McNally amendment is not about competition. It relates to wide-ranging regulatory intervention into newspapers. It is pernicious. Any action that may reduce diversity is caught if a newspaper holds a substantial degree of market power. The amendment does not distinguish anti-competitive abuses from a case where a newspaper becomes dominant through its good journalism and the failings of its competitors. If we leave the amendment as set out in the Bill, we shall be storing up

  119
  trouble for successful newspapers in future. As a consequence, we shall remove clause 19 from the Bill in Committee.
  The Opposition amendment refers to over-the-counter medicines and the review of resale price maintenance. Agreements enforcing that practice, like other agreements, will in due course fall to be considered under the Bill. In recognition of the existing exemption for resale price maintenance in over-the-counter medicines, however, the Bill gives relevant agreements a special five-year transitional exclusion from the prohibition.
  When Conservative Members had responsibility for those matters, they proposed in a draft Bill precisely what we advocate—allowing current proceedings to continue. They cannot have it both ways: they cannot pretend that the issue is new and complain about the director general's action now, as they do in the amendment. The director general announced in 1995 that he was to investigate the matter following the receipt of complaints. As long ago as October 1996, he said that he intended to bring proceedings, asking the restrictive practices court to review the matter.
  Moreover, it is clear that we could not remove the matter from competition consideration, even if we wanted to do so. EU competition law has direct effect, and the Commission has not proceeded with complaints received on the basis that the Office of Fair Trading has proceedings under way in the court that could satisfactorily resolve the matter. The logic of that was most recently confirmed in a letter from Commissioner Van Miert to my right hon. Friend the President of the Board of Trade: that if the proceedings were stayed, the Commission would pursue its own investigation of the case.
  Whatever the outcome, the public can be assured of our commitment to a national health service to which all people have access, regardless of who they are or where they live. We have published our proposals for creating a modern, dependable NHS which is there when people need it. My hon. Friend the Member for Middlesbrough, South and Cleveland, East made a passionate case. I can assure him that the community pharmacy is very much part of the Government's vision. Pharmacies provide somewhere to which patients can turn for advice and support as well as a place from which they can collect their prescriptions. The place of community pharmacies within the NHS is not in doubt.
  The right hon. Member for Wokingham referred to the closure of pharmacies. Does he remember that 178 pharmacies closed during his membership of the previous Cabinet? If there is a rag bag, a muddle and a mess, it is the Opposition's position on the matter. For example, how will the hon. Member for Tunbridge Wells (Mr. Norman), the deputy chairman of the Tory party, vote tonight? Will he be in the Lobby supporting his right hon. Friend, or will he, as I suspect, take a different view, as do many Conservatives?
  The right hon. Member for Wokingham also complained about powers of investigation. They are tough—there is no dispute about that—and so they should be. It has long been recognised that a major weakness of the existing regime is the inadequacy of powers of investigation. Strengthening is well overdue.
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  Anti-competitive behaviour, especially anti-competitive agreements, is invariably concealed. Strong powers are needed to get to the truth. There are appropriate safeguards and limitations on the exercise of powers. The Bill aims at alignment with the EU regime, and the powers are broadly similar.
  The policy of the right hon. Member for Wokingham is to be soft on corporate crime and soft on the causes of corporate crime. That is wrong: anti-competitive conduct is cheating and bullying. Small companies and medium-sized enterprises can be seriously damaged and even driven out of business. No wonder the right hon. Gentleman was described as the worst Minister responsible for competition in living memory.
  Business supports the Bill. The CBI, Kingfisher, CIA—[Interruption] the Consumers Association, the Law Society—[Interruption.] I knew that that would get Conservative Members going: the CIA is the Chemical Industries Association, with which I have a long-standing involvement, unlike the other CIA, in which Conservative Members may have had a long and active interest.
  I make it clear that the Bill represents a manifesto commitment by the Government. We are now delivering on it, as we are on our other promises. That may surprise the Opposition, who consistently failed to address reform of competition law when in government. We have not failed business or consumers. I commend the Bill to the House.
  Question put, That the amendment be made:—
  The House divided: Ayes 169, Noes 314.

  Division No. 268]

  [9.58 pm

  AYES

  Ainsworth, Peter (E Surrey)

  Cran, James

  Allan, Richard

  Curry, Rt Hon David

  Amess, David

  Davies, Quentin (Grantham)

  Arbuthnot, James

  Davis, Rt Hon David (Haltemprice)

  Baker, Norman

  Dorrell, Rt Hon Stephen

  Baldry, Tony

  Duncan, Alan

  Ballard, Mrs Jackie

  Duncan Smith, Iain

  Beth, Rt Hon A J

  Emery, Rt Hon Sir Peter

  Bell, Martin (Tattoo)

  Evans, Nigel

  Bercow, John

  Faber, David

  Beresford, Sir Paul

  Fabricant, Michael

  Blunt, Crispin

  Fallon, Michael

  Body, Sir Richard

  Feam, Ronnie

  Boswell, Tim

  Flight, Howard

  Bottomley, Peter (Worthing W)

  Forth, Rt Hon Eric

  Bottomley, Rt Hon Mrs Virginia

  Foster, Don (Bath)

  Brady, Graham

  Fowler, Rt Hon Sir Norman

  Brake, Tom

  Fraser, Christopher

  Brand, Dr Peter

  Gale, Roger

  Brazier, Julian

  Garnier, Edward

  Breed, Colin

  Gibb, Nick

  Brooke, Rt Hon Peter

  Gill, Christopher

  Browning, Mrs Angela

  Gillan, Mrs Cheryl

  Bruce, Ian (S Dorset)

  Goodlad, Rt Hon Sir Alastair

  Bruce, Malcolm (Gordon)

  Gorman, Mrs Teresa

  Burnett, John

  Gorrie, Donald

  Burns, Simon

  Green, Damian

  Cable, Dr Vincent

  Greenway, John

  Cash, William

  Grieve, Dominic

  Chidgey, David

  Gummer, Rt Hon John

  Chope, Christopher

  Hague, Rt Hon William

  Clappison, James

  Hamilton, Rt Hon Sir Archie

  Clark, Rt Hon Alan (Kensington)

  Hammond, Philip

  Clifton-Brown, Geoffrey

  Hancock, Mike

  Cormack, Sir Patrick

  Harvey, Nick

  Cotter, Brian

  Hawkins, Nick

  121

  Heath, David (Somerton & Frome)

  Robathan, Andrew

  Heathcoat-Amory, Rt Hon David

  Robertson, Laurence (Tewk'b'ry)

  Hogg, Rt Hon Douglas

  Roe, Mrs Marion (Broxbourne)

  Horam, John

  Rowe, Andrew (Faversham)

  Howard, Rt Hon Michael

  Ruffley, David

  Howarth, Gerald (Aldershot)

  Russell, Bob (Colchester)

  Hughes, Simon (Southwark N)

  St Aubyn, Nick

  Hunter, Andrew

  Sanders, Adrian

  Jack, Rt Hon Michael

  Sayeed, Jonathan

  Jackson, Robert (Wantage)

  Shepherd, Richard

  Jenkin, Bernard

  Simpson, Keith (Mid-Norfolk)

  Johnson Smith, Rt Hon Sir Geoffrey

  Smyth, Rev Martin (Belfast S)

  Soames, Nicholas

  Jones, Nigel (Cheltenham)

  Spelman, Mrs Caroline

  Kennedy, Charles (Ross Skye)

  Spicer, Sir Michael

  Key, Robert

  Spring, Richard

  King, Rt Hon Tom (Bridgwater)

  Stanley, Rt Hon Sir John

  Kirkbride, Miss Julie

  Steen, Anthony

  Laing, Mrs Eleanor

  Streeter, Gary

  Lait, Mrs Jacqui

  Stunell, Andrew

  Lansley, Andrew

  Swayne, Desmond

  Leigh, Edward

  Syrns, Robert

  Letwin, Oliver

  Tapsell, Sir Peter

  Lewis, Dr Julian (New Forest E)

  Taylor, Ian (Esher & Walton)

  Lidington, David

  Taylor, John M (Solihull)

  Lilley, Rt Hon Peter

  Taylor, Matthew (Truro)

  Lloyd, Rt Hon Sir Peter (Fareham)

  Taylor, Sir Teddy

  Llwyd, Elfyn

  Tonge, Dr Jenny

  Loughton, Tim

  Tredinnick, David

  Luff, Peter

  Trend, Michael

  Lyell, Rt Hon Sir Nicholas

  Tyler, Paul

  MacGregor, Rt Hon John

  Tyrie, Andrew

  McIntosh, Miss Anne

  Viggers, Peter

  MacKay, Andrew

  Walter, Robert

  Maclean, Rt Hon David

  Wardle, Charles

  Maclennan, Rt Hon Robert

  Waterson, Nigel

  McLoughlin, Patrick

  Wells, Bowen

  Malins, Humfrey

  Whitney, Sir Raymond

  Maples, John

  Whittingdale, John

  Mates, Michael

  Widdecombe, Rt Hon Miss Ann

  Maude, Rt Hon Francis

  Wilkinson, John

  Michie, Mrs Ray (Argyll & Bute)

  Willis, Phil

  Moore, Michael

  Winterton, Mrs Ann (Congleton)

  Moss, Malcolm

  Winterton, Nicholas (Macclesfield)

  Nicholls, Patrick

  Woodward, Shaun

  Page, Richard

  Yeo, Tim

  Paice, James

  Young, Rt Hon Sir George

  Paterson, Owen

  Pickles, Eric

  Tellers for the Ayes:

  Redwood, Rt Hon John

  Sir David Madel and

  Rendel, David

  Mr. Stephen Day.

  NOES

  Ainger, Nick

  Bradley, Peter (The Wrekin)

  Ainsworth, Robert (Cov'try NE)

  Bradshaw, Ben

  Anderson, Donald (Swansea E)

  Brown, Rt Hon Nick (Newcastle E)

  Armstrong, Ms Hilary

  Browne, Desmond

  Ashton, Joe

  Buck, Ms Karen

  Atherton, Ms Candy

  Burgon, Colin

  Atkins, Charlotte

  Butler, Mrs Christine

  Austin, John

  Byers, Stephen

  Banks, Tony

  Caborn, Richard

  Barnes, Harry

  Baron, Kevin

  Campbell, Alan (Tynemouth)

  Bayley, Hugh

  Campbell, Mrs Anne (C'bridge)

  Beard, Nigel

  Campbell, Ronnie (Blyth V)

  Beckett, Rt Hon Mrs Margaret

  Campbell-Savours, Dale

  Benn, Rt Hon Tony

  Canavan, Dennis

  Bennett, Andrew F

  Caplin, Ivor

  Benton, Joe

  Casale, Roger

  Berry, Roger

  Chapman, Ben (Wirral S)

  Best, Harold

  Chaytor, David

  Betts, Clive

  Chisholm, Malcolm

  Blears, Ms Hazel

  Church, Ms Judith

  Blizzard, Bob

  Clapham, Michael

  Borrow, David

  Clark, Rt Hon Dr David (S Shields)

  122

  Clark, Dr Lynda (Edinburgh Pentlands)

  Hain, Peter

  Hall, Mike (Weaver Vale)

  Clark, Paul (Gillingham)

  Hall, Patrick (Bedford)

  Clarke, Charles (Norwich S)

  Hamilton, Fabian (Leeds NE)

  Clarke, Rt Hon Tom (Coatbridge)

  Hanson, David

  Clarke, Tony (Northampton S)

  Harman, Rt Hon Ms Harriet

  Clwyd, Ann

  Heal, Mrs Sylvia

  Coffey, Ms Ann

  Healey, John

  Cohen, Harry

  Henderson, Ivan (Harwich)

  Coleman, Iain

  Hepburn, Stephen

  Colman, Tony

  Heppell, John

  Cook, Rt Hon Robin (Livingston)

  Hesford, Stephen

  Cooper, Yvette

  Hewitt, Ms Patricia

  Corbett, Robin

  Hill, Keith

  Corbyn, Jeremy

  Hinchliffe, David

  Corston, Ms Jean

  Hodge, Ms Margaret

  Crausby, David

  Hoey, Kate

  Cryer, Mrs Ann (Keighley)

  Hood, Jimmy

  Cryer, John (Hornchurch)

  Hoon, Geoffrey

  Cummings, John

  Hope, Phil

  Cunningham, Jim (Cov'try S)

  Hopkins, Kelvin

  Dalyell, Tam

  Howarth, Alan (Newport E)

  Darling, Rt Hon Alistair

  Howarth, George (Knowsley N)

  Darvill, Keith

  Howells, Dr Kim

  Davey, Valerie (Bristol W)

  Hoyle, Lindsay

  Davies, Rt Hon Denzil (Llanelli)

  Hughes, Ms Beverley (Stretford)

  Davies, Geraint (Croydon C)

  Hughes, Kevin (Doncaster N)

  Dean, Mrs Janet

  Hurst, Alan

  Hutton, John

  Denham, John

  Iddon, Dr Brian

  Dismore, Andrew

  Illsley, Eric

  Dobbin, Jim

  Jackson, Ms Glenda (Hampstead)

  Dobson, Rt Hon Frank

  Jackson, Helen (Hillsborough)

  Doran, Frank

  Jenkins, Brian

  Dowd, Jim

  Johnson, Alan (Hull W & Hessle)

  Drew, David

  Johnson, Miss Melanie (Welwyn Hatfield)

  Dunwoody, Mrs Gwyneth

  Eagle, Angela (Wallasey)

  Jones, Barry (Alyn & Deeside)

  Eagle, Maria (L'pool Garston)

  Jones, Helen (Warrington N)

  Edwards, Huw

  Jones, Ms Jenny (Wolverh'ton SW)

  Efford, Clive

  Ellman, Mrs Louise

  Jones, Jon Owen (Cardiff C)

  Ennis, Jeff

  Jones, Dr Lynne (Selly Oak)

  Etherington, Bill

  Keeble, Ms Sally

  Ewing, Mrs Margaret

  Keen, Alan (Feltham & Heston)

  Fatchett, Derek

  Keen, Ann (Brentford & Isleworth)

  Field, Rt Hon Frank

  Kemp, Fraser

  Fitzpatrick, Jim

  Kennedy, Jane (Wavertree)

  Fitzsimons, Lorna

  Khabra, Piara S

  Flint, Caroline

  Kidney, David

  Flynn, Paul

  Kilfoyle, Peter

  Follett, Barbara

  King, Andy (Rugby & Kenilworth)

  Foster, Michael Jabez (Hastings)

  King, Ms Oona (Bethnal Green)

  Foster, Michael J (Worcester)

  Kingham, Ms Tess

  Foulkes, George

  Kumar, Dr Ashok

  Galloway, George

  Ladyman, Dr Stephen

  Gapes, Mike

  Laxton, Bob

  Gardiner, Barry

  Leslie, Christopher

  George, Bruce (Walsall S)

  Levitt, Tom

  Gerrard, Neil

  Lewis, Ivan (Bury S)

  Gibson, Dr Ian

  Linton, Martin

  Gilroy, Mrs Linda

  Livingstone, Ken

  Godman, Dr Norman A

  Lloyd, Tony (Manchester C)

  Godsiff, Roger

  Lock, David

  Goggins, Paul

  Love, Andrew

  Golding, Mrs Llin

  McAvoy, Thomas

  Gordon, Mrs Eileen

  McCabe, Steve

  Grant, Bernie

  McCafferty, Ms Chris

  Griffiths, Jane (Reading E)

  McCartney, Ian (Makerfield)

  Griffiths, Nigel (Edinburgh S)

  McDonagh, Siobhain

  Grocott, Bruce

  McDonnell, John

  Grogan, John

  McFall, John

  Gunnell, John

  McGuire, Mrs Anne

  123

  McIsaac, Shona

  Ruddock, Ms Joan

  Mackinlay, Andrew

  Russell, Ms Christine (Chester)

  McLeish, Henry

  Ryan, Ms Joan

  McNamara, Kevin

  Salter, Martin

  McNulty, Tony

  Sawford, Phil

  MacShane, Denis

  Sedgemore, Brian

  Mactaggart, Fiona

  Shaw, Jonathan

  McWalter, Tony

  Sheerman, Barry

  McWilliam, John

  Sheldon, Rt Hon Robert

  Mahon, Mrs Alice

  Simpson, Alan (Nottingham S)

  Mallaber, Judy

  Singh, Marsha

  Mandelson, Peter

  Skinner, Dennis

  Marek, Dr John

  Smith, Rt Hon Andrew (Oxford E)

  Martlew, Eric

  Smith, Angela (Basildon)

  Meacher, Rt Hon Michael

  Smith, John (Glamorgan)

  Meale, Alan

  Smith, Llew (Blaenau Gwent)

  Merron, Gillian

  Snape, Peter

  Michael, Alun

  Soley, Clive

  Michie, Bill (Shef'ld Heeley)

  Southworth, Ms Helen

  Milburn, Alan

  Spellar, John

  Miller, Andrew

  Starkey, Dr Phyllis

  Mitchell, Austin

  Stevenson, George

  Moffatt, Laura

  Stewart, Ian (Eccles)

  Moonie, Dr Lewis

  Stinchcombe, Paul

  Moran, Ms Margaret

  Stott, Roger

  Morgan, Alasdair (Galloway)

  Strang, Rt Hon Dr Gavin

  Morgan, Ms Julie (Cardiff N)

  Straw, Rt Hon Jack

  Morgan, Rhodri (Cardiff W)

  Stringer, Graham

  Morris, Rt Hon John (Aberavon)

  Stuart, Ms Gisela

  Mudie, George

  Sutcliffe, Gerry

  Mullin, Chris

  Taylor, Rt Hon Mrs Ann (Dewsbury)

  Murphy, Denis (Wansbeck)

  Norris, Dan

  Taylor, Ms Dari (Stockton S)

  O'Brien, Mike (N Warks)

  Taylor, David (NW Leics)

  Olner, Bill

  Temple-Morris, Peter

  O'Neill, Martin

  Thomas, Gareth R (Harrow W)

  Organ, Mrs Diana

  Tipping, Paddy

  Palmer, Dr Nick

  Todd, Mark

  Pearson, Ian

  Touhig, Don

  Perham, Ms Linda

  Truswell, Paul

  Pickthall, Colin

  Turner, Dr George (NW Norfolk)

  Pike, Peter L

  Twigg, Derek (Halton)

  Twigg, Stephen (Enfield)

  Pollard, Kerry

  Vaz, Keith

  Pond, Chris

  Walley, Ms Joan

  Pope, Greg

  Ward, Ms Claire

  Pound, Stephen

  Wareing, Robert N

  Powell, Sir Raymond

  Watts, David

  Prentice, Ms Bridget (Lewisham E)

  Whitehead, Dr Alan

  Prentice, Gordon (Pendle)

  Wicks, Malcolm

  Prescott, Rt Hon John

  Williams, Rt Hon Alan (Swansea W)

  Primarolo, Dawn

  Prosser, Gwyn

  Williams, Alan W (E Carmarthen)

  Quin, Ms Joyce

  Wills, Michael

  Radice, Giles

  Winnick, David

  Rammell, Bill

  Winterton, Ms Rosie (Doncaster C)

  Rapson, Syd

  Wise, Audrey

  Raynsford, Nick

  Wood, Mike

  Reed, Andrew (Loughborough)

  Woolas, Phil

  Reid, Dr John (Hamilton N)

  Wray, James

  Robinson, Geoffrey (Cov'try NW)

  Wright, Anthony D (Gt Yarmouth)

  Roche, Mrs Barbara

  Wright, Dr Tony (Cannock)

  Rogers, Allan

  Wyatt, Derek

  Rooney, Terry

  Ross, Ernie (Dundee W)

  Tellers for the Noes:

  Rowlands, Ted

  Mr. David Clelland and

  Ruane, Chris

  Janet Anderson.

  Question accordingly negatived.
  Main Question put forthwith, pursuant to Standing Order No. 62 (Amendment on Second or Third Reading):—
  The House divided: Ayes 345, Noes 134.

  Division No. 269]

  [10.12 pm

  AYES

  Ainger, Nick

  Cotter, Brian

  Ainsworth, Robert (Cov'try NE)

  Crausby, David

  Allan, Richard

  Cryer, Mrs Ann (Keighley)

  Anderson, Donald (Swansea E)

  Cryer, John (Hornchurch)

  Armstrong, Ms Hilary

  Cummings, John

  Ashton, Joe

  Cunningham, Jim (Conv'try S)

  Atherton, Ms Candy

  Dalyell, Tam

  Atkins, Charlotte

  Darling, Rt Hon Alistair

  Austin, John

  Darvill, Keith

  Baker, Norman

  Davey, Valerie (Bristol W)

  Ballard, Mrs Jackie

  Davies, Rt Hon Denzil (Llanelli)

  Banks, Tony

  Davies, Geraint (Croydon C)

  Barnes, Harry

  Dean, Mrs Janet

  Barron, Kevin

  Denham, John

  Bayley, Hugh

  Dismore, Andrew

  Beard, Nigel

  Dobbin, Jim

  Beckett, Rt Hon Mrs Margaret

  Dobson, Rt Hon Frank

  Beith, Rt Hon A J

  Doran, Frank

  Bell, Martin (Tatton)

  Dowd, Jim

  Benn, Rt Hon Tony

  Drew, David

  Bennett, Andrew F

  Dunwoody, Mrs Gwyneth

  Benton, Joe

  Eagle, Angela (Wallasey)

  Berry, Roger

  Eagle, Maria (L'pool Garston)

  Best, Harold

  Edwards, Huw

  Betts, Clive

  Efford, Clive

  Blears, Ms Hazel

  Ellman, Mrs Louise

  Blizzard, Bob

  Ennis, Jeff

  Borrow, David

  Etherington, Bill

  Bradley, Peter (The Wrekin)

  Ewing, Mrs Margaret

  Bradshaw, Ben

  Fatchett, Derek

  Brake, Tom

  Fearn, Ronnie

  Brand, Dr Peter

  Field, Rt Hon Frank

  Breed, Colin

  Fitzpatrick, Jim

  Brown, Rt Hon Nick (Newcastle E)

  Fitzsimons, Lorna

  Browne, Desmond

  Flint, Caroline

  Bruce, Malcolm (Gordon)

  Flynn, Paul

  Buck, Ms Karen

  Follett, Barbara

  Burgon, Colin

  Foster, Don (Bath)

  Burnett, John

  Foster, Michael Jabez (Hastings)

  Butler, Mrs Christine

  Foster, Michael J (Worcester)

  Byers, Stephen

  Foulkes, George

  Cable, Dr Vincent

  Galloway, George

  Caborn, Richard

  Gapes, Mike

  Campbell, Alan (Tynemouth)

  Gardiner, Barry

  Campbell, Mrs Anne (C'bridge)

  George, Bruce (Walsall S)

  Campbell, Ronnie (Blyth V)

  Gerrard, Neil

  Campbell-Savours, Dale

  Gibson, Dr Ian

  Canavan, Dennis

  Gilroy, Mrs Linda

  Caplin, Ivor

  Godman, Dr Norman A

  Casale, Roger

  Goggins, Paul

  Chapman, Ben (Wirral S)

  Golding, Mrs Llin

  Chaytor, David

  Gordon, Mrs Eileen

  Chidgey, David

  Gorrie, Donald

  Chisholm, Malcolm

  Grant, Bernie

  Church, Ms Judith

  Griffiths, Jane (Reading E)

  Clapham, Michael

  Griffiths, Nigel (Edinburgh S)

  Clark, Rt Hon Dr David (S Shields)

  Grocott, Bruce

  Clark, Dr Lynda (Edinburgh Pentlands)

  Grogan, John

  Gunnell, John

  Clark, Paul (Gillingham)

  Hain, Peter

  Clarke, Charles (Norwich S)

  Hall, Mike (Weaver Vale)

  Clarke, Rt Hon Tom (Coatbridge)

  Hall, Patrick (Bedford)

  Clarke, Tony (Northampton S)

  Hamilton, Fabian (Leeds NE)

  Clwyd, Ann

  Hancock, Mike

  Coffey, Ms Ann

  Hanson, David

  Cohen, Harry

  Harman, Rt Hon Ms Harriet

  Coleman, Iain

  Harvey, Nick

  Colman, Tony

  Heal, Mrs Sylvia

  Cook, Rt Hon Robin (Livingston)

  Healey, John

  Cooper, Yvette

  Heath, David (Somerton & Frome)

  Corbett, Robin

  Henderson, Ivan (Harwich)

  Corbyn, Jeremy

  Hepburn, Stephen

  Corston, Ms Jean

  Heppell, John

  125

  Hewitt, Ms Patricia

  Mallaber, Judy

  Hill, Keith

  Mandelson, Peter

  Hinchliffe, David

  Marek, Dr John

  Hodge, Ms Margaret

  Martlew, Eric

  Hoey, Kate

  Meacher, Rt Hon Michael

  Hood, Jimmy

  Meale, Alan

  Hoon, Geoffrey

  Merron, Gillian

  Hope, Phil

  Michael, Alun

  Hopkins, Kelvin

  Michie, Bill (Shef'ld Heeley)

  Howarth, Alan (Newport E)

  Michie, Mrs Ray (Argyll & Bute)

  Howarth, George (Knowsley N)

  Milburn, Alan

  Howells, Dr Kim

  Miller, Andrew

  Hoyle, Lindsay

  Mitchell, Austin

  Hughes, Ms Beverley (Stretford)

  Moffatt, Laura

  Hughes, Kevin (Doncaster N)

  Moonie, Dr Lewis

  Hughes, Simon (Southwark N)

  Moore, Michael

  Hurst, Alan

  Moran, Ms Margaret

  Hutton, John

  Morgan, Alasdair (Galloway)

  Iddon, Dr Brian

  Morgan, Ms Julie (Cardiff N)

  Illsley, Eric

  Morgan, Rhodri (Cardiff W)

  Jackson, Ms Glenda (Hampstead)

  Morris, Rt Hon John (Aberavon)

  Jackson, Helen (Hillsborough)

  Mudie, George

  Jenkins, Brian

  Mullin, Chris

  Johnson, Alan (Hull W & Hessle)

  Murphy, Denis (Wansbeck)

  Johnson, Miss Melanie (Welwyn Hatfield)

  Norris, Dan

  O'Brien, Mike (N Warks)

  Jones, Barry (Alyn & Deeside)

  Olner, Bill

  Jones, Helen (Warrington N)

  O'Neill, Martin

  Jones, Ms Jenny (Wolverh'ton SW)

  Organ, Mrs Diana

  Palmer, Dr Nick

  Jones, Jon Owen (Cardiff C)

  Pearson, Ian

  Jones, Dr Lynne (Selly Oak)

  Perham, Ms Linda

  Jones, Nigel (Cheltenham)

  Pickthall, Colin

  Keeble, Ms Sally

  Pike, Peter L

  Keen, Alan (Feltham & Heston)

  Pollard, Kerry

  Keen, Ann (Brentford & Isleworth)

  Pond, Chris

  Kemp, Fraser

  Pope, Greg

  Kennedy, Charles (Ross Skye)

  Pound, Stephen

  Kennedy, Jane (Wavertree)

  Powell, Sir Raymond

  Khabra, Piara S

  Prentice, Ms Bridget (Lewisham E)

  Kidney, David

  Prentice, Gordon (Pendle)

  Kilfoyle, Peter

  Prescott, Rt Hon John

  King, Andy (Rugby & Kenilworth)

  Primarolo, Dawn

  King, Ms Oona (Bethnal Green)

  Prosser, Gwyn

  Kingham, Ms Tess

  Quin, Ms Joyce

  Kumar, Dr Ashok

  Radice, Giles

  Ladyman, Dr Stephen

  Rammell, Bill

  Laxton, Bob

  Rapson, Syd

  Leslie, Christopher

  Raynsford, Nick

  Levitt, Tom

  Reed, Andrew (Loughborough)

  Lewis, Ivan (Bury S)

  Reid, Dr John (Hamilton N)

  Linton, Martin

  Rendel, David

  Livingstone, Ken

  Roche, Mrs Barbara

  Lloyd, Tony (Manchester C)

  Rogers, Allan

  Llwyd, Elfyn

  Rooney, Terry

  Lock, David

  Ross, Ernie (Dundee W)

  Love, Andrew

  Rowlands, Ted

  McAvoy, Thomas

  Ruane, Chris

  McCabe, Steve

  Ruddock, Ms Joan

  McCafferty, Ms Chris

  Russell, Bob (Colchester)

  McCartney, Ian (Makerfield)

  Russell, Ms Christine (Chester)

  McDonagh, Siobhain

  Ryan, Ms Joan

  McDonnell, John

  Salter, Martin

  McFall, John

  Sanders, Adrian

  McGuire, Mrs Anne

  Sawford, Phil

  McIsaac, Shona

  Sedgemore, Brian

  Mackinlay, Andrew

  Shaw, Jonathan

  McLeish, Henry

  Sheerman, Barry

  Maclennan, Rt Hon Robert

  Sheldon, Rt Hon Robert

  McNamara, Kevin

  Simpson, Alan (Nottingham S)

  McNulty, Tony

  Singh, Marsha

  MacShane, Denis

  Skinner, Dennis

  Mactaggart, Fiona

  Smith, Rt Hon Andrew (Oxford E)

  McWalter, Tony

  Smith, Angela (Basildon)

  McWilliam, John

  Smith, John (Glamorgan)

  Mahon, Mrs Alice

  Smith, Llew (Blaenau Gwent)

  126

  Snape, Peter

  Twigg, Derek (Halton)

  Soley, Clive

  Twigg, Stephen (Enfield)

  Southworth, Ms Helen

  Tyler, Paul

  Spellar, John

  Vaz, Keith

  Starkey, Dr Phyllis

  Walley, Ms Joan

  Stevenson, George

  Ward, Ms Claire

  Stewart, Ian (Eccles)

  Wareing, Robert N

  Stinchcombe, Paul

  Watts, David

  Stott, Roger

  Whitehead, Dr Alan

  Strang, Rt Hon Dr Gavin

  Wicks, Malcolm

  Straw, Rt Hon Jack

  Williams, Rt Hon Alan (Swansea W)

  Stringer, Graham

  Stuart, Ms Gisela

  Williams, Alan W (E Carmarthen)

  Stunell, Andrew

  Willis, Phil

  Sutcliffe, Gerry

  Wills, Michael

  Taylor, Rt Hon Mrs Ann (Dewsbury)

  Winnick, David

  Winterton, Ms Rosie (Doncaster C)

  Taylor, Ms Dari (Stockton S)

  Wise, Audrey

  Taylor, David (NW Leics)

  Wood, Mike

  Taylor, Matthew (Truro)

  Woolas, Phil

  Temple-Morris, Peter

  Wray, James

  Thomas, Gareth R (Harrow W)

  Wright, Anthony D (Gt Yarmouth)

  Tipping, Paddy

  Wright, Dr Tony (Cannock)

  Todd, Mark

  Wyatt, Derek

  Tonge, Dr Jenny

  Touhig, Don

  Tellers for the Ayes:

  Truswell, Paul

  Mr. David Clelland and

  Turner, Dr George (NW Norfolk)

  Janet Anderson.

  NOES

  Ainsworth, Peter (E Surrey)

  Greenway, John

  Amess, David

  Grieve, Dominic

  Arbuthnot, James

  Gummer, Rt Hon John

  Baldry, Tony

  Hague, Rt Hon William

  Bercow, John

  Hamilton, Rt Hon Sir Archie

  Beresford, Sir Paul

  Hammond, Philip

  Blunt, Crispin

  Hawkins, Nick

  Body, Sir Richard

  Heathcoat-Amory, Rt Hon David

  Boswell, Tim

  Hogg, Rt Hon Douglas

  Bottomley, Peter (Worthing W)

  Horam, John

  Bottomley, Rt Hon Mrs Virginia

  Howarth, Gerald (Aldershot)

  Brady, Graham

  Hunter, Andrew

  Brazier, Julian

  Jack, Rt Hon Michael

  Brooke, Rt Hon Peter

  Jackson, Robert (Wantage)

  Browning, Mrs Angela

  Jenkin, Bernard

  Bruce, Ian (S Dorset)

  Johnson Smith, Rt Hon Sir Geoffrey

  Burns, Simon

  Cash, William

  Key, Robert

  Chope, Christopher

  King, Rt Hon Tom (Bridgwater)

  Clappison, James

  Kirkbride, Miss Julie

  Clark, Rt Hon Alan (Kensington)

  Laing, Mrs Eleanor

  Clifton-Brown, Geoffrey

  Lait, Mrs Jacqui

  Cormack, Sir Patrick

  Lansley, Andrew

  Cran, James

  Leigh, Edward

  Curry, Rt Hon David

  Letwin, Oliver

  Davies, Quentin (Grantham)

  Lewis, Dr Julian (New Forest E)

  Davis, Rt Hon David (Haltemprice)

  Lidington, David

  Dorrell, Rt Hon Stephen

  Lilley, Rt Hon Peter

  Duncan, Alan

  Lloyd, Rt Hon Sir Peter (Fareham)

  Duncan Smith, Iain

  Loughton, Tim

  Evans, Nigel

  Luff, Peter

  Faber, David

  Lyell, Rt Hon Sir Nicholas

  Fabricant, Michael

  MacGregor, Rt Hon John

  Fallon, Michael

  McIntosh, Miss Anne

  Flight, Howard

  MacKay, Andrew

  Forth, Rt Hon Eric

  Maclean, Rt Hon David

  Fowler, Rt Hon Sir Norman

  McLoughlin, Patrick

  Fraser, Christopher

  Malins, Humfrey

  Gale, Roger

  Maples, John

  Garnier, Edward

  Mates, Michael

  Gibb, Nick

  Maude, Rt Hon Francis

  Gill, Christopher

  Moss, Malcolm

  Gillan, Mrs Cheryl

  Nicholls, Patrick

  Goodlad, Rt Hon Sir Alastair

  Page, Richard

  Gorman, Mrs Teresa

  Paice, James

  Green, Damian

  Paterson, Owen

  127

  Pickles, Eric

  Taylor, John M (Solihull)

  Redwood, Rt Hon John

  Taylor, Sir Teddy

  Robathan, Andrew

  Tredinnick, David

  Robertson, Laurence (Tewk'b'ry)

  Trend, Michael

  Roe, Mrs Marion (Broxbourne)

  Tyrie, Andrew

  Rowe, Andrew (Faversham)

  Viggers, Peter

  Ruffley, David

  Walter, Robert

  St Aubyn, Nick

  Wardle, Charles

  Sayeed, Jonathan

  Waterson, Nigel

  Shepherd, Richard

  Wells, Bowen

  Simpson, Keith (Mid-Norfolk)

  Whitney, Sir Raymond

  Smyth, Rev Martin (Belfast S)

  Whittingdale, John

  Soames, Nicholas

  Widdecombe, Rt Hon Miss Ann

  Spelman, Mrs Caroline

  Wilkinson, John

  Spicer, Sir Michael

  Winterton, Mrs Ann (Congleton)

  Spring, Richard

  Winterton, Nicholas (Macclesfield)

  Stanley, Rt Hon Sir John

  Woodward, Shaun

  Steen, Anthony

  Yeo, Tim

  Streeter, Gary

  Young, Rt Hon Sir George

  Swayne, Desmond

  Syrns, Robert

  Tellers for the Noes:

  Tapsell, Sir Peter

  Mr. Stephen Day and

  Taylor, Ian (Esher & Walton)

  Sir David Madel.

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

  COMPETITION BILL [LORDS] [MONEY]
  Queen's recommendation having been signified—
  Motion made, and Question put forthwith, pursuant to Standing Order No. 52(1)(a),
  That, for the purposes of any Act resulting from the Competition Bill [Lords], it is expedient to authorise the payment out of money provided by Parliament of any—

  (a) expenses incurred by a Minister of the Crown under or in consequence of that Act, or

  (b) increase attributable to that Act in the sums so payable under any other enactment. —[Mr. Betts.]

  Question agreed to.

  COMPETITION BILL [LORDS] [WAYS AND MEANS]
  Motion made, and Question put forthwith, pursuant to Standing Order No. 52(1)(a),
  That, for the purposes of any Act resulting from the Competition Bill [Lords], it is expedient to authorise—

  (a) the setting by the Director General of Fair Trading of fees in respect of the exercise of certain functions under the Act and the charging of such fees;

  (b) the payment of sums into the Consolidated Fund. —[Mr. Betts.]

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

    BROADCASTING
    That the draft Broadcasting (Percentage of Digital Capacity for Radio Multiplex Licence) Order 1998, which was laid before this House on 7th April, be approved. —[Mr. Betts.]
    Question agreed to.

  Secondary Transfer (Hertfordshire)
  Motion made, and Question proposed, That this House do now adjourn. —[Mr. Betts.]
  10.25 pm
  Ms Claire Ward: I have asked for this debate on behalf of the many parents and children in my constituency, and in much of Hertfordshire, who are suffering from the inadequacies of the secondary school transfer system. I shall speak for about 10 minutes, and then give my hon. Friend the Member for Stevenage (Barbara Follett) an opportunity to speak before my hon. Friend the Minister replies to the debate.
  In Watford and its immediate districts, we are served by 12 good secondary schools—of which 10 are grant-maintained, leaving only two within the control of the local education authority, Hertfordshire county council. They include single-sex schools and what were formerly known as voluntary aided schools.
  The problem is that, in the past few years, an increasing number of our children have been unable to gain admission to a school of their choice—whether it was their first, second, third or even fourth preference. Consequently, they have had to travel many miles from their friends and neighbourhood to attend another school.
  Last year, for example, one young boy was not offered a place at a local grant-maintained school of his choice. His parents came to see me at my surgery, and told me that he has to travel about six miles to another school, in St. Albans. The situation has been disruptive for both him and his family, affected his social circle, and—because of the extra time that he must spend travelling to school—restricted him in the after-school activities that he can participate in. Travel to and from school has also imposed much greater costs on the boy's parents.
  Unfortunately, that case is only one example of the difficulties faced by parents in Hertfordshire whose children have been refused a place at a local grant-maintained school.
  Schools are unable to refuse applications from students outside my area—such as north London and other parts of Hertfordshire—because of the Greenwich judgment. Consequently, local children are unable to obtain places at schools that are often within walking distance of their home.
  Mr. Andrew Dismore: Is my hon. Friend aware that the problem spills over from Hertfordshire into the neighbouring authority of Barnet, where my constituency is located, or that, in the past year, 134 pupils from Hertfordshire were moved to Barnet? Specifically, a grant-maintained school in my constituency—the Mill Hill school—has selected 45 per cent. of its pupils by aptitude, and admitted another 110 pupils who are siblings of existing pupils. The net result has been that there are absolutely no places for children who live even in the same street as the school. Is my hon. Friend aware that, because of the Greenwich judgment, the problems in Hertfordshire are mirrored in my own constituency?
  Ms Ward: I am aware of the situation, which has meant that local schools are unable to provide for their local community.

  129
  The causes of our problems in secondary school transfers cannot be attributed to one factor alone.
  The very quality of the schools has caused some of the problems, as parents from many miles away want to send their children to single-sex grammar schools or to former voluntary-aided schools, putting immense pressure on places. Some children living nearby cannot get in.
  I accept that some schools will always be more popular than others, but the problem is especially acute in Watford. For example, this year there were 859 applications for only 185 places in Parmiters school; the boys grammar school received 851 applications for 162 places; and the girls school received 812 for only 180 places. Those figures highlight the real problems that schools face in selecting children, and the significant number of parents who will ultimately be disappointed.
  The system of selection causes most of our difficulties. Children of 11 or 12 are required to take an exam early on a Saturday morning in January, and are given the terrible task of meeting their parents' expectations and obtaining a place at what they consider to be the best school in the area. It is the old 11-plus by any other name.
  There is no central clearing-house system, and parents have to make application to the individual school of their choice. The schools select on the basis of a number of criteria, and of course the exam results feature high on the list. As the schools consider the applications in the weeks following the exam, parents and children wait anxiously for news of offers.
  As letters arrive from each of the schools, some children will be fortunate enough to receive one or more offers, while others will receive four or five rejections. Because of the absence of a co-ordinated system, some children receive up to six offers of places, at the expense of others who receive none. That is only the first round of problems for some children and their parents, and those without a place after the first round can face another three or four rounds.
  That causes real heartache: children who do not gain a place feel rejected, and believe that they are failures. That may live with them for the rest of their lives. Those of us with parents or grandparents who went through the original 11-plus system will undoubtedly have such stories to tell. Sometimes a child is the only one not to have a place at a school that is due to take all his or her classmates.
  In total, about 3,000 children transfer each year in Hertfordshire from primary to secondary schools. This February, 1,000 of those children had not received an offer from any school. That shows how acute the problem is. Over recent months, the local education authority has attempted to gain agreement with all the admitting authorities on a single clearing-house system to save parents from the difficulties of multiple applications and children ultimately receiving no offers.
  Such a system would ensure that every child received the offer of a place on the same day, rather than having to proceed through up to four rounds, over many weeks, before possibly—only possibly—receiving a place. As no agreement has been reached between the grant-maintained schools and the local education authority, the decision has been referred to my right hon. Friend the Secretary of State for Education and Employment, and we hope that he will be able to make a decision.
  130
  It is vital to have a system that recognises parental choice and, above all, is transparent, simple and effective. Perhaps my hon. Friend the Minister will be able to confirm that my right hon. Friend has received communications from the LEA, together with a request that he impose on the county a system that will help to alleviate at least some of the administrative problems caused by the need for multiple applications. What options is my right hon. Friend currently considering?
  The system has an effect not only on children and parents but on the schools themselves. The most popular schools are in a position to offer places to the ablest and brightest children, as determined by the exams. That means that schools do not have a broad range of ability. In no sense is there a comprehensive intake of children with differing abilities: the small number of children with special needs in schools that use 11-plus selection is proof of that. Watford girls grammar school has only one child who has been statemented to receive special needs assistance; Francis Coombe, a local education authority school, has 60 statemented children.
  Many parents will refer to the locally and nationally published league table results. It is not surprising that many wish their children to attend the schools with the best academic performance results. It is much more difficult for schools with such a high proportion of children who require special attention to achieve the performance in the league tables that other schools without such a varied intake can achieve, and that creates a vicious circle.
  Schools with many pupils with special needs are seen as schools that parents do not consider to provide the best education. But that is not true: such schools provide a very good education, although the absence of any value added information deceives parents into thinking otherwise. It is vital for the Government to deal with the problems by amending league tables to take full account of the real value of education at such schools.
  Last May, the Government were elected on a manifesto that promised no selection of children at the age of 11 on the basis of academic ability. I whole-heartedly support that policy, as, I am sure, do my hon. Friends. There can be no question of determining children's life chances at the age of 11 on the basis of a single exam held on a Saturday morning in late January. I hope that my hon. Friend the Minister will tell us that the situation will improve for the parents of children in my constituency who are still caught in a selection-driven time warp.
  10.36 pm
  Barbara Follett rose—
  Mr. Deputy Speaker (Mr. Michael Lord): Has the hon. Lady secured the permission of the hon. Member for Watford (Ms Ward) and the Minister to speak?
  Barbara Follett: Yes.
  I congratulate my hon. Friend the Member for Watford (Ms Ward) on securing the debate—and on speaking on her 26th birthday.
  As my hon. Friend said, the present secondary school admission system in Hertfordshire is in dire need of reform. I congratulate the education authority on all its efforts to reform the system, and particularly on its

  131
  consultation exercise with parents. At present, children get into secondary schools in Hertfordshire on the basis of parental letters, which is plainly unjust. It favours not only the better off but the better educated, and, not surprisingly, has led to a record number of appeals in recent years.
  Last autumn, the county council conducted a survey, that found—understandably—that most Hertfordshire families wanted their children to attend a school as near to their homes as possible. At present, a significant number of children cannot secure a place at the nearest school, while others cannot even secure a place at a school in their home village or town. As a result, one of Hertfordshire's main problems is the amount of travelling that schoolchildren must do. That is on top of all the other problems outlined by my hon. Friend.
  To solve the transport problem and to try to give parents more choice, Hertfordshire local education authority decided to create a system of multiple ring fences around groups of towns and villages. Under that system, children would have been guaranteed a place within their ring-fenced areas, and parents would have been guaranteed an element of choice. Any spare places would have been allocated to children outside the ring fence.
  Unfortunately, the ring fence system had to be abandoned, because of the Rotherham judgment. That judgment states that parents' first choice of school is paramount, and means that any LEA that tried to allocate second or third places at a school before giving places to first preferences from outside the ring fence would be acting unlawfully.
  In the light of the Rotherham judgment, Hertfordshire has had to revise its secondary admission plans, and despite herculean efforts, the new ones do not provide a solution as good as the original ring fencing. In some areas, little or no choice is given to parents and children.
  That is not the fault of the local education authority, which has done its best to consult parents and respond to children's needs. It produced a solution that would have satisfied most parents, whether they lived in the rural or the urban areas of my constituency. Unfortunately, the Rotherham judgment scuppered it. More than 100 parents have contacted me about the problems they will face as a result of the compromise criteria that the LEA has had to introduce.
  Mr. Kerry Pollard: Is my hon. Friend aware that my constituency suffers the same problems? Dozens of children have been left without places. I endorse her comments, and congratulate my hon. Friend the Member for Watford (Ms Ward) on obtaining this debate.
  Barbara Follett: As my hon. Friend says, this is a Hertfordshire-wide problem, but the Government must address it. There is still a pretence in some circles that the national law on school admissions provides choice for all parents. It does not: some parents get some choice in some areas. Our task is to provide a choice for the many, not the few.
  10.40 pm
  The Minister for School Standards (Mr. Stephen Byers): I congratulate my hon. Friend the Member for Watford (Ms Ward) on securing this debate. I offer double congratulations if this is also her 26th birthday.
  132
  This issue did not come to my hon. Friend only in the past few weeks or months. I remember vividly being lobbied within a few days of taking office as Minister for School Standards about her concerns on school admissions procedures as they effected her constituents. She led a delegation to meet the Under-Secretary, my hon. Friend the Member for Birmingham, Yardley (Ms Morris), last summer. She has tabled parliamentary questions about the issue and arranged local meetings with concerned parents and teachers to discuss the way forward. I am pleased that officials from my Department were able to attend some of those meetings.
  All that activity has been for a good reason. Parents and children are not getting a fair deal. That is a real problem which must be addressed. We heard from my hon. Friend the Member for Stevenage (Barbara Follett) about the increased difficulties caused by what is referred to as the Rotherham judgment, which places restrictions on the way in which local education authorities can administer their admissions policies. The Government are considering its legal consequences. My right hon. Friend the Secretary of State for Education and Employment is considering what action the Government should take. We are discussing the way forward with the Local Government Association.
  From the intervention of my hon. Friend the Member for St. Albans (Mr. Pollard), we know that the issue affects many constituencies in Hertfordshire. I am pleased that my hon. Friends the Members for Welwyn Hatfield (Miss Johnson) and for Hemel Hempstead (Mr. McWalter) joined the debate. However, it is not just a Hertfordshire issue. As my hon. Friend the Member for Hendon (Mr. Dismore) noted, difficulties can also be caused in neighbouring local education authorities.
  We have a pressing problem which the Government must address, because we do not underestimate the upset and anxiety caused to parents by the way in which admissions arrangements apply in Hertfordshire. Parents have to make multiple applications to different schools at various times of the year. There is no single preference system covering all schools in the county. As a result, some parents receive multiple offers and others none at all. The local education authority has informed my Department that, in this year's round of applications, one in three parents in Watford were not given a place for their child. That is the scale of the problem we face.
  The problem has come about for a variety of reasons, but there are two principle causes: first, the number of schools operating their own admissions arrangements and, secondly, the level of partial selection. The present situation is clearly unacceptable, and something needs to be done. In the long term, the School Standards and Framework Bill will remedy the problem; if I have time, I hope to say a little about how it will do that. However, that legislation, even though we hope it will be enacted by this summer, will cover only admissions for the school year starting in September 2000. The Government believe that we need to move more quickly than that.
  Whatever action we take, we can do nothing to affect admissions to start school this September; the admissions round is already under way and we are having to operate that round under a system inherited from the previous Government. However, the Government have been giving serious thought to the steps that can be taken in respect of admissions for the school year starting in September 1999. If we move quickly, that is the soonest we can make

  133
  an impact on the admissions round. As a result of representations made by my hon. Friend the Member for Watford and other hon. Friends representing constituencies in Hertfordshire, I am able to announce this evening the action that the Government intend to take in Hertfordshire in respect of admissions for the school year starting September 1999.
  As my hon. Friend the Member for Watford said, Hertfordshire local education authority has been trying to achieve local agreement on a co-ordinated secondary transfer process for the September 1999 intake. Its recent consultation exercise included all grant-maintained and voluntary-aided schools. Some schools have rejected the LEA's proposals for a single preference system, which is already operated by the county's 55 county schools and some of its grant-maintained and voluntary-aided schools. As a result of the failure to achieve agreement, the LEA has written to my right hon. Friend the Secretary of State formally requesting him to make a co-ordinated scheme for secondary school admission arrangements under section 430(4) of the Education Act 1996.
  The application from the LEA is to cover the whole of Hertfordshire, and my officials met the LEA on 1 May to discuss the proposals in detail. The LEA wants a single preference system that results in all parents receiving at least one offer of a school place and all offers being made on the same day, to overcome some of the real difficulties that are apparent under the present arrangements. A unique aspect of the situation in Hertfordshire is that there is no overall shortage of places, so the objective is to make admissions arrangements more streamlined, and ensure that places are allocated fairly and without the present stress for parents and children.
  Officials from my Department will now visit those grant-maintained and voluntary-aided schools that have not signed up to the LEA's agreement. We shall listen to their views and try to seek agreement from those schools to the LEA's proposals. If that does not prove possible, Ministers have the power to impose a co-ordinated scheme. It is a power that we have recently exercised in Peterborough. Obviously, we would prefer there to be a voluntary agreement, but, if that cannot be achieved, we will not simply stand to one side and ignore the difficulties faced by parents. We will therefore, if necessary, impose a scheme to overcome the difficulties experienced by parents and children in Hertfordshire.
  Any scheme proposed by the Secretary of State would be subject to consultation—that is only right and proper—but we intend to move with as much speed as possible to ensure that all changes will be in place to effect admissions for the school year starting September 1999. This will be an important development, which I hope reflects the urgency with which the Government intend to treat the situation.
  In the longer term, the issue of admissions will be covered by the School Standards and Framework Bill, currently under consideration in another place. Provisions in that Bill will require all schools admissions authorities to operate under a code of practice on admissions. It is the Government's intention to publish, during the first part of 1999, this code of practice. It will be subject to
  134
  approval by Parliament, and it will cover such vexed issues as partial selection, a school's admissions criteria and co-ordinated practical arrangements for admissions.
  The application of the code will be in the hands of an adjudicator, who will arbitrate if there are disputes between the relevant admissions authorities. Adjudicators will be appointed by the Secretary of State.
  This evening, it would be wrong of me to pre-empt the contents of the code before it has been agreed by Parliament; but the code will allow the adjudicator to call a halt to partial selection when it is clearly operating in a manner that is not in the best interests of children in a locality. We also need to consider, in the context of the School Standards and Framework Bill, how parents' appeals against a refusal can be judged more independently. There is genuine concern in many areas that there might be a conflict of interest among those taking part in admissions appeals. The Bill therefore provides that appeals panels will be independent of the LEA and of the governing body that has refused a parent's application. We will achieve that by ensuring that members of the authority or the relevant governing body are precluded from serving on an appeals panel.
  The difficulty we face is that the School Standards and Framework Bill will not be in place until the admissions round starting in the school year 2000. As I have said, we feel that action needs to be taken before then to ensure that parents in LEA areas such as Hertfordshire no longer have to go through the grief and difficulty that they encounter now. In many parts of the country, we have inherited from the previous Administration admissions procedures that may suit certain schools but do not suit many parents. We have to overcome those difficulties in a way that is sensitive to local requirements. Above all, we must do so in a way that puts the interests of parents and their children first.
  I believe that, by giving urgent attention to using our powers under section 430 of the 1996 Act, we will be able to act positively to assist parents in Hertfordshire who, as my hon. Friend the Member for Watford pointed out, all too often feel vulnerable to, and let down by, the admissions arrangements now in place. If we move with urgency, and with all due speed, I am confident that we shall be able to consult all those interested parties and to ensure that we have in place an imposed system, if that is necessary, which will put the interests of parents and of children first.
  This is an important issue for parents, teachers and children in the Hertfordshire area. The attendance of so many hon. Members, and of my hon. Friends representing constituencies in Hertfordshire, shows that that is so. I hope that tonight I have been able to offer some reassurance to my hon. Friends and their constituents. The Government do take their concerns seriously and we will act to ensure a fair admissions policy, which meets the needs of parents, children and schools in Hertfordshire and throughout the country.
  Question put and agreed to.
  Adjourned accordingly at five minutes to Eleven o' clock.

PRESIDENT OF THE COUNCIL

  Drugs
  Mr. Green
  To ask the President of the Council what is the budget under the direct control of the United Kingdom Anti-Drugs Co-ordinator. [40262]

  Mrs. Ann Taylor
  The UK Anti-Drugs Co-ordinator, Keith Hellawell, is a special adviser to the Government, and as such has no budget to spend. As part of the Government's Comprehensive Spending Review, he has overseen a review of existing drug resources. This has informed the Government's new anti-drugs strategy, 'Tackling Drugs to Build a Better Britain', launched last month. This estimated that the Government currently spend about £1.4 billion a year on anti-drugs activity within departmental programmes. An announcement on funding from 1999–2000 will be made later in the year, following the outcome of the Comprehensive Spending Review.

DEFENCE

  Nuclear Submarines
  Mr. Brazier
  To ask the Secretary of State for Defence which SSNs are presently undergoing refit; when the work commenced; and when they are expected to be rededicated. [40868]

  Mr. Spellar
  The following submarines are currently in refit with the dates of commencement and rededication as shown:

  Submarine

  Date of commencement

  Rededication

  HMS Tireless

  June 1996

  January 1999

  HMS Torbay

  January 1998

  Estimated February 2001

  HMS Superb

  August 1994

  April 1998

  HMS Sceptre

  May 1997

  June 2000

  Weapon Diagnostic Division, Aldermaston
  Mr. Matthew Taylor
  To ask the Secretary of State for Defence when the Weapon Diagnostic Division at the Atomic Weapons Establishment, Aldermaston, was set up; what is the purpose of this division; how many series of technical papers or reports are currently being produced by this division; and what are the names of each series. [40754]

  Mr. Spellar
  The Weapon Diagnostic Division of the Atomic Weapons Establishment, Aldermaston was created in 1979 and disbanded in 1994. Its function 2
  was to diagnose underground test programme results. As it no longer exists, there are no documents currently being produced by the Weapon Diagnostic Division.

  Atomic Weapons Establishment
  Mr. Matthew Taylor
  To ask the Secretary of State for Defence, pursuant to his answer of 21 April 1998,Official Report, columns 552–53, on the Atomic Weapons Establishment, how many audit reports have been produced by the Directorate of Quality Assurance since 1 January 1995; and how many of these reports are unclassified. [40768]

  Mr. Spellar
  The Directorate of Quality Assurance has produced over 1,200 audit reports since 1 January 1995. Of these, only one was classified.

  Mr. Matthew Taylor
  To ask the Secretary of State for Defence, pursuant to his answer of 21 April 1998,Official Report, column 553, on the Atomic Weapons Establishment, if he will list the unclassified reports in the untitled series of papers produced by the Warhead Engineering Division, indicating the title of each paper and the date on which each paper was produced. [40753]

  Mr. Spellar
  I am today placing a list in the Library of the House.

  Computers (Hacking)
  Mr. Matthew Taylor
  To ask the Secretary of State for Defence what monitoring his Department conducts on the extent to which outside individuals have attempted to hack into his Department's computer system; how often reports are made on this matter; and what is the current security classification of such reports. [40755]

  Mr. Spellar
  Ministry of Defence policy on the connection of computer systems to external data networks, such as the Internet, is that the computer system should be dedicated to the purpose and, unless the system processes only unclassified data, be protected by a security architecture which includes firewall technology that monitors attempts at hacking. There is no evidence of a successful intrusion from an external source to any MOD computer system.

  The MOD is a contributing Department to the Government-wide Unified Incident Reporting and Alert Scheme, UNIRAS, run by the Security Service. Security incidents, including attempts at hacking, are reported to UNIRAS and an annual report, classified RESTRICTED, is produced by the Security Service.

  Strategic Defence Review
  Mr. Matthew Taylor
  To ask the Secretary of State for Defence how many authors of submissions by outside organisations and individuals to the Strategic Defence Review have consented to their submissions being made public; and by what means members of the public may view these submissions. [40668]

  Mr. George Robertson
  486 authors of submissions by outside organisations and individuals to the Strategic Defence Review have consented to their submissions being made public. We are offering to supply copies of the submissions on microfiche to libraries in London,
  3
  Belfast, Edinburgh, Cardiff, Cambridge, Manchester, Newcastle-upon-Tyne, Birmingham, Bath, Exeter and Oxford. These copies are currently in production.

  Tank Regiments
  Mr. Gordon Prentice
  To ask the Secretary of State for Defence what additional opportunities for training tank regiments are likely to occur with the proposed expansion of NATO to include Poland and Hungary. [41224]

  Mr. George Robertson
  Extensive facilities for brigade-level armoured training in Poland are already available for use by other nations, and the United Kingdom makes regular use of them. The enlargement of NATO is unlikely in itself to result in additional opportunities for armoured training in Poland, Hungary or the Czech Republic.

  NATO Enlargement
  Ann Clwyd
  To ask the Secretary of State for Defence if he will place in the Library a copy of the NATO study on the costs of enlargement. [41543]

  Mr. George Robertson
  The NATO study on the costs of enlargement is a classified document, and I am therefore withholding it under exemption 1 (defence, security and international relations) of the Code of Practice on Access to Government Information and do not propose to publish it. I have however provided a copy of the study to the Defence Select Committee, whose Third Report of Session 1997–98 (HC 469) reproduces the unclassified information provided to it.

EDUCATION AND EMPLOYMENT

  Pre-school Care
  Mr. Dawson
  To ask the Secretary of State for Education and Employment how he will ensure that the needs of three year old children are appropriately met in pre-school care. [41660]

  Ms Estelle Morris
  The pre-school needs of children up to the age of eight are safeguarded by statute under the Children Act 1989. This requires every local authority to keep a register of persons who act as childminders on domestic premises and also of persons who provide day care in non-domestic premises. The local authority has to be satisfied that those registered are suitable to be looking after children up to this age and have adequate regard to the needs of all children. The Department published, on 27 March 1998, a Consultation Paper on the Regulation of Early Education and Day Care.

  Pathfinder Areas
  Mr. Keetch
  To ask the Secretary of State for Education and Employment how much public money each New Deal Pathfinder area received from the Government between 1 January and 6 April; and if he will make a statement. [40825]

  Mr. Andrew Smith
  Although approximately £3.2 million was earmarked to meet the cost of operating the New Deal Pathfinders in 1997–98, with £5m programme expenditure held centrally, it is not possible to give actual expenditure figures at this stage.

  Mature Students
  Mr. Brady
  To ask the Secretary of State for Education and Employment what percentage change has taken place in the numbers of(a) mature students entering higher education and (b) lone parents entering higher education as mature students in the last year over the previous year. [40823]

  Dr. Howells
  The number of mature students entering higher education courses in higher education institutions in the UK rose by 1 per cent. between 1996–97 and 1997–98, from 339,100 to 342,900. Mature students are defined as postgraduates aged 25 and over, and undergraduates aged 21 and over. Information on the numbers of lone parents entering higher education as mature students is not held centrally. However, data from the Labour Force Survey show that the number of lone parents aged 21 or over in full-time higher or further education rose from 207,000 in 1996–97 to 222,000 in 1997–98, representing an increase of 7 per cent.

  Public Bodies
  Mr. Öpik
  To ask the Secretary of State for Education and Employment how many and what proportion of his Department's appointees to non-departmental public bodies are (i) aged under 25, (ii) aged 25 to 30 and (iii) aged 31 to 35 years. [40742]

  Dr. Howells
  The number of appointees to Non-Departmental Public Bodies sponsored by this Department, within the specified age ranges, is as follows:

  (i) aged under 25—nil;

  (ii) aged 24 to 30—nil;

  (iii) aged 31 to 35—one.

  This one appointee under 35 years of age, represents 0.6% of the 160 current appointees.

  The Government are committed to encouraging a wide range of candidates to apply for positions on the boards of public bodies, reflecting the diverse society in which we live. This includes encouraging more young people to put themselves forward as potential candidates for public appointments. All appointments are made on merit, and candidates must demonstrate that they have the necessary skills and experience to match the needs of the public body on which they wish to serve.

  Long-term Unemployment
  Mr. Keetch
  To ask the Secretary of State for Education and Employment when his Department will publish the design of the new deal for the long-term unemployed; when he expects the new deal to begin; and if he will make a statement. [40665]

  Mr. Andrew Smith
  I will publish this month the design document for the New Deal for people aged 25 and over. The New Deal for people aged 25 and over will begin on 29 June.

  Departmental Energy Use
  Mr. Stunell
  To ask the Secretary of State for Education and Employment what proportion of the Department's energy usage was from(a) renewable energy and (b) combined heating in each year since 1989–90. [40410]
  5
  Dr. Howells
  The Department does not, at present, utilise any renewable energy. Since 1995–96, some of the Department's energy has been supplied by combined heat and power. The proportions in each year since 1995–96 are as follows:

  Year

  Percentage

  1995–96

  7.53

  1996–97

  8.14

  1997–98

  18.76

  1 End of year figures for 1997–98 are not yet available. Therefore, the figure has been estimated against the projected outturn

  Oil, gas and electricity consumption in accommodation occupied by DfEE

  Year

  Gas consumption (kWh)

  Actual cost £

  Gas oil (kWh)

  Actual cost £

  Electricity (kWh)

  Actual cost £

  Total consumption (kWh)

  Actual cost £

  1990–91

  16,362,479

  194,586

  4,155,560

  63,202

  19,359,731

  1,205,638

  39,877,770

  1,463,426

  1991–92

  16,543,141

  215,385

  4,290,339

  47,135

  21,365,033

  1,513,544

  42,189,514

  1,776,064

  1992–93

  17,388,136

  215,174

  74,401

  900

  21,020,158

  1,444,586

  38,482,695

  1,660,660

  1993–94

  19,236,941

  228,908

  42,400

  600

  20,753,014

  1,468,543

  40,032,355

  1,698,051

  1994–95

  17,229,941

  186,135

  —

  —

  22,012,900

  1,407,250

  39,242,841

  1,593,386

  1995–96

  14,074,182

  113,704

  —

  —

  21,223,204

  1,350,526

  34,297,386

  1,464,230

  1996–97

  13,588,165

  132,708

  —

  —

  22,342,299

  1,205,667

  35,930,464

  1,337,963

  1997–981

  7,110,025

  29,116

  —

  —

  14,565,570

  295,481

  21,675,595

  324,597

  1 Only the first three quarters' figures are available

  Local Authority Youth Services
  Dr. Tonge
  To ask the Secretary of State for Education and Employment if he will make a statement on the establishment of a statutory base for local authority youth services. [40136]

  Dr. Howells
  Local authorities have an existing duty under the Education Act 1996 to secure provision of adequate facilities for further education, of which the youth service forms a part. The Green Paper The Learning Age reaffirmed the Government's commitment to placing the youth service on a stronger footing. A consultation paper on the future of the youth service will be issued later this year.

  Dentists (Training)
  Mr. Livsey
  To ask the Secretary of State for Education and Employment what was the average cost to public funds of training an NHS dentist in the last year for which figures are available. [40104]

  Dr. Howells
  The average cost to public funds of training a dentist over five years on the basis of 1996/97 figures was some £120,000 per student, including the costs to the NHS of providing clinical placements but excluding the cost of student support.

  Higher Education Funding
  Mr. Jim Cunningham
  To ask the Secretary of State for Education and Employment if he will ensure that higher education funding is not reduced following the introduction of tuition fees. [41228]
  6
  Mr. Stunell
  To ask the Secretary of State for Education and Employment what quantity of(a) oil, (b) gas and (c) electricity, was purchased for the heating, lighting and powering of all accommodation occupied by his Department in each year since 1989–90; and what was the total cost in real terms for (a) to (c) in each year. [40413]

  Dr. Howells
  The following table details the information which is available on DfEE consumption and costs for each financial year from 1990–91 to 1997–98. Central records were not held prior to 1990–91; therefore, information for 1989–90 is not included.

  Dr. Howells
  As my right hon. Friend said in the House on 23 July 1997,Official Report, column 951, the Government will ensure that savings promised from the new funding arrangements for higher education are used to improve quality, standards and opportunities for all in further and higher education. As evidence of our intention, the funding package announced by my right hon. Friend on 23 September 1997 will allow an extra £165 million to be spent on higher education in 1998–99.

  Graduate Earnings
  Dr. Lynne Jones
  To ask the Secretary of State for Education and Employment what assessment he has made of the earnings of graduates relative to those of non-graduates; and what assessment he has made of the impact of gender on the earnings of graduates. [41593]

  Dr. Howells
  Compared with those who obtain the qualifications to go to university but choose not to do so, graduates on average see their earnings rise by broadly a fifth by their early 30s as a direct result of their higher qualifications.

  Comparing the gross weekly earnings of people whose highest qualification is a degree with the gross weekly earnings of people whose highest qualification is 2 or more A levels shows that both male and female graduates earn more than male and female non-graduates throughout their working life.

  The pattern of earnings for young women graduates is broadly similar to men, but diverges after the age of 30. Women's earnings are lower than men's on average, reflecting a greater likelihood of part-time work or time out of the labour force. However, after allowing for this, the earnings of graduates compared with non-graduates remains greater for women than men.

CULTURE, MEDIA AND SPORT

  Sport (Lottery Funding)
  Mr. Sanders
  To ask the Secretary of State for Culture, Media and Sport what representations he has received in favour of making the care and repair of existing sports facilities eligible for lottery funding; and if he will make a statement. [41134]

  Mr. Banks
  I have received several representations calling for Lottery funding to be made available for the care and repair of existing sporting facilities.

  The English Sports Council, who are responsible for the distribution in England of the Lottery Sports Fund, are in constant dialogue with the Local Government Association, Chief Leisure Officers and Governing Bodies of Sport about the need for the funding of existing sports facilities.

  The Bill to reform the National Lottery will widen access to the benefits of the Lottery and allow a more strategic and co-ordinated approach to distribution to reflect identified needs. As part of this new approach, I hope the English Sports Council will plan to introduce in future a suitable programme under which existing sporting facilities can apply for funding from the Lottery.

  Television Advertising
  Mr. Dafis
  To ask the Secretary of State for Culture, Media and Sport if he will take action to reduce the average number of minutes of advertising per hour on commercial television. [41461]

  Mr. Fisher
  Under the Broadcasting Act 1990 it is for the Independent Television Commission to determine the maximum amount of time to be given to advertisements on licensed television services.

ENVIRONMENT, TRANSPORT AND THE REGIONS

  Radioactive Materials (Dumping at Sea)
  Mr. McGrady
  To ask the Secretary of State for the Environment, Transport and the Regions what discussions he has held concerning the early release of files containing information on the historic dumping of radioactive materials at sea. [40871]

  Angela Eagle
  Representatives of the Committee of Nuclear Free Local Authorities raised questions about the availability of information on historic dumping of radioactive material at sea when they met the Minister for the Environment on 8 April. The Minister is writing to the Committee in response to the points raised.

  Journey Lengths
  Mrs. Curtis-Thomas
  To ask the Secretary of State for the Environment, Transport and the Regions what percentage of all journeys made in Britain are(a) under one mile and (b) under four miles in length. [41131]

  Ms Glenda Jackson
  29 per cent. of journeys made by residents of Great Britain are under 1 mile in length, and 63 per cent. are under four miles. (Data from the National Travel Survey, averaged over the years 1994–96.)

  MV Rema
  Mr. Prosser
  To ask the Secretary of State for the Environment, Transport and the Regions how many times the merchant vessel Rema was inspected under port state control arrangements in the past five years; and if he will make a statement on the loss of the vessel. [40350]

  Ms Glenda Jackson
  Four port state inspections were carried out on the merchant vessel REMA in the UK in the past five years. An additional five inspections were carried out in other countries within the region of the Paris Memorandum of Understanding in the period since 20 August 1996. The Marine Accident Investigation Branch will be investigating the loss of the REMA on behalf of the Belize Authorities. A report detailing their findings will be published in due course.

  Mr. Prosser
  To ask the Secretary of State for the Environment, Transport and the Regions what were the minimum certificate of competency requirements for the seafarers on the vessel Rema; what was the issuing authority of those certificates of competency; and if the vessel complied with these on the day of her loss. [40349]

  Ms Glenda Jackson
  The minimum certificate of competency requirements for the seafarers on the vessel REMA being registered in Belize are stipulated by the International Merchant Marine Registry of Belize in accordance with Regulation V/13(b) of SOLAS. The vessel's Minimum Safe Manning Certificate, issued 10 February 1998, specifies One Master, One First Mate and One Engineer Officer. These were the only personnel required to hold certificates of competency. When the vessel was inspected in February 1998, the certificates of competency were issued by the International Merchant Marine Registry of Belize. It is not possible to say if the vessel complied with the requirements of the Minimum Safe Manning Certificate on the day of her loss.

  Mr. Prosser
  To ask the Secretary of State for the Environment, Transport and the Regions if he will provide details of the last port state control inspection of the vessel Rema, listing the areas of deficiency; and what actions were taken by the vessel's owners to remedy the deficiencies. [40354]

  Ms Glenda Jackson
  The last port State inspection of the vessel REMA in Montrose, UK, on 9 February 1998 resulted in detention of the vessel. It was released on 13 February 1998, after all detainable deficiencies had been rectified.

  Deficiencies

  Action taken by owners

  Detainable deficiencies

  Captain unable to produce certificate of competency

  Rectified

  No personnel on board able to produce radio certificate

  Rectified

  Various navigation charts out of date

  Rectified

  Various nautical publications out of date

  Rectified

  No fire fighting system in paint locker

  Rectified

  Fire hose leaking

  Rectified

  No lifeboats or equivalent on board as required by SOLAS 60

  Rectified

  Radio batteries found dry and in need of replacement

  Rectified

  9

  Deficiencies

  Action taken by owners

  Other deficiencies

  6" of oil in engine room

  Rectified

  Waste tank open to atmosphere

  Rectified

  No receipt on board for last waste tank discharge—Master informed

  Not recorded

  Navigation (NVC) white light not working

  Rectified

  Navigation (NUC) white light without appropriate bulb and shade

  Rectified

  Lifebuoy light not working

  Rectified

  Light out in engine room

  Rectified

  Mate's ticket has no STCW endorsement

  Flag state/consul Informed by MCA

  MF/HF wire antenna insulation readings very low—lead in insulator to be cleaned. Master instructed to rectify before departure.

  Not recorded

  MF/HF wire antenna connector to be re-made. Master instructed to rectify before departure.

  Not recorded

  Mr. Prosser
  To ask the Secretary of State for the Environment, Transport and the Regions what the minimum manning requirements were for the vessel Rema; and if the ship complied with these on the date of her loss. [40352]

  Ms Glenda Jackson
  The minimum manning requirement for the vessel REMA, being registered in Belize, is as stipulated by the International Merchant Marine Register of Belize in the vessel's Minimum Safe Manning Certificate. When the vessel was inspected in Montrose in February 1998, the minimum safe manning required by Belize was four and it was noted that there was no Engineer Officer aboard. When this was queried, Belize responded by producing a Minimum Safe Manning Certificate for seven, including an Engineer officer, but the ship had life-saving appliances and accommodation for only five. As this was approximately the manning that could be reasonably expected on a vessel of this size and type, the REMA was released from detention with a crew of five, including an Engineer Officer, on the condition that the discrepancy between the Safe Manning Document and life saving appliance was rectified, by Belize, before departure from the next port after release from detention. Once again we cannot say whether there were five aboard the vessel at the time of her loss.

  Mr. Prosser
  To ask the Secretary of State for the Environment, Transport and the Regions on how many occasions the vessel Rema was detained following port state control inspections in the past five years; and if he will list the dates of and reasons for the detentions. [40351]

  Belize flag vessels detained by United Kingdom: 1993–31 March 1998

  Name of vessel

  Ship type

  GT

  Date detained

  Date released

  Date Place of detention

  Reasons for detention

  Rose

  General cargo

  299

  14/7/93

  5/8/93

  Topsham

  Manning, fire-fighting and life-saving appliance deficiencies.

  Eagle

  Bulk carrier

  499

  5/1/94

  28/1/94

  Montrose

  No certificated master or deck officer on board. Certificates issued by non-recognised authority.

  Eastwind

  Supply vessel

  110

  1/9/94

  8/9/94

  Grangemouth

  No loadline certificate. No liferafts, no lifejackets, no certificated mate, inadequate navigation lights, inadequate charts and tide tables.

  10
  Ms Glenda Jackson
  The vessel REMA was detained once following port state inspections in the UK in the past five years, and once by another member of the Paris Memorandum of Understanding in the period since 20 August 1996.

  Date

  Reasons for detention

  9 February 1998 UK

  Captain unable to produce certificate of competency

  No personnel on board able to produce a radio certificate

  Various navigation charts out of date

  Various nautical publications out of date

  No fire fighting system in paint locker

  Fire hose leaking

  No lifeboats or equivalent on board as required by SOLAS 60

  Radio batteries found dry and in need of replacement

  Note

  All detainable deficiencies were rectified before release on 13 February 1998

  Date

  Areas of deficiencies

  14 March 1997

  Hull damage impairing seaworthiness

  Germany

  Decks cracking

  Railing cat walks

  Ventilator air pipes

  Anchoring devices

  Musters and drills

  Minimum safe manning certificates

  Charts

  Auxiliary engines

  Steering gear

  Certificates of competency

  Yvette Cooper
  To ask the Secretary of State for the Environment, Transport and the Regions if she will publish the report of the investigation into the loss of the 'Rema' vessel by the Marine Accident Investigation Branch. [41000]

  Ms Glenda Jackson
  The MAIB will be investigating the loss of the REMA on behalf of the Belize authorities. A report detailing their findings will be published in due course.

  Port State Controls
  Yvette Cooper
  To ask the Secretary of State for the Environment, Transport and the Regions if he will list the reasons for the detention of all Belize-registered vessels under Port State Control arrangements in the past five years. [40998]

  Ms Glenda Jackson
  The table gives details on the 23 Belize-flag vessels detained by the UK from April 1993 to March 1998.
  11

  Belize flag vessels detained by United Kingdom: 1993–31 March 1998

  Name of vessel

  Ship type

  GT

  Date detained

  Date released

  Place of detention

  Reasons for detention

  Westwind

  Supply vessel

  111

  1/9/94

  8/9/94

  Grangemouth

  No loadline certificate. No liferafts, inadequate navigation lights, no certificated mate, no pilot books or tide tables.

  Caribe 1

  General cargo

  209

  27/3/95

  13/5/95

  Newhaven

  Numerous air vents and pipes not closing. Hatch covers not watertight, various weathertight doors not closing, seawater leaking into master's cabin. Numerous deficiencies in life-saving equipment. No stability information, no certificated officers other than master.

  Claire

  General cargo

  2,774

  4/10/95

  6/10/95

  Aberdeen

  Starboard lifeboat engine inoperative. No emergency fire pump. Fuel oil emergency shut-off valves inoperative. Engine room fire hoses perished.

  Atlantic Princess

  Fish factory ship

  1,322

  10/10/95

  13/10/95

  Birkenhead

  International oil pollution prevention certificate not on board. Oily water separator inoperative.

  Tamar

  Tug

  161

  21/12/95

  5/1/96

  Portsmouth

  No satellite distress beacon (EPIRB). Liferafts incorrectly rigged. Liferafts incorrectly rigged and stowed. Bilges clogged with oil. Equipment missing from lifeboats. No master on board. Numerous additional deficiencies to load line, life-saving appliances, radio equipment and charts and publications.

  Reina

  General cargo

  1,249

  19/2/96

  23/2/96

  Teignmouth

  Oily water separator inoperative. One certificated radio officer missing, survival craft hand-held VHF missing.

  Tina M

  General cargo

  447

  14/3/96

  15/3/96

  Plymouth

  Ballast tank perforated due to grounding.

  Seabreeze

  General cargo

  3,170

  25/3/96

  27/3/96

  Tees

  Lifeboard launching equipment inoperative. Bunker tank emergency shut-off valves inoperative. Main radio transmitter inoperative.

  Orca

  Fishing vessel

  133

  27/6/96

  1/7/96

  Holyhead

  Liferafts incorrectly stowed and one expired. Distress flares expired. Fire extinguishers expired. Forecastle and accommodation doors unsecured.

  Lucie

  General cargo

  919

  3/7/96

  4/7/96

  Leith

  Insufficient liferaft capacity for crew on board. Lifejackets lacking lights. No gas leak detectors. Spare gas bottles incorrectly stowed.

  Reina

  General cargo

  1,250

  3/7/96

  9/7/96

  Barking Creek, London

  Main engine manoeuvring system defective. Fuel oil emergency shut-off valves inoperative. Fire dampers inoperative. Ballast tank vent pipes defective.

  Tramp

  General cargo

  1,181

  24/2/97

  21/4/97

  Newport

  Main propulsion inoperative in astern mode. Galley fire door missing. Emergency radio batteries defective.

  Veria

  General cargo

  574

  2/7/97

  4/7/97

  Teesside

  Number of crew on board less than that stated on safe manning certificate. Hold bilges unable to be pumped free of water. Hull corrosion at forepeak store. Fire main leaking. Not under command lights inoperative. Engine room vent flap unable to be secured.

  Star Anna

  General cargo

  1,044

  9/7/97

  11/7/97

  Mistley

  Engine room and harbour generator fuel oil emergency shut-off valves inoperative. Oily water separator defective.

  Almilan 1

  Supply vessel

  386

  24/7/97

  28/8/97

  Marchwood

  Safe manning certificate inadequate for intended voyage. Master's certificate invalid for vessel.

  Ladoga-8

  General cargo

  1,511

  18/9/97

  20/9/97

  Bromborough

  Radio telephony operator missing. Lifeboat equipment incomplete engine vent trunking on deck missing in several places.

  Skylark

  General cargo

  2,456

  22/9/97

  3/10/97

  Goole

  Oily water separator inoperative. Lifeboat thwarts and rudder damaged. Nautical publications missing. Navigation lights inoperative. Navtex receiver inoperative.

  Niral

  General cargo

  1,948

  17/10/97

  21/10/97

  Avonmmouth

  Vessel operating beyond class limits. No valid exemption from carriage of radio telegraphy on board. Oil water separator inoperative.

  12 13

  Belize flag vessels detained by United Kingdom: 1993–31 March 1998

  Name of vessel

  Ship type

  GT

  Date detained

  Date released

  Place of detention

  Reasons for detention

  Seacombe Trader

  Bulk carrier

  507

  30/10/97

  14/11/97

  London

  Oily water filtering equipment inoperative. Excess oily water in engine room bilges. Manning not in accordance with safe manning certificate. Emergency fire pump inoperative. Reserve radio battery defective. Charts for area of operation out of date. Hand-held radio missing. Fire hoses holed.

  Sea Pink

  General cargo

  1,203

  20/01/98

  21/01/98

  Hull

  Emergency fire pump inoperative.

  Rema

  General cargo

  748

  09/02/98

  13/02/98

  Montrose

  No lifeboat on board. Master unable to produce certificate of competency. No qualified radio officers on board. Charts out of date. Nautical publications out of date. Fire hose leaking. No fixed fire fighting system in paint locker. Radio batteries found dry and in need of replacement.

  Yvette Cooper
  To ask the Secretary of State for the Environment, Transport and the Regions(a) how many and (b) what percentage of vessels passing through British ports have been inspected under Port State Control arrangements (i) in the past year, (ii) in the past two years and (iii) in the past five years. [40999]

  Ms Glenda Jackson
  The number inspected during the periods requested is as follows:

  PSC inspections by UK

  Number inspected

  % inspected

  April 1997–March 1998

  1,890

  27.6

  April 1996–March 1998

  3,770

  27.5

  April 1993–March 1998

  10,239

  30.4

  Yvette Cooper
  To ask the Secretary of State for the Environment, Transport and the Regions(a) how many and (b) what percentage of vessels that have been inspected by Port State Control arrangements have subsequently been detained (i) in the past year, (ii) in the past two years and (iii) in the past five years. [41007]

  Ms Glenda Jackson
  The number inspected and detained during the periods requested is as follows:

  Number detained

  % detained

  April 1997–March 1998

  179

  9.4

  April 1996–March 1998

  336

  8.9

  April 1993–March 1998

  963

  9.4

  Yvette Cooper
  To ask the Secretary of State for the Environment, Transport and the Regions(a) how many and (b) what percentage of vessels that have been detained following an inspection by the Port State Control (i) in the past year, (ii) in the past two years and (iii) in the past five years had (a) a British port of registry and (b) a Belize port of registry. [41009]

  Ms Glenda Jackson
  The number detained as figures and percentages of total detentions during the periods requested is given in the table. These figures are based on inspections conducted under the Paris Memorandum of Understanding on Port State Control. The British-flag vessels include those registered in overseas Territories.
  14

  Detention of British and Belize flag vessels

  Number of British vessels detained

  Percentage of total detentions

  Number of Belize vessels detained

  Percentage of total detentions

  1997

  18

  1.1

  50

  3.1

  1996–97

  32

  1.0

  72

  2.2

  1993–97

  68

  0.9

  92

  1.2

  Millennium Experience (Contaminated Soil)
  Sir Raymond Powell
  To ask the Secretary of State for the Environment, Transport and the Regions, pursuant to his answer of 8 April 1998,Official Report, column 294, if he will list (a) the names and locations of licensed landfill sites used in the disposal of contaminated soil from the area of the Greenwich Peninsula which is to be leased to the New Millennium Experience Company, (b) the names of contractors used for the disposal, (c) the statutory provisions under which consultations were carried out with local residents at selected licensed landfill sites, (d) the total cost of removal and (e) the cost to Government funds of the disposal. [40599]

  Angela Eagle
  The information requested is:

  (a) the names and location of licensed landfill sites used, by owner are:
  Shanks and McEwan (Southern Waste Services) Ltd.:
  Calvert Landfill Site, Brackley Lane, Calvert, Buckinghamshire MK18 2EN
  "L" Field Landfill Site, Green Lane, Stewartby, Bedfordshire MK43 9LZ
  Brogborough Landfill Site, Woburn Road, Brogborough, Bedfordshire MK43 0TN
  Weldon Landfill Site, Kettering Road, Welcon, Corby, Northamptonshire NN17 3JG
  Biffa Waste Services Ltd.:
  Redhill Landfill Site, Cormongers Lane, Nuffield, Redhill, Surrey RH1 4ER
  Shakespeare Farm Landfill Site, Shakespeare Farm Road, St. Mary Hod, Rochester, Kent NE3 8RN
  Welford Landfill Site, Welford Quarry, Cold Ashby, Northamptonshire NN6 7JF
  Sandspinner' s Ltd.:
  Wootton Landfill Site, A508 (southbound), Collingtree, Northamptonshire NN4 0LY

  15
  EEB Cliff Ltd., Erith Group:
  Mardyke Farm Landfill Site, Dagenham Road, South Homchurch, Rainham, Essex
  William Boyer and Sons Ltd.:
  Area "A" Harmondsworth, Egglesey Farm, Harmondsworth, Middlesex
  Leigh Environmental (Southern) Ltd.:
  Wapsey's Wood Landfill Site, Oxford Road, Gerrard's Cross, Buckinghamshire SL9 8TE
  Pioneer Aggregates:
  Brazier Landfill Site, Ware Quarry, Westmill Road, Ware, Hertfordshire SG12 0AP
  St. Albans Sand and Gravel Co. Ltd.:
  Westmill Landfill Site, Watton Road, Ware, Hertfordshire, SG12 0ES
  Hales Waste Control Ltd.:
  Kilsby Landfill Site, Daventry Road, Kilsbury, Rugby, Warwickshire CV23 8XF
  Thames Waste Management:
  Norlands Lane, Thorpe, Egham, Surrey, TW20 8SS.

  (b) the names of the main waste haulage firms who were employed as sub-contractors to the main contractors are:

  Erith Haulage Group

  Shanks and McEwan (Southern Waste Services) Ltd.

  McArdle.

  (c) The statutory provisions relating to consultation on applications for waste management licences, or applications to modify the conditions of licences, are set out in sections 36(4) and 37(5) of the Environmental Protection Act 1990 (as amended following the establishment of the Environment Agency). There is no statutory requirement for consultation with local residents. The objective of the licensing system is to ensure that waste is disposed of without harming the environment or human health and the Environment Agency has a statutory duty to supervise licensed sites. It is a criminal offence to dispose of waste in breach of licence conditions or in a manner likely to cause pollution of the environment or harm to human health.

  (d) and (e) Separate figures are not maintained on the cost of removal which forms part of larger contracts. It is estimated that £8.2m was spent on removal and disposal of which an estimated £6m was a cost to Government funds.

  Toxic Waste
  Mr. Baker
  To ask the Secretary of State for the Environment, Transport and the Regions what agreements have been reached in respect of the importation of toxic waste from South Africa for disposal by Rechem in South Wales; what quantities are involved; and if he will make a statement. [41196]

  Angela Eagle
  [holding answer 8 May 1998]No agreements have been reached in respect of the import of toxic waste from South Africa. In March 1998, the Environment Agency received a request from the Government of the Republic of South Africa to export 5,550 tonnes of wastes into the United Kingdom over a three year period. The wastes in question were a mixture of polychlorinated biphenyls, pesticides and hexachlorobenzene, destined for disposal by high 16
  temperature incineration. This request was technically deficient and contained unacceptable caveats. It was therefore refused.

  On 24 April 1998, a revised request was received from the Republic of South Africa for an increased total of 5,850 tonnes of wastes. The Agency is currently considering this request.

  The Agency is obliged to consider each such "duly motivated request" on its own merits, within the terms of the policies set out in the United Kingdom Management Plan for Exports and Imports of Waste. It is Agency policy to determine a completed request within two months of receipt.

  Mr. Baker
  To ask the Secretary of State for the Environment, Transport and the Regions if he will make a statement in respect of the importation of toxic waste for incineration. [41195]

  Angela Eagle
  [holding answer 8 May 1998]The importation of waste into the UK is governed by Council Regulation EEC 259/93 on the supervision and control of shipments of waste within, into and out of the European Community (the Waste Shipment Regulation). The UK's policy is set out in the United Kingdom Management Plan for Exports and Imports of Waste, which came into effect on 1 June 1996. The Plan:generally prohibits imports of waste from EC Member States for high temperature incineration in the UK after 1 June 1999. At present, imports are permitted on a reducing basis, to assist other Member States, pending completion of their own high temperature incineration facilities;
  excepts Ireland and Portugal from this ban, as the Government accept that neither country produces sufficient hazardous wastes per year to make the provision of their own high temperature incinerators economically viable;
  generally prohibits imports for high temperature incineration from OECD countries outside the EC, except in cases of emergency;
  allows imports from developing (non-OECD) countries, where the UK Government or its Environment Agency are satisfied that the exporting country does not have and cannot reasonably acquire the technical capacity and necessary facilities to deal with the waste in an environmentally sound manner.

  Maritime Rescue Subcentre (Liverpool)
  Mr. Duncan Smith
  To ask the Secretary of State for the Environment, Transport and the Regions (1) if he will review the decision to close the Maritime Rescue Subcentre in Liverpool; [41573]

  (2) for what reason no operational reasons were given for the closure of the Maritime Rescue Subcentre in Liverpool; [41570]

  (3) what estimate he has made of the saving resulting from the closure of the Maritime Rescue Subcentre in Liverpool. [41574]

  Ms Glenda Jackson
  The Coastguard Agency (now part of the Maritime & Coastguard Agency) issued a consultation document on 19 January which set out a 5-year strategy for Her Majesty's Coastguard. The document included, among other things, operational aspects of the proposed closure of four Coastguard stations and the co-location of two others. Analysis of the consultation, including the proposed closure of the
  17
  Liverpool Maritime Rescue Subcentre, is currently being considered and an announcement will be made shortly. During the life of the strategy, we expect there to be a major contribution to the cost of investment in the Service.

  Correspondence
  Mr. Winnick
  To ask the Secretary of State for the Environment, Transport and the Regions when the hon. Member for Walsall, North will receive a reply to his letter of 30 March concerning a constituent, Ref PT/AG/PSO 7452/98. [41462]

  Ms Armstrong
  I replied to my hon. Friend's letter on Friday 1 May.

  Trawsfyndd Power Station
  Mr. McGrady
  To ask the Secretary of State for the Environment, Transport and the Regions if he will make a statement on plans to decommission the nuclear power station at Trawsfyndd. [40872]

  Mrs. Beckett
  I have been asked to reply.

  Subject to meeting the requirements of the Regulators, decommissioning of the Trawsfyndd nuclear power station is a matter for its operator, Magnox Electric plc, and I have asked the chairman to write to the hon. Member.

PRIME MINISTER

  School Exclusions
  Mr. Pound
  To ask the Prime Minister if he will make a statement on the work of the Social Exclusion Unit on school exclusions and truancy. [41752]

  The Prime Minister
  I launched the Social Exclusion Unit last December, with a remit to co-ordinate and improve Government action to reduce social exclusion. As one of its first priorities, I asked it to report by Easter on how to make a step change in the scale of truancy and exclusions from school, and to find better solutions for those who have to be excluded. The Unit has worked closely on this task with other Government Departments, drawing on outside expertise and research, as well as a wide programme of visits and meetings and a written consultation exercise.

  The Government have now reached their conclusions. These decisions, and the underlying analysis, are set out in the Unit's report Truancy and School Exclusions, published today. Copies of the report are available in the Libraries.

  The report sets out what we know about the scale of truancy and exclusion.

  Our information on both is imperfect. For truancy, figures compiled from registration statistics suggest that around 1 million pupils take at least one half day off without authority. But in confidential surveys pupils admit to much higher levels: one survey suggested nearly one in ten 15 year olds truanted at least once a week.
  18
  The numbers permanently excluded from school stand at around 13,000 a year and have been rising fast. Over 100,000 are excluded temporarily. 83 per cent. of excluded pupils are boys, and half are aged fourteen or fifteen. African Caribbean children are 6 times more likely than average to be excluded, and children in care 10 times more likely.

  The causes of both problems are complex. Parents are responsible for ensuring that their children attend school, and poor parental supervision is often the cause of truancy. Peer group and community attitudes are also important, as are anxiety about exams, poor basic skills, fear of bullying or boredom with school.

  The reasons for exclusions vary widely, from relatively minor issues which should not have warranted such a response, to serious, even criminal, behaviour. The rise in exclusion has been attributed to a wide mix of factors, including poor basic skills, limited aspirations and opportunities, high levels of family stress, as well as lack of training and support in schools, and pressures on academic standards.

  More often than not, excluded children do not get reintegrated into school quickly, Those who are educated outside school rarely receive a full timetable and many get little more than a few hours tuition per week, and are otherwise left to their own devices.

  Both truancy and exclusion are strongly associated with a range of other problems including unemployment and homelessness, but above all with crime. An Audit Commission study showed that nearly half of all school age offenders have been excluded from school and a quarter truanted significantly. The problems cut across departments and agencies and therefore require coherent solutions that involve not only schools, but also the police and social services, as well as parents.

  There is much good practice to learn from. Where it is followed, exclusion and truancy have been greatly reduced. As a result, there are wide variations in the levels of exclusion and truancy between regions and between schools with similar intakes and results.

  The report published today draws on the lessons of what works. It commits the Government to the goal of cutting levels of both exclusions and truancy by a third by 2002. The measure to deliver this span a range of departments and local agencies, as well as schools, parents and pupils, reflecting the multi-dimensional nature of the problem.

  The national target will be underpinned by local authority level targets for truancy and exclusion reductions. The Government will consult on the detail of how targets should be set. The Secretary of State for Education and Employment will introduce an amendment to the Schools Standards and Framework Bill to permit school level targets for the worst performers on truancy.

  The Crime and Disorder Bill introduces parenting orders for parents who fail to ensure their children attend school. The Home Secretary will introduce an amendment to the Bill to give the police a new power to pick up truants in areas where the local education authority has agreed with the Chief Constable designated places to where they may be taken.
  19
  To cut down on inappropriate exclusions, the Government will lay down clear rules on when exclusion is justified and give them legal force. There will be special Ofsted inspections for schools with particularly high levels of exclusions. Children excluded from school during the two GCSE years will stay in their original school for league table purposes, so there is no advantage in excluding poor performers.

  The number of children from ethnic minorities who are excluded will be measured and reported at school level. The DfEE task group on raising achievement of ethnic minority pupils will look at what can be done to promote community mentoring in ethnic minority communities. There will be a major push to improve the school performance of children in local authority care, with more detailed proposals announced later this summer.

  The Government will develop proposals to target more resources on preventive work with children at risk of exclusion. Local education authorities will also have incentives to provide more support to schools. There will be a requirement that all excluded pupils receive full time education so that their discipline or other problems are tackled in controlled environments and they are not abandoned to roam the streets. Decisions on the extra funding that is necessary, and on how funding will be organised, will be taken in the Comprehensive Spending Reviews. Full provision will be phased in over no more than three years.

  In addition, Education Action Zones will have a special focus on areas with particularly high levels of exclusion and truancy, to give extra encouragement for innovative approaches to bringing them down.

  A Ministerial Task Force under the Minister for School Standards will oversee the implementation of these policies.

  Together, these measures will ensure that far fewer young people lose time from school. In the short-term, children themselves will benefit from keeping up with their education. The wider community will benefit from less crime. In the long-term there will be benefits as fewer young people leave school without qualifications.

  These measures will require schools, police, and parents to play a part in ensuring that education is no longer optional, and they will end a situation where failure to attend school has been tolerated and sometimes even condoned.

  Consultation Papers
  Mr. Gordon Prentice
  To ask the Prime Minister if he will list the consultation papers published since 1 May 1997, giving date of publication, closing date for submissions and, where relevant, the number of respondents. [39907]

  The Prime Minister
  The details requested by my hon. Friend are not held centrally and could be obtained only at disproportionate cost.

  Lockerbie
  Mr. Dalyell
  To ask the Prime Minister what assessment Her Majesty's Government have made of the relevance of the evidence of Mr. James T. Thurman to 20
  the investigation into the Lockerbie bombing; and if he will discuss that evidence with the relatives of the victims. [41577]

  The Prime Minister
  My noble and learned Friend the Lord Advocate gave his assurance in another place on 25 June 1997,Official Report, House of Lords, column 1572, that he was satisfied on the information available to him that there was no reason not to proceed with the petition warrants issued in respect of the two Libyan accused. On 6 October 1995, the then Lord Advocate wrote to my hon. Friend confirming that proof of the case against the two Libyan accused does not depend on evidence which Mr. Thurman might give. That remains the position. The evidence available to the prosecuting and investigation authorities cannot be discussed while criminal proceedings are pending for fear of prejudicing the prospects of a criminal trial.

INTERNATIONAL DEVELOPMENT

  Montserrat
  Sir Alastair Goodlad
  To ask the Secretary of State for International Development what representations she has made to the Governments of Caribbean and other countries where Montserrat citizens rendered homeless by volcanic activity are resident about their eligibility for social security and other benefits; and if she will make a statement. [40921]

  Mr. Foulkes
  Department for International Development (DFID) officials have raised this matter in discussions with the Governments in the region and in North America who have received the largest number of evacuees. These have indicated their willingness to allow Montserratian evacuees who are legally resident to have equal access to their education, health and social services as afforded to their own citizens. The United Nations Children Fund (UNICEF) survey will provide information on whether evacuees are experiencing any difficulties in this area.

  Sir Alastair Goodlad
  To ask the Secretary of State for International Development (1) when she will establish a charitable fund for Montserratian refugees in the Caribbean who are unable to become independent because of age or disability; what will be its size and scope; and if she will take a statement; [41026]

  (2) what will be the cost to her Department of the Hardship Fund for Montserratian refugees in the Caribbean region; how many people will benefit; and if she will make a statement. [41031]

  Mr. Foulkes
  A Special Needs Fund (previously called the Hardship and Charitable Fund) is being established to support Non-Governmental Organisations assisting these groups. We have advertised, seeking expressions of interest from NGOs in the region. The size of the Fund will depend upon the initial response.

  Sir Alastair Goodlad
  To ask the Secretary of State for International Development if she will publish the six month scientific re-assessment of volcanic risks in Montserrat. [41035]
  21
  Mr. Foulkes
  A summary of the latest scientific reassessment of volcanic risks was published by a joint committee of scientists from the British Geological Survey and the University of the West Indies on Montserrat on Tuesday 5 May. Copies are being made available to Montserratian community groups in the UK and in the region. I have today laid a copy in the Library of the House.

  The full report will be available shortly.

  Sir Alastair Goodlad
  To ask the Secretary of State for International Development what discussions her officials have conducted with officers of the Montserrat Building Society; and if she will make a statement. [40916]

  Mr. Foulkes
  Discussions have been limited to a brief presentation by Montserrat Building Society officers to Department for International Development (DFID) officials in January 1998. My officials passed on their comments to officials at the Foreign and Commonwealth Office, which is responsible for co-ordinating HMG's policy towards Montserrat, at the subsequent Montserrat Action group.

  HMG has decided that we cannot support the Montserrat Building Society, a private institution, which is insolvent, only partially liquid and not commercially viable. This decision has been conveyed to the Government of Montserrat.

  Sir Alastair Goodlad
  To ask the Secretary of State for International Development what discussions she has had with the(a) Red Cross and (b) other agencies about the future of food vouchers for citizens of Montserrat rendered homeless by volcanic activity; and if she will make a statement. [40920]

  Mr. Foulkes
  The Department for International Development (DFID) officials have regular contact with the Red Cross and other agencies about a range of matters concerning Montserratian citizens. We will shortly appoint Consultants to review the social welfare system on the island.

  Sir Alastair Goodlad
  To ask the Secretary of State for International Development if she will introduce a soft mortgage scheme for citizens of Montserrat. [41033]

  Mr. Foulkes
  My right hon. Friend the Secretary of State for International Development has previously said that she is prepared to provide funding for a soft mortgage facility. We have engaged consultants to identify regional financial institutions which might be interested in co-financing the project. We hope that it will be possible to reach agreement with such an institution by June.

  Sir Alastair Goodlad
  To ask the Secretary of State for International Development when she will publish the report by UNICEF into the needs of Montserratian evacuees in the Caribbean region. [41028]

  Mr. Foulkes
  We expect to receive UNICEF's report by the end of July and will discuss with them how the report's findings can be made publicly available.

  Sir Alastair Goodlad
  To ask the Secretary of State for International Development when she will publish the results of the feasibility study for an airstrip in Montserrat. [41034]
  22
  Mr. Foulkes
  A draft airstrip feasibility study is currently under discussion between the consultants, HMG and the Government of Montserrat. We expect to receive a final report in June. The results of the study will be made known shortly thereafter.

  Sir Alastair Goodlad
  To ask the Secretary of State for International Development how many people in Montserrat are currently living in shelters; and when they will be rehoused. [41036]

  Mr. Foulkes
  There are currently some 512 people living in shelters. The vast majority of individuals with special needs and families currently in shelters will be re-housed by the end of this year.

  Sir Alastair Goodlad
  To ask the Secretary of State for International Development what requests for assistance she has received from Governments other than Antigua who have received Montserratian refugees; and what has been her response. [41032]

  Mr. Foulkes
  The Government of St. Kitts and Nevis has requested assistance to cover additional costs related to providing Montserratian evacuees access to health, education and social services. We have told them we are not prepared to reimburse them directly for such costs, but would consider assistance for specific additional education or health facilities if there is an established need. No requests for assistance have been received from other Governments. Antigua has received a much larger number of Montserratian evacuees than any other country in the region.

  Sir Alastair Goodlad
  To ask the Secretary of State for International Development when she will publish the sustainable development plan for Montserrat. [40931]

  Mr. Foulkes
  We are currently considering a draft sustainable development plan with the Government of Montserrat. Assuming that agreement can be reached on the outstanding points this month, a draft will be made available to the public in June.

  Sir Alastair Goodlad
  To ask the Secretary of State for International Development what proposals she has to assist the improvement of police accommodation in Montserrat. [41027]

  Mr. Foulkes
  We have just received outline proposals from the Government of Montserrat for the improvement of police accommodation on the island. These are under consideration and an announcement will be made in due course.

  Sir Alastair Goodlad
  To ask the Secretary of State for International Development what proposals she has for future financial support for Montserrat citizens rendered homeless by volcanic activity; and if she will make a statement. [40929]

  Mr. Foulkes
  My right hon. Friend the Secretary of State for International Development has previously said that she is prepared to fund the servicing of additional land required to meet the needs of those remaining on Montserrat. The Department for International Development (DFID) and Government of Montserrat officials are discussing the amount of land required and the location. The Secretary of State has also indicated her willingness to provide funding for a soft mortgage facility.
  23
  When added to the housing we, and other donors, are already providing, these projects should meet the housing needs of the current population in shelters.

  Sir Alastair Goodlad
  To ask the Secretary of State for International Development what assessment she has made of the employment prospects of Montserratians rendered homeless by volcanic activity who are resident in(a) Montserrat, (b) Antigua and (c) elsewhere; and if she will make a statement. [40915]

  Mr. Foulkes
  An assessment of Montserratians' employment projects was undertaken for the development of the small enterprise initiatives for Montserrat and Antigua. The conclusion was that assistance was required to improve employment and income earning potential: arrangements are now in place on Montserrat and planned to be later this month, on Antigua. The United Nations Children Fund (UNICEF) survey currently underway will provide the information on the employment prospects of those evacuees located elsewhere in the region.

  Sir Alastair Goodlad
  To ask the Secretary of State for International Development if she will provide a breakdown of how the funds so far spent on helping Montserrat deal with the volcanic crisis have been applied; and how the further £14 million committed will be applied. [41025]

  Mr. Foulkes
  Since the start of the crisis, the Department for International Development (DFID) has committed £62 million in assistance to Montserrat of which about £50 million has been spent: £16 million of budgetary aid and £34 million of emergency and development aid. Of the remaining £12 million, £7 million is additional budgetary support for 1998 with the balance being primarily allocated for housing.

  Sir Alastair Goodlad
  To ask the Secretary of State for International Development how many businesses have been started in Antigua by Montserratian evacuees with support from her Department; and at what cost. [41029]

  Mr. Foulkes
  A project to assist those Montserratian evacuees in Antigua wishing to start their own business is currently being developed with the assistance of regional consultants. We hope that the project will start by the end of May.

  Sir Alastair Goodlad
  To ask the Secretary of State for International Development what will be the cost of the Community Empowerment Project for Montserratian evacuees in the Caribbean region; how many will benefit; and if she will make a statement. [41030]

  Mr. Foulkes
  Up to £250,000 has been allocated for the Community Empowerment Project. It is intended that the project will help Montserratian evacuees to become financially independent. All Montserratian evacuees in the region will be able to seek advice from the organisations supported by the project and to improve their access to host Government social services.

  Environmental Resources Management
  Mr. Matthew Taylor
  To ask the Secretary of State for International Development if she will make a statement on the findings of the Environmental Resources Management report of March 1997, Evaluation of Environmental Performance of EC Programmes in Developing Countries. [41108]
  24
  Mr. Foulkes
  The report, entitled Evaluation of the Environmental Performance of EC Programmes in Developing Countries, was recently published and distributed by the European Commission. The evaluation is acknowledged within and outside the Commission to have been a very useful exercise, which presents detailed findings and recommendations on aspects of policy and practice.

  We are waiting for the Commission's response to the report. We then intend to monitor follow-up work and examine ways in which we can assist the Commission in their efforts. However, the Commission is reorganising its foreign policy services in order to rationalise and streamline policy formulation and implementation. This reorganisation can be expected to address many issues raised by the report. In particular, the Commission's capacity to implement recommendations should be strengthened as manpower and technical resource deficiencies are addressed. The Commission is also in the process of substantially revising its Environment Manual for development assistance. We welcome this positive action and would urge the commission to continue in this direction.

  Development Assistance
  Mr. Matthew Taylor
  To ask the Secretary of State for International Development what steps she has taken to ensure that European Commission development assistance is spent in an effective and efficient way and that environmental and social procedures are improved and implemented. [41109]

  Mr. Foulkes
  We continue to seek to ensure resources are spent effectively and efficiently through dialogue with Commission officials in Brussels and in delegations, and through our active participation in the Commission's management committees. We have also seconded 13 staff to work in the external development Directorates-General to use their expertise to assist the Commission. Amongst those seconded are a social development adviser and a forestry specialist.

  Although the European Commission's own internal project cycle management guidance stresses the importance of cross cutting issues such as environmental and social issues in the project cycle, continuing efforts are required to ensure this is always fully reflected in the design and implementation of projects and programmes.

  This is why one of DFID's priorities during the UK Presidency has been to try and improve the poverty focus and effectiveness of the Community's aid programmes. This has involved reviewing the implementation of important previous policy resolutions, on poverty and gender, to see how effective we have been and consider what more needs to be done to improve performance and impact in these key areas. We expect conclusions on this work to be adopted at the Development Council on 18 May.

  In addition, we are seeking to promote the integration of environmental and social issues into the programme and project cycle through: our participation on the Commission's Scientific Environmental Monitoring Group and the forestry and water expert groups; providing a project leader to prepare an EC/Member States strategy for bio-diversity conservation; working closely with the

  25
  European Commission to develop procedural guidelines on the integration of social and environmental issues into development projects.

TREASURY

  Inward Investment
  Mr. Alan Campbell
  To ask the Chancellor of the Exchequer if he will list the inward investment projects located in intermediate status areas for which his Department permitted the higher development areas job subsidy limit to apply in each of the years from 1987 to 1992. [39723]

  Mr. Geoffrey Robinson
  From 1987 to 1992, the Treasury approved two offers of Regional Selective Assistance for inward investment into an intermediate status area where the cost per job ceiling for intermediate status areas was exceeded. Approval was granted in 1991 for Heller Machine Tools (UK) Ltd for a project in the West Midlands, and in 1989 for Koya Bearings (Europe) Ltd for a project in Yorkshire and Humberside.

  Scottish Parliament
  Mr. Tyrie
  To ask the Chancellor of the Exchequer if he will ensure that the National Audit Office retains the necessary powers to audit the Scottish block, following the establishment of the Scottish Parliament. [40930]

  Mr. Darling
  The National Audit Office will retain the powers to audit the expenditure of the Secretary of State for Scotland, including the payment of grant into the Scottish Consolidated Fund. Expenditure out of the Scottish Consolidated Fund will be audited by an independent auditor or auditors reporting to the Scottish Parliament as provided for in clause 66(1)(c) of the Scotland Bill.

SCOTLAND

  Public Appointments
  Mr. Öpik
  To ask the Secretary of State for Scotland how many and what proportion of his Department's appointees to non-departmental public bodies are (i) aged under 25, (ii) aged 25 to 30 and (iii) aged 31 to 35 years. [40739]

  Mr. Dewar
  The information is as follows:(i) 32, 1.0%; (ii) 123, 3.7%; (iii) 212, 6.4%.

  Fisheries
  Mr. Maclennan
  To ask the Secretary of State for Scotland if he will list the criteria used by the Scottish Fisheries Protection Agency in drawing up their list of ports proposed for designation. [41353]

  Mr. Macdonald
  Proposals to introduce designated ports for vessels of 20 metres overall length or above landing non-pelagic fish into the UK were announced by the Parliamentary Secretary, Ministry of Agriculture, Fisheries and Food, my hon. Friend the Member for Scunthorpe (Mr. Morley) on 3 March 1998,Official Report, column 593. The proposed designated landing
  26
  ports in Scotland are essentially those where the Scottish Fisheries Protection Agency currently has a Sea Fisheries Inspectorate office and where there is a recognised auction market. There are, however, two exceptions. Excluded from the list is the port of Arbroath where the local office will be closed on 1 July 1998 following a decrease of whitefish landings into the port. Scalloway has no SFI office, but has been included in recognition of the scale of landings made there. Additionally, the Scottish ports listed in the consultation paper account for approximately 90% of all non-pelagic landings in terms of tonnage and value made by the vessels to be included in the proposed scheme.

  The proposed arrangements are currently the subject of a consultation exercise with the industry and harbour authorities. Careful consideration will be given to all comments received, including those relating to the list of ports which are to be designated.

NORTHERN IRELAND

  Beef Exports
  Mr. John D. Taylor
  To ask the Secretary of State for Northern Ireland if exports of beef to the European Union have recommenced; what support she is giving to the Northern Ireland beef industry to regain their markets in Europe; and if she will make a statement about the prospects of the Northern Ireland beef industry. [40861]

  Mr. Paul Murphy
  While the Export Certified Herds Scheme has been approved, exports of Northern Ireland beef cannot resume until the European Commission sets a date for the lifting of the ban. That will depend on the outcome of the recent visit to Northern Ireland by European Commission Inspectors.

  The industry has submitted a case for Government assistance towards regaining export markets as part of an overall redmeat development strategy agreed by the relevant industry interest. The case for Government support is being considered.

  The Government recognise the importance of the beef sector to the Northern Ireland agricultural industry and is aware of the serious difficulties which it has faced since March 1996. Within the context of the declining long-term trend in consumption of beef and the direction of reform of the beef regime set out by the European Commission in Agenda 2000, the Government would wish to see the Northern Ireland beef industry re-establish itself as a significant force in export markets.

AGRICULTURE, FISHERIES AND FOOD

  Cocoa
  Mr. Dawson
  To ask the Minister of Agriculture, Fisheries and Food what action he is taking to(a) support Ivory Coast cocoa producers in efforts to deal with black pod disease and (b) support Brazilian cocoa producers in efforts to suppress the witches broom fungus and to preserve rainforests in which cacao trees grow; and if he will make a statement on the threatened world shortage of chocolate. [41370]
  27
  Mr. Rooker
  Despite the recent reports in the press, there is no evidence that black pod disease is adversely affecting cocoa production in the Ivory Coast. Nevertheless, a wide range of cocoa diseases are being tackled by the world-wide research programmes. The International Cocoa Organisation, of which the UK Government are an active member, is co-ordinating various projects aimed at combating cocoa diseases and addressing other difficulties affecting cocoa production. There is a specific project to fight witches broom disease in Brazil.

  Quarantine
  Mr. Evans
  To ask the Minister of Agriculture, Fisheries and Food what plans he has for consultation over any proposed changes to the quarantine laws. [41001]

  Mr. Rooker
  I refer the hon. Member to the reply I gave to my hon. Friend the Member for Ogmore (Sir R. Powell) on 20 April 1998,Official Report, column 488.

  Departmental Research
  Dr. Starkey
  To ask the Minister of Agriculture, Fisheries and Food (1) what percentage of applications, in relation to his Department's research budget, were from women, for(a) project grants, (b) programme grants, (c) special grants intended for new investigators, (d) studentships and (e) fellowships, in 1997 and each of the two previous years; [40885]

  (2) what percentage of applications from women, in relation to his Department's research budget, were successful for (a) project grants, (b) programme grants, (c) special grants intended for new investigators, (d) studentships and (e) fellowships, in 1997 and each of the two previous years. [40884]

  Mr. Rooker
  The Ministry places its R and D work, through contracts and commissions, with research establishments and universities rather than individuals. I regret, therefore, that the information sought in these questions is not available to us.

SOCIAL SECURITY

  Lone Parents
  Mr. Webb
  To ask the Secretary of State for Social Security (1) if she will ensure that the Child Support Agency updates the common inquiry system when there are changes in the level of child maintenance owing to a lone parent receiving income support; and if she will make a statement; [40207]

  (2) what is the average time taken between an application by the Benefits Agency to the Child Support Agency for child maintenance to be paid direct to a lone parent following a move off income support and implementation of that request; and if she will make a statement. [40211]
  28
  Mr. Keith Bradley
  Regular payments of maintenance can transform the lives of lone mothers and their children, providing a stable income that can help them off Income Support and into work. We expect the Child Support Agency to provide a consistent, fair and efficient service to all its clients.

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

  Letter from Faith Boardman to Mr. Steve Webb, dated 8 May 1998:
  I am replying to your Parliamentary Questions to the Secretary of State for Social Security about maintenance due to parents with care who are receiving or moving off Income Support.
  In cases where the parent with care is receiving Income Support and the maintenance liability changes, the Child Support Agency notifies the Benefits Agency to advise them of the change. Benefits Agency staff then access the Income Support Computer System and input the revised amount of maintenance liability, and Income Support is adjusted accordingly. This revised information will then be available via Common Enquiry Services.
  Where the parent with care is moving off Income Support, the Benefit Agency notify the Child Support Agency of the date from which Income Support is no longer payable so that maintenance payments can be passed onto the parent with care.
  Statistics are not collated on the time between the notification and payment as these details would not prove very informative due to the several factors that have an influence on when a payment is due and in turn actually made. The length of time is influenced by the complexity of the change, the payment preferences of the parent with care and the absent parent, and also the absent parent's pay frequency. It is therefore difficult to estimate an average length of time for this process.
  The Agency is very aware of the need to deal with changes and ensure payments are passed on to the parent with care as quickly as possible. Where the change is straightforward all aspects can be dealt with in 2 weeks; in more involved cases (e.g., where a deduction from earnings order is in place) the change can take 8 weeks. During 1997–98, the Agency exceeded its Secretary of State target which required that 97% of payments be passed to the parent with care within ten days of receipt from the absent parent.
  We are constantly looking at how we can adapt and improve our procedures to speed up the time taken. The timescales achieved for many cases have shortened over the last 2 years. Such an example is that the Agency is building more pro-active use of the telephone into its procedures between assessment and first payment to ensure that timescales are shortened wherever possible. The vast majority of payment advice is now conducted by telephone.
  As part of the Welfare to Work programme, the Agency is committed to ensuring that the disincentives and barriers to entering employment are minimised, and that obstacles are removed which jeopardise the prospect of lone parents moving from welfare dependency to work. The Agency has agreed to process as a priority cases where the parent with care has signed up to a New Deal for Lone Parents Action Plan. Also the Agency has agreed to answer straightforward inquiries from New Deal for Lone Parents Personal Advisers on behalf of lone parents immediately, and more complex ones within five working days.
  As the Department moves towards a more Active Modem Service, one of the key elements is to provide staff with a system which cuts across all Agencies where they will have access to information regarding payments and records of other Social Security systems. This should alleviate problems encountered by staff acting in ignorance of information held by other Agencies.
  I hope this is helpful.

  Focus Group Research
  Mr. Webb
  To ask the Secretary of State for Social Security, pursuant to her answer to the hon. Member for Bognor Regis and Littlehampton (Mr. Gibb), of 21 April 1998,Official Report, columns 607–08, on focus group research, if she will list for each research project (a) the expected completion date and (b) the means by which the findings from the completed research projects will be made public. [40836]

  Mr. Field
  The expected completion dates of those projects which were commissioned as part of the Department's Research Programme, and which relate to the development and evaluation of policy, are as follows:

  1998: April-June
  Alan Hedges—Pensions and Retirement Planning.
  Centre for Research in Social Policy, Loughborough University—Invalidity Benefit and the contributory principle.
  Market Opinion Research International—Attitudes towards disability benefits.
  Market Opinion Research International—Attitudes towards welfare reform.

  1998: July-September
  Social and Community Planning Research—Work Incentives and Intermediaries.\
  Social and Community Planning Research—Survey of Women; developmental work.
  Newchurch and Company—Child Support Agency customer and compliance research.
  British Market Research Bureau International—Attitudes towards housing benefits.
  Institute for Employment Studies—People management in DSS Headquarters (summary report).

  1998: October-December
  Social and Community Planning Research—Take Up of Income Support amongst Older Citizens.
  Social and Community Planning Research—Preparation for Women's Juries.

  Number and proportion of appointees aged

  Non-Departmental Public Body

  Total number of appointees

  under 25

  aged 25–30

  aged 31–35

  Central Advisory Committee on War Pensions (CACWP)1

  20

  0

  0

  0

  Child Support, Disability, Medical & Social Security Appeal Tribunals and Vaccine Damage Tribunals

  5,929

  0

  15 (0.3%)

  72 (1.2%)

  Disability Living Allowance Advisory Board (DLAAB)2

  20

  0

  0

  0

  Industrial Injuries Advisory Council (IIAC)3

  15

  0

  0

  2 (13%)

  Occupational Pensions Regulatory Authority

  9

  0

  0

  1 (11%)

  Pensions Compensation Board

  3

  0

  0

  0

  Pensions Ombudsman

  1

  0

  0

  0

  Social Security Advisory Committee

  13

  0

  0

  0

  War Pensions Committees (WPCs)1

  858

  0

  0

  0

  Women's National Commission (WNC)4

  52

  —

  —

  —

  1The legislation which governs CACWP and the WPCs requires there to be, among others, representatives of ex-service organisations or persons with ex-service experience. Many of the ex-service organisations, from which the appointees are drawn, have problems recruiting younger members which effects the scope of interested individuals from which suitable candidates can be selected.

  2 Members of DLAAB are required to be professionally qualified and/or experienced which makes it difficult to appoint people under 36.

  3 50 per cent. of posts on IIAC are nominated by organisations representing employees and employers. These organisations are aware of the principles that should govern appointments to public bodies and additionally, have been sent Guidance produced by the Commissioner for Public Appointments on nominating people for public service. The other 50 per cent. need to come from experts in the field of occupational health and related fields. If their advice is to carry the required authority and weight these appointees need to be drawn from the top of their profession. People who have reached a position of eminence in their professional field will tend to be at the higher end of the age scale.

  4 The WNC membership is determined by the individual member organisations and therefore no records concerning the appointees are kept by this Department.

  30
  1999: January-March
  Alan Hedges—Behavioural Response to the evidence requirements.

  2000: Summer
  Centre for Research in Social Policy, Loughborough University—Earnings Top Up Staff Panel.

  The ongoing contract with Social and Community Planning Research for qualitative research on welfare reform issues allows us to commission small projects as required.

  All studies within the Department's Research Programme will be published. Decisions on means of publication are not taken until the project has been completed.

  As explained in my written answer to the hon. Member for Bognor Regis and Littlehampton (Mr. Gibb) on 29 April 1998, Official Report, columns 170–72, reports for those contracts commissioned to develop and evaluate publicity campaigns or to inform other presentational issues, would be published once the decision-making process is completed and/or the relevant publicity campaign has started. Two projects are nearing completion and will be placed in the Library by the end of July:
  One World—New Deal for Lone Parents; development of publicity work
  Cragg Ross Dawson—Creative Development Research for a New Deal for Lone Parents Newsletter.

  Public Bodies
  Mr. £pik
  To ask the Secretary of State for Social Security how many and what proportion of her Department's appointees to non-departmental public bodies are (i) aged under 25, (ii) aged 25 to 30 and (iii) aged 31 to 35 years. [40735]

  Mr. Denham
  The information is set out in the table.
  31
  The Government are committed to encouraging a wide range of candidates to apply for positions on the boards of public bodies, reflecting the diverse society in which we live. This includes encouraging more young people to put themselves forward as potential candidates for public appointments. All appointments are made on merit and candidates must demonstrate that they have the necessary skills and experience to match the needs of the public body on which they wish to serve.

  Benefit Integrity Project
  Mr. Kirkwood
  To ask the Secretary of State for Social Security on what dates each of the monthly statistics for the Benefit Integrity Project for each month since November 1997 were placed in the Library; and when the next monthly statistics will be available. [41504]

  Mr. Denham
  A full set of Benefit Integrity Project statistics up to the end of March 1998 was placed in the Library on 8 May 1998. Owing to an error, statistics relating to earlier months were not previously placed in the Library.

  The release of statistics for February and March was delayed as work was undertaken to improve presentation of the data. The Disability Benefits Consortium have been invited to comment on the revised format. Their comments and suggestions will be reflected in the presentation of statistics relating to May 1998 and beyond.

  Any comments Members may have on the new format would also be welcome.

TRADE AND INDUSTRY

  Plutonium Dispersal
  Mr. Baker
  To ask the President of the Board of Trade if she will adopt a plutonium dispersal strategy. [40329]

  Mrs. Beckett
  [holding answer 7 May 1998]All civil plutonium in the United Kingdom, whether separated or in spent fuel, is stored safely and securely under relevant national and international regulations. It is for the owners of spent nuclear fuel and plutonium to choose their preferred management options subject to meeting the necessary environmental and regulatory requirements.

  Nuclear Waste
  Mr. Jim Cunningham
  To ask the President of the Board of Trade what plans she has to review current policy on the reprocessing of nuclear waste. [41167]

  Mr. Battle
  Almost all spent nuclear fuel can be recycled to provide further energy supplies, and accordingly is not classified as waste. The Government have no plans to review their current policy on the management of spent nuclear fuel, which was set out most recently in the policy document entitled "United Kingdom Civil Nuclear Policy including Plutonium", a copy of which was placed in the Library of the House on 30 January.

  Mr. Jim Cunningham
  To ask the President of the Board of Trade what assessment she has made of(a) the economic benefits and (b) the safety implications of (i) dry storage and (ii) reprocessing of nuclear waste. [41168]
  32
  Mr. Battle
  Almost all spent nuclear fuel can be recycled to provide further energy supplies and accordingly is not classified as waste. Government policy is that it is for the owner of spent nuclear fuel to determine the economic aspects of the various options for its management. The Health and Safety Executive will ensure that no option is carried out unless it meets adequate standards of safety.

  Mr. Llew Smith
  To ask the President of the Board of Trade what quantities of spent fuel have been reprocessed to date through the Thorp Plant at Sellafield; and if she will list the throughput targets provided to her Department by BNFL before active commissioning of the plant in March 1994. [40637]

  Mrs. Beckett
  I understand from BNFL that, as at the end of March 1998, the Thorp plant had sheared some 1,450 tonnes of spent fuel since the plant was actively commissioned in March 1994.

  In July 1993 BNFL published a document entitled 'The Economic & Commercial Justification for Thorp'. That document stated that the expected throughput for the first ten years of Thorp's operation would be 7,000 tonnes.

  I understand that there are currently no plans to change this target.

  Mr. Llew Smith
  To ask the President of the Board of Trade what is the current estimated cost of refurbishment of the reprocessing facility at Dounreay to be used to process the uranium fuel recently received from Georgia; when the plant is expected to be ready; and what further foreign customers she expects to use the plant. [40670]

  Mr. Battle
  The unirradiated fuel, which amounts to eighty per cent of the uranium fuel received from Georgia, will be processed in existing equipment at Dounreay which does not require refurbishment. It is likely to be two years before the remaining twenty per cent., which has been irradiated, will be reprocessed. This could be done in one of a number of different plants and a decision has yet to be made about which one to use. As the plant used will also be used to reprocess other material, it is not possible to say at this stage what share of the refurbishment cost will fall to the irradiated Georgian fuel.

  Mr. Llew Smith
  To ask the President of the Board of Trade what arrangements currently govern the period over which radioactive waste arising from reprocessing foreign fuel at Dounreay may be stored at the site before it is repatriated to the country of origin; and if he will place in the Library a specimen contract covering such arrangements. [40641]

  Mrs. Beckett
  All waste arising from reprocessing activities at Dounreay will continue to be stored in accordance with the regulatory requirements in force at the time. UKAEA contracts for reprocessing foreign nuclear materials are commercially confidential but they all comply with Government policy on nuclear waste repatriation (in force since 1976) by including a clause stipulating that waste will be returned. In all such cases this return of waste condition is backed by a Government to Government agreement. The Georgian highly enriched uranium (HEU) was recently transferred to Dounreay to improve international security. In this case, an exception
  33
  to the general policy on return of waste was agreed because the Georgians do not have the capability to deal with the small quantity of waste involved.

  Engineering Design
  Mrs. Curtis-Thomas
  To ask the President of the Board of Trade what initiatives the Government are taking to promote United Kingdom engineering design during their Presidency of the EU. [41104]

  Mr. Battle
  As well as the on-going promotion of design by the Design Council and Business Link, during the term of the UK Presidency the Government have promoted the best use of design, including engineering. Most recently, on 2 April my right hon. Friend the Prime Minister launched the `powerhouse::uk' exhibition in London. Funded by DTI as a showcase of British design and creativity, the exhibition was timed to coincide with the second ASEM Summit, attracting some 20,000 visitors over a two-week period, and included examples of world class UK engineering.

  £ million

  1987

  1988

  1989

  1990

  1991

  1992

  1993

  1994

  1995

  1996

  1997

  UK exports of services

  Malaysia

  258

  311

  441

  602

  591

  636

  966

  1,310

  1,190

  1,160

  1,206

  Thailand

  207

  281

  429

  417

  466

  475

  664

  749

  835

  974

  862

  Argentina

  10

  13

  14

  35

  70

  119

  179

  229

  234

  332

  487

  Brazil

  348

  305

  339

  320

  339

  273

  415

  525

  675

  847

  1,028

  Venezuela

  158

  178

  125

  205

  167

  189

  227

  197

  179

  180

  204

  Peru

  49

  31

  30

  29

  33

  31

  33

  45

  58

  63

  86

  Zambia

  75

  86

  119

  93

  63

  65

  74

  45

  50

  52

  46

  Tanzania

  92

  89

  93

  85

  73

  79

  109

  89

  87

  82

  77

  Egypt

  342

  289

  296

  298

  283

  252

  337

  369

  384

  431

  499

  UK imports of goods

  Malaysia

  397

  526

  676

  776

  914

  1,104

  1,397

  1,204

  1,489

  2,381

  2,026

  Thailand

  239

  321

  444

  484

  635

  643

  772

  914

  1,040

  1,188

  1,222

  Argentina

  65

  66

  99

  144

  136

  125

  141

  171

  252

  285

  270

  Brazil

  637

  740

  817

  720

  766

  886

  904

  919

  987

  983

  955

  Venezuela

  92

  77

  111

  102

  100

  138

  126

  134

  204

  189

  157

  Peru

  92

  91

  126

  97

  84

  92

  126

  113

  123

  130

  148

  Zambia

  30

  25

  22

  19

  22

  7

  12

  13

  19

  18

  32

  Tanzania

  26

  27

  23

  26

  21

  21

  26

  22

  27

  29

  33

  Egypt

  127

  164

  213

  145

  136

  137

  188

  252

  247

  282

  270

  UK exports of services

  Malaysia

  n/a

  227

  244

  272

  271

  315

  358

  404

  454

  580

  n/a

  Thailand

  n/a

  171

  196

  225

  230

  201

  233

  260

  338

  335

  n/a

  Brazil

  n/a

  n/a

  n/a

  n/a

  n/a

  192

  209

  218

  258

  266

  n/a

  UK imports of services

  Malaysia

  n/a

  81

  167

  180

  177

  137

  163

  188

  194

  220

  n/a

  Thailand

  n/a

  115

  161

  178

  141

  172

  210

  216

  273

  274

  n/a

  Brazil

  n/a

  n/a

  n/a

  n/a

  n/a

  49

  56

  63

  68

  73

  n/a

  Notes

  Figures for trade in goods are on an Overseas Trade Statistics (OTS) basis. Figures for trade in services are on a Balance of Payments (BOP) basis.

  Figures for trade in services are available only for approximately forty of the UK's largest trading partners and generally only from 1988. Information for many of the countries requested is not available. Services data for 1997 will be available in August 1998.

  Sources:

  Overseas Trade Statistics of the United Kingdom, HM Customs & Excise

  Monthly Review of External Trade Statistics (MRETS), ONS

  UK Balance of Payments, The Pink Book, ONS

  Exploration Wells
  Mr. Page
  To ask the President of the Board of Trade how many exploration oil and gas wells were drilled in the first quarter of (i) 1997 and (ii) 1998. [40348]
  34
  In addition, last September, my right hon. Friend the Prime Minister launched the Millennium Products project which is managed by the Design Council. The project aims to identify up to 2,000 successful products and services that have been created in the United Kingdom and which exemplify our creativity and innovation. The first 200 products to receive the accolade `Millennium Product' were announced in April.

  International Trade
  Ms Drown
  To ask the President of the Board of Trade if she will make a statement on the values of imports to the United Kingdom from and exports from the United Kingdom to(a) Malaysia, (b) Thailand, (c) Argentina, (d) Brazil, (e) Venezuela, (f) Peru, (g) Zambia, (h) Tanzania and (i) Egypt in each of the years between 1987 and 1997. [39681]

  Mrs. Beckett
  The available information is given in the table:

  Mr. Battle
  [holding answer 6 May 1998]Twenty-one exploration wells for oil and gas commenced drilling in the first quarter of 1997. In the same period of 1998, thirteen exploration wells were started.

  Petrol Consumption
  Mrs. Curtis-Thomas
  To ask the President of the Board of Trade what is the annual per capita petrol consumption in(a) the United Kingdom, (b) Germany, (c) Holland, (d) Sweden and (e) the USA. [41133]

  Mr. Battle
  The latest full year for which data for all five countries are available is 1996, and are given in the table:

  Petrol consumption per capita 1996

  Country

  Tonnes per head of population

  United Kingdom

  0.38

  Germany

  0.37

  Holland

  0.27

  Sweden

  0.48

  U.S.A.

  1.27

  Source:

  International Energy Agency

  UKAEA Constabulary
  Mr. Matthew Taylor
  To ask the President of the Board of Trade (1), pursuant to the oral answer of 27 April 1998,Official Report, column 21, what is the current force establishment of the UKAEA Constabulary; and what is the planned establishment for each of the next three years; [41084]

  (2) if she will list the sites policed by the UKAEA Constabulary in each of the last five years, indicating (a) when they first assumed responsibility and (b) when they ceased to have responsibility; [41088]

  (3) pursuant to the oral answer of 27 April 1998, Official Report, column 21, over what period of time the Chief Constable had raised his concerns about police numbers at (a) Dounreay and (b) other nuclear installations; [41090]

  (4) pursuant to her answer of 30 April 1998, Official Report, column 237, what reviews have been commissioned which have still to report; what sites these relate to; and if she will make a statement; [41092]

  (5) pursuant to her answer of 30 April 1998, Official Report, column 237, if she will list the two sites referred to; what was the increase in staff; for what period of time the increases were agreed; and what was the consequential effect on the overall police establishment; [41083]

  (6) if she will list the category of each site for which the UKAEA Constabulary had responsibility over the last five years indicating when category changes took place and the associated change in police establishments; [41089]

  (7) pursuant to the oral answer of 27 April 1998, Official Report, column 21, what conditions were attached to the agreement for an increase in police numbers at Dounreay; [41091]

  (8) pursuant to the oral answer of 27 April 1998, Official Report, column 21, for which sites in each of the last three years the Chief Constable has requested extra police staffing; on what dates; and with what outcome; [41087]
  36
  (9) pursuant to the oral answer of 27 April 1998, Official Report, column 21, on what occasions the Chief Constable has made representations on UKAEA police numbers to ministers in the past five years; in relation to which sites; and with what outcome. [41082]

  Mr. Battle
  [holding answer 6 May 1998]The UKAEA Constabulary polices sites at Chapelcross, Risley, Sellafield, Springfields, Capenhurst, Dounreay, Harwell, and Winfrith. It assumed responsibility for policing these sites in 1955, with the exception of Chapelcross and Winfrith, where the relevant dates are 1956 and 1957 respectively.

  The current force establishment of the UKAEA Constabulary is 471. Police numbers at all sites are subject to a continuing process of review and are approved as necessary by the Police Authority in the light of developing requirements. It is normal security practice not to reveal details relating to the police establishment at particular sites, or the security category of those sites, because this information is of potential use to criminals. The Chief Constable's requests for extra staffing in the past three years have been met in full. He has made no representations to Ministers on UKAEA Constabulary numbers.

  Mr. Matthew Taylor
  To ask the President of the Board of Trade, pursuant to the oral answer of 27 April 1998,Official Report, column 21, if she will list the membership of the UKAEA Police Authority, indicating for each member their current employment. [41085]

  Mr. Battle
  [holding answer 6 May 1998]The members of the Police Authority are Mr. J. Bretherton, Director Corporate Services, UKAEA; Dr. R. L. Nelson OBE, Director of Dounreay, UKAEA; Dr. E. Drage, Director Euratom, Nuclear Safety, Security and Emergency Planning, Department of Trade and Industry (advised by the Director of Civil Nuclear Security); Dr. R. Howsley, Head, Security and International Safeguards, British Nuclear Fuels plc (BNFL); Mr. G. R. Smith, Head of Sellafield site, BNFL; and Dr. P. Upson, Managing Director Technical, Urenco Limited. Sir John Woodcock CBE QPM, Police adviser to the UKAEA Police Authority, also attends Police Authority meetings.

  Energy Sources
  Sir Raymond Powell
  To ask the President of the Board of Trade when she expects the review of energy sources for power generation to be completed. [38826]

  Mr. Battle
  The review is expected to reach conclusions before 30 June.

  Chernobyl
  Mr. Llew Smith
  To ask the President of the Board of Trade what has been the total cost to(a) the European Union and (b) the United Kingdom of work done at the Chernobyl site since the accident on 26 April 1986. [40634]

  Mr. Battle
  At the 1992 Summit in Munich, G7 leaders launched a programme of nuclear safety assistance for the countries of Eastern Europe and the Former Soviet Union. Although the EU was providing some help in identifying options for dealing with the sarcophagus, Chernobyl was not a target for nuclear safety assistance as Ukraine planned to close the plant by the end of 1993. Following
  37
  the Ukrainian Parliament's reversal of that decision in late 1993, the EU at the 1994 Corfu Summit offered Ukraine an action plan leading, amongst other things, to the closure of Chernobyl. After extensive negotiations, the G7 countries, European Commission, and Ukraine signed a Memorandum of Understanding in 1995 which provided for support for Ukraine's energy sector, including help with nuclear safety at Chernobyl and the decommissioning of the plant. The MOU commits Ukraine to close the plant by the year 2000. Of the 100 mecu Tacis assistance offered by the EU at Corfu, 60 mecu has been allocated for work on site. This includes a site survey (0.5 mecu), development of a plan for dealing with the sarcophagus (2.5 mecu) and turnkey projects for three decommissioning facilities (38.5 mecu). An on-site assistance team is now in place primarily to help with the procurement of these facilities.

  In 1993, the UK's Know How Fund supported completion on a £217,000 land remediation study for the benefit of Ukraine's Ministry of Chernobyl Affairs. The EU has financed a number of studies linked to the development of an optimal management route for dealing with the different types of contamination around the site.

  The EU has also contributed 20 mecu to the EBRD-managed Nuclear Safety Account. Of the UK's £18.25 million contribution to that account, £10 million has been specifically scheduled for the Ukraine. The commitments to this fund stand at 270 mecu and the 118 mecu project for Chernobyl includes safety upgrades for Unit 3, as well as a liquid radwaste treatment plant and a spent fuel interim storage facility to assist with decommissioning.

  The G7 and the Ukraine have now agreed on a Shelter Implementation Plan to ensure that the sarcophagus is transformed into a safe and environmentally stable condition. The EU has pledged $100 million to the fund which has been set up to finance this plan. The UK is making a separate bilateral donation of $16.8 million. A project management team has now been appointed and tendering will shortly begin for the first stage of the work. A £20,000 UK Government-financed study into the options for treating the water trapped in the sarcophagus is shortly to be made available to the project management team.

  Arms Exports
  Ann Clwyd
  To ask the President of the Board of Trade what human rights considerations were taken into account when(a) refusing and (b) granting the ML1 licences to Indonesia. [40389]

  Mr. Fatchett
  I have been asked to reply.

  All applications for licences to export goods entered in Part III of Schedule 1 to the Export of Goods (Control) Order 1994 to Indonesia or any other country, are considered against the criteria announced by the Foreign Secretary on 28 July 1997, Official Report, columns 26–29. The criteria are also used for considering applications for the export of dual-use goods where there are grounds for believing that the end-user would be the armed forces or the internal security forces of the recipient country. The criteria include consideration of respect for human rights
  38
  and fundamental freedoms in the recipient country and the risk of the proposed export being used for internal repression.

  Vehicle Licensing
  Mrs. Ray Michie
  To ask the President of the Board of Trade if she will list the costs for each year since 1987 of posting licensing reminders to all licensed vehicle owners. [41048]

  Ms Glenda Jackson
  I have been asked to reply.

  Following are the postage costs, for financial years 1987–88 onwards, of vehicle licensing reminders:

  £ million

  Year

  Vehicle reminder postage costs

  1987–88

  2.6

  1988–89

  2.7

  1989–90

  2.9

  1990–91

  3.3

  1991–92

  3.7

  1992–93

  3.8

  1993–94

  3.9

  1994–95

  3.9

  1995–96

  4.2

  1996–97

  4.3

  1997–98

  4.5

HEALTH

  EC Workshop on Sexuality
  Sir Richard Body
  To ask the Secretary of State for Health, pursuant to his answer of 3 July 1997,Official Report, column 229, when he expects to give a substantive reply to the hon. Member for Boston and Skegness relating to the EC Workshop on Sexuality. [31232]

  Ms Jowell
  I wrote to the hon. Member on 6 May 1998. Copies of this letter have been placed in the Library.

  In my answer of 3 July 1997, Official Report, column 229, I indicated that I was providing the hon. Member with information available to me at the time about the European Community funded workshop on sexuality. There is now some doubt about whether the workshops were ever held in the United Kingdom, and my letter of 6 May sets out the latest information in full.

  Silicone Breast Implants
  Ann Clwyd
  To ask the Secretary of State for Health (1) how many women have received silicone breast implants in each of the last five years on the NHS; and if he will estimate the number of women who have received such implants privately; [23010]

  (2) how many women have had their silicone breast implants removed on the NHS due to rupturing in each of the past five years; and if he will estimate the equivalent figure for private health care. [23011]

  Mr. Boateng
  The available information for the National Health Service is in the table. We record the number of episodes in which a breast implant was
  39
  inserted, the number of implants removed and the number of revision operations. Whether the implants were filled with silicone-gel or another material is not known. There are no equivalent figures for the private sector.

  Number of episodes by primary operation; ordinary admissions and day cases combined, NHS hospitals, England

  Operation

  1991–92

  1992–93

  1993–94

  1994–95

  1995–96

  Breast

  Implants1

  1,514

  1,680

  1,234

  1,320

  1,435

  Revision/removal1

  289

  333

  274

  363

  412

  Total

  2,188

  2,457

  1,860

  2,097

  2,362

  1 Breast implants

  B30.1 Insertion of prosthesis for breast.

  B31.2 Augmentation mammoplasty.

  B31.8 Other specified plastic operations on breast.

  2 Revision/removal

  B30.2 Revision of prosthesis for breast.

  B30.3 Removal of prosthesis for breast.

  Note:

  Data in this table are grossed for both coverage and unknown/invalid clinical data.

  Source

  Department of Health, Hospital Episode Statistics.

  Hepatitis C
  Judy Mallaber
  To ask the Secretary of State for Health when he expects to be able to make an announcement on the claim for recompense by haemophiliacs infected with hepatitis C as a result of treatment with contaminated blood products; and when he will be writing to the Haemophilia Society on this matter. [41008]

  Mr. Boateng
  We fully recognise that those who have made representations on this subject are disappointed that we have not as yet announced our conclusions on the matter. This is, however, a very complex issue which we are still considering. We will announce the outcome of our deliberations, and write to the Haemophilia Society, as soon as we are in a position to do so.

  Children's Rights Commission
  Mr. Dawson
  To ask the Secretary of State for Health what discussions he has had about the office of Children's Rights Commissioner as part of the work leading up to the United Kingdom's response to the United Nations Committee on Children's Rights; and if he will make a statement. [41369]

  Mr. Boateng
  On 12 January 1998, I met a delegation to discuss possible ways of assessing the potential value of a Children's Rights Commissioner for England. We asked officials to prepare an initial assessment of the progress made by other countries who have established a Children's Rights Commissioner or similar office. We expect that report by the end of June. Thereafter, we will consider whether further work should be initiated and within what timetable. The preparation of the United Kingdom's second report on the implementation of the United Nations Convention on the Rights of the Child is expected to be concluded by the end of 1998 and the report will be published early in 1999. Copies will be placed in the Library.

  Civil Service Rebuttal Officer
  Mr. Malcolm Bruce
  To ask the Secretary of State for Health if he has appointed a civil service rebuttal officer in his Department; and if he will make a statement. [41165]

  Mr. Dobson
  The Department's communications planning unit includes a rebuttal officer whose job is to make more systematic and orderly the process of responding to criticism of Government policy, and in particular to inaccurate or misleading allegations. This role complies with the official Civil Service "Guidelines on the Work of the Government Information Service" and the person appointed is a career civil servant who reports to a career civil servant.

  Communications Planning Unit
  Mr. Malcolm Bruce
  To ask the Secretary of State for Health if he will list(a) the cost of establishing and (b) the annual running cost of his communications planning unit; for what reason the unit is to be financed from public funds; and if he will make a statement. [41164]

  Mr. Dobson
  As endorsed in the Report of the Working Group on the Government Information Service (Mountfield Report), the Department's communications planning unit was set up to provide better co-ordination of news handling. The total basic staff cost of the unit is estimated at £86,000, which is from existing running costs. All the staff involved were already employed by the Department.

  Teaching Hospitals (London)
  Mr. Duncan Smith
  To ask the Secretary of State for Health what financial transitional support was available to London teaching hospitals in 1994–95, 995–96, 1996–97 and 1997–98. [41571]

  Mr. Milburn
  The information requested is provided in the table.

  Transitional support to London teaching hospitals 1994/95–1997/98

  £000

  Year

  Total

  1994–95

  61,892

  1995–96

  51,823

  1996–97

  41,716

  1997–98

  48,869

  Notes

  (i) Trusts included in total are: King's College, Guy's & St. Thomas', St. George's, Royal Hospitals, University College Hospital London, Hammersmith, St. Mary's, Chelsea and Westminster

  (ii) In addition to the above, financial transitional support has been made available over the period to other London trusts and to London health authorities. The total central funding for London was included in the Turnberg Report

  Waiting Lists
  Mr. Malcolm Bruce
  To ask the Secretary of State for Health when he will publish the next set of quarterly waiting lists statistics; and if he will make a statement. [41166]
  41
  Mr. Milburn
  The next set of quarterly waiting list statistics for England will be published in week commencing 18 May 1998. The figures will be based on provisional information from health authorities and trusts and will show the position on 31 March 1998.

  NHS Finances (London)
  Mr. Duncan Smith
  To ask the Secretary of State for Health when the weighted capitation formula, and the market forces factor, will be reviewed for London. [41572]

  Mr. Milburn
  The national standing Advisory Committee on Resource Allocation is looking at how resources are distributed across both secondary and primary care to ensure that these fully reflect local population needs and operate as fairly as possible.

  One of the Committee's tasks is to undertake a review of the staff market forces factor which has important implications for London.

  The aim is to complete this review in time to inform health authority allocations for 1999–2000.

  NHS (50th Anniversary)
  Mr. Simon Hughes
  To ask the Secretary of State for Health how much money(a) his Department and (b) the NHS plan to spend on marking the 50th anniversary of the NHS. [40951]

  Mr. Milburn
  I refer the hon. Member to the answer given to my hon. Friend the Member for Falkirk, West (Mr. Canavan) on 19 December 1997,Official Report, columns 389–90. In accordance with the principles that the activity will be decentralised and devolved, will promote core National Health Service aims, and that money is not diverted from patient care, it is for individual NHS organisations to consider what funds they are able to use or generate for local activities, and it is not possible to estimate the likely cost to the NHS.

  The costs of central support for the NHS's aims during anniversary year are met from within the Department's publicity and communications budget. In 1997–98, the gross forecast outturn for this element is £1,122,252. In 1998–99, we estimate that the gross contribution will be around £550,000. We intend that this expenditure will be offset by sponsorship wherever possible.

  NHS Nurses
  Helen Jones
  To ask the Secretary of State for Health what guidance he has given to NHS trusts on the procedures they should follow in order to check that all applicants for nursing posts are registered nurses. [41116]

  Mr. Milburn
  On 6 May 1998, the Department published guidance (HSC(98)64 "The Management of Health, Safety and Welfare Issues for National Health Service Staff") which reminds managers of their responsibility for taking up references from previous employers and making registration checks with the appropriate regulatory body. Earlier guidance (EL(92)84) advised employers to check registration before applicants take up post and to designate this as the responsibility of a single named officer.

  Psychotherapists
  Helen Jones
  To ask the Secretary of State for Health (1) what steps he intends to take to ensure that those practising as psychotherapists subscribe to a recognised code of practice and ethics; [41118]

  (2) what action he intends to take to ensure that those practising as psychotherapists are trained by, and registered with, a reputable body. [41117]

  Mr. Milburn
  Counselling and psychotherapy services are provided by a wide diversity of professionals. A large number of professional bodies and organisations exist to provide guidance on training, professional practice, ethics and conduct. It is for those professional bodies to agree on matters concerning training and standards of psychotherapists.

  We have required National Health Service employers to satisfy themselves that all staff, including those practising as psychotherapists, have the skills and training appropriate to the roles they are required to carry out.

  Health Care Assistants
  Helen Jones
  To ask the Secretary of State for Health what plans he has to prevent nurses who are struck off the register from obtaining posts as health care assistants. [41119]

  Mr. Milburn
  It is a matter for employers to check that all prospective employees are suitably qualified and experienced for the post to be filled, and to take up references.

  Alcohol
  Mrs. Roe
  To ask the Secretary of State for Health what plans he has to take forward the strategy set out in the green paper, Our Healthier Nation, on alcohol; and what is his Department's timetable for producing this strategy. [41508]

  Ms Jowell
  We intend to produce a coherent strategy which reinforces our messages about sensible drinking and provides an effective framework for action to tackle alcohol misuse in all its forms. It will need to reflect all of the issues of major concern about alcohol across Government, as well as for other interested parties, including the alcohol industry. Much new co-ordinated work on alcohol is already taking place, for example through the Ministerial group on under-age drinking; the Department of Environment, Transport and the Regions' consultation exercise on drink-driving and the Home Office's recently announced review of liquor licensing. But that work will be more successful if it can take place within the context of a clearer framework for activity. Alcohol Concern have secured private sector support to carry out an extensive consultation exercise by the end of 1998 on what form an alcohol strategy might take. All interests should be reflected in this process and we will await its results before taking further action.

  Ritalin
  Mr. Burstow
  To ask the Secretary of State for Health if he will list by health authority the levels of prescribing
  43
  of Ritalin (methylphenidate) in terms of (a) numbers of people and (b) cost in (i) 1993–94, (ii) 1994–95, (iii) 1995–96 and (iv) 1996–97. [41203]

  Mr. Milburn
  [holding answer 8 May 1998]Information on the number of people receiving Ritalin is not available. Information on prescriptions dispensed for individual products such as Ritalin is not released at health authority level. This is in order to preserve patient, contractor and commercial confidentiality.

  The net ingredient cost of prescription items dispensed for Ritalin in the community in England from 1993–94 to 1996–97 is shown in the table. Data on prescriptions dispensed in hospital are not available.

  The net ingredient cost of prescription items for Ritalin (methylphenidate hydrochloride) dispensed in the community, 1993–94 to 1996–97 in England

  £000

  Year

  Net ingredient cost

  1993–94

  30.6

  1994–95

  61.2

  1995–96

  365.6

  1996–97

  998.7

  Notes

  1. The data cover all prescriptions dispensed in the community, i.e. by community pharmacists and appliance contractors, dispensing doctors, and prescriptions submitted by prescribing doctors for items personally administered in England

  2. The net ingredient cost refers to the cost of the drug before discounts and does not include any dispensing costs or fees. It does not include any adjustment for income obtained where a prescription charge is paid at the time the prescription is dispensed or where the patient has purchased a pre-payment certificate

FOREIGN AND COMMONWEALTH AFFAIRS

  Sierra Leone
  Sir John Stanley
  To ask the Secretary of State for Foreign and Commonwealth Affairs what action was taken by Ministers following publication of the article, "Britain holds talks with hired killers", in The Observer on 8 March. [41576]

  Mr. Wilshire
  To ask the Secretary of State for Foreign and Commonwealth Affairs (1) how many officials or diplomats in his Department have been cited in allegations that at least one official or diplomat had dealings with Sandline International in connection with the supply of arms and aid to Sierra Leone in contravention of a United Nations embargo; [41243]

  (2) if he will list all the meetings that have taken place between Lieutenant-Colonel Tim Spicer and (a) the current British High Commissioner to Sierra Leone, (b) himself or other ministers and (c) other officials or diplomats of his Department, stating (i) the dates when they took place, (ii) who was present, (iii) at whose request the meetings took place, (iv) where they took place and (v) what was discussed; [41229]

  (3) what contacts (a) he, (b) his ministers and (c) his officials or diplomats have had with Sandline International concerning the supply by that company of arms and aid to Sierra Leone; [41238]
  44
  (4) on what date (a) he and (b) his ministers were told about the allegations that at least one diplomat had had dealings with Sandline International in connection with the supply of arms and aid to Sierra Leone in contravention of a United Nations embargo; [41242]

  (5) on what date officials in his Department first became aware of allegations that at least one official or diplomat had had dealings with Sandline International in connection with the supply of arms and aid to Sierra Leone in contravention of a United Nations embargo; [41245]

  (6) if the provision of arms and aid to Sierra Leone by Sandline International was contrary to United Nations resolution 1132; [41230]

  (7) if he will list all the meetings that have taken place between Sandline International and (a) the current British High Commissioner to Sierra Leone, (b) himself or other ministers and (c) other officials or diplomats of his Department, stating (i) the dates when they took place, (ii) who was present, (iii) at whose request the meetings took place, (iv) where they took place and (v) what was discussed; [41235]

  (8) what are the terms of reference of his departmental inquiry into the allegations that at least one diplomat had dealings with Sandline International in connection with the supply of arms and aid to Sierra Leone in contravention of a United Nations embargo; who will be conducting it; when it will start work; and when will it finish; [41237]

  (9) what (a) formal and (b) informal approaches were made by Sandline International to (i) him, (ii) his ministers and (iii) officials or diplomats in his Department regarding the supply of arms and aid to Sierra Leone; [41239]

  (10) on what date (a) he and (b) his ministers were first told that the allegations that at least one diplomat had had dealings with Sandline International in connection with the supply of arms and aid to Sierra Leone in contravention of a United Nations embargo had been referred to HM Customs and Excise; [41241]

  (11) on what date officials in his Department referred the allegation that at least one official or diplomat had had dealings with Sandline International in connection with the supply of arms and aid to Sierra Leone in contravention of a United Nations embargo to HM Customs and Excise; [41244]

  (12) on what date and for what reasons he decided to hold an internal departmental inquiry into the allegations that at least one diplomat had had dealings with Sandline International in connection with the supply of arms and aid to Sierra Leone in contravention of a United Nations embargo; [41231]

  (13) if he will make it his policy to publish the report and findings of the internal departmental inquiry into the allegations that at least one diplomat had dealings with Sandline International in connection with the supply of arms and aid to Sierra Leone in contravention of a United Nations embargo; [41236]

  (14) when (a) he and (b) his ministers were first told of the allegations made in The Observer in March that at least one diplomat had had dealings with Sandline

  45
  International in connection with the supply of arms and aid to Sierra Leone in contravention of a United Nations embargo; and what action he or they then took, and when. [41240]

  Mr. Robin Cook
  I refer the right hon. and hon. Members to the answer I gave to the Private Notice Question tabled by the right hon. and learned Member for Folkestone and Hythe (Mr. Howard) on 6 May 1998,Official Report, columns 721–31.

  Mr. Wilshire
  To ask the Secretary of State for Foreign and Commonwealth Affairs what help given by the current British High Commissioner in respect of the successful counter-coup in Sierra Leone led him to congratulate the High Commissioner to Sierra Leone on giving such help. [41234]

  Mr. Robin Cook
  I congratulated the British High Commissioner in June 1997 on his role in the evacuation of British citizens and others from Sierra Leone during the coup in May. I have sent no message since.

  Mr. Wilshire
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on the use of a picture of the current British High Commissioner to Sierra Leone on T-shirts being sold in that country. [41232]

  Mr. Robin Cook
  We are not selling any such T-shirts, and have no stake in any commercial enterprise that is.

  Soviet Union (Nuclear Reactors)
  Mr. Llwyd
  To ask the Secretary of State for Foreign and Commonwealth Affairs what data he has collated on the risks in respect of nuclear reactors in the former Soviet Union. [40903]

  Mrs. Beckett
  I have been asked to reply.

  The International Atomic Energy Agency has published a series of technical documents on the Soviet-designed WER and RBMK (Chernobyl types) reactor types. A major European Union-financed report on the safety of the RBMK reactors has also been completed. These identify and prioritise the main safety issues which need to be addressed. These documents are being used by the countries concerned and international donors, to help shape safety upgrading programmes. The UK continues to work with our G7 and European Union partners to improve nuclear safety in the countries concerned and to encourage them to develop viable energy sector strategies that enable alternative generating capacity to be brought on line, allowing the older, less safe, reactors to close.

  Berlin Airlift
  Mr. Howard
  To ask the Secretary of State for Foreign and Commonwealth Affairs what events the Government are planning to commemorate the 50th anniversary of the Berlin airlift. [40639]

  Mr. Spellar
  I have been asked to reply.

  The Berlin Airlift was a remarkable expression of Allied cooperation and it is fitting that our commemoration of this event should also reflect that spirit.
  46
  The annual wreath laying ceremony in Berlin is to take place on 12 May 1998, and will be supported by the RAF Western Band. The British Ambassador to Germany will lay a wreath on behalf of the nation.

  The Queen's Colour Squadron of the RAF, the RAF Western Band, RAF aircraft and the Battle of Britain Memorial Flight Dakota will participate in various ceremonies marking the 50th Anniversary of the start of the Airlift. These will include those at the former RAF Airlift base at Gatow, the Tempelhof Airbridge Open Days and the opening celebrations for the Allied Museum Berlin which my right hon. Friend, the Secretary of State for Defence, has accepted an invitation to attend. The RAF will also be represented at the Berlin Air Show in May which has been dedicated to the Airlift and at a military history symposium in Berlin during July.

HOME DEPARTMENT

  Organised Crime
  Mr. Stephen Twigg
  To ask the Secretary of State for the Home Department if he will make a statement on European Union initiatives to combat organised crime. [40264]

  Mr. Straw
  This has been a major priority for the United Kingdom Presidency.

  We have made good progress in implementing the Action Plans on organised crime and drugs, which have included: negotiation of a Pre-Accession Pact with the countries of central and eastern Europe and Cyprus; a new funding programme [to support further action against organised crime]; the new convention on mutual legal assistance.

  And we have resolved most of the outstanding difficulties to allow Europol to become fully functional in the autumn.

  Mr. Sheerman
  To ask the Secretary of State for the Home Department what steps he is taking to ensure effective responses to evidence of sophisticated syndicates of organised criminals operating across national borders. [40285]

  Mr. Michael
  The Government have used the opportunity of the Presidency of the European Union to drive forward the fight against transnational organised crime and the menace it poses. The National Criminal Intelligence Service and the National Crime Squad provide a focus for operational activity which contributes to efficient and effective international co-operation.

  Sex Offenders
  Miss Kirkbride
  To ask the Secretary of State for the Home Department what plans he has to implement the powers for the supervision of sex offenders contained in the Crime (Sentences) Act 1997. [40269]

  Mr. Michael
  The provisions for the extended supervision of sex offenders in the Crime (Sentences) Act 1997 were not implemented as they were linked to other provisions on release and post-release supervision which were unnecessarily complicated. Instead, we have brought
  47
  forward fresh provisions for extended supervision of sexual and violent offenders, which are contained in the Crime and Disorder Bill.

  Racial Violence
  Dr. Ladyman
  To ask the Secretary of State for the Home Department what plans he has to introduce measures to combat racial violence. [40284]

  Mr. Michael
  The lives of far too many people have been damaged or destroyed by racial violence and harassment. In our manifesto, Labour promised to crack down on mindless, racist thuggery and the Crime and Disorder Bill introduces new offences of racial violence, harassment and criminal damage. These will send out a strong message to society that racist crime is unacceptable, while the inquiry into the death of Stephen Lawrence will identify the lessons to be learnt for the investigation and prosecution of racially motivated crime.

  Drug Misuse
  Mr. Gordon Marsden
  To ask the Secretary of State for the Home Department what plans he has to encourage the extension of arrest referral schemes by the police as a means of combating drug use. [40286]

  Mr. George Howarth
  One of the four key aims of the Government's recently published drugs strategy is to protect communities from drug-related crime. Action planned in support of this aim will include promotion of arrest referral schemes. Currently, just over half the police forces in England and Wales have arrest referral schemes.

  Mr. Ronnie Campbell
  To ask the Secretary of State for the Home Department what recent research he has commissioned into the link between drugs and crime. [40291]

  Mr. George Howarth
  Research currently in progress includes work on the criminal lifestyles of crack addicts, on the effects of treatment of addicts' criminality, and on developing performance indicators for police anti-drugs strategies. Consideration is also being given to extending a project on drug testing and interviewing arrestees, the first results of which were published last month.

  Mr. Gareth Thomas
  To ask the Secretary of State for the Home Department what proportion of people arrested by the police are addicted to heroin and other opiates. [40294]

  Mr. Michael
  Information on what proportion of people arrested by the police are addicted to heroin and other opiates is not available. However, a study conducted for the Home Office by the University of Cambridge of drug use by samples of people arrested by the police in various English cities was published recently, and a copy is in the Library.

  Urine tests showed high levels of recent drug consumption among arrestees—61 per cent. had taken at least one illegal drug. Comparatively high proportions of arrestees across all sample areas tested positive for heroin/opiates (18 per cent.). The proportion of interviewees who said they were dependent on heroin was 11 per cent.; 9 per cent. admitted dependency on methadone; and a further 2 per cent. on dipipanone
  48
  (Diconal). It should be noted that the proportions admitting drug dependence varied from one sample to another.

  Ms Oona King
  To ask the Secretary of State for the Home Department if he will visit the drugs awareness scheme in Bethnal Green and Bow to discuss community-based projects to tackle drug abuse among young people. [40295]

  Mr. George Howarth
  I am happy to receive information about the scheme but have no plans to visit.

  Mr. Barry Jones
  To ask the Secretary of State for the Home Department if he will make a statement about the priorities of his Department for the UK presidency of the European Union in respect of drug abuse. [40298]

  Mr. George Howarth
  The United Kingdom Presidency has given priority to action against drug trafficking and drugs misuse, in particular by building on the wide range of work already underway across the three pillars of the European Union, which covers the responsibilities of a number of Government Departments. A main objective for the Home Office, in addition to ongoing practical activity, such as implementation of the Joint Actions on new synthetic drugs and approximation of drugs laws and practices, has been to launch consideration of a new five-year European Union drugs strategy, which would take effect from 2000. We have tabled detailed proposals of the key aims and goals of the new strategy.

  We have also played a significant part in ensuring an effective input to European Union co-ordination in the preparatory process for the United Nations General Assembly Special Session on Drugs, being held in New York in June, particularly in areas of direct interest to the Home Office, such as precursor chemicals, amphetamine-type stimulants, judicial co-operation, money laundering and drugs demand reduction.

  Paedophiles
  Mr. Robathan
  To ask the Secretary of State for the Home Department what representations he has received about the length of sentences given to paedophiles. [40287]

  Mr. Michael
  Since the beginning of the year, my right hon. Friend and I have received 76 representations from hon. Members relating to sex offenders, and the Criminal Policy Directorate has received over 400 letters and petitions from members of the public.

  Women Prisoners
  Mrs. Anne Campbell
  To ask the Secretary of State for the Home Department if he will make a statement on the custody of women prisoners. [40288]

  Ms Quin
  Following the very helpful report published last year by Her Majesty's Chief Inspector of Prisons, a new Directorate of Regimes has been established with an Assistant Director who has direct responsibility for women in prison. Within that framework, the needs of women prisoners are being re-examined, with particular attention to the development of constructive regimes and programmes to address offending behaviour.

  Prisoners' Paid Employment
  Mr. Clifton-Brown
  To ask the Secretary of State for the Home Department what regulations govern paid employment for a person serving a custodial sentence. [40289]

  Ms Quin
  Regulations governing prisoners' pay and earning are set out in Prison Service Standing Order 6 and the Prisoners' Pay Manual which was introduced in 1992, copies of which are in the Library.

  The manual sets out a framework within which prisoners can be rewarded for taking part in purposeful activities. Properly balanced incentives encourage sustained effort from prisoners engaging in those activities. We are looking again at this to see whether further changes need to be made.

  Computer Pornography
  Mr. Blizzard
  To ask the Secretary of State for the Home Department what representations he has received regarding control of pornography in computer magazines. [40290]

  Mr. Michael
  Since December 1997, seven representations about computer magazines have been received, three from hon. Members, one from a Member of another place and three from members of the public. None of them specifically concerned explicit sexual material.

  Human Rights Bill
  Mr. Bradshaw
  To ask the Secretary of State for the Home Department what recent representations he has received from the churches about measures contained in the Human Rights Bill[Lords]. [40292]

  Mr. Mike O'Brien
  My right hon. Friend has had meetings with representatives of a number of churches, and my noble Friend has met a delegation from the group "Christians for Human Rights". We have also received a good deal of correspondence. We are taking account of all the various views expressed in considering how to respond to the amendments made to the Bill in another place.

  Immigration
  Mr. Wilkinson
  To ask the Secretary of State for the Home Department what assessment he has made of the impact of the Dublin convention on British control of the immigration of non-EU nationals from EU member states. [40293]

  Mr. Mike O'Brien
  The Dublin Convention has made it more difficult and time consuming to secure the return to other member states from the United Kingdom of non-European Union nationals who claim asylum on arrival here. Under our Presidency of the European Union, we are seeking agreement on a programme of action aimed at improving the operation of the Dublin Convention.

  Protection for the Elderly
  Mr. Bill O'Brien
  To ask the Secretary of State for the Home Department what proposals he has to give 50
  greater protection to older people in respect of (a) mugging, (b) burglary and (c) fear of crime; and if he will make a statement. [40296]

  Mr. Michael
  The well-being of elderly people is a very high priority for this Government. Crimes against the elderly are particularly shocking, and we are determined to ensure that they are effectively addressed. Measures in the Crime and Disorder Bill will help achieve this goal.

  Under the Bill, the police and local authorities will be required to form partnerships to identify and to reduce crime and disorder. These partnerships will bring together many agencies and, importantly, will entail the full involvement of the local community. Implementation will involve local consultation, and guidance which we plan to issue in July will include specific reference to the need for public meetings and other forms of consultation to be accessible to all members of the community, including the elderly. The partnerships will be required to conduct an audit of current levels of crime and disorder and to devise a strategy to tackle specific local problems, including those affecting the elderly.

  Fortunately, crime risks for the elderly are lower than they might appear from media coverage. The British Crime Survey found that, across a wide range of offence categories, risks for those aged 16 to 29 were at least treble the risks for the elderly. For assault, young people were 37 times more at risk.

  Asylum Seekers
  Mr. Viggers
  To ask the Secretary of State for the Home Department how many applicants for political asylum are currently detained in secure accommodation while their case is being investigated. [40297]

  Mr. Mike O'Brien
  As at 31 March 1998, the most recent date for which information is available, a total of 765 persons who had sought asylum at some stage were recorded as being detained solely under Immigration Act powers.

  Prisoners' Meals
  Mr. Gordon Prentice
  To ask the Secretary of State for the Home Department what steps he is taking to ensure prisoners receive varied and nutritious meals. [40299]

  Ms Quin
  All prison establishments offer multi-choice menus with about 50 per cent. offering prisoners the opportunity to pre-select their meals. These pre-select meals also incorporate information which allows prisoners to select healthy eating options.

  Home Security
  Mr. Mackinlay
  To ask the Secretary of State for the Home Department if he will make a statement on the Government's initiatives to increase the security of people in their homes. [40300]

  Mr. Michael
  The Crime and Disorder Bill includes a range of measures to reduce crime and disorder, and the fear of crime. Foremost of these is the proposal for the police and local authorities together to undertake a crime and disorder audit in the district, borough or unitary authority area, in consultation with other agencies and the wider community. They will then have to develop a local
  51
  strategy to tackle the identified crime and disorder problems. The work of the partnerships created to implement the local strategies, which will include clear targets, will include action at a much more local level within the local authority area. I am confident that these measures will have a significant effect on local levels of crime and disorder, and that this will in turn help people to feel more secure both in their homes and their communities.

  Animal Experiments
  Mr. Baker
  To ask the Secretary of State for the Home Department what estimate he has made of the number of animal experiments that will be carried out in 1998–99 under the terms of the Animals (Scientific Procedures) Act 1986. [40301]

  Mr. George Howarth
  Statistics on animal use can be collated only in retrospect and this is done on a calendar year basis. We expect to publish the figures for 1997 in July. We do not expect a significant increase.

  We cannot predict the number of procedures that will take place in the coming year. Although project licence applicants must estimate how many animals are to be used per year in each protocol, these figures are not collated centrally and, in practice, the number of animals actually used falls short of this estimate. We cannot predict the number of new project licence applications that we will receive during the year, or the number of animals that each will seek authority to use.

  The Animals (Scientific Procedures) Act 1986 does not make provision for controlling the overall number of procedures; it requires that project licences be granted only if the benefits have been weighed against the costs and the purpose of the work cannot be achieved by other means. Whilst we can ensure that the number of animals used in each programme of work is minimised, we cannot dictate how many applications for new project licences will be submitted nor how many proposed programmes will satisfy the requirements of the Act, particularly the cost/benefit assessment. The number of scientific procedures involving animals is dependent on a number of factors, including the implications of scientific breakthroughs and the buoyancy of United Kingdom industry.

  The primary purpose of the 1986 Act is to reduce suffering. In consequence, where there is a choice between one protocol involving a certain number of animals and a more severe protocol involving fewer animals, the former will, in many cases, be authorised. One of the roles played by the Home Office Animals (Scientific Procedures) Inspectorate is to ensure that applications to use animals have taken full account of the 3Rs concept of alternatives (refining procedures to minimise suffering; reducing the number of animals used; and replacing procedures with ones not involving protected animals), while ensuring that the scientific integrity and value of the work is not compromised.

  The overall number of procedures is not a true indication of the effectiveness of the Act.

  Mr. Flynn
  To ask the Secretary of State for the Home Department what steps are being taken to end the testing of cosmetics on animals; and if he will make a statement. [41097]
  52
  Mr. George Howarth
  We have already announced an end to the testing of finished cosmetic products on animals in the United Kingdom and we are exploring the possibility of extending this ban to cover ingredients intended primarily for "vanity products". (The European definition of cosmetics includes sun screens, toothpastes and other products which may be considered to be pharmaceuticals in other countries).

  European Directives require that new and, in certain circumstances, existing ingredients be tested to ensure that they are safe to use, manufacture and transport. For these purposes, animal tests are still required.

  Mr. Flynn
  To ask the Secretary of State for the Home Department what plans he has to reduce the number of experiments conducted on animals in the United Kingdom; and if he will make a statement. [41098]

  Mr. George Howarth
  The Animals (Scientific Procedures) Act 1986 does not make provision for controlling the overall number of procedures; it requires that project licences be granted only if the benefits have been weighed against the costs and the purpose of the work cannot be achieved by other means. We cannot dictate how many applications for new project licences will be submitted, or how many proposed programmes will satisfy the requirements of the Act, particularly the cost/benefit assessment.

  We are promoting the development, validation and use of alternative methods which replace animal use, reduce the number of animals needed and refine procedures to minimise suffering (the 3Rs). To this end: we have announced our intention to explore, with the Animal Procedures Committee and the European Centre for the Validation of Alternative Methods (ECVAM), the possibility of promoting databases on alternative methods; we have increased the money made available to the Animal Procedures Committee to sponsor research on alternatives from £182,000 to £259,000; we will be requiring project licence applicants to state what consideration they have given to alternatives before a licence is granted; and we are discussing with regulators how best to apply the 3Rs to regulatory safety testing.

  Air Guns
  Mr. Caton
  To ask the Secretary of State for the Home Department what plans he has to review the law controlling air guns. [41155]

  Mr. Michael
  It is illegal to carry a loaded air weapon in a public place, to discharge an air weapon within 50 feet of a road or to use one to shoot birds or other protected animals.

  The Government have no current plans to introduce further legislation on firearms controls, but will keep under close scrutiny the way in which air weapons are used. We shall consult widely with all interested parties if further steps are considered necessary.

  Suicides
  Mr. Allan
  To ask the Secretary of State for the Home Department how many young people under the age of 21 years have committed suicide or attempted suicide while on remand awaiting trial, in each of the last three years; and if he will make a statement. [40025]
  53
  Ms Quin
  Some of the information requested is shown in the table. It should be noted that the number of deaths shown are of self-inflicted deaths, a broader definition than that of suicide, particularly as the inquest into some deaths have yet to take place. The information requested on attempted suicides is not available in the format requested and could be obtained only at disproportionate cost.

  Age

  1995

  1996

  1997

  16

  0

  0

  0

  17

  0

  0

  1

  18

  1

  2

  2

  19

  2

  5

  1

  20

  1

  1

  1

  Total

  4

  8

  5

  Probation Constables
  Mr. Cousins
  To ask the Secretary of State for the Home Department what representations he has received about the proposal to relocate the District Training Centre for probationer constables in Durham away from the North East; what factors underlay this proposal; and if he will consult with local parties on this matter. [41467]

  Mr. Michael
  My right hon. Friend has received correspondence from Councillor George Gill, the Chairman of the Northumbria Police Authority and from eight right hon. or hon. Members who have written in support.

  The future of probationer training in the North East is under examination in the light of the forthcoming expiry of the lease of the present site at Durham in December 1999 and against the background of the demand for probationer training places generally. A working group composed of representatives of the Association of Police Authorities, the Association of Chief Police Officers (ACPO), the police staff associations, National Police Training (NPT) and the Home Office, has been set up to consider NPT's accommodation requirements in the North East and more generally, and to make recommendations. No final decision has been made and there is no preconceived view that probationer training should not take place in the North East. The working group, whose members include the Chief Constable of Durham Constabulary, will take full account of the views of the police authorities and forces in the North East. The correspondence from Councillor Gill has also been circulated to the working group.

  In view of the approaching expiry of the lease for the site at Durham, it was considered right to make plans on the basis that the centre would then close. However, the working group will consider any proposals which may be made for an extension of the lease alongside any other options which may emerge. In doing so, they will take account of the shortcomings in the facilities at the centre and the cost of the premises compared to alternatives, including the possibility of a Public Private Partnership.

  Children (Supervision)
  Mr. Jim Cunningham
  To ask the Secretary of State for the Home Department what assessment he has made of the extent of unsupervised gatherings of children aged under 10 years at night. [41210]

  Mr. Michael
  Research by the Home Office and others has shown that one of the strongest factors in relation to the commencement of offending by juveniles is poor parental supervision. One of the measures which the Government will introduce as part of their youth justice reform programme will be the local child curfew.

  The Crime and Disorder Bill [Lords] will give local authorities a permissive power to introduce local child curfews for unsupervised children under 10 who are out on the streets late at night. The aim of such curfews is two-fold. They will address the need to protect young children from being drawn into anti-social or criminal behaviour, and they will protect communities from the misery and distress which can be caused by groups of unsupervised children.

  Anti-social Behaviour Orders
  Mr. Jim Cunningham
  To ask the Secretary of State for the Home Department what plans he has to ensure that anti-social behaviour orders are not used improperly. [41211]

  Mr. Michael
  The fact that only local authorities and the police, in consultation with one another, will be able to apply to the courts for orders will help to avoid any risk of improper use. It will be up to the courts to decide whether an anti-social behaviour order can be granted. We are producing detailed guidance to make clear the kind of circumstances in which applications should or should not be made.

  We have already given an undertaking to Parliament to review the effectiveness of the provisions and report our findings. This review will cover the types of behaviour for which orders are sought.

  Europol Convention
  Mr. Mitchell
  To ask the Secretary of State for the Home Department if he will list for (i) the Convention of the European Police Office (Europol Convention), European Communities No. 12 (1995) CM 3050 and (ii) the Protocol to that Convention concerning Privileges and Immunities of its Organs and Staff, European Communities No. 12 (1997) CM 3767(a) which members of the European Union have ratified it and (b) when it came into force, and in respect of (ii) for what reasons privileges and immunities apply to its staff, members of its Management Board and Financial Committee, and its Financial Controller, when they have ceased serving in those capacities. [41233]

  Mr. Michael
  The Europol Convention has been ratified in Austria, Denmark, Finland, France, Germany, Greece, Italy, Ireland, the Netherlands, Portugal, Spain, Sweden and the United Kingdom. It will enter into force on the first day of the month following the expiry of a three-month period after ratification by the final member state.
  55
  The Protocol on Privileges and Immunities has been ratified in Denmark, Finland, Ireland, the Netherlands, Sweden and the United Kingdom. It will enter into force on the first day of the second month following ratification by the final member state.

  Article 8 of the Protocol deals with the immunities which will apply to Europol staff and members of its organs
  "in respect of words spoken or written, and acts performed by them, in the exercise of their official functions".

  There may well be situations in which individuals would be obliged to fulfil such official functions (such as the giving of evidence in judicial proceedings) after they had ceased to serve in those capacities, and therefore the same Article goes on to provide that in those circumstances the immunities would still apply.

  Cocoon Watch Scheme
  Ms Shipley
  To ask the Secretary of State for the Home Department what plans he has to extend the Cocoon Watch Scheme. [40561]

  Mr. Michael
  Cocoon Watch is an approach which the police and other agencies may choose to adopt as part of local strategies, depending on local circumstances. The early indications of its success to combat domestic violence in Killingbeck are welcome and I am looking forward to seeing a further report on its use in the Killingbeck project later this year. Any wider adoption of this approach would be a matter for local decision.

  Vulnerable and Intimidated Witnesses
  Sir Raymond Powell
  To ask the Secretary of State for the Home Department when he expects the review on the treatment of vulnerable and intimidated witnesses to be complete. [41591]
  56
  Mr. Michael
  In consultation with colleagues, my right hon. Friend and I are currently considering how to take forward the final report of the inter-departmental working group on vulnerable and intimidated witnesses, which we received recently.

  Prisoners
  Mr. Luff
  To ask the Secretary of State for the Home Department if he will discuss with the Lord Chancellor the possibility of denying prisoners serving custodial sentences access to civil justice in matters relating to the conduct of the Prison Service unless they have first exhausted all internal grievance procedures and taken their case to the Prisons Ombudsman; and if he will make a statement. [41023]

  Ms Quin
  I refer the hon. Member to the replies I gave to him on 20 April 1998,Official Report, columns 515–16, and 5 May 1998, Official Report, column 367. I shall ask Prison Service officials to advise on prisoners' access to civil justice generally at the same time as advising on their use of small claims court procedures.

  Public Bodies
  Mr. Öpik
  To ask the Secretary of State for the Home Department how many and what proportion of his Department's appointees to non-departmental public bodies are (i) aged under 25, (ii) aged 25 to 30 and (iii) aged 31 to 35 years. [40743]

  Mr. Straw
  Of the 526 appointees to my Department's non-departmental public bodies (NDPBs), one is aged under 25 years, one is aged between 25 and 30 and two are aged between 31 and 35 years. This includes appointments made by the Prime Minister to NDPBs sponsored by my Department.

  The Government are committed to encouraging a wide range of candidates to apply for positions on the boards of public bodies, reflecting the diverse society in which we live. This includes encouraging more young people to put themselves forward as potential candidates for public appointments. All appointments are made on merit and candidates must demonstrate that they have the necessary skills and experience to match the needs of the public body on which they wish to serve.

Preamble
The House met at half-past two of the clock: The CHAIRMAN OF COMMITTEES on the Woolsack.
Prayers—Read by the Lord Bishop of Carlisle.

Cyprus
Baroness Knight of Collingtreeasked Her Majesty's Government:
Whether they would support an American initiative to start peace talks on the Cyprus issue.
Lord Whitty: My Lords, Her Majesty's Government fully support US efforts in support of the United Nations Secretary-General's Mission of Good Offices in his search for an overall solution to the Cyprus problem.
Baroness Knight of Collingtree: My Lords, does the Minister agree that there is some urgency, bearing in mind the recent Greek Cypriot decision to deploy Russian S300 surface-to-air missiles and, at a lower level, the continuing inconvenience in that all visitors to and exports from Northern Cyprus must go through Turkey?
Lord Whitty: My Lords, I agree that there is a real danger of increased tension in the area partly as a result of the decision to deploy the missiles. That is why Mr. Holbrooke was in Cyprus during the weekend of 1st to 4th May. The Government remain committed to his efforts, and to those of others under the UN umbrella, as he tries to pursue a settlement in Cyprus. From that point of view, the situation is urgent.
The Earl of Lauderdale: My Lords, does the Minister agree that there is a Russian element to the problem which is indirectly related to the attention being paid to central Asia as regards mineral resources?
Lord Whitty: My Lords, I am afraid that I cannot make the last connection, although the noble Earl may wish to pursue it. There is a Russian element in the sense that the missiles being ordered by the Cypriot Government are of Russian origin. We have made it clear that we do not think it wise of the Cypriot Government to acquire those missiles, although they have the right to do so in defence of the sovereign territory of the Republic of Cyprus.
Lord Ponsonby of Shulbrede: My Lords, does my noble friend believe that this is precisely the kind of issue in which the Western European Union should be playing a greater role because all the parties concerned are members or observers of the WEU? Will my noble friend encourage the Council of Ministers and the parliamentarians of the Western European Union to make greater efforts to try to resolve this potentially disastrous situation?
Lord Whitty: My Lords, I shall encourage anyone to contribute their good offices to improving the situation
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and increasing the likelihood of a settlement within Cyprus. However, there is a serious problem with the WEU or NATO formally being the main peacemakers in the area in that both Greece and Turkey are members of NATO and therefore conflicts are involved. We have primarily supported the UN efforts in this area and the efforts of the US in support. We have also designated our own special negotiator, Sir David Hannay, on behalf of the UK presidency, to try and make progress in the area.
Lord Pilkington of Oxenford: My Lords, when the Government advise the Republic of Cyprus, will they bear in mind that the crisis which produced such antagonism from the Turks was caused, in the first instance, by the attempts of the Greek Cypriots to unite with Greece? That created great tension in the Turkish community which could be repeated. Therefore, may I urge the Government to put pressure on the Republic of Cyprus not to accentuate the tension by deploying such missiles?
Lord Whitty: My Lords, we could go over the desperate history of the period in the 1970s, but the fact remains that there was a Turkish invasion of the Republic of Cyprus. Those troops remain there and we recognise the legitimacy of the Government of Cyprus. Nevertheless, we consider that all parties to the dispute should try to seek an intercommunal settlement. We support the UN, the US and anyone else who contributes towards the achievement of that settlement.
Lord Jenkins of Putney: My Lords, does my noble friend agree that an increased nuclear threat in Europe or anywhere else is to be condemned? Should not the Government actively take a more negative attitude towards such development?
Lord Whitty: My Lords, the Cypriot Government are not acquiring nuclear weapons so this is not a nuclear issue. Nevertheless, I agree with my noble friend and the noble Lord, Lord Pilkington, that it would have been better had the escalation of weaponry within Cyprus not occurred. However, we recognise the right of the Cypriot Government to acquire arms to defend themselves. Furthermore, from the point of view of Turkey, it would be better were sabre-rattling not to occur. The situation is delicate and all efforts must be directed at seeking a settlement.
Lord Ellenborough: My Lords, does the Minister agree that the very unsympathetic attitude of some of the western countries and the European Union towards Turkey has resulted in the fact that the Turkish Cypriots are merely pushed towards Turkey and Turkey is pushed away from the West towards the Islamic East, which may be a very dangerous situation?
Lord Whitty: My Lords, Her Majesty's Government recognise the potential danger of that situation. Indeed, we were anxious that Turkey should take part in the European conference organised in March of this year. However, the Turkish Government declined to participate. We are hoping that further diplomatic efforts will be made so that Turkey will feel able to participate

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in the process emanating from that European conference and that, therefore, relations between the European Union and Turkey will improve because they were seriously damaged at about the time of the Luxembourg conference.
Lord Pearson of Rannoch: My Lords, further to the answer which the Minister gave to his noble friend Lord Ponsonby of Shulbrede, would he agree that the Western European Union does not in fact have any foreign policy successes to its credit; that it is most unlikely to chalk one up in this instance; and that therefore Her Majesty's Government are best advised to continue collaboration with NATO and with our allies, the United States of America?
Lord Whitty: My Lords, I agree with the noble Lord's conclusion but not with his premise. The WEU has a number of initiatives in the former Yugoslavia and so on which can be pointed to. However, the main peace process within Cyprus will be carried out through the auspices of the United Nations. We shall continue to support that and in particular United States's efforts to support that UN initiative.
Lord Moynihan: My Lords, in view of the Minister's support for the US initiative, does the Minister agree with Richard Holbrooke, the special emissary appointed by President Clinton to forge a peace deal between the Greeks and Turks in Cyprus, when he said that:
"[The] EU's decision to open membership talks with Cyprus in March was a correct one, but the failure to put Turkey on the same basis as the other 11 countries that began the accession process was a mistake"?
Lord Whitty: My Lords, not precisely. I obviously agree with the first part of Richard Holbrooke's remarks. As regards the second part, I have said already that we considered it important that Turkey should participate in the European conference. We made all diplomatic efforts to try to ensure that that happened. In the event, the Turks declined to attend. However, there is a distinction between Turkey and some of the other applicant members of the European Union, particularly the five which are not currently involved in formal negotiations, in that there are political problems with the Turkish application which must still be addressed. Nevertheless, we believe that Turkey should return to a positive relationship with the European Union which, in current circumstances, means participating in the European conference process.

Mordechai Vanunu
2.35 p.m.
Lord Aveburyasked Her Majesty's Government:
Whether the Prime Minister raised the case of Mordechai Vanunu at his meeting with the Israeli Prime Minister on 19th April, and what response he received.
Lord Whitty: My Lords, the Prime Minister did not raise the case of Mordechai Vanunu when he met the
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Israeli Prime Minister recently. However, we have already raised Mr. Vanunu's case with the Israeli Government on humanitarian grounds and, if necessary, will do so again.
Lord Avebury: My Lords, I am grateful to the Government for raising the case of Mr. Vanunu with the Israeli authorities. Is the Minister aware that recently the honourable Member for Islington North and myself presented to the Israeli Prime Minister and President a petition which had been signed by hundreds of people from all over the world, from Archbishop Desmond Tutu downwards, calling for Mr. Vanunu's release and that that release has been demanded also by Amnesty International? Does not the Minister believe that the continued detention of Mr. Vanunu is purely retributive in view of the fact that he has already spent 11 years wholly deprived of human company? That represents a much more severe sentence than the 20 years originally passed on him.
Lord Whitty: My Lords, I am indeed aware of the noble Lord's visit to Israel and his contact with the Israeli authorities. As a government, we have expressed our concern about the solitary confinement which was ended earlier this year. However, Mr. Vanunu is still in confinement. The Government have raised those humanitarian concerns with the Israeli Government and will continue to do so. That was done most recently by my honourable friend Mr. Derek Fatchett.
Lord Hylton: My Lords, will the Government use their best endeavours to make sure, first, that the prisoner is allowed to associate with other prisoners, and, secondly, that in due course and as soon as possible he is released?
Lord Whitty: My Lords, as I understand it, the solitary confinement has finished. There are other humanitarian concerns which we shall continue to raise. However, the aegis of Her Majesty's Government is relatively limited in this matter because the prisoner is being dealt with under Israeli law and there is no real locus for the UK Government.
Lord Janner of Braunstone: My Lords, am I not right that on 13th December 1945, the House of Lords, sitting in the Queen's Robing Room, rejected an appeal against conviction for treason and sentenced to death one Lord Haw-Haw, who did not acquire his title either by heredity or appointment but through notoriety? Does my noble friend agree that if anyone committed the sort of treason against our country that Vanunu committed against his, that person would receive very little sympathy either in this House or in the country?
Lord Whitty: My Lords, the case to which my noble friend refers was slightly before my time but I am aware of the circumstances and the emotions surrounding it and the situation of British law at that time. Our concern is that Mr. Vanunu should be treated properly under Israeli law and on humanitarian grounds. As I say, we have raised those concerns with the Israeli Government from time to time and, if necessary, will continue to do so.
Baroness Williams of Crosby: My Lords, given that the world has moved on in the past 45 years, does the Minister agree that Israel would wish to live by the highest standards of civilised and tolerant conduct? In particular, will he see whether steps can be taken to ensure that Mr. Vanunu receives visits from his family and from others who wish to see him?
Lord Whitty: My Lords, I hope that the Government of Israel will abide by humanitarian standards in that respect. Indeed, that will be one aspect of the representations which are made. We have made several representations to the Israeli Government on humanitarian grounds on a number of issues, many of which have been taken on board. We hope that the Israeli Government will continue to listen to points made in your Lordships' House, as well as to those made elsewhere, on behalf of this particular prisoner.
Lord Jenkins of Putney: My Lords, does my noble friend the Minister agree that Mr. Vanunu is greatly admired by all sensible people throughout the world because he blew the whistle when his government secretly and nefariously acquired a nuclear capacity?
Lord Whitty: My Lords, we have frequently expressed our concern about the Israeli development of a nuclear capability. Indeed, we have urged the Israeli Government to sign the non-proliferation treaties. To that extent, therefore, I agree with my noble friend that that is the actual issue, rather than necessarily the precise treatment of this prisoner, which I believe should continue to be dealt with under Israeli law.
Lord Cocks of Hartcliffe: My Lords, have the Government received any representations from the noble Lords, Lord Avebury, Lord Hylton and Lord Jenkins, regarding a free pardon for Dr. Klaus Fuchs and Dr. Alan Nunn May?
Lord Whitty: My Lords, although I am, in general, aware of those cases, I am unaware of any such representations.
Lord Monkswell: My Lords, bearing in mind that the Government support the public interest disclosure legislation, which will affect residents in the UK, does not this case demonstrate the need for international action to protect international whistle-blowers who publicise information which is of benefit to the world-wide community?
Lord Whitty: My Lords, ideally, the answer is probably "yes". However, in practice, these issues are unlikely to be conceded by governments, all of whom have a legitimate security concern.
Lord Avebury: My Lords, does the Minister recall that Mr. Vanunu was originally enticed away from the territory of the UK? Therefore, does not that give us something of a locus in the matter? Further, will the Minister make representations to the Israeli authorities to allow Mr. Vanunu to see his brother, who has been
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deprived of the privilege of visiting him since he conveyed some questions, which were perfectly legitimate, to the Sunday Times?
Lord Whitty: My Lords, as I understand the issue, and as far as one can ascertain, Mr. Vanunu actually left UK soil of his own volition. Therefore, anything that happened subsequently did not happen on UK soil. Nevertheless, we do have a general humanitarian concern here, including on the issue of family visits. However, I believe that that was probably covered by my earlier answer to the noble Baroness, Lady Williams.

Miners' Claim Against British Coal
2.52 p.m.
Lord Islwynasked Her Majesty's Government:
What is the result of the negotiations that have taken place with lawyers acting on behalf of miners suffering from chronic bronchitis and emphysema in respect of their claim for compensation.
Lord Haskel: My Lords, unfortunately, the negotiations are not yet finished. On 27th March, the plaintiffs' solicitors asked the court for a three-month adjournment to allow for further discussions. This was granted. Discussions continue and we hope that, by the end of June, we will have an agreed settlement. I should point out that the Government have real sympathy for those miners unfortunate enough to have suffered lung damage. That is why we intend that these arrangements should provide a quick and fair settlement.
Lord Islywn: My Lords, does my noble friend the Minister appreciate that the Government's action in agreeing to settle the miners' claims in line with the High Court decision was much welcomed? However, since that time, there have been damaging reports stating that thousands of claimants have not even received the £2,000 interim payment. Can my noble friend tell the House what the real reason is for this delay? Further, will my noble friend ensure that the Government take action to speed up the process so that these miners—these worthy applicants—who have had their lives ruined through the arduous and hazardous nature of the mining industry, receive their just compensation?
Lord Haskel: My Lords, I can assure my noble friend that we are not moving slowly. That is why we are offering interim payments of £2,000 each to at least 5,000 elderly claimants who are currently receiving state benefit for chronic bronchitis and emphysema. We have also extended this to widows whose husbands were in receipt of that benefit. Nearly 1,000 offers have been made since April. We hope to start making interim payments this week.
Lord Ezra: My Lords, in seeking to reach an agreement on the present case, will the Government bear in mind the settlement reached as regards pneumoconiosis some years ago when a substantial

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capital sum was set aside from which adequate compensation was thereby made to those suffering from this dread disease, thus avoiding expensive court action?
Lord Haskel: My Lords, British Coal set up the pneumoconiosis compensation scheme in 1975, in agreement with the unions, on a no-fault liability basis to avoid a long and expensive trial. However, liability has been established for chronic bronchitis and emphysema. Therefore, settlement arrangements will have to reflect that fact.
The Earl of Lauderdale: My Lords, will the Minister acknowledge the fact that the pneumoconiosis scheme was a piece of Tory legislation, for which the Conservatives should be credited?
Lord Haskel: My Lords, it was indeed an awfully long time ago.
Lord McNair: My Lords, can the Minister give me any hope for justice for men such as my neighbour in south Wales, Mr. Owens, who spent 25 years boring into silica rock without the benefit of water damping equipment and, therefore, suffers from silicosis and who now faces apparent collusion between the social services and the medical authorities in his attempts to gain just compensation?
Lord Haskel: My Lords, I am afraid that I cannot give the noble Lord much hope as regards the particular arrangement that we are now discussing. The judgment was specific to underground coal-mining and the damages reflect the negligence of British Coal. Compensation will reflect that fact. The settlement arrangements cannot extend to employees in other industries.
Lord Hylton: My Lords, are the Government aware that, in the former Bristol coalfield where I live, there are several dozen qualified miners all of whom are aged 70 or 80 and among whom there are, therefore, frequent deaths? Will the Government accelerate these payments as much as they possibly can?
Lord Haskel: My Lords, the Government are well aware of this and priority has been given to elderly miners.
Lord Thomas of Gresford: My Lords, are the Government actively considering compensation not just for coal-miners, which we welcome, but also for quarrymen who have suffered from lung damage through long employment in the slate quarries of north Wales?
Lord Haskel: No, my Lords; this judgment is specific to negligence by British Coal.
Earl Attlee: My Lords, can the Minister tell the House what size of financial provision the Government have made for these claims, both for this financial year and the next?
Lord Haskel: My Lords, it is too early to say what the total cost will be as all the claims have not yet been evaluated. It is a huge task. There are tens of thousands of claimants and hundreds of millions of pounds involved. Indeed, it is just too early to be able to say.

Office of Science and Technology
2.58 p.m.
Lord Peyton of Yeovilasked Her Majesty's Government:
Whether they will consult with leading scientists as to whether it would be more beneficial in the national interest for the Office of Science and Technology to be located in the Cabinet Office rather than as at present in the Department of Trade and Industry.
The Minister of State, Department of Trade and Industry (Lord Simon of Highbury): My Lords, as my noble friend Lord Haskel made clear to your Lordships on 6th April, the Government have no plans to relocate the Office of Science and Technology from the Department of Trade and Industry, where it successfully fulfils a distinct and most valuable function. The Government, therefore, have no intention to undertake a consultation exercise in this respect.
Lord Peyton of Yeovil: My Lords, what a sad Answer. Is the Minister just dimly aware that this slavish following of a not particularly brilliant decision by the previous administration seems a little eccentric? I would be grateful if he could explain to the House how it is possible for the Office of Science and Technology to occupy a central and independent position among all departments, as it should and as the noble Lord, Lord Haskel, said it did on 6th April, when it is absorbed into and is part of the DTI, where it has no influence whatever on the remainder of the Government.
Lord Simon of Highbury: My Lords, I note that the previous time this Question was asked by the noble Lord the answer was less than dismal. I have tried to give the same one. The decision was taken by the previous administration on the grounds that it was its belief—it is one we share—that the development of our science and technology rides well with our industrial development policy and our ability to apply that policy for the benefit of Britain's competitiveness. We do not feel so strongly about where one locates offices; we feel very strongly about the quality of the people and the advice that they can give to government.
Lord Craig of Radley: My Lords, given the reports in the media about the establishment of a Prime Minister's office or department in the event that such a reorganisation should take place, would that not be an appropriate moment to move the Office of Science and Technology into that new department?
Lord Simon of Highbury: My Lords, I do not think we have any details yet of the reorganisation of the central offices. As I said, we have no intention at present to undertake consultation on this matter. The system is well understood and functions successfully.
Lord Tordoff: My Lords, does the noble Lord accept that science and technology is not all about commerce and industry; it is about science, which is much more widely based than merely DTI matters?
Lord Simon of Highbury: My Lords, I perfectly understand the noble Lord's point. At present we have a budget of £14.4 billion for science. That may be allocated to pure science—in industrial terms one can call that "blue skies" research—and to the application of science and the development of technology which is desperately needed to make our industry more competitive. That annual sum of £14.4 billion should be able to accommodate both aspects.
Earl Russell: My Lords, I was glad to hear the Minister mention "blue skies" research, but does he understand that the skies in the Department of Trade and Industry are not blue?
Lord Simon of Highbury: My Lords, today I can remember only seeing the sun shine through my windows.
Lord Porter of Luddenham: My Lords, the noble Lord, Lord Peyton, has asked whether Her Majesty's Government will consult with the leading scientists on this matter. If they do so, whom will they consult? The Chief Scientific Adviser and the director general of the research councils are part of the Department of Trade and Industry and are therefore hardly in a position to give independent advice. In this country we have a truly independent body of scientists; namely, the Royal Society. This is closely associated with other relevant bodies; for example, the Royal Academy of Engineers, the medical colleges and others. They understand that science extends far beyond trade and industry. Will the Government seek the advice of the scientists themselves on this matter?
Lord Simon of Highbury: My Lords, the noble Lord has asked a hypothetical question. As I said, we are not in the process of a formal consultation for the reasons I explained in a previous answer. All the time there is, of course, informal consultation with the scientific community. If that became formal consultation for reasons which I do not have at my fingertips—I do not believe they are in the plans—no doubt the learned bodies to which the noble Lord refers could play a part in that consultation.
Lord Peyton of Yeovil: My Lords, is the noble Lord aware that I do not doubt that the reply has been inserted in his brief by his officials or some of his colleagues? It implies that the Government are not interested in the opinions of an eminent body such as the Royal Society. Is he aware that it is at least tinged with arrogance?
Lord Simon of Highbury: My Lords, I do not accept that. As I said, there is continuous consultation with the scientific community about the quality of our research and the strenuous efforts that are made by our scientific bodies. I refer to the Foresight Operations and the Business Link Operations. There is continuous consultation. As I said, at present formal consultation is not taking place. This Government have been a listening government and no doubt if there were formal consultation we would listen formally to the opinions of the bodies that the noble Lord has mentioned.
Lord Stoddart of Swindon: My Lords, is my noble friend aware that there has been much concern over a long period of time that scientific discoveries and inventions made in this country have been developed abroad and not in this country? Is it not therefore sensible for the Department of Trade and Industry to be the lead department for science to enable us to develop discoveries which have been made in this country rather than allow foreign countries to reap the benefit of that?
Lord Simon of Highbury: My Lords, I am grateful to my noble friend for returning to the serious point of why the previous administration took the decision to locate the Office of Science and Technology in the DTI. That was done to add value to our science and to make our businesses more competitive. I believe that decision was correct. I quote from the report of the House of Commons Select Committee which was published just before the election. It states:
"There may be a temptation for Government to reconsider the system for managing, reviewing and allocating funds for public research; the evidence we have received leads us to conclude that the present system is now working well and there is, accordingly, no requirement for major change, with all the disruptions that it would bring".
Lord Peyton of Yeovil: My Lords, I hope I may pester the noble Lord again. He referred to a listening government. That tempts me into observing that they have become very deaf.
Lord Simon of Highbury: My Lords, I am listening carefully to the noble Lord. I heard every word he said and I repeat that we are listening.

Sierra Leone: Arms Sales
3.6 p.m.
Lord Moynihan: My Lords, I beg leave to ask a Question of which I have given private notice, namely:
Whether Her Majesty's Government will make a statement on reports concerning British sales of arms to Sierra Leone in breach of the United Nations arms embargo.
The Parliamentary Under-Secretary of State, Foreign and Commonwealth Office (Baroness Symons of Vernham Dean): My Lords, my right honourable friend the Foreign Secretary made a statement on this issue in another place on 6th May. I am glad to have the opportunity to give your

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Lordships as full a picture as I am able at this stage. We have consistently stressed the Government's intention to discover the full facts surrounding this case and to be as open as possible.
Let me put this into context. As the Prime Minister said today:
"This affair has been more than a little overblown. Of course it is the case that nobody should be involved deliberately in breaking a UN arms embargo".
But he also said,
"Don't let us forget that what was happening was that the UN and UK were both trying to help the democratic regime from an illegal military coup…That is the background and people can see that a lot of the hoo-ha is overblown".
I think that is an admirable summary which we would do well to remember.
Having said that, I must re-emphasise to your Lordships that Her Majesty's Customs and Excise, which is investigating the allegations of breaches of the arms embargo on Sierra Leone, has requested that while its investigation proceeds, nothing should be said that could prejudice it. It is a matter of record that the Customs investigation resulted from notification of the alleged breach being passed to it by the Foreign and Commonwealth Office. I welcome that investigation, and I hope that it can be completed swiftly.
When that investigation has been completed, the Foreign Secretary has announced his intention to appoint a person from outside the Foreign Office and Diplomatic Service to carry out a full investigation. The report of that investigation will, of course, be made public. In the meantime I can confirm to your Lordships that my department is co-operating fully with the Customs investigation.
I should also like to make the point that it is important to recognise that just because allegations have been made against officials in my and other government departments, we should not assume that they are true. This is a matter on which it is important not to rush to judgment until we have seen the conclusions of the investigation.
There have been a number of questions raised in the last few days about the investigation which the Foreign Secretary announced on 6th May: who is to head it; what its terms of reference are to be; how wide its scope should be. Your Lordships will appreciate that before it is set up it would be wrong for me to speculate on those questions. What I can say is that as soon as possible after the Customs investigation has been completed we will make an announcement that covers all these points.
Your Lordships are aware of the background to the allegations that have been made about breaches of the UN arms embargo on Sierra Leone. In May 1997 President Kabbah, the democratically elected leader of Sierra Leone, was deposed in a military coup. In October 1997 the UN Security Council passed Resolution 1132 which, among other things, imposed an arms embargo on Sierra Leone. That resolution was then implemented in the United Kingdom by an Order in Council. In March this year President Kabbah was restored to power in Sierra Leone with the assistance of military forces from the region.
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Allegations contained in a letter from the noble Lord, Lord Avebury, in February that arms had been flown from Bulgaria to supply forces loyal to President Kabbah by arrangement through the British company, Sandline, were referred to H.M. Customs and Excise on 10th March. Since then the Foreign Office has given full, active co-operation to the Customs' investigation and full access to all relevant Foreign Office papers and officials.
The Foreign Secretary made clear on 6th May that he was first informed of the Customs and Excise investigation on 28th April and minuted the Permanent Secretary the following day stressing the importance he attached to full and open co-operation with the Customs and Excise investigation. The private office of the Minister of State with responsibility for Africa, Mr. Lloyd, received copies of papers on the Customs' investigation in early April and they were shown to him for noting in mid-April. However, he was not fully informed of the allegations made by Sandline of Foreign Office contacts until Friday 1st May.
There have been allegations in the press that Ministers had prior knowledge of or gave prior approval to breaches of the arms embargo on Sierra Leone. I can confirm to your Lordships that there was no such prior knowledge or approval. Your Lordships will understand that I cannot go into details which will be covered in full in the investigation by a person from outside the Foreign Office.
It is right and proper that this House should be fully informed of the events surrounding these allegations and I look forward to being able to present the report of the investigation to your Lordships when it has been completed. In the meantime, I would once again draw your Lordships' attention to the context of the allegations which are being made: the legitimate government of President Kabbah has been restored to power in a significant move for democracy in the region.
Lord Moynihan: My Lords, given that earlier today the Prime Minister argued that the end justifies the means, even if you have to breach UN arms embargoes, tear up your ethical foreign policy and allow your Foreign Secretary to tell the House of Commons a very different story from the one made public today by the Prime Minister, when did the Minister learn about the Prime Minister's new foreign policy? And can the Minister explain to the House why such an extraordinary intervention by the Prime Minister was made when a Customs and Excise investigation into possible criminal charges is under way?
When did the Minister first learn of Sandline's involvement; and is the noble Baroness now aware that Ministers responsible for Customs and Excise first knew about the affair on Wednesday 1st April?
Finally, is it true that when the Foreign Secretary's ministerial boxes are returned by him, civil servants in the Foreign Office take it as read that the Foreign Secretary is content if papers are returned without written comments on them?
Baroness Symons of Vernham Dean: My Lords, the noble Lord is quite wrong. There is no, as he describes

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it, new foreign policy. As I made clear when I gave my Answer to your Lordships' House a few moments ago, the Prime Minister said quite clearly,
"Of course it is the case that nobody should be involved deliberately in breaking a UN arms embargo".
The Prime Minister said that. I made that clear to your Lordships. When did I first hear about it? At about lunch time today. The Prime Minister made that statement this morning. I reiterate to your Lordships,
"nobody should be involved deliberately in breaking a UN arms embargo".
The Prime Minister has said exactly the same as the Foreign Secretary has made clear: we are seeing an investigation by Customs and Excise and my right honourable friend, the Foreign Secretary, has made it clear to everyone that as soon as that investigation is completed he will initiate the investigation in the Foreign and Commonwealth Office by a person from outside the Diplomatic Service or the Foreign and Commonwealth Office.
The noble Lord asked when I knew of Sandline's investigations. I saw a report in the Observer shortly before 10th March. These were allegations but I would not expect to see detailed papers. As the whole House will know, the Minister that deals with these questions in the Lords is briefed for Lords' debates and I would not expect to see, and nor indeed would it be proper and right for me to see, papers which are meant for other Ministers in their own areas of responsibility.
Lord Avebury: My Lords, does the noble Baroness recall that on 9th March before my Question the following day I wrote to her not only drawing attention to the Observer article but also to the fuller account, and perhaps the more reliable one, given in the US News and World Report which repeated the allegations that had been made as long ago as 31st July 1997 in the Toronto Globe and Mail?
Would the Minister agree that while we should not assume that the allegations that have been made are true, neither should we assume that they are false, and that the Prime Minister, in paying tribute to Mr. Peter Penfold, has undermined the future inquiry announced by the Foreign Secretary on the complicity of Foreign Office officials in the alleged violations of Security Council Resolution 1132? And has he not also undermined the position of the Foreign Secretary himself in describing as "hoo ha" alleged breaches of international law which Mr. Cook has treated with the seriousness that they deserve?
Does not the Minister also agree that a further matter has now arisen; that is, the role of the Royal Navy in helping to provide services to the firm of so-called military consultants who are at the centre of this controversy? Is the Minister aware that contrary to the impression given by the Prime Minister this morning that peace had been restored in Sierra Leone, one of the legacies of the counter coup is that they have been left with an ethnic militia known as the Kamajors which is hostile to other groups within the territory and that far from promoting reconciliation, the restored government have charged 59 people with treason and locked up
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2,000 others without charge, most of whom are northeners or ethnic Krios and that this is hardly a recipe for the national reconciliation of which both Resolutions 1132 and 1162 have spoken?
Baroness Symons of Vernham Dean: My Lords, the noble Lord says that in the same way as we must not judge that the allegations that have been made are true, we should not judge that they are false. That is self-evidently so. That is the reason that there is a Customs and Excise investigation in process. That is the reason my department is co-operating fully with that Customs and Excise investigation. It is also the reason that we shall continue beyond that to look at any other pieces of information which may be of relevance in this business.
I do not accept that what the Prime Minister said this morning in any way undermined the Customs and Excise investigation, or the very robust position which my right honourable friend the Foreign Secretary has taken on these issues. They are very serious issues indeed; my right honourable friend has emphasised that at every turn. My right honourable friend the Prime Minister also emphasised that this morning, saying that nobody should be involved in deliberately breaking a UN arms embargo. He could not have been more unequivocal in his condemnation of any such breach, if that is the case.
The noble Lord also raised questions concerning President Kabbah's regime at the moment. I do not have information on what is happening at this moment in Sierra Leone, but I am happy to write to the noble Lord on the specific points he raises. All I can say to him is that this Government have supported the process of conciliation, as I hope I made clear in answering Questions in your Lordships' House on the day that President Kabbah was restored to Government on 10th March. But I shall of course be happy to write to the noble Lord on the detailed point he raises.
Lord Kennet: My Lords, this is not a hostile question but a request for a piece of information which I believe would help public understanding. What aspects of Customs law might have been broken by a firm which transported arms from Bulgaria to Sierra Leone without, as I understand it, touching down in the United Kingdom?
Baroness Symons of Vernham Dean: My Lords, I am not an expert on Customs and Excise. I understand the allegation is that a UN arms embargo has been broken. That is a very serious question; and it is taken very seriously by this Government. I am afraid that we shall have to await the Customs and Excise report. As I am sure all noble Lords will agree, it would be wrong in any way to prejudice the outcome of the Customs and Excise investigation.
Lord Tebbit: My Lords, does the noble Baroness recollect that only about a week ago this whole affair was a disgraceful matter, all got up by a bunch of mercenaries called Sandline? However, according to the Prime Minister this morning, it was all rather a wizard

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idea thought up by the British High Commissioner and Sandline did not have much to do with it. I wonder what the noble Baroness's story will be next.
Will the Minister tell me whether the Government interpret the UN resolution as being an embargo on the sale and transport of arms to the country called Sierra Leone or to the previous military regime in Sierra Leone?
Baroness Symons of Vernham Dean: My Lords, I do not recognise the definition with which the noble Lord sought to characterise this debate. Nobody has described this as what he calls—I assume in an effort to be light-hearted—a wizard idea. The Prime Minister has taken this issue enormously seriously, as has my right honourable friend in his very robust responses on the issue.
The noble Lord asked a serious question which I shall attempt to answer. As I understand it, the Sierra Leone United Nations sanctions order prohibited sale or supply of arms to any destination for the purposes of delivery, directly or indirectly, to or to the order of a person connected with Sierra Leone. I understand that that is what is in the Sierra Leone United Nations order. I hope that that answers the specific point the noble Lord made.
Baroness Williams of Crosby: My Lords, perhaps I may—
Lord Ewing of Kirkford: My Lords—
Lord Peston: My Lords, it is this side's turn.
The Lord Privy Seal (Lord Richard): My Lords, I am sorry to have to lumber yet again to my feet at Question Time. However, I think that it is this side's turn and then no doubt that of the noble Baroness.
Lord Peston: My Lords, none of us will disagree that we must wait for the two inquiries to take place. However, I believe my noble friend said that Ministers had no prior knowledge and gave no prior approval. Being herself a Minister, I think that she included herself. As regards the proceedings of your Lordships' House, is it not therefore a matter of honour that we do not remotely question that statement? Ministers have said something; my noble friend has repeated that on behalf of Ministers and on her own behalf. I would not wish anyone to stop asking any other question. However, I should take a dim view if we were to impugn the honour of a Minister in our own House, or other Ministers, when they have put on record a statement which is easily tested. They know whether it is true or false. They have said that they had no prior knowledge and gave no prior approval. Will my noble friend repeat that so that at least we know according to which rules we are currently playing.
Baroness Symons of Vernham Dean: My Lords, my noble friend mentions the two inquiries. As I have made
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clear, the Customs and Excise inquiry will be completed first; and then the inquiry by an independent person from outside the Foreign Office will take place.
The noble Lord asked me to repeat the assurance I gave the House. There was no prior knowledge and no prior approval on the part of any Ministers. I hope it goes without saying that, of course, that includes me.
Baroness Williams of Crosby: My Lords, is the Minister aware that many of us share the enthusiasm of the Prime Minister in wishing to see democracy restored in Sierra Leone? However, with respect, that does not seem the key point which concerns many Members in this House and in another place. Perhaps I may ask her whether we may return for a moment to what seems to me the crucial constitutional issue of the relationship between senior officials and elected Ministers, without in any way impugning the honour of the noble Baroness, which I would not dream of doing.
There are two questions which I hope the Minister can assure us any inquiry will pursue. The first is whether Ministers authorised the use of Her Majesty's forces to help to maintain and repair equipment, in particular a helicopter belonging to a private group of mercenaries. The second question is whether, when on 12th March the Minister of State in another place let it be known that in his view an article that appeared on this matter in the Sunday Times was "ill informed and scurrilous", he had inquired of the Foreign Office what submissions it had received. That was more than a month after my noble friend Lord Avebury had drawn the attention of the Foreign Office to the serious allegation that Sandline was involved in breaching UN sanctions. Perhaps I may ask for the Minister's assurance that those two matters will be dealt with in detail and with great care by the public inquiry when it has been established.
Baroness Symons of Vernham Dean: My Lords, I can give the noble Baroness the assurance she requires about the relationship as regards the chain of information between senior officials and elected Ministers. Of course it is of the utmost importance that there is confidence between Ministers and officials over sensitive issues. I can assure the whole House that Ministers, and indeed senior officials, will be co-operating with the investigation by the person from outside the Foreign Office; and that Ministers, and I am sure I speak for senior officials in this respect as well, will be keen to see exactly how all the pieces of this important jigsaw (if I may put it that way without seeming in any way not to take the matter seriously) fit together. That is why my right honourable friend took the initiative in saying that we need a Foreign Office investigation on this matter as well. My right honourable friend is to be congratulated on taking the initiative on that in the way that he did.
Lord Tordoff: My Lords, during the period of these investigations, life is going on in Sierra Leone. Before the coup, there were a number of initiatives to try to improve the level of governance in that unhappy state. May we have an assurance that the Foreign Office will

827
not be totally distracted by what is going on from doing the job that it ought to be doing; namely, trying to strengthen democratic government in Sierra Leone for the future?
Baroness Symons of Vernham Dean: Yes, my Lords, I can give the noble Lord that assurance. Of course, there is much more going on in the Foreign Office at present than simply the preparation for this very important investigation and dealing with the Customs and Excise investigation. The noble Lord is quite right. The normal business of the Foreign Office must continue. That includes dealing with the problems referred to by the noble Lord, Lord Avebury, which are still evident in Sierra Leone.
Lord Ewing of Kirkford: My Lords, perhaps I may apologise to the noble Lord, Lord Tordoff. I had mistakenly assumed that we were all Cross-Benchers! My humble apologies.
Will my noble friend give the House an absolute assurance that if, following the inquiry being carried out by Customs and Excise, criminal proceedings were to take place, unlike the previous Conservative Government—who shame-facedly sought to use public interest certificates to protect Ministers in that government from public scrutiny in regard to any role they may have played in the Matrix Churchill fiasco—our Government will not, in any circumstances, in any proceedings, resort to the use of public interest certificates?
Baroness Symons of Vernham Dean: Yes, my Lords, I can give my noble friend that assurance.
Baroness Young: My Lords, perhaps I may take the noble Baroness back to her answer. I am sure that she speaks with all honesty when she says that no Minister knew what was happening. I speak as someone who has been a Minister. I find it extraordinary, following upon the letter from the noble Lord, Lord Avebury, and press reports, that no Minister was involved. I recognise, and hear, that the noble Baroness does not have responsibility for Africa and I should not have expected her personally to be the first to be informed about anything that was going on. I should, however, have expected her colleague, Mr. Tony Lloyd, whose responsibility it is, to know. There are those among us who find it quite extraordinary that Ministers did not know. How can that be the case? Is it believed that there has been some kind of extraordinary conspiracy on the part of civil servants, including our own High Commissioner in Sierra Leone, who is a most respected man, to keep Ministers in the dark over this affair? Can the noble Baroness shed any light on the point about whether or not there really was some document in a Minister's Box that was possibly not seen?
Baroness Symons of Vernham Dean: My Lords, I repeat what I said in my Answer: there was no such prior knowledge or approval. The noble Baroness asks detailed questions about the possibility of a conspiracy, and how it could possibly have happened that there were
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no details, prior knowledge or approval. Those questions are entirely right and proper. I applaud the noble Baroness and others for asking them. It is precisely those questions that we hope will be answered by the Foreign Office investigation. It will be carried out by an independent person with no conflict of interest. That person will examine all the paperwork with the full co-operation, not only of Ministers, but also of officials in the Foreign and Commonwealth Office.
Lord Janner of Braunstone: My Lords, surely this House should welcome the Minister's Answer, repeating as it does the Government's firm promise to seek to find and report the full facts. Does my noble friend agree that that is precisely what the previous government did not promise to do, did not do, and should have done in the "arms-to-Iraq" affair?
Earl Russell: My Lords, on 10th March, when the Minister answered a question from my noble friend Lord Avebury on the Observer article, she said:
"That article was in several respects not entirely accurate, or at least not on all fours with the reports that Her Majesty's Government are receiving".—[Official Report, 10/3/98; col. 101.]
The Minister will hear in those words an element of honest doubt. Can she tell the House what accounted for that doubt?
Baroness Symons of Vernham Dean: My Lords. I answered your Lordships as I always do, as honestly and accurately as I could within the terms of the briefing that I had at the time. I can say no more than that, except that, if my remarks are shown to have been inaccurate, although made in good faith, I shall of course correct them.
Lord Harris of Greenwich: My Lords, when does the noble Baroness expect to receive some indication from Customs and Excise as to when its investigation will be completed?
Lord Richard: My Lords, we have been discussing this matter for 28 minutes. The House may feel that these proceedings have gone on long enough. I say that merely because there is no standing order that governs the time allowed for Private Notice Questions. Under those circumstances, I hope that the House will feel that the correct way of dealing with the matter is for the noble Lord, Lord Moynihan, to wind up for the Official Opposition, and then perhaps the House should move to other matters.
Lord Harris of Greenwich: My Lords, with great respect, may I have an answer to the question that I have already put?
Baroness Symons of Vernham Dean: My Lords, we very much hope that the Customs and Excise department will be able to complete its investigations as quickly as possible. At that point, my right honourable friend will wish to make it clear who is to lead the Foreign Office investigation into these matters, and exactly what are the terms of reference for that investigation. I am sure that

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at that point noble Lords will wish to ask further questions. I shall, as always, be delighted to answer your Lordships.
Lord Moynihan: My Lords, I am most grateful to the Minister for her answers. Inside this House—like, I am sure, those outside—we remain astonished that Ministers in the Government—not merely in the FCO, as we have learnt this afternoon—had no knowledge of the affair. They clearly should have.
Finally, does the Minister agree with those of her colleagues in the "arms-to-Africa" affair who believe and have said that they were quite right to do it?
Baroness Symons of Vernham Dean: My Lords, I am not quite sure what the noble Lord is saying—quite right to do what? No, I do not agree that it is ever right to break a UN embargo. I do not believe that; nor do my right honourable friend the Foreign Secretary and my right honourable friend the Prime Minister.

Police (Northern Ireland) Bill
Brought from the Commons; read a first time, and to be printed.

Government of Wales Bill
3.38 p.m.
The Parliamentary Under-Secretary of State, Home Office (Lord Williams of Mostyn): My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.
Moved, That the House do now resolve itself into Committee.—(Lord Williams of Mostyn.)
On Question, Motion agreed to.
House in Committee accordingly.
[The CHAIRMAN OF COMMITTEES in the Chair.]
Clause 1 [The Assembly]:
Lord Roberts of Conwymoved Amendment No. 1:
Page 1, line 8, at beginning insert ("Subject to the sovereignty of the Parliament of the United Kingdom,").
The noble Lord said: It is worth noting that at the start of this Committee stage we are faced with 65 pages of amendments, new schedules and new clauses. The bulk of those pages—over half—are occupied by government changes to the Bill. Some of them are welcome, and one is sufficiently significant to require a change in the title of the Bill. I refer to the provision relating to the new office of welsh administration ombudsman.
However, I am not complaining at all about what is before us so much as what is not. We still have not seen the Bill relating to the registration of political parties which will shortly feature in our discussions on the Bill, as it has already done in debates on a number of other measures, where it is also relevant. My noble friend Lord Mackay of Ardbrecknish, who has been cooling
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his ire in Scottish waters this weekend, will, I feel sure, have more to say on the point when it arises in the course of our deliberations.
I am grateful to the Minister for his letter today very much regretting the fact that the second draft of the transfer order, which he promised would be with us before the Committee stage, is not yet available. He told us during his Second Reading speech that it is a bulky document, and that I can well believe. He also told us that it would be available well before we discuss Part II of the Bill. We look forward to its publication, although it is hardly likely to qualify as relaxing bed-time reading.
As regards the amendment which I am moving and the others grouped with it, the aim is to clarify beyond all possible doubt the relationship between the national assembly for Wales and this United Kingdom Parliament. Some may take the view that the contents of the Bill make the relationship clear enough and that the amendments are therefore otiose and unnecessary. But there are good precedents for their inclusion in legislation and we should not disregard those precedents lightly. I shall come to them in a moment.
One of the arguments in favour of devolution advanced by the Government during the referendum campaign was that devolution would strengthen rather than weaken the unity of the United Kingdom. That argument was based on the acknowledgement that the pressures for devolution were inherently centrifugal, but by devolving powers downwards from the centre, a formal statutory scheme of devolution would provide an appropriate opportunity to redefine the bonds that hold the United Kingdom together. Among the forces that make for that unity, the sovereignty of this United Kingdom Parliament must surely be supreme.
Included in the precedents for a statement of this supremacy was the Northern Ireland Constitution Act 1973 which followed Section 75 of the Government of Ireland Act 1920. It stated that:
"Notwithstanding anything contained in this Act, the supreme authority of the Parliament of the United Kingdom shall remain unaffected and undiminished over all persons, matters and things in Northern Ireland and every part thereof".
My colleagues in the other place tried to secure the inclusion of a Welsh version of that clause in the Bill at Committee stage, but the Parliamentary Under-Secretary of State, Mr. Win Griffiths, argued against it, as did the Secretary of State, Mr. Ron Davies. Mr. Davies said in an intervention:
"There is no need to make it explicitly clear that sovereignty rests with the House, because it clearly does. Nothing that the assembly or any future Government do can undermine the sovereignty of Parliament".—[Official Report, Commons, 20/1/98; col. 866.]
My right honourable friend Mr. Michael Ancram, never had an answer to his counter point at col. 869 that:
"If the sovereignty of this Parliament is complete, what is there to prevent the amendment from being accepted?"
The substance of the amendment was not otiose or unnecessary in the Northern Ireland Constitution Act 1973 or its predecessors. But we are not seeking the full replication of that clause in our first amendment today, merely the inclusion of a reference to the sovereignty of the United Kingdom Parliament in the opening clause

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of the Bill. We are doing so because many people in Wales would feel reassured by the presence of such a reference on the face of the Bill. Such reassurance is necessary at present. I believe it would be helpful to the Government and to the implementation of the Bill. I should have thought that this Government who claim to be sensitive to public opinion would have ensured the inclusion of such a reference without a prompting amendment of this kind.
As I understand it, the Government propose to remove all references to the Government of Ireland Act 1920 from the new constitutional settlement for Ulster emerging from the Belfast Agreement. However, another section of the Northern Ireland Constitution Act is to be preserved in some form or another—that is, the Section which asserts that although measures classed by the Northern Ireland Assembly would have the same force and effect as an Act of Parliament,
"This section does not affect the power of the Parliament of the United Kingdom to make laws for Northern Ireland".
That latter section has been adapted and incorporated in the Scotland Bill where it is to be found in Clause 27(7). A Welsh form is reproduced in our second amendment, Amendment No. 2. Similar wording appears in the Belfast Agreement, paragraph 33.
Again it may be argued that such a re-statement is not necessary in the Government of Wales Bill principally because, unlike Scotland, no primary legislative powers are being devolved to the assembly in Wales. Primary legislative powers remain with this Parliament. The point was made by the Minister, Mr. Win Griffiths, when he replied to the Committee stage debate in the other place. He said:
"It is unnecessary and otiose for a similar statement to be included in the legislation for the Welsh assembly because the National Assembly for Wales will not have the same wide-ranging primary legislative powers as the Scottish Parliament".—[0fficial Report, Commons, 20/1/98; col. 875.]
That, of course, is true, but the Welsh assembly will have very extensive secondary legislative powers and there are more to come. The truth is that we cannot anticipate all the circumstances that may arise or what use will be made of those powers. What we know is that there is a great deal of concern here in this Parliament about the growing use of such delegated powers, the adequacy of scrutiny and so on.
This Bill proposes a further enlargement of the whole field of delegated legislation and envisages some differences between the secondary legislation emerging in Wales and that stemming in England from the same primary legislation. Anyone who doubts that need only look at Clause 26 of the School Standards and Framework Bill which gives considerable latitude to education authorities in Wales in implementing government policy.
Shortly before this debate, we received the 18th Report of the Select Committee on Delegated Powers and Deregulation. The committee expressed its concern and drew the special attention of the House to its comments on the provisions transferring the exercise of existing legislative powers to the assembly and the new legislative powers conferred on the assembly. It also draws to the attention of the House the
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exceptionally large number of Henry VIII powers in the Bill. So there we have the concern of the Select Committee. This is an area of considerable potential confusion and even conflict. Many people—including the people of Wales—would feel safer if it were made absolutely clear where the ultimate authority lies.
As the Secretary of State for Wales said on more than one occasion in the referendum campaign, devolution is an ongoing process, and that is clearly implied in the Bill. Future legislation will contain order-making powers, some of which will be exercised by the assembly. We have no idea at this stage what those powers may be in the future or how they will be exercised. But we know that there is no provision for the return of powers to Westminster, whatever happens—even if things go badly wrong; there is only provision for going forward. That is what one might call the ratchet effect.
There is provision for the Secretary of State to intervene if the assembly acts contrary to UK treaty obligations and there is a right of appeal to the Judicial Committee of the Privy Council if the assembly acts ultra vires and so forth. However, there is no encouragement to this Parliament or obligation upon it to give its protection or assert its supremacy should the need arise. The thrust of the Bill is to give the assembly as much independence as possible. I am not at all sure that that is the best approach that could be adopted. I would have preferred to see a more co-operative approach and more co-operative links between the assembly and this Parliament; that would have been helpful to both.
We value the unity of the United Kingdom and the supremacy of Parliament not only from an institutional standpoint but from the point of view of the affected citizen. One cannot forget—though the Government may wish to—that three-quarters of the electorate in Wales did not support the Government's devolution proposals. The inclusion of a reference to parliamentary sovereignty and primary legislative power may provide those people with the reassurance that they need.
To include the amendments purely on that account may be thought to be cosmetic. But at this point we do not know what circumstances could arise in future where the intervention of the UK Parliament may be called for. We know that circumstances arose in Northern Ireland where it was necessary to abolish the Stormont Parliament at a stroke, and I hope that the same thing never happens to the Welsh assembly. But such extreme circumstances are not inconceivable and should clearly be provided for in the event that this Parliament is called upon to intervene either by the people of Wales or by their representatives at Westminster. We should not be blind to the worst scenario. We could be held culpable if we were.
For all those reasons it would be a wise precaution to place a reference to parliamentary sovereignty on the face of the Bill, together with a clear and unambiguous statement regarding the power of Parliament to make laws for Wales. It may seem otiose now, but who can

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guarantee that it will always be so? The addition of our amendments would reassure millions and help them to see the assembly in a proper perspective. I beg to move.
Lord Thomas of Gresford: With the greatest respect to the careful and lengthy argument of the noble Lord, Lord Roberts of Conwy, from these Benches we disagree with the amendments. The noble Lord said that some may feel that the amendments are otiose and unnecessary; I include myself among that number. A principle not to include otiose and unnecessary language in any form of statute should be followed in all legislation.
The noble Lord referred to the analogy of the Northern Ireland legislation, in which similar clauses are included. It is a false analogy. It may be necessary to make statements of this sort in a community where a significant number of people question the sovereignty of the United Kingdom Parliament, but that is not the case in Wales. Who are the people who worry, who need reassurance, who will not feel safe unless these words are included in the Bill? I do not meet them in the Wrexham Rugby Club or the pub in Gresford. I have never heard anybody express any worries of that nature.
The noble Lord also referred to anxieties about secondary legislation. He said that we show concern in this House because there is no adequacy of scrutiny. We on these Benches have always shown concern in relation to the lack of scrutiny of legislation that is brought before these Houses of Parliament. That is one of the reasons why over the past 30 or 40 years we have supported the need for devolution and for a domestic parliament where proper scrutiny can take place of legislation that affects the interests of the people of Wales. We oppose the amendment.
Viscount St. Davids: I have considerable sympathy, particularly for Amendment No. 1. I should like to pick up on the point made by the noble Lord, Lord Thomas of Gresford, when he said that we do not need redundant or superfluous wording on the face of the Bill.
This Bill is unlike any other that has come before your Lordships' Chamber pertaining to the government of Wales for 426 years. It sets up a completely new form of administration for Wales for many aspects that govern the lives of Welsh people. It is different from the majority of Bills that will come before this Chamber. We should recognise—a point made by my noble friend—that half the people of Wales did not, for one reason or another, take part in the referendum. A great number voted against these proposals. They would be reassured by the wording in Amendment No. 1. I take that further and say that there are those of extreme tendency who need to be reminded that that is as far as these proposals go, and therefore we need Amendment No. 1.
Lord Simon of Glaisdale: I spoke on the referendum Bill relating to Wales. I did not speak on the Second Reading of this Bill because many others whose connection with Wales was far closer could and did speak with great authority on the matter. But perhaps
834
the Committee will allow me to make a few general observations on the constitutional and parliamentary considerations which have relevance to the Bill generally, the amendments generally and Amendment No. 1 in particular.
The Government's manifesto was perfectly clear: they would hold a referendum and if that referendum, by a simple majority, answered yes, they would go ahead to legislate on the lines of the White Paper. That undoubtedly bound the Government to do what they said they would do, having obtained a majority, however exiguous. As has been pointed out, the majority was extremely narrow and that also gave cause for concern, even to those like myself who were in favour of devolution, partly on the ground of subsidiarity and partly because we found deeply moving the speeches made by the noble Lord, Lord Cledwyn, my noble friend Lord Elis-Thomas, the Minister, the noble Lord, Lord Hooson, and many others.
What did that tell me? In addition to the narrow majority and the high degree of abstentions, the geographical division was disclosed by the voting, both economic and social. That narrow majority was secured after massive intervention and propaganda—by no means improper—by the Government and by the Prime Minister's great personal popularity being thrown into the struggle.
The answer being yes, the Government were bound to go ahead; but Parliament was not bound in any way, and no one can pretend that it was. Moreover, the position was difficult for the Government's supporters in the House of Commons. Even if they were less docile than they apparently seem to be, they too had endorsed the manifesto and it was very difficult for them to go against what the Government were proposing. But that means that the parliamentary responsibility falls with particular weight on your Lordships' House, and your Lordships are bound to go ahead, bearing in mind that there was, on analysis, no majority at all for the White Paper.
It was a great pity that an amendment put forward by my noble friend Lord Elis-Thomas and myself on a referendum was rejected by the Government. It would have shown quite clearly what proportion of the yes vote came from those who supported the White Paper and what proportion came from those who regarded the White Paper as merely a step forward to independence. The same problem arises in the Scottish case. However, the Government having chosen, as I am afraid they so often do, to fudge the question, we can only guess what majority was really against the White Paper. It certainly was a majority.
What are your Lordships to do in those circumstances? A few years ago there used to be talk of a manifesto mandate. There have been occasionally claims of that on devolution Bills but not very often. I think it is now accepted that a vote for a party does not endorse in any way constitutionally the contents of the manifesto. Therefore, the responsibility of your Lordships, as was pointed out at Second Reading, is primarily scrutiny, but on this Bill it goes very much further. All too often it seems to be taken that

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democracy and majority rule are interchangeable terms. That is not so. The wisest thing that was ever said by a statesman about the nature of democracy was said by Clement Attlee. He said that democracy does not merely mean government by the majority but government by the majority having regard to the interests of the minority. That is what I think the noble Lord who moved the amendment has in mind.
It seems to me that your Lordships should incline to the approach of the noble Lord, Lord Roberts, but, on the whole, even though it seems to fit in with the approach that one would have to have regard to the interests of the minority, it does not really go far enough. In the first place, as has been said, this is a completely unnecessary amendment constitutionally. Your Lordships would not be legislating at all unless the legislative superiority rested at Westminster. However, there is another reason, which was referred to obliquely at Second Reading. This is an Act of devolution and it should not be ungenerously carried out. I fear that if the amendment were carried it would seem to be a niggling reservation on what I think by now is a consensus that the Bill should go ahead—that appeared clearly throughout the Second Reading debate—with any necessary amendment in order to preserve the true interests of the minority. The true interests of the minority are not in any way served by the amendment before the Committee. It seems to be an ungenerous gesture for your Lordships to be making. I hope that the noble Lord will not press it to a Division.
4 p.m.
Lord Elis-Thomas: My noble and learned friend Lord Simon should not seek to apologise for intervening in this debate. After all, I believe he has a distinguished record of military service with the RWF. One cannot know of a more Welsh institution than that.
I agree with his remarks and wish to emphasise that the Delegated Powers and Deregulation Committee refers in paragraph 5 of its report to the obvious fact that the Westminster Parliament will remain the supreme legislative body for Wales. Therefore, there is no need to rehearse that point on the face of the Bill. As my noble and learned friend indicated, there are issues here of subsidiarity. It is important to understand that a national assembly will have a responsibility for the whole of Wales in terms of delegated legislation and the administration of transferred functions. It is important that the granting of that subsidiary power to the national assembly should be done generously and without the dark sense of foreboding of the noble Lord, Lord Roberts of Conwy, who uncharacteristically lapsed into his worst Presbyterian past. He brings to the Committee dark hints of foreboding of a Welsh assembly in a state of collapse which might require rescue by Westminster.
The policy of subsidiarity, which I understand to be warmly endorsed by Christian Democrats throughout Europe, is one I warmly commend to the noble Lord, Lord Roberts. Indeed, I thought he always believed in it. However, he is taking a particular line on the Bill and I suppose that we should be sympathetic to him because of that. What concerns me more than the words in the amendment that the Parliament of the United Kingdom
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is to make laws for Wales is how the Parliament of the United Kingdom is effectively to make laws for Wales in the context of the Bill. The issue we face is how we turn the system of delegated legislation which was initially designed for the execution of policy by different Ministers in different departments into a scrutinised body of delegated legislation for a subsidiary, delegated legislature. But we shall return to that issue on another day.
Lord Crickhowell: I did not intend to take part in this debate but when I heard the noble and learned Lord, Lord Simon of Glaisdale, I thought I was making an error in doing so. I was tempted, to begin with, to rise to my feet, as on a number of occasions before, by the speech of the noble Lord, Lord Thomas of Gresford. He spoke about the redundancy of the proposed wording. The noble and learned Lord, Lord Simon of Glaisdale, quite correctly said that it was not necessary constitutionally.
However, I could not help remembering that not so very long ago when we were debating the Welsh Language Bill, I and, I believe, the noble Lord, Lord Elis-Thomas—and, I suspect, the noble Lord, Lord Thomas of Gresford, and his colleagues—argued that there was a case for inserting some words in the Bill although they were not strictly required. It was thought to be right on that occasion to say something which was firm and clear about the status of the Welsh language. There are occasions when it may be helpful to say something that is not strictly necessary in order to inspire confidence.
Let us make no mistake about it. I am absolutely clear that this Bill deserves support now, for the reasons that I set out at Second Reading. We have to gain the confidence of the Welsh people, and in some respects it may be necessary to strengthen rather than weaken the legislation. But there are issues of confidence to be overcome. Therefore, there may well be a case for wording of this sort.
That good Anglican, the noble Lord, Lord Elis-Thomas, spoke about my noble friend's Presbyterian sense of foreboding. As I came into the Chamber today I opened an envelope which contained a journal which I do not frequently read. Indeed, I am not at all sure that I have ever read it before. It is entitled welsh democracy review. Apparently, this is the third issue. In the first article, which speaks about this Bill giving responsibility without power, it says,
"The National Assembly of Wales is being given responsibility without power. Unless there are radical changes early in its life ensuring that it has the resources to meet its aspirations, widespread political disillusion seems inevitable—with incalculable consequences for the future of Welsh democracy".
So there are others in very different positions who have dark forebodings.
This is what really tempted me to my feet. The journal goes on to say,
"In short, the Government of Wales Bill is no more than a start. Wales will not become a full, modern democracy until it has secured all the items on the political shopping list above".

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The first item on that shopping list is primary law-making powers. The magazine contains invitations to join a "Parliament for Wales" campaign. It seems to me that when there are others already actively campaigning for a parliament for Wales with extended powers of this kind—I need not weary the Committee with the further detailed demands of the campaigning group—it may be no bad thing to start this Bill by pointing to the supremacy of the Westminster Parliament.
That is so, particularly as this is a rather unusual Bill, in this sense. We begin by saying that we are going to set up an assembly in the first lines of page 1 of the Bill, but it is not until we reach Part II many pages later that we actually begin to say what the assembly is supposed to do. We have a great chunk of the Bill devoted to who shall represent it and the electoral system, but it is only when we get to Part II that there is a statement about the functions that are to be transferred by order.
For those reasons I do not believe that the wording of this amendment is quite so unnecessary as has been suggested. If we can give reassurance to the many of people in Wales who have worries about this Bill we will be rendering a service to Wales and those who favour an effective assembly.
4.15 p.m.
Lord Prys-Davies: There are others in Wales who need reassurance that this law will not be unmade. Many years ago we were taught that Parliament can make a law and that it can unmake it. This Bill is the creature of Parliament and in future Parliament could repeal it or a part of it. I must also mention to the Committee that there is also concern in parts of Wales that the Bill, or a part of it, could be repealed. Indeed, I have been asked to consider whether an amendment can be designed that will protect the national assembly in such a way as to inhibit the repeal of this Bill when it is enacted. I am forced to concede that that is not possible under our present constitutional arrangements. The doctrine of parliamentary sovereignty allows no legal limitation on that sovereignty. I am aware that many years ago a Commonwealth judge said, "Freedom, once conferred, cannot be revoked". I hope that this Bill will never be undone. However, I am conscious that that is possible by even a simple majority in parliament.
I believe that the amendment that the noble Lord, Lord Roberts, is pressing is unnecessary, uncalled for and, in my opinion and that of others, it is provocative and lacks generosity, as has been mentioned by the noble and learned Lord, Lord Simon of Glaisdale. I very much hope that the Government will not accede to this amendment.
Lord Thomas of Gwydir: I would like to support the amendment. It cannot be described as unnecessary; it is really necessary, for this reason. The Minister knows as well as anyone that the vast majority of the people in Wales believe in being part of a United Kingdom. The sovereignty of Parliament exists and is accepted by the
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Government. Indeed, it has even been said that the unity of Wales in the United Kingdom will be strengthened by this Bill.
There is no doubt at all that there are people in Wales who are concerned about the process of this Bill. They can see that as time goes on demands will be made for changes and that the assembly will become nearer to a parliament for Wales. Indeed, people are already advocating that. There are many in Wales who are concerned about the unity of Wales and the United Kingdom. They would like to be reassured that, as this Bill is currently worded, there is no question of the sovereignty of Parliament not remaining. For that reason a simple amendment such as this can give that reassurance and I commend it to the Committee.
The Earl of Northesk: I support these two amendments. Members of the Committee will recall that at Second Reading I suggested that the Bill as it stands lacks constitutional glue. The amendments have the great virtue of providing some glue in stating the constitutional position in a clear, concise and unequivocal way. Many Members of the Committee have intimated that the amendments are otiose, and the Government agree with that position. At one level that may be true, but there is something more to it than that. The Committee will also recall my suggestion at Second Reading that it will be the interaction of this Bill with other measures of primary legislation in this Parliament which will determine the actual day-to-day legislative competence of the assembly.
This gives rise to two quite distinct concerns. Like my noble friend Lord Roberts, I cite the School Standards and Framework Bill as an example. As my noble friend has already said, this measure is loaded to the gills with order-making powers. Some are relatively mundane, falling well within the scope of what we would normally expect of subordinate legislation; others are more disturbing in terms of the way that they confer wide powers of detailed policy determination upon the Secretary of State; yet others are mechanisms by which manifesto commitments are intended to be delivered. It is reasonable to assume that legislative competence for these, in so far as they are currently intended to be exercised by the Secretary of State for Wales, will in due course be transferred to the assembly. That intention is writ large in Clause 127(6) of the School Standards and Framework Bill. Some may say that there is nothing wrong with that and that that is the whole point of devolution, but it is a little more complicated.
It is perhaps bad enough that the Welsh assembly will be empowered to fly in the face of the UK Government's manifesto commitments by virtue of its competence over subordinate legislation; for example, as the School Standards and Framework Bill currently stands, there is nothing to prevent the Welsh assembly, once established and once the relevant order-making powers are transferred, from adopting an entirely different class size limit—say, 35 or 36—from that which will apply in England. Whether or not it would do so is conjecture but, as matters stand, the reality is that it could.

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While acknowledging that the noble Baroness, Lady Blackstone, gave some indication of the possibility that the Government may be prepared to state this manifesto commitment clearly on the face of the School Standards and Framework Bill, this nonetheless demonstrates the inevitable tension that is being built into the system. Unlike this House, the assembly will not be constrained by the Salisbury-Addison convention. Not only does this confer a superior legislative competence upon the assembly than that enjoyed by this House, but it also empowers the assembly to contest the UK-wide mandate of this Parliament. I do not wish to over-play it because it is an inevitable—some would argue desirable—consequence of devolution, but this is the first concern, which is in essence a purely political one. At the same time, this demonstrates the fiction of the assembly being confined solely to competence over subordinate legislation. That is necessarily a function of how order-making powers are framed in Bills considered by this Parliament. In this context it is worth noting the Henry VIII clauses on the face of the School Standards and Framework Bill, of which I detect three. As currently drafted, they are unconstrained and apply equally to both Wales and England. It is reasonable to assume that these powers will in due course be transferred to the assembly. In effect, such a transfer would confer primary legislative power upon the assembly. More importantly, there is an implicit and attendant risk that that transfer could—I do not say would—inadvertently give the assembly legislative competence over England as well as Wales.
I am aware that Clause 22 constrains the assembly so that it is bound to exercise transferred powers "in relation to Wales", but that constraint is not as effective as it may at first appear. We should not draw too much comfort from it. The Bill before us today does not change one particular aspect of our existing constitutional arrangement: its evolutionary character. As, when, and if, competence for Henry VIII clauses is transferred in future, it will be a matter of interpretation as to the scope of the available power. As these matters evolve the question will inevitably be asked as to where the primary source of statutory authority lies. In the example I have cited, will it be with the Government of Wales Bill or the School Standards and Framework Bill? We can quite legitimately worry that the assembly may well be drawn down the road of interpreting that it lies with the latter. It will, after all, have its own democratic mandate. That being so, the assembly could grant itself legislative competence over England. This therefore is the second concern: the constitutional one.
The government line with respect to the issue of sovereignty has been consistently one of saying that these amendments are otiose. No doubt the noble Lord, Lord Williams of Mostyn, will follow this line when he responds. If it were simply a matter of where sovereignty resides, I could be swayed to accept that argument. In all kinds of ways, as the Government argue, that is self-evident, but I suggest that the real issue before us is where the primary source of legislative authority is located. In stating the constitutional position
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on this, the amendments, far from being otiose, and for avoidance of any doubt, are both important and necessary.
Lord Cledwyn of Penrhos: If we proceed at this rate, the Committee will take a very long time. The point is a simple one. I do not accept it. I draw the attention of the Committee to the words of Clause 1(3) at the very beginning of the Bill:
"The exercise by the Assembly of its functions is to be regarded as done on behalf of the Crown".
I would have thought that everyone should be satisfied by that.
Lord Hooson: I had not intended to speak to this amendment. I believe that it would be a political error to insert this phrase into the Bill. There has been devolution of powers to administrative boards and local government from Parliament for centuries, yet it has never been necessary to state in any Bill that Parliament is sovereign. The noble and learned Lord, Lord Simon, is undoubtedly right that this is unnecessary. To include this phrase is to invite trouble. Every Member of this House, every Welsh Member of Parliament and every council in Wales knows that Parliament is sovereign. If there is anyone who requires reassurance about whether there are sovereign Welsh dragons in the garden, breathing fire and slaughter, it can only be because those fears have been created by politicians. I believe that it would be a political error to insert this phrase. It suggests trouble and a means of division. As it is totally unnecessary and otiose, why on earth should we consider it?
Lord Dixon-Smith: I hesitate to rise, particularly in view of what has just be said. However, I should like to make just one point. With the exception of my noble friend Lord Northesk, this issue has been discussed as if it is simply a Welsh matter. Perhaps the dog of the noble Lord, Lord Crickhowell, that did not bark at Second Reading may be permitted a small growl. It must be made clear that this is a United Kingdom Bill to devolve powers from the United Kingdom Parliament to a Welsh national assembly. For the life of me, I have the greatest difficulty in seeing what problem there can be in stating that on the face of the Bill. The fact of the matter is that, as the noble Lord, Lord Thomas of Gresford, said, today we do not have to consider solely the views of the members of Wrexham Rugby Club or the Gresford Rugby Club. We have to consider what those views may be in five or 10 years' time or—heaven help us-50 or 100 years' time.
We have heard that there are already some strange views being propagated in Wales. Whatever we may believe about the sovereignty of Parliament, increasingly in today's society there are those who call into question the sovereignty of Parliament in various parts of the United Kingdom, and not exclusively in Wales. As a mere Englishman—I believe that the English can claim some responsibility for the integrity of the totality of the United Kingdom, and certainly for a very large part of it—I am enormously concerned that this matter could ever be called into question. In view

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of the fact that our constitution generally is not written but is understood, and also in view of the fact that lawyers have a great deal of fun with "understandings" as opposed to what is written, I must say that I would support having this written very clearly in this Bill now.
4.30 p.m.
Lord Ellenborough: I, too, hesitate to intervene in this debate amid so many distinguished former Secretaries of State for Wales. I should have thought that the Government would be well advised to accept these amendment because they clarify the position and they confirm the supremacy of the Parliament of the United Kingdom. I would have thought there must be a danger of visibly increasing support for the SNP in Scotland, and future pressure there for independence must have some effect in Wales.
If I may say so, one feature of the various devolution debates in both Houses—and here I agree with my noble friend Lord Dixon-Smith—has been the scant regard shown for the English, who are, after all, pretty generous towards the Scots and the Welsh both as regards finances and representation at Westminster. In his otherwise admirable winding-up speech on Second Reading, the noble Lord, Lord Falconer of Thoroton, did not, so far as I can recollect, even mention the words "England" or "English", despite the intervention in that debate of several of my noble friend Lord Crickhowell's "English dogs", of which I was one, although I only barked very quietly. This amendment should go some considerable way to satisfying not only English doubts and susceptibilities but also, and most importantly, the majority of the Welsh people, who are, after all, pretty unenthusiastic about devolution at the present time. If this assembly is to work as a secure part of the United Kingdom constitution it must have the support of the majority of the Welsh people and the acceptance of the English.
I would say to the Government that they really should not be too ostrich-like in this matter. They will bitterly rue the day if, once this legislation is enacted and the Welsh assembly and the Scottish parliament are under way, they are faced with a war on two fronts, with growing Welsh and Scottish nationalism on the one hand and increasing resentment by the English on the other. There are, as has already been said this afternoon, a fair number of Welsh nationalists and other closet nationalists who make it all too clear that they would deny the sovereignty of the Westminster Parliament and they regard devolution as a springboard leading to further separation. So, for my part, I strongly support this amendment. It helps to clarify the position and provide some reassurance.
Lord Williams of Mostyn: Perhaps I could make one or two preliminary observations. First of all, the noble Lord, Lord Roberts of Conwy, reasonably asked what had happened to the political parties registration Bill, and the noble Lords, Lord Mackay of Ardbrecknish and Lord Henley, have made similar inquiries. I did say—I do not think those two noble Lords were present then but the noble Lord, Lord Roberts, was—that on Maundy
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Thursday I had undertaken that the Bill would be ready soon after Easter. I did explain to your Lordships that on Good Friday there was the agreement on Northern Ireland matters and of course the resources of the parliamentary draftsmen had, rightly in my opinion, to be directed to those urgent matters. I can say that it is the Government's intention that the Bill on the registration of political parties should be published imminently.
I would echo, if I may, what I said at Second Reading, that any amendment which we regard as, first, consistent with the scheme of the Bill and, secondly, a genuine improvement would be carefully looked at. Perhaps I may also say with great respect that I believe that what the noble Lord, Lord Cledwyn of Penrhos, said has a good deal of virtue in it. Perhaps your Lordships will forgive me if I attend to the point of the amendment rather than rehearsing Second Reading speeches at any great length.
Questions were raised at Second Reading and in another place about sovereignty. It was said that the Solicitor-General, in his winding-up speech, did not refer to wider questions. That, of course, is wrong. I refer your Lordships to col. 1128 of Hansard for 21st April, where he specifically said:
"The Government believe that this is a step which is in the interests of both the people of Wales and the good government of the whole of the United Kingdom".
Indeed, I opened the debate by saying that this will strengthen the union, to which this Government remain adamantly and unshakeably committed. I do not think I need to repeat more than that.
We believe that these amendments are not necessary and we cannot accept them. We do not seek to undermine the sovereignty of this place, whether by means of this Bill or any other Bill. For instance, the Human Rights Bill was carefully constructed and crafted to meet the proper legitimate place of a sovereign Westminster Parliament, and everyone who dealt with it recognised what we had done. There is nothing in the Bill which is capable of calling into question the sovereignty of this Parliament. I entirely endorse what was said by the noble Lord, Lord Thomas of Gwydir. The overwhelming mass of those who live in Wales wish to see their future continuing as part of the United Kingdom.
As the noble Lord, Lord Hooson, said, this is simply a transfer of functions already exercised by Minsters to the assembly; no more than that. Noble Lords have referred to Section 75 of the Government of Ireland Act 1920 and to Clause 27(6) of the Scotland Bill, which is presently before another place. Both have statements similar to the spirit of the amendment contended for, but both convey powers to make primary legislation. That is a complete qualitative difference.
The Belfast agreement, to which I referred a moment ago, makes similar provision for an assembly with primary legislative powers. Therefore it is only right to make clear the relationship between primary legislation in Belfast or Edinburgh and that passed at Westminster.

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This Bill, I respectfully repeat, conveys no such powers and there is therefore nothing to clarify. As Mr. Ancram said in another place, an identical amendment,
"would not affect the position either way".—[Official Report, Commons, 20/1/98; col. 870.]
It is easy to think that it might be a good idea to have a cosmetic face-saver on this Bill, but that is not the purpose of a Bill. The statute book is not the proper place to seek to allay phantom concerns, and indeed sometimes, as an unintended consequence, to raise fears, as the noble Lord, Lord Hooson, said, rather than dealing with them properly.
The noble Lord, Lord Elis-Thomas, chided the noble Lord, Lord Roberts of Conwy, very gently about gloom and foreboding. I must say that from my own experience I always thought that gloom and foreboding were the most attractive part of life in North Wales. It certainly seems to be infectious because it has travelled all the way from Conwy to Abergavenny. The fact is that there is not a constant agitated thought, whether in the rugby club at Gresford or in the Pontllotyn branch of the Flat Earth Society as to what is actually intended by this Bill. It is perfectly straightforward. It is a transfer of functions which are presently devolved to the Secretary of State to a Welsh assembly, the principle of which throughout every one of the 35 speeches—I think it was—on Second Reading was accepted by the overwhelming majority of speakers. This amendment is not required and, being not required, it is not necessary.
Lord Roberts of Conwy: I am grateful to the Minister and indeed to all noble Lords who have participated in what I have found to be a very interesting debate. Of course we know all the arguments about otiosity and these suggestions being unnecessary. Nevertheless, a number of us feel very strongly that advantage should be taken of this opportunity in this Government of Wales Bill to build upon the relationship between the assembly and this United Kingdom Parliament, rather than suggesting that somehow or other they should be kept as separate as possible. As we pursue our discussions on the Bill, we shall see more clearly the need for a closer relationship between the two bodies.
I was interested in many of the comments that were made. I was glad that the noble and learned Lord, Lord Simon of Glaisdale, called the late Lord Attlee in my support in part. But he also described the amendments as niggling reservations and I take his point very much to heart.
We are seeking to suggest—and it is not all "North Walesian" or Presbyterian doom and gloom—that things may not go as well as the great optimists of devolution hope. I firmly suggest that our action would be remiss and that we would be culpable if things did go wrong in the assembly and the assistance of the United Kingdom Parliament was required.
As the noble Lord, Lord Williams, assured us, nothing in the Bill calls into question the sovereignty of this Parliament. As no powers of primary legislation are transferred from this place to the Welsh assembly one can understand the difference between the Welsh
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assembly, the Scottish parliament and the proposed Northern Ireland assembly and the need to differentiate between them by the inclusion of Clause 27(6) in the Scottish Bill.
Extensive secondary legislative powers are being transferred to the assembly and that is causing us a great deal of concern. Even the noble Lord, Lord Thomas of Gresford, expressed his concern about the nature of delegated legislation and its extension. As my noble friend Lord Northesk suggested, there is little difference between primary and secondary legislation in, for example, the School Standards and Framework Bill.
A considerable number of Henry VIII clauses in the Bill cause great concern. Nevertheless, in view of the Minister's comments, we shall not press the amendment to a Division. We shall be watchful as we proceed with the Bill and on Report we may return to the broad thrust of the amendments. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 2 not moved.]
Clause 1 agreed to.
Clause 2 [Membership]:
Lord Mackay of Ardbrecknishmoved Amendment No. 3:
Page 1, line 15, leave out from ("constituency") to end of line 16.
The noble Lord said: The amendment brings us to a discussion on the voting system. Not only are the Government proposing to change the constitutional arrangements of the United Kingdom vis-à-vis England, Scotland, Wales and Northern Ireland, but they are proposing to turn upside down a voting system which I and many other people believe has served this country and the rest of the English-speaking world extraordinarily well over the long march of history. The Government intend to replace that with a system of proportional representation or, as I would prefer to call it, one of the various methods of fiddle voting on which some people are so keen.
The amendment deals specifically with removing from the Bill those parts which would introduce proportional representation. If I were successful the Bill would have a first-past-the-post electoral system for the Welsh assembly. I would not like it to be thought that I have not realised that the Minister will say that I am looking a gift horse in the mouth, but I have to tell him that the weakest of all arguments for one or other electoral system is that your particular party gains advantage from it. That ought not to be the argument which convinces anyone to choose one electoral system as opposed to any other.
That is why, when the Labour and Conservative Parties stood as one in favour of a first-past-the-post system, the Liberal Democrat Party was alone in wanting to change it. And it wanted to change to one specific form of PR which it believed would fiddle the votes in the most advantageous way for that party. I believe that the true voting system is the one which we have had in this country for many years—
Lord Thomas of Gresford: The noble Lord said that we were anxious to fiddle the vote. Will he explain

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precisely what he means by that? Is he saying that the importance which the Liberal Democrats attach to proportional representation is a fiddle?
4.45 p.m.
Lord Mackay of Ardbrecknish: The point is that the argument in favour of one form of PR over another is usually put forward on the basis that the advantage may or may not be to the political party advocating it. In my view, and in the view of anyone who has studied the subject, I could put forward an electoral system which would present the Committee with any result it wished. Indeed, there are so many variations of proportional representation, which we shall debate later, that my argument would be adequately met by showing that the different types can lead to different results. That is why I used the word "fiddle" when I discussed proportional representation because it depends—
Lord Mackie of Benshie: Has the noble Lord noticed that in Scotland where proportional representation would not suit our party we are still advocating it?
Lord Mackay of Ardbrecknish: That has more to do with the noble Lord's party's cosying up to the Government and the fact that before the election they reached a pre-electoral pact on these matters. Oh, I have got them all up!
Lord Thomas of Gresford: Does the noble Lord agree that on his definition his government were complicit in fiddling the votes in Northern Ireland where they introduced proportional representation in local government some 10 or 12 years ago?
Lord Mackay of Ardbrecknish: As the noble Lord will know, the problem in Northern Ireland is that there are particular and difficult circumstances—
Noble Lords: Oh!
Lord Mackay of Ardbrecknish: There are, and the ignorance of the Liberal Democrat Party about Northern Ireland is well shown by the fact that it does not seem to believe that there are particular circumstances. I see that the Minister is coming to its aid.
Lord Williams of Mostyn: Does that mean that if there are particular circumstances one is properly entitled to devise a system which will produce the result that will deal with those circumstances, otherwise known as a "fiddle"?
Lord Mackay of Ardbrecknish: The point about Northern Ireland is that for better or worse a significant minority of the population there do not wish to be members of the United Kingdom. They find it difficult to operate within the United Kingdom system. As a result, the previous government introduced a form of proportional representation to give that particular minority—not a political party minority, but one which wished to belong to another country—some say in the
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government of Northern Ireland. It must be said that our previous efforts to do so and to put in place a system which worked have not proved particularly successful. We all hope that the new system devised on Good Friday will prove to be more successful and that the two communities will live together. However, I do not believe that for most of the rest of the world there are such divisions inside the one society where a sizeable minority do not wish at all to belong to the nation state to which the majority belongs.
In any event, the situation in Northern Ireland is so special. If one looks around the rest of the English-speaking world, proportional representation is not used at all except in one country. I shall say a little about its rather unsuccessful and unhappy experiment over the past two years where the system which this Bill proposes has been tried.
The Bill proposes to create two classes of Members of Parliament or members of the assembly. Two-thirds will be elected in the conventional first-past-the-post system. The other one-third will be wholly unaccountable to the electorate as individuals. It will also transfer power from the individual voter to the political parties. It will add a complication to what I believe is a very simple, democratic system which has served us very well indeed.
The case for the first-past-the-post system is one which I fear is not being heard too clearly at present. Indeed, the commission set up by the Government has been told specifically not to consider the merits of the first-past-the-post system. It is there to consider only which variation, which different methods of fiddling, which different tune will be played on the proportional representation system. As I have said to the Chamber before, it seems to me odd that these people are entirely paid-up members of the proportional representation club and not one person will ask critical questions.
I have been told before that I should not worry about that because this commission is merely asked to suggest an alternative PR system. When the commission reports, I shall look forward with interest to hearing the Government's response. I am sure that they will say that that does not in any way negate the importance of first-past-the-post. Perhaps they will say that the commission has not studied the first-past-the-post system and is not arguing against it but is merely looking at the system of PR. The Government will say, "Here is our great commission of people who have concluded that PR is the way and this particular version of PR is the way". That is not what the commission has been asked to do. The noble Lord, Lord Williams of Mostyn, intervened during my remarks recently and I must say to him that his remarks on that occasion are being kept close to my heart for the day on which the commission reports in the autumn.
The first-past-the-post system clearly gives us accountability at constituency level and at national level. The accountability is clear: it allows the electorate to remove the governing party if it no longer retains its confidence. That is something which we experienced a year ago. Under the British system, the verdict is decisive. An unpopular government cannot be kept in

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office by a minor party against the will of the electorate; nor can a minor party decide to change the government without going to the electorate. Therefore, there is accountability in the governing party.
It is interesting that during our consideration of the European Parliamentary Elections Bill, the noble Lord, Lord Williams of Mostyn, underlined the important difference between European parliamentary elections and elections to the other place and—dare I say it?—elections to the Welsh assembly and Scottish parliament. As the noble Lord pointed out to me, the European Parliament does not have a government arising from it. But of course, the other place does, as will the Scottish parliament and the Welsh assembly.
The noble Lord pointed out to me when we were discussing the European Parliamentary Elections Bill that:
"Different elections require different systems and the key determining factor is the nature and functions of the body or legislature that is being elected".
He added later that,
"the European Parliament, unlike our own, is not one from which a government is drawn".
The Welsh assembly will be an assembly from which a government is drawn, so to that extent it is more akin to the House of Commons than it is to the European Parliament.
The noble Lord went on to say:
"We take the view that electoral systems should be appropriate for the particular bodies being elected. Our Parliament has a very different function from that performed by the European Parliament and we believe that different considerations obtain".—[Official Report, 9/4/98; cols. 857–859.]
Again, when he summed up, the noble Lord said later in the debate:
It is not, I repeat, a Parliament from which a government is chosen".—[Official Report, 9/4/98; col. 899.]
I do not suppose for a moment that the Liberal Democrats would at all accept that argument as having any merit because they would like proportional representation regardless of whether or not the elected body creates a government. Therefore, it is important that we look at the Welsh assembly as being much more akin to the House of Commons in creating a government for Wales than to the European Parliament which does not create a government for Europe, although one never knows, the Liberal Democrats may be quite keen to do that one day.
The other matter is that accountability exists quite clearly. It is a direct accountability that the electorate can and does exercise at the ballot box. It can remove an unpopular party from power. That seems an important aspect of our system. Proportional representation systems can keep one party, usually a very small party, in power for ever and ever. It just shifts partners as in an elaborate dance and is never properly accountable to the electorate. It is interesting that in one or two countries where PR has developed, on occasions the larger parties have become so infuriated at the dictatorship of the minority that they have created coalitions between the larger parties to prevent the tail continually wagging the dog.
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Therefore, there is accountability in government. There is also accountability of Members of Parliament who are representatives and not delegates. They are entitled, if not obliged, to use their own judgment once they are elected. If the electorate does not like them and the way they use their judgment, they can be thrown out at the next election. They are accountable to their constituents.
The important point is that they are accountable to all their constituents. Every Member of your Lordships' House who has been a Member of another place will know that is the case. If one is a Member of Parliament, one does not say, "No, you did not vote for me. Take your problem elsewhere". As a Member of Parliament, you are responsible to every one of your constituents. You must look after their problems and take up their cases. You must take up the issues which concern them. You are the sole representative of that constituency and that is an extremely important link.
The first-past-the-post system undoubtedly, over time, has given us stable and effective government in this country. The governing party has, by and large, had a working majority in the House of Commons and has been able to run its term safely through the course of a full Parliament. Our current system also enables governing parties to get their business through the other place. It tends to give the winning party a healthy majority. That is one of the aspects which advocates of PR do not like. They do not like the thought that the winning party has a healthy majority and is able therefore to give the country effective government with effective parliamentary scrutiny from the Opposition. Therefore, on that basis, it seems to me that first-past-the-post is hugely superior when it comes to selecting a government than any method of proportional representation.
As regards the representatives themselves, in the British system, although of course the political parties play a major part—and nobody would pretend otherwise—they must ensure the widest possible support for themselves if they are to win an election. A party cannot hope to win an election by promoting a narrow sectional viewpoint, as does happen in those countries with a PR system. Accordingly, each party represents a fair settlement between competing philosophical interests within the same large framework. In this country, we tend to call it a broad church and the two major parties—the Conservative Party and the Labour Party—have traditionally been that broad church.
As I said, each individual MP is exposed to that broad range of views because in his constituency, even within his own party—let alone outside—he must listen to the different views of the different parts of his own party. Therefore, it seems to me that the political parties, inside themselves, must reconcile what is sometimes a wide variety of interests. That is not a fault. I know that some people consider it to be so. I believe that our system, in which our political parties represent a wide spectrum, has served this country well.
Therefore, when it comes to choosing the governing party and selecting the constituency representative, I believe that our system is vastly superior to that in other

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countries. I do not expect other countries to change to our system; indeed, I am not an evangelist in these matters. History and tradition dictate where you end up. We have ended up with first-past-the-post, and that is the sensible way for us to proceed.
As regards the various methods of proportional representation—fiddle systems, as I am going to call them, even though some people may not like me to do so—I must say that I find some of the systems—not necessarily the one proposed here—which give people second, third, or fourth votes while other people only have one vote, to be a negation of, "one person, one vote". I believe that one vote should count for each person and not that your second, third or fourth vote should count if you happened to vote first for a party which does not succeed in gaining many votes. It seems to me that that is something about which you have to make a decision, and live with.
Our system is clear. The amendments before the Committee today would in fact remove the AMS system from the Welsh Bill and would mean that the members of the Welsh assembly would be elected by the first-past-the-post system. If I am told that that would not be particularly beneficial to my party at present, my response to the Minister will be, "So be it". I do not believe that the narrow interests of my party in 1998 should necessarily determine how the electoral system of this country works. I give way to the noble Lord.
5 p.m.
Lord Harris of Greenwich: I am much obliged. The noble Lord is approaching the matter in a very high-minded way. Given that fact, can he say whether he intends to put himself forward as a Scottish Conservative for election where exactly the same electoral system will be proposed and where in fact, if we have the first-past-the-post system, the prospects of the noble Lord being elected are minuscule?
Lord Mackay of Ardbrecknish: I do not think that I am under any obligation to tell the noble Lord, Lord Harris, what my intentions are with regard to the Scottish parliament. Suffice it to say that I am one of the three people who are actually vetting all the potential candidates for the Scottish parliament. I am sure that they would find it a little odd if I were to be one of the candidates. I hope that that answers the noble Lord's question. Unlike, perhaps, one noble Lord in his party, I have no great ambitions at my stage in life to become a great player in the Scottish parliament. I was indeed a considerable player in your Lordships' House, but the noble Lord about whom I am thinking did not succeed in being a great ministerial player either in this or the other place.
I turn now to Amendment No. 14. It is linked here because it does in fact bundle properly with amendments regarding first-past-the-post. If you have a first-past-the-post electoral system, you do not need to register political parties. Amendment No. 14 would actually delete the mention of the registration of political parties. I was grateful to the noble Lord, Lord Williams of Mostyn, for telling me, through his earlier reply to
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my noble friend today, that the registration of political parties Bill is imminent. I suppose that that is better than saying, "shortly". Moreover, having been given such a generous piece of timing, I suppose that I really must not be too ungrateful.
However, this legislation has become known, at least in the Mackay household, as the "invisible Bill". It is in fact central to the method for the Welsh elections, to the Scottish elections and, indeed, to the European parliamentary elections. Members of the Committee will notice that both the Welsh Bill and the European Parliamentary Elections Bill have already passed through the other place without this fundamental Bill ever seeing the light of day. The other place complained, but the Government just brushed those complaints aside. So the European Parliament Bill and the Welsh Bill are through, and the Scottish Bill has completed its Committee stage without this important little brick, which is necessary to build the PR system, being shown to any of us.
The noble Lord, Lord Williams of Mostyn, told me on Maundy Thursday that the Bill would be produced shortly after Easter. However, even the noble Lord must have realised that my definition of the word "shortly" was running out of days. Indeed, he told my noble friend Lord Henley, in another debate, that due to the difficulties being encountered by the draftsmen with the Irish business, the registration of political parties Bill would have to wait. What amazes me is the fact that a Bill, which I do not believe will have too many clauses, was not prepared some time ago. After all, it is central to the three systems of election. In my view, it should have been done some time ago.
However, I accept what the Minister said and understand that we will see the invisible Bill imminently. However, it is a Bill which I believe has dangers. It sends shivers up and down my spine, at least. If I wanted to start chipping away at democracy, I believe that my first step would be to register political parties and my second step would be to register only those of which I approved. I know that the Government will not want that, but I believe that it will require pretty careful drafting to ensure that that is not a possibility some time in the future. Perhaps that is why the Bill is proving so difficult.
All I can say to the noble Lord, Lord Williams, is that if this is yet another Bill to come this Session, the log jam that we are about to see, especially in this Chamber and in the other place to a lesser extent, will get even greater. However, on the basis that the noble Lord has given me that assurance—namely, that the Bill's production is imminent—I shall await such news daily. Whether there is another definition just about to come along after "shortly" and "imminently", is a matter that I leave to the noble Lord's fertile imagination.
The main point of the amendments is to advocate to noble Lords the continuation of the traditional British first-past-the-post system—a tradition which has served democracy in our country extraordinarily well over

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many decades. That is more than I fear can be said for most of our continental friends who have indulged in various forms of PR from time to time. I beg to move.
Lord Thomas of Gresford: I listened with care to the even longer speech of the noble Lord, Lord Mackay, in introducing the amendments. Again, I regret to say that we do not support them. The noble Lord said that the Conservative government had made a fiddle in order to deal with the particular circumstances in Northern Ireland and that, therefore, proportional representation was acceptable if particular circumstances demanded it. But what are the particular circumstances in Wales as we look at it today? The particular circumstances are that the Conservative Party achieved 20 per cent. of the popular vote in Wales in the last election, but did not gain a single seat.
With most unusual and unexpected magnanimity, this Government have decided that the Welsh assembly should not be as adversarial as the Westminster system. They have decided that it should be inclusive and that all strands of political opinion in Wales should be represented in that assembly, with an electoral system being devised which would ensure that that happens. The result will be to give that assembly a far greater legitimacy than would otherwise be the case if only first-past-the-post were to be used in its elections.
Prior to the last election, there was an agreement between the Labour Party in Wales and the Welsh Liberal Democrats that the alternative member system would be employed in elections to the Welsh assembly if such a happening were to take place. On that basis, we agreed that we would support the Labour Government if that should happen; and it did happen. We stand by that arrangement. We will support the Government. Indeed, we campaigned with them in the referendum which took place on that basis, as did Plaid Cymru. I believe that it is fair to say that, if the Liberal Democrats and Plaid Cymru had not added their weight to that of the Labour Party, the referendum might have gone a different way altogether.
As the alternative member system was clearly spelt out in the Labour Party manifesto, and as it has since received the assent of the Welsh people in a referendum, I wonder why these amendments have been tabled at all. Surely there is no intention that the Salisbury doctrine should be breached; that there should be a vote on this; or that there should be any attempt to amend the legislation in the way that the noble Lord has suggested. If this is never to be voted upon, I must regard the time that the noble Lord has taken in expounding the first-past-the-post system as "muscle flexing", "shadow boxing" and as a warm-up for the true fight that will take place in the autumn. No doubt at that time the parties will adopt all kinds of different attitudes as regards the proposals.
I do not propose to take on the noble Lord as regards the disadvantages of the first-past-the-post system, save to say that between 1989 and 1997 the Conservative government never achieved a majority of voters in their favour at the ballot box and yet continued as an "elective dictatorship", to use the term that the noble and learned Lord, Lord Hailsham, has used about our constitutional
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system. However, I shall not be drawn further into this argument. These amendments ought not to be put to the vote, in accordance with the Salisbury doctrine.
Viscount St. Davids: If you call into question the proportional representation elements in this Bill, you have to call into question the validity of the referendum. The referendum was held on a White Paper that promised a measure of proportionality in the voting system. If you call that into question, you would have to call into question the referendum. These can be regarded only as wrecking amendments.
Baroness Young: The establishment of proportional representation is a serious issue. I recognise that the issue arises in this Bill and in the Scottish Bill and that it is being considered generally. This is an enormous change. I recognise entirely the point that was made about the referendum. Although I did not read about the matter as closely as no doubt I should, I recognise that under the terms of the referendum everyone in Wales knew that they would have proportional representation. But how many people in Wales understand what proportional representation will mean for them? I have no intention of repeating the arguments of my noble friend Lord Mackay, with which I largely agree, or indeed answering the counter arguments. However, I know that everyone in this country likes to have a link with an MP. It is one of my regrets in life that I have not been an MP, but I have fought a number of local government elections. To that extent I have had "constituents", as it were. At that time I had an enormous postbag, and people came to see me about their problems. Under proportional representation that direct link will disappear.
I am sure that Members of the Committee have contacts on the Continent. Only last week I talked with a friend who is the headmaster of the British School in Madrid. He wanted to consult someone in the Spanish Parliament about a matter that concerned Madrid. However, that was simply not possible. No Member of the Spanish Parliament could answer his questions. We are entering a new world here. I shall not argue that every aspect of it will be for the worst. However, this point needs to be explained to everyone. It would be interesting to know whether the same number of Members of Parliament will remain in London. That is how I understand the position. Will people in Wales take their problems to their MP representing them in Westminster and bypass the assembly as they will not know who to contact given that the direct link will be broken? What will happen? I believe that the ordinary person in North or South Wales ought to have this matter explained to them. It should be spelt out in some way in an official document.
5.15 p.m.
Lord Crickhowell: I rise to make two brief points in response to points that have been made from the Liberal Benches and by my noble friend Lord St. Davids. The Committee will recall that we were presented with a pre-legislative referendum. Many of us voiced concerns that the issue was being put to the people of Wales

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without their having had the advantage of hearing all the details of the legislation and discovering how significant it might be.
To be told now that if a matter was not mentioned in the Government's White Paper, or if it is amended subsequently, we can make no change in the Bill, is a pretty audacious statement and one that I find profoundly shocking. I am one who accepted the verdict of the referendum, narrow though the majority was. However, I accept it on the basis that we must make the assembly work and we must make it strong and effective. I do not believe that can mean that Parliament is not able to accept amendments either from the Opposition Benches or from the Government Benches because the matter has perhaps not been fully covered in a White Paper. I have not looked to see what references were made to the points covered in the great mass of amendments that have been tabled by the Government, but I do not believe that the Salisbury doctrine can be stretched to deprive us of the right to move amendments and perhaps to pass them in this Chamber.
Further, the noble Lord, Lord Thomas of Gresford, claimed that the assembly had been accepted by the people of Wales and the majority of 7,000 had been obtained because of the support that Liberal voters gave the Government. I wonder whether he has studied the post-referendum academic investigation which I believe was carried out by academics in the University of Aberystwyth on behalf of one of the bodies that studies the results of elections, which noted that although there was a marginally higher turnout of Liberals than of Labour supporters, 74 per cent. of those Liberals voted "No". I wonder therefore on what basis the noble Lord, Lord Thomas of Gresford, presses his point with such considerable audacity.
Lord Harris of Greenwich: I hope I may say a few words. I think it is about time we had a few words. As regards the point made by the noble Lord who has just sat down, what does he think the Salisbury doctrine meant? The Salisbury doctrine meant that the Conservative Party—which then, as now, had an overwhelming majority in this Chamber—would not use that majority to defeat the Government on issues which had been spelt out in the Labour Party's election manifesto. That is what the Salisbury doctrine means. Therefore to pass an amendment of this kind would be to undermine totally the undertaking given on behalf of the then Conservative opposition, which as I understand it remains the position of the Conservative Party. The noble Baroness, Lady Young, was concerned—I understand this concern—that a large number of people in Wales would not understand the possible complexities of a proportional representation system. In that case, why did the people of Northern Ireland find it quite so easy?
Baroness Young: I did not say that they would not understand the complexities. I said that I did not think they had understood that they would lose the direct link with an MP. That is quite a different issue.
Lord Harris of Greenwich: I believe that in the Bill as drafted there will, of course, be Members for
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constituencies. Therefore, the concern that the noble Baroness has expressed is entirely misdirected. The noble Lord, Lord Mackay of Ardbrecknish, spoke at rather substantial length. I thought once or twice that we were in the midst of a timeless Test match. I found it a little difficult to understand why he made that speech given that this matter had been spelt out in the Labour Party's election manifesto, as it was in my party's manifesto. He seemed a little modest when it came to a direct question of whether he would stand for election to the Scottish parliament which is to be elected on exactly the same basis.
The noble Lord, Lord Mackay, says that he is prepared to live with the argument that it is perfectly all right to allow a substantial minority of the people of Scotland and of Wales to be totally unrepresented in the House of Commons. I wonder whether good democrats necessarily all take quite such a dismissive view of the rights of the electorate. It seems to me highly likely, as another academic study has demonstrated, that if one was not to have some form of proportional representation in Wales, there would be no Conservative members in the Welsh Assembly at all. I would regret that because I do not believe it is right that a substantial block of the electorate has no elected representatives. I am appalled that noble Lords are prepared to get up in this House and say that they could live with that without the slightest trace of concern.
Lord Onslow of Woking: I have no particular wish to follow the tone of the noble Lord who has just sat down. I simply wish to ask two questions about the legislation on the registration of political parties which we have been promised and which is so essential with regard to this and other pieces of legislation now before Parliament. First, can we have an undertaking from Ministers this evening that we shall have an opportunity to see that Bill before the Report stage on this Bill? Secondly, can we have a guarantee that its provisions, whatever they may be in detail, will be the same for any elected body in any part of the United Kingdom, and that there will be no different rules of registration for political parties in Wales, in Scotland, in Northern Ireland, or in the rest of the United Kingdom?
The Earl of Balfour: Following on from what the noble Lord who has just sat down has said, and as Amendment No. 14 (seeking to leave out subsection (8) of Clause 4) is grouped with this amendment, may I ask the Minister whether he can tell me if there is any enactment providing for the registration of political parties or any directive through any statutory instrument? I think it would be helpful to find out how political parties are recorded. I hope we can have an answer.
The Solicitor-General (Lord Falconer of Thoroton): The noble Lord, Lord Mackay of Ardbrecknish, quoted my noble friend Lord Williams of Mostyn saying that you approach the question of what is the correct electoral system by what is appropriate for the particular body. The Government have said repeatedly in relation to a national assembly for Wales

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that they want an assembly which is representative of all parts of, and all interests in, Wales. We are determined that the assembly will provide a focus for Welsh life and reflect the diversity of modern Wales. I understand that that diversity of modern Wales includes Conservatives. We want it to be an institution which commands the respect and support of people throughout Wales and which transcends differences between regions, cultures and political traditions. We want the assembly to encourage a new style of inclusive politics which will be more open, more accountable and more relevant to the people of Wales.
We believe that using the additional member system will help to achieve those objectives. We approached the question of the best system on the basis of what we hoped to achieve rather than simply by adherence to the existing system for the UK Parliament. The additional member system combines the traditional first-past-the-post system with an element of proportionality. The constituency element enables us to retain the close and effective link between the electorate and their representatives while the election of the 20 additional members will address any disproportionality that may occur in the constituency elections. May I deal with the point—
Lord Simon of Glaisdale: Will the noble Lord not accept that the additional member system is only one of the systems of proportional representation and it has particular disadvantage in that it yields power to the party managers, taking it away from those who are close to the electorate?
Lord Falconer of Thoroton: I accept that there are other systems. We believe that this is the most appropriate system for the Welsh assembly.
Perhaps I may deal with the point raised by the noble Baroness, Lady Young. She expressed concern that there would be no direct link between a constituent and his or her representative in the Welsh assembly. The system proposed involves 40 members of the new assembly elected by the same means as are the UK parliamentary constituencies. There will be a direct link, identical to that between an MP and his constituency and, on top of that, there will be 20 additional members introduced by the additional member system.
There will be no question of individual constituents not knowing to whom to refer a problem and there will be that direct link about which the noble Baroness was so concerned. So, with the greatest of respect to the noble Baroness, I do not think that there is anything in her point about losing the direct link.
The level of representation enjoyed by a party in the assembly should reflect, more or less, the level of support it has won across the country. The result should be an assembly which is truly representative of the range of opinions in Wales. In addition, the proposed geographic distribution of seats under the system will ensure that all areas of Wales are properly represented in the assembly and that no one area is able to dominate the affairs of the assembly.
The noble Lord, Lord Mackay of Ardbrecknish, made much of the point that the amendments that he was proposing were detrimental to the interests of his own
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party. He said, "Look how high-minded I am". His amendments would be very destructive of the Conservatives because he knows, as everyone else in the Chamber knows, that they did not return one seat in the election in May 1997. Having clothed himself in this high-mindedness, he then did not deal one way or another with whether that was a good thing or a bad thing. Perhaps I may adopt the arguments put from the Liberal Democrat Benches to the effect that what is wanted is an assembly where all shades of opinion are reasonably represented, including that of the noble Lord's party. That is not an argument that he addressed one way or the other.
As the noble Lord also pointed out, the main beneficiary of the amendments would, of course, be my party. But in relation to the Welsh assembly we are concerned with a vision which genuinely has nothing to do with competing party political manoeuvres. We want to establish the assembly as an institution which will give voice to the needs and concerns of all people in Wales, and not only those who vote for my party. While accepting that there are other systems, we are nevertheless convinced the additional member system is the most appropriate method for electing an assembly which will achieve our goal of inclusiveness.
Lord Simon of Glaisdale: May I ask the noble Lord again: would the additional members chosen by the party managers be chosen by the managers of the Welsh parties or the managers in London?
Lord Falconer of Thoroton: It is a matter for each individual party to determine how they select those people who are on their list. We are not dealing here with how each individual party will handle the system. We are dealing with the system that is being set up. In the interests of establishing an assembly which is truly representative of the people of Wales, I strongly urge the Committee to reject the amendment proposed.
It was made clear that this system was to be adopted, both in the manifesto at the time of the election and before the referendum took place. The noble Baroness, Lady Young, said that perhaps the electorate did not understand the proposal. That point could be made in every case where a clear policy has been laid out, as this was, and accepted twice unequivocally by the electorate. I strongly urge the Committee to reject the amendment.
5.30 p.m.
Lord Davies of Coity: I suggest that the Welsh people thoroughly understood what they were voting for in the referendum for the Welsh assembly. It is true that the poll could be considered low, and that the majority was somewhat low. Nevertheless, the result had nothing to do with the first-past-the-post system and proportional representation. It was based on whether or not Wales should have an assembly.
Many people did not believe that Wales should have an assembly. Some voted against it; and some abstained. However, the question we have to answer here is that of individual representation by Members of Parliament on the first-past-the-post system. That somewhat defies

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reality. Frankly, elections in this country have been run for a long time on party lines. The vast majority of people vote for the party and not the individual.
When considering representation of constituents by Members of Parliament, let us recognise another reality. The vast majority of people do not see their MPs; they do not ask MPs as individuals to represent them. Some do so, but not the majority. The majority vote for a government to represent them on the big issues that affect their lives—employment, the National Health Service and education. The Welsh assembly will be concerned with affairs that affect the Welsh people. Nevertheless, with the system of proportional representation, the representatives will represent the people in the European Parliament constituencies. Therefore there will be representation if individuals require it.
I believe that it would be wrong for this Chamber to try to frustrate or defeat what was contained clearly in a manifesto commitment at the last general election. If such amendments are pushed to a vote, they will be mischievous.
Lord Falconer of Thoroton: I am grateful to my noble friend for his intervention. I wish to make clear that I did not suggest for one moment that the Welsh people did not understand what they were voting for. The noble Baroness, Lady Young, expressed a view as to what the Welsh people might have thought. I do not adopt it.
While I am on my feet perhaps I may answer the question of the noble Lord, Lord Onslow of Woking, to which I did not respond. I apologise. First, the noble Lord asked whether I could give an undertaking that we shall produce the document before the beginning of Report stage of the Bill. I cannot give a formal undertaking to that effect. But I can say that it is extremely likely that the Bill will be forthcoming before the start of Report stage. If not, either I or my noble friend Lord Williams of Mostyn will give an explanation as to why. However, I very much hope that that will not be the position.
Secondly, the noble Lord asked whether the Bill would cover all elections. As I understand it, it will deal with those elections which relate to the putting forward of lists of candidates for the various party list elections. I do not know whether it will cover local government elections; I suspect that it will not. That is as far as I can take the matter at present.
Lord Mackay of Ardbrecknish: I am grateful for the assurances we have received again from the Solicitor-General about the registration of political parties Bill—or I was grateful until he returned to the subject. I had thought that "imminently" meant before we return to this Bill at Report stage. The noble and learned Lord will have to work hard to persuade me that we should have a Report stage of this Bill before we see the registration of political parties Bill. He would have to work hard, too, to persuade me that we should start the Committee stage of the European Parliamentary
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Elections Bill before we see that Bill. However, I have little doubt that "imminent" means imminent. I accept the noble and learned Lord's assurances.
Perhaps I may say this to the noble Lord, Lord Davies. I am sure that the Welsh people knew what they were or were not voting for; about half of them decided that they did not wish to vote for the proposal. Half of those who voted were not particularly keen. So I believe that they knew what they were voting for. I am not sure that the noble Lord and I would agree on the conclusions that we would both draw from that.
As my noble friend Lord Crickhowell mentioned, we accept that however narrowly it was won the referendum was won. Perhaps I may say this to my noble friend Lord St. Davids. I do not consider this to be a wrecking amendment. The main proposition put before the people of Wales and Scotland was that they will have an assembly or a parliament. It is just possible that if the people of Wales had been asked to vote for an assembly elected by the first-past-the-post system, the yes campaign in which my noble friend played a part might have achieved a better result. My noble friend might contemplate that for a moment or two.
This is not a wrecking amendment. It is not justified to try to knock it down with reference to the Salisbury doctrine. There is a point to be debated. We have a longstanding first-past-the-post system in this country. I do not think that we should overturn it readily or quickly just because of some agreement the Labour Party rather foolishly made with the Liberal Democrats before the election. I much appreciate the interest of the noble Lord, Lord Harris of Greenwich, in my political career. I have indicated my position. I assure the noble Lord that if I change my mind I shall lose no time in making sure that he is among the first to know.
We shall return to the subject of proportionality, a subject about which the Solicitor-General spoke. I shall then show him that proportionality has as many definitions as there are fiddle tunes—and there are many of them! It is doubtful whether the method achieved in the Welsh Bill will deliver the same degree of proportionality that the method outlined in the Scotland Bill will achieve. However, we shall come to the amendment from the Liberal Democrats Benches and that of Plaid Cymru later. I shall not go into that.
I believe that our system has served us well. As I mentioned—I am not surprised that no one took up the point—only one country in the English-speaking world (if I may so call it) has gone over to PR. That is New Zealand. It is interesting that the National Party in New Zealand is considering whether or not to have another referendum and whether or not to abandon the system that it has had for a year or two. A report in the Daily Telegraph of 23rd April reported that business confidence has plunged; the economy has stalled; the currency has fallen sharply; and economic reforms, for which New Zealand was famous and for which it gained acclaim internationally, have all but ground to a halt.

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The polls showed only 30 per cent. remained in support of the system. Mr. Geoff Thompson, the National Party president, said that the MMP system, which is close to the system we are discussing,
"has disappointed those who expected an environment of peace and goodwill to develop…That hasn't happened".
We have heard a little about that today. I shall be happy to eat a raw leek if the Welsh assembly is peace loving with no arguments and no political divide—nothing of that nature. It will amaze me. It will be the only legislature anywhere in the world that works like that in a democracy. I think that it was George Thomas who defended noise in the House of Commons by saying that if you want a silent legislature go and listen to the Supreme Soviet—in the days before the wall came down. If noble Lords believe that there will be no controversy across the political divide in the Welsh assembly, they will believe anything.
I turn again to New Zealand. Another National Party MP, Mr. Gavin Herlihy, said that the system which is close to that being proposed for Wales is the worst possible. Although consensus politics was inherent in it,
"in reality this degenerates into compromise and mediocrity".
I believe that we shall regret having moved down the proportional representation road. I do not think that it will do Wales any service.
I do not accept the argument that just because the Welsh electorate decided that they did not wish to have my party in any of their constituencies I should ask to change the system. They made a conscious decision to get rid of all my honourable and right honourable colleagues. In a democracy they had a right to do that. That is what the first-past-the-post system provides. However, I accept that the Government have argued for this proposal, both in their manifesto and in the White Paper. For the moment at least, I beg leave to withdraw the amendment.
Lord Thomas of Gresford: Before the noble Lord sits down, is he speaking for the Welsh Conservative Party when he says that he is for the first-past-the-post system, and for the 10 candidates who have already been adopted by the Conservative Party to fight these elections? Is he speaking for them, or for himself?
Lord Mackay of Ardbrecknish: I was about to say that that is a particularly silly question, but that might be unkind. I am speaking for my noble friends and myself on this amendment. I am speaking for the Conservative Party in Wales and in Britain; and indeed I shall address the same issue in relation to Scotland. The fact that we already have candidates in place for both the Welsh assembly and the Scottish parliament simply underlines the fact that we are a democratic party and that we shall fight elections on whatever basis they are arranged, even though we do not approve of that basis. That is what democracy is about. I appreciate that the Liberal Party perhaps does not understand that.
Amendment, by leave, withdrawn.
[Amendment No. 4 not moved.]
On Question, Whether Clause 2 shall stand part of the Bill.
Lord Simon of Glaisdale: Perhaps I may ask one technical question in relation to subsection (7):
"The validity of proceedings of the Assembly is not affected by any vacancy in its membership".
The assembly is a corporation, and is defined as such in Clause 1, and a corporation aggregate. I was not aware that a vacancy in a corporation aggregate could affect the validity of its proceedings. There must be many, many examples where there has been a vacancy, for example, in the establishment of a government department, a local authority or a statutory body, and where that body has still been able to act effectively. I merely ask Ministers whether, if they believe there is any question about this matter, they will look into it. If this draft subsection is unnecessary, it can only cause trouble. An unnecessary subsection of this nature lends itself to endless unnecessary and undesirable argument.
Lord Hylton: When the Minister replies, perhaps he will say whether there will be a quorum laid down for the assembly, and whether that will be in the standing orders or in some other place.
Lord Williams of Mostyn: The matter of a quorum would seem to be for standing orders. In respect of the point made by the noble and learned Lord, Lord Simon of Glaisdale, on subsection (7), I will certainly examine the matter that he raises, as I hope I always have done in the past, and respond to him as promptly and fully as possible.
Lord Simon of Glaisdale: I am most obliged to the noble Lord.
Clause 2 agreed to.
5.45 p.m.
Schedule 1 [Assembly constituencies and Assembly electoral regions]:
Lord Elis-Thomasmoved Amendment No. 5:
Page 78, line 11, leave out ("four") and insert ("five").
The noble Lord said: I am grateful to the noble Lord, Lord Mackay, for giving a taster of this amendment—though I would recommend that, when the noble Lord comes to eat his leek in Cardiff, I should serve it to him, parboiled, cooled and with a little vinaigrette rather than completely raw.
This group of amendments in my name and those of my noble friends on the Liberal Democrat Benches provides an opportunity for us to examine rather more closely the whole issue of proportionality. It also provides an opportunity to examine the role of the regional members, if I may so call them—the additional members elected from electoral regions. As we scrutinise that matter, it is important to ask the Government what are their future intentions in regard to the electorate from which those additional members are to come.

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We know that the Euro-constituencies, which are the electoral regions for the purpose of this Bill, are due to come to an end before the next European elections. It is therefore important to have an indication as to whether it is the intention that these regions will continue to be electoral regions for the purposes of the national assembly, or whether some other electoral regions would be appropriate.
Personally, I commend the election of additional members on a regional basis. That will provide us with a further constituency basis in regard to the role of members. I fail to understand the question raised earlier by the noble Baroness, Lady Young, about the relationship between a constituent and a member being dependent on the fact that there is only one member. I see it as a rather attractive idea that a constituent might have recourse either to a constituency elected member or to a regionally elected member on the party list should a constituent or member of the public wish to take up any issue. In regard to the noble Baroness's remarks on the Spanish Parliament, I have never found any difficulty in relation to any member of the Cortes or the Senate of that parliament being able to raise any issues. Indeed, it would be difficult to prevent my Catalan colleagues in both of those houses from raising any issue—on education or any other matter.
The question of the role of the additional regional members is an important one for this place. It is relevant to rehearse it briefly in this debate. I do not want to see us create a two-tier membership. That seems to be the hint emerging from the noble Baroness: that somehow the first-past-the-post members would have a more realistic mandate because they would be somehow closer to the electorate than those on the party list. But surely those of us who will vote, and use our second vote for the list, will be similarly electing a member and creating a mandate for that member, as would be the case under the first-past-the-post system. The fact that the constituency is to be the same as the Westminster constituency for a member of the national assembly elected on the first system, and that there will be another regional electoral district for the other member, is beneficial to democracy. It implies a multiplicity of experience brought to bear by members representing different areas, although those areas will overlap.
That brings us to the question of the role of regional, or additional, members in relation to regional committees. Regional members representing regions might well provide excellent members for regional committees, thus giving them a further representative role. That is the reasoning behind this set of amendments; namely, that we should have more additional members but within the general parameters of the White Paper and the referendum.
I know that the Government might say later that the number 60 is sacrosanct because that is the number in the White Paper. The noble Lord, Lord Mackay, is still referring back to the question of the result and the figures. In relation to this whole debate, I would say this to the noble Lord. If we all accept the result, then we accept it. But we need to accept the political lessons from the result; namely, that there is a need to make the
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assembly as inclusive—to quote "government speak" on the matter, with which I entirely agree—and as proportionate and representative as possible. For those reasons, I suggest that the numbers in our amendments, whether we take my five or my noble friends' six, provide for greater proportionality.
If we examine the Scottish system—to anticipate what the noble Lord, Lord Mackay, may say on this matter—the greater numbers and the greater split between the first-past-the-post members and the regionally elected members provides for greater proportionality than in the Welsh model.
Perhaps we may consider the calculations made on the basis of the results in previous elections and apply them to a potential assembly election. We can see that the present proportionality, together with the present calculation of the AMS system—to which we will come in later amendments for debate tonight—provide an imbalance in favour of the larger parties. There is a "big party" bias in the d'Hondt allocation system which would be reflected in the projected results in Welsh constituencies with the present numbers of members.
That affects the party of Wales, Plaid Cymru, in that as a party we would not be as proportionally represented, certainly in South Wales, under the present additional member system. However, with the allocation of further members, it might be possible to allow for the Green Party, Plaid Cymru, the party of Wales, and the Liberal Democrats to be more fairly represented.
I do not make those points for party reasons but because I wish to ensure that the assembly has as broad a spread of representation from as many political parties as possible. I hope that there will be Conservatives there. I shall not name which of the 10 selected members I might prefer to see there, it is a matter for the electorate. I am sure that Mr. Richards will be there, we hope Mr. Andrew and some others will also be there. Whoever it may be, it is important that they feel able to play a part and have a proportional share of power in the bodies. Similarly with the Liberal Democrats, and particularly the Green Party. I would not be at all averse to seeing the occasional independent member from certain regions of Wales represented in the assembly. If we are to have that facility, we need a stronger form of proportionality than is before us at present. Therefore, I beg to move.
Lord Thomas of Gresford: It is fortunate for me that I follow the noble Lord, Lord Elis-Thomas. I shall speak to Amendment No. 6, in my name.
The noble Lord, Lord Mackay of Ardbrecknish, has already pointed out that the provisions in the Welsh Bill for proportionality do not match those in the Scottish Bill. In that Bill there is a ratio of four constituency members to three list members. In the Welsh Bill it is two to one. Consequently, the proportional element in Wales will not be as strongly felt as it will be in Scotland.
I see no reason that that should be the case. That is why it is proposed that we should have 40 elected members for the 40 constituencies in Wales and 30 elected proportionally by the list system. That is the

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purpose of my amendment. I endorse much of what the noble Lord, Lord Elis-Thomas, said but I wish to make this point. In order to make the various committees effective and make them fulfil the function for which they are designed, there must be manpower, or womanpower, and a proper balance. The Bill provides in Clause 58(5) that in the subject committees,
"the balance of the parties in the Assembly is reflected in the membership".
There are six subject committees. The subordinate legislation scrutiny committee is covered by a clause to the same effect, Clause 60(2), which states that the Committee shall be elected,
"so as to secure that, as far as is practicable, the balance of the parties in the Assembly is reflected in the membership of the committee".
The same provision goes for the audit committee, and there are other committees on which members of the assembly will have to serve. In addition to having a balance of parties, it is to be hoped that on the six subject committees and on all the other committees, as well as the regional committees, there should be a balance of interests from all parts of Wales. That represents a huge amount of work for every member of the assembly. But if, for example, a smaller party were to return 10 members, as opposed to the larger party returning 35 to 40 members, Members of the Committee will appreciate that the workload on the individual members will be considerable. They will have to play their part in sitting on each of the committees in order to maintain the party balance.
It is for practical reasons and to make the committee system effective with committees that support the executive of the Welsh assembly, that we suggest that, as in Scotland, it would be sensible to increase the numbers of members to 70 rather than 60 and to include the same proportionality for Wales as there is in Scotland.
Lord Mackay of Ardbrecknish: As the noble Lord, Lord Elis-Thomas, mentioned, I gave a foretaste of this discussion. I had better not say it is part of the "fiddling around with the PR system"; perhaps I had better say "twiddling around with the PR system" or I may have the Liberal Democrats on their feet again. This is the kind of twiddling that inevitably PR invites. If we twiddle it a bit one way, we get a slightly different result and if we twiddle it the other way the result is different again. If we give it a great big twiddle, we can turn the results on their head.
The noble Lords, Lord Elis-Thomas and Lord Thomas of Gresford, and I are at one on this. Four additional members per European constituency is not enough to gain necessarily—although it may gain occasionally—any kind of vague proportionality. One of the problems is that there are conflicting philosophies, conflicting arguments, which have to be compromised. The purest form of proportionality is simply for everyone in Wales to vote for the party of their choice. It is then for the mathematicians to get out a simple calculator and work out what percentage of vote it is and what percentage of the size of the assembly it represents. Then the mathematicians can say to the
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Labour Party in Wales: "There you are, you can have 30 seats". It would be the same for the Conservative Party, one hopes. I had better watch that I do not get more than the number of seats in the calculation, but I am being realistic. The Labour Party may have half, one would say to the Conservative Party: "You can have 15". Plaid Cymru could have 10 and then whatever is left is for the Liberal Democrats. That is the purest form of PR but it has no constituency link. So if we wish to try to marry the proposals, we must make compromises.
The one thing about the system chosen in the Welsh Bill is that it makes a considerable compromise in the direction of the first-past-the-post seats. The Scottish system of seven additional members in each European seat achieves in many cases quite close proportionality, although not in every case and not exact proportionality. The same is true here. I considered some of the Welsh constituencies on the basis of the last election, and some are quite wide of the mark with four extra members on the basis of proportionality. The Committee might think that I was coming to the conclusion that either the noble Lord, Lord Elis-Thomas, or the noble Lord, Lord Thomas of Gresford, was right.
My concern, however, is that the proposal adds members to the Welsh assembly and therefore costs to the Welsh budget and therefore less money for other services in Wales. The noble Lord, Lord Thomas of Gresford, would have 10 additional members of the Welsh assembly. That would add up to quite an additional cost, year on year, which would have to come out of either the health budget or the education budget.
The noble Lord, Lord Elis-Thomas, is mindful of that and seeks only five extra members. One could address the problem in a slightly different way if one were prepared to work inside the envelope of 60 members and move away from Westminster constituencies and even European constituencies. It seems pretty irrelevant to me that in both the Bills we are dealing with European constituencies when there is another Bill before us which will make the European constituencies obsolete and out of date. It seems odd that we are using European seats.
If we had four seats in Wales—and I can see the argument for that—it would match the regional committees, to which I shall come later. There is a strong argument, which perhaps the Government will consider, for matching the additional member seats to the regional committees. Then there would be a good link between the regional committees and the additional members. The additional members could ensure that they represented the regions. It would go some way towards increasing the top-up; it would be increased by one which would undoubtedly improve the proportionality.
My problem in relation to increasing the number of members of the Welsh assembly is that when I look at page 22 of this interesting document—The National Assembly for Wales—and see the timetable, it indicates that it will not be the most overworked organisation on earth. In fact, the assembly will meet in plenary session but once a week and committees twice a week. I do not believe that there is a huge amount of work to be done

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and the more people, the less each of them will do. I am not persuaded therefore that we should increase the numbers.
The point of the noble Lord, Lord Thomas of Gresford, in relation to more members helping the committee system sets aside the fact that the Government made a major change in the other place and agreed that the Welsh system should be on a Cabinet-government model and not on a local government committee system model. We welcome that, though I am not sure that the noble Lord, Lord Thomas, does. He seemed to wish for the committee system to be introduced.
The Government made changes in the other place, for which I doubt they received referendum mandates and I say to my noble friend Lord St., Davids that that was not part of the White Paper though I make no complaint about that; it is up to both Houses in discussion to see how matters can be improved and this is an improvement. Because of those changes, the argument that the committees may need more members begins to fade away when it is no longer a local government system. The Government have therefore dug themselves into a hole of their own making. I am interested to hear what defence will be put up.
My difficulty in supporting either of the amendments is that I cannot see any justification for increasing the number of Welsh additional members and therefore the total size of the Welsh assembly. As I indicated, there are other ways of tackling the problem, one of which would be to reduce the number of large constituencies and thereby have more additional members per constituency. That would help, though it would not entirely remove the lack of proportionality that this system brings about.
6 p.m.
Lord Falconer of Thoroton: These two groups of amendments put forward parallel proposals. The proposal of the noble Lord, Lord Elis-Thomas, increases the number of members from 60 to 65 by increasing the element of regional members, and that of the noble Lord, Lord Thomas of Gresford, increases the number from 60 to 70. Two separate arguments are advanced in support of both proposals. First, it is said that it improves proportionality; secondly, it is said to assist in relation to the discharge of the workload.
As the Government made clear, they believe that 60 members is an appropriate size for the assembly. We expressed that view in our White Paper and that view received the endorsement of the people of Wales in the referendum on 18th September last. Therefore, if we increase the number of assembly members at this stage, it would constitute a major departure from the proposals submitted to and supported by the electorate.
Perhaps I can deal with the point raised by the noble Lord, Lord Thomas of Gresford, in relation to workload. We do not accept the view that there will be insufficient members of the assembly to enable it to carry out its tasks efficiently and effectively. We want all assembly members to have a meaningful and responsible role. It
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will be for the Standing Orders Commission to advise on the internal workings of the assembly, but I do not envisage there being numerous large, cumbersome committees involving most members in little more than a never-ending round of committee meetings. I am confident that a 60-member assembly will provide a challenging workload for members without overburdening them.
The noble Lord, Lord Thomas of Gresford, referred to the problem of how the small party will deal with its commitments in relation to its committee membership responsibilities. That is always a problem in democracies. When there are small numbers of elected members, in so far as they must be represented on a specific committee their time will be more stretched than those parties which achieved more in the election and therefore have more people to spread around the committees. Therefore, with respect to the noble Lord, Lord Thomas of Gresford, that is not a point with which any system could effectively deal.
We believe that our arrangements deliver proportionality. Although there is a substantial first-past-the-post element in the system, the balance we have struck is about right. It is premature to speculate on the result of the elections in 1999 and the extent to which the distribution of seats in the assembly may or may not depart from the proportion of votes cast for each party. The Secretary of State made clear that the Government may look again at the electoral arrangements if, in the light of experience after 1999, they fail to meet our expectations. However, this is not the time to move from the arrangements endorsed by the electorate in the referendum and not much will be achieved by speculation as to what the result and the proportionality of that result may be when the elections come.
The noble Lord, Lord Elis-Thomas, raised a final point: will the Euro-constituencies continue to serve as electoral regions for the assembly after they cease to exist for European election purposes? The answer is yes. Paragraph 2(2) of Schedule 1 specifies those areas as electoral regions and they will continue to serve as such, subject to any modifications in relation to boundaries recommended by the Boundary Commission for Wales.
In the light of those remarks I strongly urge noble Lords not to press the amendments.
Lord Elis-Thomas: I am grateful for the response to this short debate. It has been an opportunity to rehearse the issue of proportionality and, as indicated, there may already be concern among many of us looking to the future pattern of the assembly that the structure may not be adequate to the task in hand. Indeed, my noble friend Lord Thomas of Gresford made that point clearly as regards the effectiveness of the committee system.
I should like to pursue one aspect a little further; that is, the question of looking again. I noted the commitment from the Secretary of State that he would look again at the electoral system if it did not prove to be adequate. It is important that the Government explain the electoral system clearly to the Welsh public—not that we are thick and do not understand what is going

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on, as some Members of the Committee seemed to imply earlier; but we have a new system and therefore the effective use of both votes to maximise preference is an important message which it is in the interests of all parties in a democracy to advertise. However, will the Minister kindly come back on the question of when the "look again" may be appropriate?
Lord Falconer of Thoroton: The looking again will take place in the light of the experience of the 1999 elections. If and in so far as there will be a look, it will be after those elections. What will be considered is whether it delivers on the expectations described in the course of these debates. I hope that answers the noble Lord's query.
Lord Elis-Thomas: In view of that assurance, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 6 to 8 not moved.]
On Question, Whether Schedule 1 shall be agreed to.
Lord Roberts of Conwy: The Government should be aware that there is some anxiety in Wales in relation to the size of the assembly. That was accentuated by the plans for the Scottish parliament and for the Northern Ireland assembly.
Most of us who are of Wales pay tribute to the work done by the Institute of Welsh Affairs, which has been involved in devolution for a considerable time. I hold a letter from the director, John Osmond, who feels that the minimum number required for the assembly to function effectively is 80. He says:
"This case, we believe, has been enormously reinforced by the recent Irish Agreement which will create an Assembly in Northern Ireland with 108 members. This is to represent a population of 1.6 million people".
The population of Wales is just under 3 million. The letter continues,
"There are, of course, special circumstances in the Irish case but, nonetheless, we believe there is an unreasonable disproportion in allowing Wales, with a population of just under three million people, an Assembly with only 60 members".
I think that Mr. Osmond and the institute undermine their case to some extent by saying that this creates a problem for operating the complex committee structure that will be required, as the Government have changed their mind on this issue and have gone for a Cabinet-style of operation which should require fewer people on the assembly committee system. Therefore, I believe that the Government have got the numbers about right, but that they should give a little more justification for the figure of 60 by way of membership compared with the 108 for Northern Ireland and the 129 proposed for the Scottish parliament.
Lord Williams of Mostyn: The schedule defines the constituencies and the electoral regions. There is a vast amount in the schedule that goes beyond the ambit of the remarks that the noble Lord has just addressed to the Committee. The schedule is vital if elections to the assembly are to proceed. A vast amount of the detail in the schedule deals with what one could call
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nuts-and-bolts questions about reviews of the electoral areas and so on. It seems to me that the noble Lord has concentrated alone, if I take his remarks correctly, on numbers. In many ways, we have already had that debate because a number of noble Lords contributed to the proposition that it should be larger by either 10 or 20.
The noble Lord said—I am grateful to him for his characteristic generosity—that the Government have it about right. It is a question of judgment. Circumstances are different in Scotland and they are different in Northern Ireland. If one were a believer in perfect symmetry, the consequence would be over-rigidity. If we all believed in symmetrical constitutional arrangements, none of us could be sitting in your Lordships' House as none of us has had the benefit of being elected by anyone. When we first discussed this matter, the noble Lord, Lord Crickhowell—I hope I do not misquote him—said that he had discussed the issue domestically and that he had had advice from a higher source in the Crickhowell household that 60 was far too many.
Bearing in mind the modern history of Wales, we believe that, because of the kind of arrangements that we have been accustomed to and because of the necessity for inclusiveness and proportionality, we do not want too large an assembly. Things have been infinitely different in Northern Ireland and at this delicate time I shall not trespass into that area to raise any difficulties, doubts or further dissentions. But Northern Ireland's history of internal democracy over the past 25 years has been that, apart from at local level, there has not been any. For the reasons that were generally alluded to by the noble Lord, Lord Mackay of Ardbrecknish, there are differences there and they do not focus entirely on the proposition that some people in Northern Ireland do not wish to live in the Union. There are other aspects: religious differences, differences of educational choice, differences of political view and differences of view over the recent history of the island of Ireland since 1922 or so.
In the Bill we have focused centrally on what will work in Wales and on how we deal with the possibility that some in Wales might think that this is too large a gravy train for the old—I put this carefully—county council writ large. We did not want the old county council writ large; we did not want the monoliths, which is why we put forward the AMS system; and we do not want too large a body. But we think that, particularly when one looks at the careful work that NAAG has done—a non-party body which has given excellent advice to the Secretary of State—we have it about right. I cannot say that I would go to the stake, even if invited to, on 59 as opposed to 61. Sixty seems about right in the context of our experience and our knowledge of recent Welsh history. I cannot put it more definitively than that because, as the noble Lord, Lord Roberts, said, it is essentially a matter of judgment. I think we are in agreement. We have got it about right.
Schedule 1 agreed to.
6.15 p.m.
Clause 3 [Time of ordinary elections]:
Lord Falconer of Thorotonmoved Amendment No. 9:
Page 2, line 32, leave out from ("order") to end of line 36 and insert—
("() An order under subsection (4) may include any provisions modifying the operation of—

(a) the Representation of the People Act 1983 (or rules made under that Act), or

(b) any other enactment relating to elections of community councillors,

which the Secretary of State considers appropriate in connection with the postponement of polls for which it provides.").
The noble and learned Lord said: This government amendment should be considered in conjunction with the power which will be given to the Secretary of State under subsection (4) of Clause 3 to postpone the date of the ordinary elections of community councils in Wales. What we are proposing is that in circumstances where the Secretary of State deems it necessary to exercise his power to postpone the date of the community council elections, it may also be appropriate for the proper and effective conduct of those elections for him to make consequential modifications to the statutory procedures relating to community council elections.
It may help to clarify our intentions if I illustrate matters with an example. Next year there are due to be four sets of elections in Wales during the spring and early summer—elections to the assembly, the unitary authorities, the community councils and the European Parliament. The best solution would be to combine the assembly elections with those for the unitary councils on 6th May 1999 and to postpone the community council elections, which are also scheduled for that date, preferably to 10th June, the date of the European parliamentary elections. I should emphasise that the final decision on the new date for the community council elections has not yet been taken, but combining them with the European parliamentary elections remains our preferred option.
It has been pointed out to us, however, that despite the advantages in terms of cost and minimising the potential for voter fatigue, holding the community council elections on 10th June could present some administrative complications regarding the timing of the submission of nominations. If the community council elections are held on 10th June, the statutory date for the submission of the nomination papers would be 13th May, a mere week after the assembly and unitary elections. Elections administrators and their staff will then be heavily engaged in duties relating to the aftermath of the two elections held on 6th May. We are advised that it might be impossible for them fully to comply with their obligations in respect of the delivery of community council nominations.
A possible solution would be to make provision for the community council nomination papers to be submitted on a timescale implied by holding the community council elections at the same time as the unitary authority elections. The community council nominations would then be "frozen" for the elections to
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be held in June. Candidates for the community councils would be submitting their nomination papers at the same time as unitary authority candidates, at a time when returning officers would be geared up to processing nominations. The European parliamentary nominations are much less of a problem as far fewer candidates are involved.
Such a step would require a change to the timetable applicable to the conduct of community council elections as set out in the Local Elections (Parishes and Communities) Rules 1986. It would be a departure from the procedure laid down in legislation and so requires special provision. This amendment would give the Secretary of State the power to make that provision.
I have given but one example of where it would be advantageous to change statutory procedures for the effective conduct of elections which had been postponed. Doubtless there will be other examples depending on the circumstances in which community council elections may have to be postponed. Accordingly, the amendment is not specific, but ensures that provision is available to enable the Secretary of State is able to take action as appropriate. I repeat: this provision could be used only in circumstances where the Secretary of State had decided to postpone the community council elections and any changes must be appropriate in connection with the postponement. He may not decide to change any provision simply because he may have a mind to. The changes may be modifications only. The order-making power will not enable him to rewrite the rules governing the conduct of the community council elections. Once the assembly has been established, he will be able to exercise that power only if he has first consulted the assembly; so it too would be party to any proposal to make consequential changes to any related statutory procedure. In the light of that rather long explanation, I beg to move.
The Earl of Balfour: I am very happy with the explanation that the Minister has given. Will he look at the bottom of page 13 of the Bill? In Clause 23(3) there is reference to Section 3(4). Does that still apply? I am perhaps straying a little far ahead. In the last two lines there appears this paragraph,
"(c) Part VII so far as relating to the provisions specified in paragraphs (a) and (b)".
That covers several sections. I simply do not understand the words at all. It is a technical point, but will the Minister look at it now before we reach Clause 23?
Lord Crickhowell: I wish to probe a little. The Minister gave a very reasonable explanation. One can see perfectly well that there may be very good reasons for altering the dates of elections on practical grounds. However the more I listened to what he had to say the more worried I became, but not because I expect that anything the Minister intends to do will be in the least improper. He provided a series of combinations at which one might arrive. When I went to cast my vote in the London elections last week, I was struck by how significant it was that they coincided with the election as to whether we should have a London mayor.

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If one has an election for one body in combination with another, that may have very considerable political significance. The point I am seeking to make is a very simple one. One can envisage a circumstance in which a Secretary of State, advised by the political party of which he is a member, might suggest that it would be helpful if an election for a particular body was held at exactly the same time as an election for another body.
I am not greatly comforted by the knowledge that he will have to consult with the assembly because it is quite possible that the Secretary of State might be of the same political party as those who presided over or dominated the affairs of the assembly. What worries me about what has been said is that there is at least some scope provided by this amendment for political manipulation.
I have no doubt that nothing was further from the mind of the Minister who introduced the amendment.
I can quite see that there are practical considerations.
I want to know how we can avoid the possibility that at some future date someone might decide that his or her party were more likely to win the election if it were held in combination with, say, a European election which would not actually fiddle the books.
Lord Roberts of Conwy: The Committee will be very grateful to the Minister for explaining the purpose of this amendment because we are always somewhat suspicious of orders, however well intentioned, that affect the workings of the Representation of the People Act and elections, albeit at the lowest level of local government. Community councils are very important. I am president of my local council's association in the Conwy Valley and I am well aware of the pride they take in their work and their role in local government.
I hope that the Solicitor-General can follow the detail of the remarks made by my noble friend Lord Balfour. As regards the point raised by my noble friend Lord Crickhowell, there is tremendous scope here for political manipulation. Even as the Minister spoke about the combination of the assembly election with the unitary authority election on 6th May, which was part of his example, he raised the issue in one's mind of why that particular combination and why that of the community councils and Euro-elections on, possibly, 10th June.
We have a plethora of elections, but the combination gives scope for some political manipulation. One can well ask, for example, whether the assembly election is not more in tune with the European election, bearing in mind that although the Welsh European constituency is changing, nevertheless, we are making use of the old Euro constituencies for the assembly election. Therefore, I believe, that some further explanation is required.
Lord Falconer of Thoroton: Perhaps I may first deal with the perfectly legitimate point raised by the noble Earl, Lord Balfour. Clause 23(3), to which he drew our attention, allows a power to make orders under Clause 3(4), which is the power to postpone community council elections. It allows them to be transferred to the assembly. If it is not transferred under the power in Clause 3(4), then the power remains to be exercised by the Secretary of State and
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only after consultation with the assembly. That is how the two interact. I hope that that explains the noble Earl's point.
The noble Lord, Lord Crickhowell, raised the point of political manipulation. That came into his head as he heard the explanation that was being given. Perhaps I may explain how the system works. Clause 3(4) gives the Secretary of State the power to postpone community council elections, and only that power. The amendment I have just moved gives the power that, if one postpones, the Secretary of State has the power to make sensible administrative arrangements.
The fear that the noble Lord, Lord Crickhowell, has raised must relate not to the amendment that I have moved, but to the power in Clause 3(4). It must be beyond argument that if one is going to be allowed to postpone, one must have the power to make sensible administrative arrangements that go along with it, such as the example that I gave of having a sensible timetable for nominations with which the administration running the elections can cope.
The example given exemplifies the need for Clause 3(4) which provides quite a limited power and relates only to community councils. If one does not have that kind of power one can end up with a large number of elections taking place at about the same time without the manpower to deal with them. It is as simple as that. The power that has been given to deal with that situation is about as limited a power as one could possibly give. It is sensible. There is not that much scope for manipulation. I believe that the matter has been thought through and it is the right conclusion.
Lord Crickhowell: I would like to consider very carefully what the Minister has said. The point only came to mind as I listened to his explanation of the clause. It is a risk that we need to avoid. I would like to consider what the Minister said and whether anything further needs to be done.
On Question, amendment agreed to.
Clause 3, as amended, agreed to.
Clause 4 [Voting at ordinary elections]:
[Amendment No. 10 not moved.]
6.30 p.m.
Lord Mackay of Ardbrecknishmoved Amendment No. 11:
Page 2, line 42, leave out from ("have") to end of line 9 on page 3 and insert ("one vote (referred to in this Act as a constituency vote).
(2) The constituency vote is to be given for a candidate to be the Assembly member for the Assembly constituency.
(3) Each registered political party which has submitted a list of candidates to be Assembly members for the Assembly electoral region in which the Assembly constituency is included shall also be assigned a number of votes to be known as "additional member votes".
(3A) The number of additional member votes assigned to each party shall be the same as the number of constituency votes cast for the candidate of the party in that constituency.").
The noble Lord said: Amendment No. 11 and the amendments with which it is grouped relate to the two-vote system which the Government introduce in this

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Bill and the Scottish Bill. I believe that the amendments from Amendment No. 17 onwards should be grouped with Amendment No. 11 because the former deal with an individual candidate in the second ballot. Clearly, if my proposition in Amendment No. 11 succeeds, one would not have individual candidates in the second ballot. Therefore, unless something comes to my notice during the Minister's reply, I shall continue to believe that Amendment No. 17 and those grouped with it should be grouped with Amendment No. 11 also.
We are to have a two-vote system. In the first instance, one will enter the polling station and vote in the normal way for party candidates, perhaps even for an independent candidate, and the result will be decided by means of the traditional first-past-the-post method. There will be a second ballot paper on which one will be asked to vote for a party. I believe that that will also contain a box for independent candidates, but I am a little unclear about that because this system has so many variations. Once the party votes on the second ballot are added up, the proportionality system, which the Committee will consider later, will be used to check the total proportionality, including the first-past-the-post members. Up to four top-ups will be allowed to try to bring the totality within the European constituency up to proportionality.
Your Lordships may regard that as fairly straightforward and believe that there is no way that it can be fiddled. I am sorry to use the word "fiddled" again in case it brings the noble Lord, Lord Thomas of Gresford, to his feet. If he waits a little while, he may agree that I have some justification in this instance for suggesting that the system is very much open to considerable fiddling and fixing. In my view, it is open to huge abuse.
I believe that the easiest way to illustrate that is to take the Euro-constituency of Wales North as at 1992, for the very straightforward reason that my party managed to win two seats then. For the purposes of the argument, my party needs to have won a seat or two under the first-past-the-post system. In that Euro-constituency in 1992, the Labour Party would have gained four seats, the Conservatives two, the Liberal Democrats none—I assure the noble Lords on the Liberal Democrat Benches that I did not pick this example deliberately—and Plaid Cymru two. Clearly, I wish to influence the noble Lord, Lord Elis-Thomas, in the example that I have taken.
One must assume that the votes in the first and second ballots are the same. That may not be a justifiable assumption, but the matter must be approached in that way because that is all the information that is available. If one then calculates the four additional members, the Labour Party would get one additional member, the Conservatives two, the Liberal Democrats one and Plaid Cymru none. That seat would have a total of five Labour, four Conservative, one Liberal Democrat and two Plaid Cymru members.
Because I believe that this system is open to fiddling I have decided to play a tune. My tune is that in Wales the Conservative Party decides to divide itself. Some of my friends set up the Welsh conservative party; others
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set up the Welsh unionist party. We succeed in being registered as separate political parties. That is an assumption; we have not yet seen the Bill about the registering of political parties and it may not be possible. However, I ask the Committee to assume for the moment that that is possible. The Conservative Party will not appear on the second ballot paper and the unionist party will not put up any candidates on the first ballot paper. When the AMS system is calculated, the Labour Party will achieve no additional members, while the unionists will achieve three and the Liberal Democrats will still manage one. The total will be: four Labour (as opposed to five), five Conservatives and unionists (as opposed to four), one Liberal Democrat and two Plaid Cymru members.
Perish the thought that the Labour Party decides to register two separate parties, one the Welsh labour party and the other the Welsh co-operative party, to take a name from history. When that calculation is made, three co-operative members, no conservatives, one Liberal Democrat and no Plaid Cymru members would be on the AMS list. The result of that particular piece of fiddling would be the election of seven Labour and co-operative members, with two Conservatives, one Liberal Democrat and two Plaid Cymru members. Noble Lords will see what I meant when I said in a previous debate that the proportional representational systems were open to endless fiddling.
In 1997 the position from a democratic point of view—dare I say it—would be even more dramatic. The Conservatives could not play this game because we did not win any first-past-the-post seats but, by jove, the Labour Party could play it on the assumption that it registered separate parties. The Labour Party would stand in the first-past-the-post ballot and the co-operative party would not. In the second vote, the Labour Party would not stand but the co-operative party would. In 1997 the position was that the Labour Party gained six seats, the Conservatives and Liberal Democrats none and Plaid Cymru two. On the basis that the fiddle to which I referred did not occur and the Labour Party stood in both ballots, the Labour Party would have gained no additional members, the Conservatives three, the Liberal Democrats one and Plaid Cymru none. The end result would be six Labour, three Conservatives, one Liberal Democrat and two Plaid Cymru members. But if the Labour Party played the tune that I mentioned and set up a separate co-operative party, the additional member system would deliver three additional members to the co-operative party, one to the Conservative Party and—this is where the Liberal Democrats should be worried—none to the Liberal Democrats or to Plaid Cymru. Labour would gain nine seats, the Conservatives one, the Liberal Democrats none and Plaid Cymru two.
I believe that my arithmetic is pretty good. The premise on which I base it is: first, that the first and second votes fall the way that I have suggested; and, secondly, that the Conservative Party manages to split itself and register as the Conservative Party and as the unionist party and that the Labour Party registers as the Labour Party and as the co-operative party. I believe

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that in that event even the noble Lord, Lord Thomas of Gresford, would agree with me that fiddling could occur in a very big way.
I would not like the Committee to believe that my devious mind had thought this up on its own. It has not, although it may have done eventually. My attention was drawn to some remarks made by Mr. Ian Davidson, the Labour Member for Glasgow Pollok, in which he said that it would be an excellent idea if a separate co-operative party registered and stood in a separate ballot and the Labour Party did not stand in the second ballot but only in the first. That idea has been floated. It may be that perhaps it is just my fellow countrymen who are particularly devious, but I suspect that the contagion may spread to Wales when people see that they can take advantage of the system.
Lord Cledwyn of Penrhos: I point out to the noble Lord that the Presbyterians would not allow it!
Lord Mackay of Ardbrecknish: The Presbyterians would not allow it but in neither Wales nor Scotland not everyone is as firmly Presbyterian as that. The game could still be played.
Mr. Win Griffiths, Under-Secretary of State at the Welsh Office, was gratifyingly clear in another place. I quote his words with approval:
"I concede that there may be scope for collusion between and within parties to exploit the two-ballot structure of the additional member system in the manner…described. Such cynical manipulation of the system would be an affront to the electorate and would undermine the democratic credibility of the elected body".—[Official Report, Commons, 2/3/98; col. 804.]
I was gratified to read that.
He went on and made it quite clear on behalf of the Labour Party. He said on 25th March in the other place,
"On behalf of the Labour party I am prepared to say publicly and openly that my party will not try to deceive the electorate by entering into any such collusion. It would he easy for all the other parties in the House to make a similar commitment, which would kill the split ticket idea altogether".—(Official Report, Commons, 25/3/98; col. 629.]
The problem with these assurances, which I absolutely accept are genuinely meant, is this. Being a Presbyterian, I understand the existence of sin and temptation; and at some stage in the future the temptation is there. It is also actually there on another method of fiddling and that is that a minority party—a party which perhaps cannot achieve any first-past-the-past gains—stands only on the second ballot paper. The voters of the party with the overwhelming vote—let us say the Labour Party, in the case of the Euro-constituency of North West Wales—advises its members as follows: "You will be wasting your vote if you vote for us in the second ballot because frankly we have got so many on the first-past-the-post ballot that we are not going to get any top-ups. We suggest you go and vote for that minority party and they will achieve something on the AM system, and of course they will be our partners if we need partners when it comes to forming the assembly government."
This is actually done, I understand, in the German system. In some cases the major party—currently it is the Christian Democrats although at some stage,
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I imagine, it was the Social Democrats who did the telling—having won so many seats under the first-past-the-post system and knowing it will not get any top-ups, advises its electors to vote for the Free Democrats in the second ballot. This means that the Free Democrats, who did not win any seats under the first-past-the-post system, can actually achieve some seats in the Bundestag and therefore help the Christian Democrats to defeat the Social Democrats, who may well actually be the biggest party after the elections. So these are the two cases—
Lord Crickhowell: I thank my noble friend for giving way. Did he hear the noble Lord, Lord Thomas of Gresford, boasting earlier about pre-election deals between his party and the Labour Party?
Lord Mackay of Ardbrecknish: I did, but I feel that I have already annoyed the noble Lord, Lord Thomas of Gresford, sufficiently for one day and should therefore resist any temptation to say that the Liberal Democrats would consider any such deals. Indeed, although I am not allowed to quote, one of their Welsh Members in, I think, the Committee stage in the other place, indicated that the Liberal Democratic Party would not wish to abuse the system either. Mr. Livsey indicated that the Liberal Democrats would not wish to abuse the system.
However, the problem is still there. The two-vote system is open to serious abuse. I cannot quote a Welsh example, but I know it is seriously being talked about in Scotland and I suspect that if it starts in Scotland the contagion may spread to Wales. I would hate to see that happen. I would be tempted to stop it in the Scottish Bill as well. There are a variety of ways in which one could stop it. Indeed, my honourable and right honourable friends in the other place mentioned some. One is to link the first ballot to the second ballot so that if you do not stand in the first ballot you cannot stand in the second. That is a possible way out of the dilemma. But the simplest solution is to have one vote only so you only vote once, which is first-past-the-post. If your man or woman wins, their votes are then added up and become the basis of the additional member system. Any sleight of hand or fiddle is not possible because people have only one vote, exercised on the first-past-the-post system.
This is a genuinely serious problem. I accept that most political parties would not use these tactics but the very fact that they have been thought about in one particular constituency means that, particularly in Scotland where Labour would win all the first-past-the-post seats but would not, if my recollection is correct, win any later—as in North-West Wales where the Labour Party would win six first-past-the-post votes but would not get any of the additional four—there is (dare I say?) too great a temptation put before politicians. I beg to move.
The Deputy Chairman of Committees (Lord Strabolgi): I have to inform your Lordships that if this amendment is agreed to I cannot call Amendment No. 12.
Lord Hylton: The noble Lord, Lord Mackay of Ardbrecknish, described his own mind as being devious.

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I think I would prefer to call it fertile and ingenious. However, perhaps the "plain man's answer" to him is that these two votes should be cast on the same day and at the same time. Secondly, I suggest that the proposed registrar of political parties should have the strictest instructions not to register pseudo-parties.
6.45 p.m.
Lord Williams of Mostyn: It seems to me that what the noble Lord overlooks is that voters are not stupid, and since the whole basic premise of our democratic arrangements is that one trusts voters to have at least a grain of common sense—though not as much as anyone in your Lordships' House, of course—one begins on rather an unhappy basis. The noble Lord earlier was quite lyrical in his support of the first-past-the-post system—how it was stable and accountable—and as I was listening to him with care the year of 1951 floated into my mind. If I remember rightly, Labour then had the majority of votes in the United Kingdom but ended up with a minority of seats.
There is no electoral system presently known or capable of being devised by the human mind which is going to be perfect. Of course there is the potential for collusion. Some call it collusion and some tactical voting. I believe the Conservative Party has had knowledge of that in recent times following the re-held election where an original deficit of two turned into a Labour majority of well over 20,000. People do vote tactically. I beg your Lordships' pardon; I meant Liberal Democrat. Before the noble Lord says that there is a significant difference, I must make that clear.
This is a solution worked out by the fertile mind of the noble Lord, Lord Mackay. I shall not speculate on the nature of the fertiliser which produced the fertility but his proposals, I am bound to say, would bring about something which is really a further distortion. What he suggests I understand, is that voters are allowed one vote only for the constituency candidate. Then the votes for that candidate in each electoral region are aggregated to constitute a party list vote for that region. So a vote for a party candidate in a constituency is automatically going to be a vote for the same party list in the electoral region. There would be no option to vote for the party list. The composition of the list would have to be taken into consideration when making the constituency selection.
I believe that to be wrong. If we go back to the point, which was well raised and well dealt with by my noble and learned friend the Solicitor-General, and also raised by the noble Baroness, Lady Young, that one wants a constituency connection, why should that constituency connection be distorted by the fact that you would only have the one vote, and if you vote for your constituency member your vote is aggregated in the way that I mentioned? It means that the four additional members are reduced to the status of being indirectly elected. Why, in the context of Wales, if voters wish to vote for the candidate of one party in the constituency and the list of another party in the region, should they not have that choice?
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There are people, I am told—though I whisper it low—who might wish to vote Labour on the party list but who might want to vote either for a Liberal Democrat candidate in the single member constituency because they favoured that individual, or for a Plaid Cymru candidate because they favoured that individual—or because they wanted to show their belief in inclusiveness and diversity. Why should they not have that opportunity?
There is something much more important, I think. This proposal would have a serious, if not devastating, impact upon the ability of smaller parties to mount a realistic campaign. Not all small parties are by definition extremists. They have a democratic right to put themselves forward to the voters and the voters have the reciprocal right, I suggest, to the opportunity to consider whether to vote for them. For smaller parties, the main hope, life being such as we know it to be, of winning seats in the assembly may well be the party list vote in the electoral region.
Under the presently proposed scheme, in order to maximise its potential for party list seats a party would have to run candidates in every constituency in the electoral region. That is a daunting prospect for a small party, which would have to find suitable candidates and resources to contest between seven and nine constituencies per region. I offer this on a plate: it would have meant that the modern Labour Party could never have come into existence because in its infancy it would not have had the resources. The same would have been true of the nascent Liberal Party in the latter third of the 19th century and the same would undoubtedly have been true of Plaid Cymru because it would not have had the resource or candidates available to stand in every constituency.
Why should they be denied the opportunity to concentrate their resources to the best advantage? There might be constituencies in Wales where a single party—for instance, the Greens—had particular support and on which it wanted to concentrate. The noble Viscount, Lord St. Davids, made a point a long time ago, as it presently seems and actually is, when we were first discussing the principle of referenda and Welsh assemblies. He stated that we ought to have a tender consideration for the interests of those who are genuinely independent. The amendment tabled by the noble Lord, Lord Mackay of Ardbrecknish, would mean that no independent candidate would be able to run in the electoral region, and we believe that to be wrong.
There is the possibility for collusion. My honourable friend Mr. Win Griffiths gave the undertaking on behalf of the Labour Party that we would not in any circumstance attempt to deceive the electorate by entering into any collusion. The Liberal Democrats have said the same and I take it as axiomatic that had the noble Lord, Lord Thomas of Gresford, contributed to the debate he would have repeated his party's commitment. I do not believe that the voters are as stupid as people sometimes pretend. It would require a degree of sophisticated cynicism, and I accept that as a possible condition of the political scene, but it would require a good deal of organisation. Most people are

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unwilling to be organised on the basis of cynicism; they prefer to be organised on the basis of either idealism or ideology.
What will happen if there is collusion? The other political parties would rightly expose it. Undoubtedly, the media would be on to it like a dog on to a rat. In the end, that would do no good at all to the party which was trying to manipulate. I did not have my pencil to hand and therefore was unable to follow the noble Lord's subtle mathematical calculations concerning what might or might not have happened in certain elections in the northern part of Wales. He may well be right. However, if one acts on the basis that one is trusting the Welsh people to run their own affairs in an assembly for Wales, one might as well trust them to recognise what they would plainly regard as deceit being practised upon them.
The serious consequences which would inure from what the noble Lord said are much too gross a distortion of the right to stand and the right to vote. Although there is a point to what he said, I believe that his solutions are infinitely worse than the problems he predicates.
Lord Simon of Glaisdale: The noble Lord, Lord Williams, said that no electoral system is perfect. He carries approbation with that. Some are worse than others, and in my respectful opinion the party list is the worst of all. The party managers already have far too much power. We read of manoeuvres to stop X or Y becoming mayor of London. No one who has had anything to do with politics can fail to be aware of the omnipresent and far too powerful influence of party managers. The party list system gives them extra power. They can compile their own list of favourites and keep off those whom they do not favour.
That shows that we are rushing into the situation without any proper consideration of what is the best system of proportional representation, if we are to have one at all. The fault is not purely that of the Government, although our present situation is of their manufacture; it is also partly the fault of their predecessors. In Session after Session last Parliament, in debates on the Queen's Speech there were pleas for a Royal Commission on the constitution. It could then consider a number of interrelated questions which we are now trying to deal with separately; for instance, a referendum, an electoral system and second Chamber reform. There are many issues. The plea was made repeatedly, but one Government Minister after another came to the Dispatch Box and stated, in effect, that everything in the constitutional garden was lovely and that there was no need for an inquiry. Therefore, if the Opposition are now uncomfortable their leaders are not entirely blameless.
That does not by any means excuse the Government in rushing us into a system which is subject to grave disadvantages. A Royal Commission is one thing, but a two-party committee presided over by the noble Lord, Lord Jenkins of Hillhead, is quite another. I have been a colleague of the noble Lord in one place or another for many years and I have high respect for him. I should
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like to flatter myself with personal friendship. However, the proposal is not a satisfactory way of dealing with the matter.
Incidentally, the noble Lord, Lord Mackay, was right when he spoke on the referendum Bill that if we had no Royal Commission behind us the first thing to consider was where a referendum was appropriate and what type of referendum there should be; should it be pre-legislative, post-legislative, ask a number of questions or a single question? What was not suggested was the fudge in which two questions should be put together, outrageously so in the elections for a London mayor, as the Liberal Democrats pointed out. If a mayor of London necessarily involved having a corporation of London and vice versa only one question was justified. But no one claimed that and so we had the familiar fudge. We are now faced with the question of what type of proportional representation we shall have. A system which surrenders yet more power to the party managers is unacceptable.
I make one general comment. In the debate on an earlier amendment, I ventured to point out that the Bill has no political legitimacy. Perhaps I should modify that. Its sole political legitimacy is that in general, all parties wish it well. But that really demands a very different attitude from the Government; namely, one in which they are prepared to take your Lordships as a council of state and to show some reasonable flexibility. We have had no flexibility at all today.
I remember many years ago being concerned with the late Lord Runcorn on a licensing Bill in another place. He genuinely treated the committee as a co-operative body. He retained sufficient authority and was trusted to prevent the Bill becoming out of shape. But otherwise, he was prepared to consider amendments on their merits. Today, all that we have had has been negative. As the Committee will know, every one of the Minister's briefs end either with "accept", "reject" or "consider". The noble Lord, Lord Williams, is in charge of this Bill. It is entirely up to him what should be the response. In the circumstances, it should be at the very least "consider". It should certainly not be what we have had so far—"reject, reject, reject".
As regards this amendment, it seems to me from the Cross-Benches that the noble Lord, Lord Mackay, made a formidable case and I really believe that the Minister should be prepared to consider it on its merits.
7 p.m.
Viscount St. Davids: The noble Lord, Lord Williams of Mostyn, very kindly referred to the question which I raised when we debated the White Paper for Wales as regards independents. Is there to be any mechanism whereby independents will be able to appear on the additional member list?
Lord Mackay of Ardbrecknish: I am not sure whether my noble friend's question was directed at the Minister or myself. As I mentioned right at the beginning of the debate, Amendment No. 17 and subsequent amendments should have been grouped

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together because if my amendment were to succeed, there would not be a second list and therefore provision for independents on the second list would fall.
As presently constituted, there could be independents on the second list. However, I should be totally and utterly amazed if any independent ever gains enough votes in those large constituencies in order to achieve the breakthrough in an additional member system to reach the fourth position in Wales or the seventh position in Scotland.
I am grateful for the intervention of the noble and learned Lord, Lord Simon of Glaisdale, whose approval of devolution is well known—he has voiced it on a number of occasions. I hoped that the noble Lord, Lord Williams of Mostyn, might show a slight glimmer that he understood the problem that I was posing. Certainly his honourable friend in the other place understood that. The problem is real. My solution may not be the best one and it may be open to more debits than credits, but the problem is real; it exists.
I did not suggest for one moment that voters are stupid. Indeed, the whole case I made was that the voters are intelligent and will see how to manipulate the system. If we take the North Wales Euro-constituency at the last election, every Labour voter would see the situation perfectly clearly. The Labour Party won six out of the eight seats on first-past-the-post. It was a waste of their time voting for the Labour Party in the second ballot. Therefore, they would see very clearly that the sensible and intelligent option for them was to vote for the Welsh Co-operative Party in order to make sure that their party, in combination with the Welsh Co-operative Party, would have the overwhelming majority of seats in the Welsh assembly. Far from thinking that the electorate could be duped by this, I believe that many voters would see that that was the only way to prevent their vote being totally and utterly wasted.
I deal now with squeezing out small parties. I know that I trotted out figures. I was conscious of the fact that it is not always easy to remember all the figures and the relationship between them. However, in north-west Wales at the last election, if a method were found to stop fiddling along the lines I suggested, then the Liberal Democrat Party—in that case, it could reasonably be described as a small party—and the Conservatives Party would gain one seat and three seats respectively. However, if the fiddle I fear were to happen did happen, the smaller of the two parties would be squeezed out entirely. The Liberal Democrats would not win any seats and the Conservatives would win only one because the co-operative party would win three of them. Therefore, far from my method squeezing out small parties, if that manipulation were carried out—and I concede that it is a big "if"—the small parties would be squeezed out. The whole point is that the big player would not only win seats on the first-past-the-post system, but would also, in his alter ego, gain seats through the additional member system.
The Minister did not convince me at all that my problem is not a real one. Indeed, it does happen in Germany. People do understand that entirely. If you are a Christian Democrat and you want your party to run
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the country—after all, that is what the first-past-the-post system allows your party to do when it wins—you achieve that in certain circumstances where your party is a heavy beneficiary of first-past-the-post by using your second vote for the minority party which will form a coalition with you. In that way, you can make sure that your party, with a minor partner, wins even though the other party which is sitting on the opposition benches has gained more seats than anybody else. That is the reality of proportional representation.
I am sorry that the noble Lord has not given an indication that he appreciates the point I was making. I understand that my amendment would remove the cross-voting which people see as a merit in the additional member system. I do not see that, but I understand the argument in favour of cross-voting being available in the additional member system.
However, the Government should see whether they can arrive at a better answer than that which I have managed to achieve today. They must try to defeat that sort of fiddle happening in the future. I shall read with great care what the Minister said, although, in all honesty, it will not take me very long. I shall also turn my mind to other methods of achieving the same result; namely, to stop serious fiddling of which we have already been given notice by a Labour Member of the other place. With that, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 12 to 14 not moved.]
Clause 4 agreed to.
Clause 5 [Additional member system: party lists and individual candidates]:
Lord Roberts of Conwymoved Amendment No. 15:
Page 3, line 25, at end insert ("who shall publish the list at the earliest available opportunity and ensure that it is clearly displayed at each polling station in the Assembly electoral region.").
The noble Lord said: This is a fairly simple amendment to ensure that the returning officer publishes the list. Along with my noble friend Lady Young, I believe that the entire PR system as drafted by the Government will come as a considerable surprise, if not a shock, to the Welsh electorate. They are not accustomed to voting simply for a political party. They like to have the ability to choose between candidates. They like to know their representative personally. They are now to be confronted with a closed list system in the five electoral regions for the election of 20 assembly members. They will have to vote for a party and a list of candidates standing in its name. They will not know the party's order of preference for its candidate unless the party chooses to reveal it. Personally, I should have preferred an open list where the votes are cast for individual party representatives rather than the parties themselves. However, that is not the Government's proposal. As I understand it, they have decided against what I call the Belgian system or, indeed, any adaptation of it.
It seems to me that the least we can do on the face of the Bill is to insist that the regional returning officer "shall publish" the lists of party candidates when they are submitted to him. It is possible that the parties will

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do so in any case, but they are under no statutory obligation. We certainly believe that Welsh electors are entitled to know, when they vote for a particular party, who may be elected to the assembly as a result of their vote.
There is, of course, a further reason for publication of the lists; namely, their continuing importance in the period between elections in the event of a vacancy occurring among the additional members in a particular region. The successor will be the next on the list from which the vacating member has withdrawn. Obviously, it is important that he should know just where he stands on the list in between elections. I commend the amendment to the Committee. I beg to move.
Lord Williams of Mostyn: In my response, I shall speak to Amendments Nos. 15 and 16. I believe that the noble Lord's remarks have a good deal of validity. We are indeed considering a number of options, including the suggestions which are described and encompassed in Amendment No. 15. In the London referendum, the ballot paper question was shown on a notice in every polling station and on every polling station compartment. We are looking at the possibility of doing something similar as regards displaying party lists.
However, we have to be careful that we do not prejudice the chances of independent candidates who may also want to stand for the electoral regions. The answer to the question posed earlier by the noble Viscount, Lord St. Davids, which I was not in a position to deal with at the time, is yes. There will be the opportunity for independents to stand for election. We must ensure that we look after the independent candidates rather than just flooding them with information about the party lists.
Some polling stations are very small; indeed, they are only caravans. So we shall also need to consider that. Our officials are discussing the practicalities of the suggestions made by the noble Lord with representatives of the elections administrators in Wales. I hope that the noble Lord will find that a helpful response. My only lasting and continuing regret is the fact that the noble and learned Lord, Lord Simon of Glaisdale is, yet again, not present in the Chamber when I am being accommodating to suggested amendments.
As regards publishing the lists as soon as possible after their having been submitted, I am bound to say that, in principle, that seems a thoroughly sensible idea. After all, at parliamentary elections, the acting returning officer is required to publish a statement of the persons nominated once the period of making objections to nominations has expired. We shall need to make similar provision for the assembly elections, and we are considering the practicalities of putting into effect the general approach which has been indicated most helpfully by the noble Lord, Lord Roberts.
There are details involved, but not unimportant ones. We are in the process of drawing up an assembly elections procedure order which will lay down the rules and regulations for the conduct of the assembly elections. That is the appropriate vehicle, but it can only approach putting principle into effect if we consider
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with care the ideas which have been put forward. I assure Members of Committee and the noble Lord that we shall do so. The elections order is intended to be subject to the affirmative resolution procedure in this Chamber and in the other place. We anticipate it being presented to Parliament before the end of this year. Therefore, I give my undertaking—I hope, co-operatively—that we shall look at the suggestions made, which I certainly regard as constructive. That being so, I shall ask the noble Lord to withdraw his amendment in due course.
Amendment No. 16 is essentially technical. It specifies that the list submitted to a regional returning officer by a political party has legal force for the purposes of the coming election to which it relates and remains in force for the term of the assembly elected at that election. So the lists submitted to the regional returning officer will be used for allocating any additional member seats to which the parties may be entitled. The appropriate party list will be used to determine the filling of vacancies in electoral region seats between ordinary elections. I hope that my amendment is regarded as a helpful one. I believe that it is entirely consistent with the observations put forward by the noble Lord when he proposed Amendment No. 15. Therefore, I invite the noble Lord to withdraw his amendment.
7.15 p.m.
Lord Roberts of Conwy: I am most grateful to the Minister for that reply. We look forward to the further development of the idea of publishing the lists. I shall be only too happy to withdraw my amendment.
However, with regard to the Government's amendment, to which the noble Lord has just spoken and the validity of the list in between elections, my impression is that the party has to be notified in the first instance, rather than the returning officer, if the candidate chooses to withdraw. It seems to me that all the emphasis is on the party in that context and that not enough regard is being paid to the interests of the individuals on the list. Indeed, a great deal can happen to individuals on the list in the course of the best part of four years between elections. It seems to me that there should be some provision whereby a candidate can withdraw without necessarily going through the party. Nevertheless, I beg leave to withdraw my amendment.
Amendment, by leave, withdrawn.
Lord Williams of Mostynmoved Amendment No. 16:
Page 3, line 25, at end insert—
("() The list has effect in relation to—

(a) the ordinary election, and

(b) any vacancies in seats of Assembly members returned for Assembly electoral regions which occur after that election and before the next ordinary election.").

On Question, amendment agreed to.
Lord Mackay of Ardbrecknishmoved Amendment No. 17:
Page 3, leave out lines 32 and 33.

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The noble Lord said: I indicated earlier that the principal reason for this group of amendments was that they teamed up with the previous group, in respect of which I discussed the problem of manipulation of the double-ballot system. I said then that I probably would not move these amendments unless something occurred to me. I have to say that something has indeed occurred to me, which I should like to share with Members of the Committee. I ask the Minister not merely to comment upon it but, even more importantly, to think upon it.
Towards the tail end of my observations on the last amendment, I said that I doubted whether an independent candidate would ever be able to achieve enough votes on the four-member additional system by the d'Hondt method to succeed in being elected. I do indeed think so in the case of a genuine independent. However, having got myself into a devious frame of mind as a result of the last amendment, it occurs to me that a person posing as an independent candidate, who in fact is a member of a considerable party worthy of high repute, could decide to stand as an independent in the additional member system.
The advantage would occur only in seats like the one that I instanced for north-west Wales when the Labour Party—indeed, it could be any of our parties—won such a significant share of the first-past-the-post seats that it really was not achieving any additional member seats. For example, Mr. Ron Davies, who has achieved devolution for Wales, might decide that he could easily stand in north-west Wales as an independent candidate. In that second vote, the Labour votes would no longer be wasted; they could all vote for Ron of the assembly. I presume that is how these things happen in Wales, or at least it does in the films about Wales that I have watched. As I said, they could all vote for Ron of the assembly and he would get all those votes and would take one of the additional member seats. For the life of me I cannot see any way that could be avoided.
I accept that that example is slightly flippant, but it is not completely flippant. Someone could be elected because of his or her well-known prominence as a member of a political party and through taking the independent route on the additional member system, safe in the knowledge that he was so well known by the supporters of the Labour Party, the Conservative Party, the Liberal Democrats, or Plaid Cymru, that he would achieve more than enough votes in the second ballot from his own party members to enable him to gain a seat via the d'Hondt system.
I accept that the fertile minds in the Welsh Office have probably not come up with this particular wrinkle. The Minister may perhaps wish to reflect on it. I would be grateful to hear his thoughts on what I think is a less likely way round the system than the one I mentioned a few minutes ago, but nevertheless I believe that it exists. I beg to move.
Lord Williams of Mostyn: These amendments would mean that independents would not be able to stand for election in electoral regions. Speaking for a Labour Government, I abominate the suggestion that
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there should be any undue party control over who should stand in elections. I share the horror that was expressed by the noble and learned Lord, Lord Simon of Glaisdale, that that should be in anyone's contemplation. It is true that independents do not always win elections, but sometimes they do. At least four, five or six of us will remember what happened at Merthyr Tydfil when the late S.O. Davies refused to stand down. A party representative was put forward and S.O. Davies, who in effect stood as an independent—I do not think one could ever contemplate anyone more independent than the late S.O. Davies—roundly trounced the party candidate. As I said, on occasions, independents can win. If we want a pluralist democracy, which we do—we have demonstrated that in our entire approach to the assembly—there ought to be the opportunity for those who wish to represent no party to stand as independents.
Lord Mackay of Ardbrecknish: I am grateful to the Minister for giving way. .I understand the point he is making. Much to the detriment of my party, an independent won a seat at the previous general election. He is not present today but I believe that the noble Lord, Lord Taverne, won a seat as an independent. I do not dispute that proposition. I have no problem with that. I do not think that my amendments were designed to deal with the first ballot which, of course, would have allowed all the people we have just discussed to stand for first-past-the-post seats. The problem I highlighted concerned the second, top-up ballot. I was not sure whether the noble Lord would discuss that. In case he did not, I thought I might try to prompt him.
Lord Williams of Mostyn: I was just about to turn to that; in fact my tongue was already pronouncing the first syllable of it. One of the problems of the noble Lord's approach is that—as I ventured to suggest earlier—his solutions are worse than the problems which he claims to identify. Does one want representatives of small parties to have the opportunity to stand for election? The answer from the Government's point of view—and, I believe, from that of the Liberal Democrats—is yes. Do we want independents to have the opportunity to stand for election? The answer is yes. If amendments are proposed which negate the possibility of that occurring, they are not a sign of an inclusive, pluralist society or assembly.
The noble Lord said that in certain circumstances, given a certain fertility of mind—to use his term—one can produce scenarios which may not necessarily please him and may not please the rest of the Committee. It is, I suppose, the bogeyman approach to electoral reform. I take the point that in some circumstances—as no system is perfect—results will occur which would not be welcome either to the noble Lord or to me, but that is democracy. We cannot always have what we regard as a perfect solution if we trust the people. We believe that the system we have will be representative and will be constituency-member related for the reasons that the noble and learned Lord the Solicitor-General outlined earlier. It will allow those parties which have no success in present circumstances under the first-past-the post system the chance of obtaining reasonable representation.

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I have now found my pencil and will do my own calculations. If the Conservative Party in Wales obtains 20 per cent. of the votes in the assembly elections, it will probably have about 12 members; in other words, a perfect fifth. That is a benefit. I do not particularly want Conservative members in the assembly as a matter of practice, but as a matter of principle alternative views should be adequately and reasonably represented, to use the phrase that the noble Lord, Lord Thomas of Gresford, mentioned earlier.
Lord Mackay of Ardbrecknish: I am grateful to the noble Lord for those comments. This is Committee stage and therefore I believe we can pursue this matter a little further. My concern is not that which the noble Lord appears to express. My concern is that a political party which is in a dominant position could easily persuade its voters—I could be easily persuaded in this circumstance—to use the second vote in the alter ego way I suggested in my earlier amendment, or to support an independent who was quite clearly a leading member of that party. It is that circumstance that I am concerned about. That process would block out the smaller parties, as I explained with regard to my previous example. I have not given a worked example on the problem that we are highlighting at the moment. I am sorry to keep on about the Labour Party but it holds all the seats we are discussing. However, this matter could equally arise if my party held all the seats in an area. If the Labour Party was to gain no seats under the additional member system—that is what would happen in north west Wales—one way round that would be the way that I suggested earlier, and another way—
Lord Thomas of Gresford: Will the noble Lord give way?
Lord Mackay of Ardbrecknish: I am replying to the point made by the Minister. We had better not have interventions on top of interventions. My worry is that an independent who was really a Labour Party man could stand, mop up these Labour votes which would otherwise be wasted, and find a way round the legitimate additional member system and—dare I say it?—probably knock out the Liberal Democrat's fourth representative in that constituency.
Lord Williams of Mostyn: I rise to speak to enable the noble Lord, Lord Thomas of Gresford, to intervene.
Lord Thomas of Gresford: I am constantly irritated in the debate between "Lestyn" Mackay and "Taffy" Falconer by the reference to north west Wales. This is the north Wales constituency. That is my point.
Lord Williams of Mostyn: The Labour Party has given a categoric assurance that we shall not do such deals, as have the Liberal Democrats. I imagine that Plaid Cymru would have the same view.
Lord Elis-Thomas: In view of the persistence of the Minister I am pleased to give that assurance.
Lord Williams of Mostyn: That leaves only the Conservative Party, as far as I am aware. If that party gives that assurance, we can all rest happy not in our beds but at our supper.
Lord Mackay of Ardbrecknish: I am certainly happy to give that assurance. However, if I may say so, that would be the same as asking us to give assurances about many other matters which concern electoral law; namely, that we would not do this, that or the other which is against the law. While that may be a good debating point for this Chamber, I do not think it is valid from the point of view of having a proper legislative framework. However, having made my purist point on that, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 18 not moved.]
Baroness Farrington of Ribbleton: I beg to move that the House do now resume and that the Committee stage be adjourned until not before 8.30 p.m.
Moved accordingly, and, on Question, Motion agreed to.
House resumed.

Public Interest Disclosure Bill
7.28 p.m.
Lord Borrie: My Lords, I beg to move that this Bill be now read a second time.
It is a pleasure and an honour to introduce this Bill into your Lordships' House. It passed through another place with strong support from both the Government and the Opposition. I pay tribute to both Mr. Richard Shepherd MP and to the Minister of State at the DTI, Mr. Ian McCartney, for the careful consideration that they and their advisers gave to this matter. The results of that careful consideration can be seen not only in the detail of the Bill but also in the support that the Bill has received from the CBI, the Institute of Directors, the TUC, consumer groups, various professions such as the medical, legal and accountancy professions, and numerous other bodies.
I myself have particular reasons to be proud of this measure as it is, to a large extent, based on the work of a charity, Public Concern at Work, which I helped to found some six years ago. It was not an easy initiative to launch, but its importance was recognised at the outset by, among others, the noble and learned Lord, Lord Oliver of Aylmerton, the noble Lord, Lord Gladwin of Clee, the noble Baroness, Lady Dean of Thornton-le-Fylde, the noble Lord, Lord Alexander of Weedon and the noble Baroness, Lady Wilcox. They all kindly offered support and advice to help the charity to find its feet. It also had the advantage of securing the services of Mr. Guy Dehn as director. He has been indefatigable in assisting with this Bill and, indeed, with the work of the charity generally.
There is one other noble and learned Lord I must particularly thank. I refer to the noble and learned Lord, Lord Nolan. Under his chairmanship, the Committee on Standards in Public Life championed the work of the charity and the issue which lies behind this Bill. Indeed, the noble and learned Lord and his committee took up

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the issue with such eloquence that I can best summarise the purposes of this Bill by quoting from his committee's second report:
"All organisations face the risks of things going wrong or of unknowingly harbouring malpractice. Part of the duty of identifying such a situation and taking remedial action may lie with the regulatory or funding body. But the regulator is usually in the role of detective, determining responsibility after the crime has been discovered. Encouraging a culture of openness within an organisation will help: prevention is better than cure. Yet it is striking that in the few cases where things have gone badly wrong in local public spending bodies, it has frequently been the tip-off to the press or the local Member of Parliament—sometimes anonymous, sometimes not—which has prompted the regulators into action.
Placing staff in a position where they feel driven to approach the media to ventilate concerns is unsatisfactory both for the staff member and the organisation".
While the committee's words referred explicitly to public bodies, the issue it addresses does sadly apply to the private and voluntary sectors as well.
The official reports in recent years into the Zeebrugge ferry disaster, the rail crash at Clapham Junction, the explosion on Piper Alpha and the scandals at BCCI, Maxwell, Barlow Clowes and Barings have all revealed that staff were well aware of the risk of serious physical or financial harm but that they were either too scared to raise their concern or that they did so in the wrong way or with the wrong person. This culture, which encourages decent ordinary citizens to turn a blind eye when they suspect serious malpractice in their workplace, has not only cost lives and ruined livelihoods, but it has also damaged public confidence in some of the very organisations on which we all depend.
The purpose of this Bill is to give a clear signal to people in places of work up and down the country that if they suspect wrongdoing, the law will stand by them provided they raise the matter in a responsible and reasonable way. Where a worker is aware of fraud, a price-fixing cartel, the sexual abuse of a child in a home or a danger to health, safety, or the environment, or some other malpractice, this Bill provides welcome and much needed guidance.
If today a worker feels unable to raise the matter with his immediate manager, for whatever reason, he may well feel that the only options are to stay silent or to blow the whistle in some underhand way, perhaps by leaking information anonymously to the media. Once this Bill is enacted and taken to heart by the British people, which I am sure it will be, there will be a much improved chance that concerns about dangers to the public interest will be raised and addressed within the organisation itself. Where there are good reasons why such concerns cannot be raised and resolved internally, the Bill sets out a tight structure whereby the concern can be raised outside the organisation, thereby protecting the public interest. Where the worker follows the Bill's framework and satisfies its requirements, he will be protected from victimisation and can bring a claim before an industrial tribunal if he is victimised.
As to that protection, the Bill provides that where a worker is disciplined or demoted for raising such a concern, he can apply for relief to an industrial tribunal
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and be awarded such compensation as is just and equitable. Where, however, he is dismissed, his remedies are not set out on the face of the Bill but are to be determined by regulation. That is because the Government rightly recognise that the matter warrants careful and further consideration. There has been much support for the view that, like discrimination legislation, awards under the Bill should compensate for the victim's loss where he loses his job. There is alternatively the option, favoured by the Government, that the awards should follow the best available under employment law, such as those provided for health and safety representatives. These not only substantially exceed the normal awards in employment cases, but also include specific incentives to encourage the employer to take back a worker who has acted in the public interest. Bearing in mind the wider implications any departure from existing employment provisions will have, I hope the House accepts the Government's case that they should consider the matter further, not least in the light of the forthcoming proposals on fairness at work.
Your Lordships will have gathered that this Bill is to be part of wider employment legislation. However, recognising the importance of the issue, it covers individuals such as trainees, homeworkers and professionals in the NHS who are not normally protected by employment law. While its scope is wide, the House should note that it does not cover the genuinely self-employed, the intelligence services, the armed forces and the police. As to the last category, however, I am pleased to report that the Government undertook in another place to ensure that police officers are to be provided with comparable protection to that provided in the Bill.
I turn to how the Bill will work in practice. Clause 1 incorporates new provisions into Section 43 of the Employment Rights Act 1996. As a starting point, it clearly directs the worker towards raising the matter internally first. What will be Section 43C will afford protection where a worker raises within his own organisation an honest and reasonable belief about one of the specified malpractices. New Section 43E will provide like protection to staff within public bodies who raise such concerns with the sponsoring department.
The Bill then addresses the particular circumstances where an external disclosure of the concern is protected. First and most importantly, new Section 43F will provide something of a halfway house in that it recognises the particular role of regulatory authorities which are charged to oversee and investigate malpractice within organisations. Where a regulator—it might be the Financial Services Authority or the Health and Safety Executive—has been prescribed for the purposes of the Bill, a worker who contacts them will be protected if, in addition to the tests I have referred to for internal disclosures, he also reasonably believes the information and any allegation within it is substantially true.
Where a wider disclosure is made, the worker must not only pass the tests that apply to disclosure to prescribed regulators, but also the additional hurdles set out in what will be new Sections 43G and 43H. New Section 43G will address the circumstances in which a

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disclosure is made to the police, a professional association, a regulator which has not been prescribed by Ministers, and the media may also be capable of protection. As to such disclosures, your Lordships will be pleased to note that these will not be protected where their purpose was the personal gain of the worker.
Apart from deciding whether the particular recipient of that disclosure was appropriate, the tribunal must be satisfied that that disclosure was reasonable, having regard, among other things, to the seriousness of the threat to the public interest, whether the danger is continuing or likely to occur again, whether the disclosure was in breach of an obligation of confidentiality owed to a third party and, where appropriate, whether use was made of any whistle-blowing procedure which the organisation had in place. Most importantly, the Bill indicates that such wider disclosures—wider than one's own employer or specified regulator—should be protected only where the concern had been raised internally or with a prescribed regulator first, in which the reasonableness of his response will also be the key issue.
This requirement within the Bill's structure that the concern should have been raised first does not apply where the worker can demonstrate a reasonable belief that he will be victimised or that evidence of the malpractice will be destroyed or covered up. Equally, no such conditions presently exist where the matter is exceptionally serious, such as the sexual abuse of a minor, an issue addressed in Section 43H.
As I hope I have made clear, this measure will encourage people to recognise and identify with the wider public interest and not just their own private position. It will reassure them that if they act reasonably to protect the legitimate interests of others who are being threatened or abused, the law will not stand idly by should they be vilified or victimised.
It is not my view, in the light of my experience with the charity Public Concern at Work, that serious malpractice is endemic or widespread in organisations throughout the country. However, I am satisfied that when it occurs, the law needs to be strengthened so that those decent people who too often stay silent for fear of losing their own job are protected. I mention as one example the case of Judy Jones who was the deputy matron in a nursing home in Yorkshire. She suspected that the manager of the home was sexually abusing women in his care suffering from senile dementia. She could not raise the issue with the manager or the owner who was the manager's wife. Her fear was that if she went to the authorities it would be the manager's word against hers and her career might be destroyed. Fortunately, with the assistance of the charity, she collected incontrovertible evidence before she contacted the police. It subsequently transpired that the manager had been sexually assaulting people in his care for some nine years; and last February he was gaoled for four years. As one victim's family said, "If it hadn't been for Mrs. Jones, it could still be going on and no one would ever have known".
I hope your Lordships will agree that the situation in which Mrs. Jones found herself is an invidious one and one which we should not allow to flourish unchecked.
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This Bill addresses that dilemma in a sound and practical way while protecting the interests of responsible employers. As such, I commend it to your Lordships' House. I beg to move.
Moved, That the Bill be now read a second time.—(Lord Borrie.)
7.42 p.m.
Baroness Turner of Camden: My Lords, I welcome the Bill. It provides long needed protection for employees who whistle-blow on unsafe, fraudulent and other undesirable practices by employers. I am glad to note that it is welcomed by both the CBI and the TUC, and although substantially about employment rights it is regarded as a public interest measure.
I am particularly glad that it has been introduced. I recall with, I may say, some pride that when I had been a Member of your Lordships' House for several years I was successful in introducing a Private Member's Bill designed to give employment protection to employees engaged in North Sea oil ventures who blew the whistle on unsafe practices. My noble friends Lord Wedderburn and Lord McCarthy and I worked together to introduce the Bill following the appalling "Piper Alpha" disaster. Many of the employees were engaged on short-term contracts and although some were apprehensive about the level of safety precautions they were unwilling to risk continued employment by exposing the problems involved. I was briefed by my union, MSF. We managed to get the Bill through this House and it was later approved in another place. It was then absorbed into a more comprehensive Health and Safety at Work Act.
The present Bill goes much further than that of course. It deals not only with health and safety issues, but fraud and other malpractices. I note from the Bill that a qualifying disclosure within the terms of the Bill occurs when this is made to a "prescribed person". It seems to me that for some workers an appropriate person might often be his or her union representative. The union might be expected to have the appropriate knowledge of the way to proceed and whether the failure concerned was of a sufficiently serious nature to qualify under the terms of the legislation. That raises a further point in my mind. It might well be said that a recognised union holding a collective bargaining agreement with the employer is clearly an appropriate person within the meaning of the new Bill. However, as the "Piper Alpha" disaster disclosed, unsafe practices often occur in situations where the employer is anti-union and refuses union recognition, making it as difficult as possible for the union to recruit.
In such circumstances, the individual employee who has detected something unsafe, or a serious failure within the meaning of the legislation, is in even more need of protection if he reports the circumstances to his union official. I would welcome the Minister's comment on that.
Other issues also occur to me. I note that enforcement of employees' rights is, as one would expect, ultimately to be a matter for employment tribunals and, I assume, for the EAT. I am concerned, as many are, about the

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level of work that might be imposed upon the system. It is true that a recent Bill, now the Job Dispute Resolution Act, has introduced another means of dealing with straightforward unfair dismissal cases via arbitration. That should lighten the workload somewhat.
However, colleagues who are more involved with ETs and EATs than I am are concerned about whether sufficient resources will be made available to deal with these new tasks. I therefore welcome the Minister's comment on that when he replies to the debate.
Finally, I wish to raise a point that has already been discussed in Committee in another place—the cap on levels of compensation. I think that the issue could be important. I note that the Government wish to stay within the limits imposed within employment law. However, as my noble friend Lord Borne said, the Bill is intended to deal with fraud and malpractices of all kinds. The Maxwell and BICC cases come immediately to mind, but there have been other less publicised cases.
People capable of bringing malpractice to the attention of the appropriate authorities in such cases are likely to be specialist and managerial personnel. It is clear from what is now known about the Maxwell affair that people who might have been able to throw some light on what was going on were too intimidated to come forward. They would have risked not only the jobs they then had; they might not have been able to find anything else in the same specialism. In other words, a whole career could have been put at risk. In such circumstances, a cap does not seem a good idea.
There is an even more pressing need to look at the cap. The employer is ordered by an employment tribunal to reinstate an employee. Let us suppose that that employer stubbornly refuses to do so. That is likely to occur in only a small minority of cases. But in such instances, when the case is finally settled, a cap on compensation offered does not seem appropriate. When I was a union official, I remember a case where reinstatement was ordered by the tribunal. It took four years before the case was settled. In such circumstances, it does not seem reasonable that a cap should be applied to the compensation eventually paid.
I am pleased that it is accepted that there has to be some protection against false allegations. That is clear from the Bill and from what my noble friend Lord Borne said. Presumably that is the reason for saying that qualifying disclosure will not apply if the individual makes disclosure for personal gain. I welcome that.
In these days when the media are so totally irresponsible, and interested so much in sensation, that is important. I note that in another place my honourable friend made it clear that simply going off to the press rather than attempting to raise the issue in the first place internally would not be acceptable. The disclosure should be to a "prescribed person" able to deal with it in an informed and responsible way.
I commend the Bill. I have raised a few points that I think are of some interest. However, I have no doubt that overall it is greatly to be welcomed. I congratulate my noble friend on introducing it.
7.48 p.m.
Baroness Dean of Thornton-le-Fylde: My Lords, I welcome the Bill and support it. I congratulate my noble friend Lord Borne on introducing it to the House. I have to declare an interest, although my noble friend has declared it for me. I, too, am a member of the charity Public Concern at Work. I supported that organisation when it was founded because of my practical experience as a trade union officer. Over a number of years I have seen the often traumatic situation in which employees found themselves.
As a result of those experiences, I quickly formed the view not only that this kind of measure was necessary, but that it would be brought about only if there was wide consensus across the whole range of employment activity, not merely among trade unions but among businesses and various institutions. It is to the credit of the charity that it has been able to bring together a large group of support. One would expect support from the TUC; but it has come also from the CBI, the Institute of Directors and large public companies, and not least from both Government and Opposition Benches in the other place.
This is a practical Bill. It is short—it has 18 clauses—but, my goodness, I wish it had been around some years ago! It would certainly have made the lives of employees in Britain in certain selected cases far easier, and made it easier for them to rest in their employment. Such matters can be traumatic. Even if an employee is represented by his or her union, the issue that he or she may feel they need to raise may not necessarily affect them individually; it may affect a third party. It may be a health and safety issue in relation to the production process which does not affect the employees, but affects the user of the goods in question.
I was involved in a practical way in the early stages of the Maxwell pensions scandal. I know one person in the UK who will be delighted today that the Bill is being introduced in this place. He is a man called Harry Templeton. He was a trustee of the Maxwell pension fund at the Scottish Daily Record. Harry had been employed by the company for many years before Maxwell owned that newspaper. From the information he had, Harry Templeton felt that the pension fund was going wrong, and he raised the issue at a formal trustees' meeting. As a result, he was sacked by Maxwell, who would not take him back.
As a result of legislation enacted by the previous government, it was impossible for us to take collective industrial action to force his re-employment. As general secretary of the trade union, the best I could negotiate for Harry in those "hands tied behind our backs" circumstances was a cash settlement. Although the settlement was high, that outcome was disgraceful. He had raised a genuine concern many months before that scandal in overall terms hit the headlines. Had this legislation been on the statute book, it would have helped Harry Templeton and would have kept him in employment. And—who knows?—it may have helped those thousands of workers who subsequently had many sleepless nights—many of whom indeed lost much of their pension provision.

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Having a piece of legislation on the statute book is a great thing. If you are a member of a trade union, the union will make sure that you know about it. But if you are not in a trade union, it is important that you know that the Act is there. I can think of many isolated situations in which an individual employee knows that something is wrong, wants to speak out and yet does not know where to turn. In those circumstances, it is not unusual for an employee possibly to visit a citizens advice bureau, where he may receive help. But how can he or she share what may be private information without being protected?
As a trade union officer, I raised those kinds of issues. However, I was not employed by the company; I was a full-time union officer. One of the concerns I have in relation to the Bill, welcome though it is—and it is a tremendous step forward—is the fact that the Bill does not provide specifically and clearly for trade union representatives to be able to speak out on behalf of an individual employee who, despite legal protection, may be absolutely terrified about raising an issue. Working people quite often do not have great self-confidence. If they know that something is wrong, they need an arena in which to discuss the matter. In some cases that situation is covered under the Bill. But sometimes, in order to have the self-confidence to raise such issues, people may need a third voice to speak for them. I am therefore concerned that the Bill does not provide clearly for such trade union representation.
My noble friend Lady Turner of Camden raised the issue of capping on compensation. I am concerned about that matter too. It may be argued that if reinstatement is required and the employer does not do it, capping is not an issue. I do not accept that. I see this as a weakness that needs to be addressed.
Those are my two key concerns. However, they do not in any way prevent me from giving the Bill my wholehearted support. It is a step forward. I know that many employees will feel a confidence that they may not have felt before when they believe that matters are going wrong—and not necessarily for them as individuals: in the example I have given, Harry Templeton was concerned about his fellow workers; and when he spoke out, he lost his job. This Bill will help prevent such a situation. It will build on employment guidelines to which employers will have to refer when they would like to respond aggressively—as they do from time to time—and in a way that is damaging to the employee. I support the Bill despite those two reservations. Perhaps the Minister will comment on those points when he replies.
7.56 p.m.
Lord McCarthy: My Lords, this is an excellent and overdue Bill. Those of us on this side of the House only want to probe as to the detail of the Bill because it has not received a Second Reading before coming before the House.
All I wish to do is explore a point made by several previous speakers. It relates to the role of the employer.
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As the noble Lord, Lord Borne, said, the assumption behind the Bill is that in the first—the primary—instance, the worker who has a problem will go first to his or her employer. The explanatory memorandum states that in general it is envisaged that the matter has been raised with the employer, or with the prescribed regulatory body.
I suggest that we examine the type of matters for which this Bill will be used. We may take, for instance, the example of Mrs. Jones, cited by the noble Lord, Lord Borne. That relates to the type of matter that an employee might very well feel he or she cannot take to the employer. In cases such as a criminal offence, a miscarriage of justice, some danger in the machinery, some situation where an employee believes the employer has concealed information, to whom does he or she go? On the employer's side, one can go to an immediate superior with these matters; or possibly the level above that; or perhaps the managing director? To whom do you go? I suggest that in the majority of cases employees may very well not feel confident in such a case in going to anybody on the management side. Yet the Bill envisages that in general the matter has been raised with the employer. I question how far that is likely to be the case, and ask the Government to comment.
It will be said, as it was by the noble Lord, Lord Borne, that there are exceptions. If I am correct, the Bill envisages six situations in which a person does not go to his or her employer. The first is when the matter does not involve the employer but is related to the misconduct of some other person. In that case a person is covered if he or she does not go to the employer first. A second exception, introduced in new Section 43D, is when an employee goes to a lawyer. In relation to the comment made by the previous speaker, why does that not apply if he or she goes to the union representative? Why should the union representative not be protected in the same way? That is the second case: the employee may go to some adviser, possibly a lawyer. If a lawyer is consulted, the employee does not have to go first to the employer. As I understand it, if the issue has no element of confidentiality, a person might be able to avoid the employer. If a person is likely to be victimised or penalised in some way, that may be possible. If there is some residuary body, such as the Health and Safety Commission, it may be possible to refer the problem to that body rather than go to the employer. And the most difficult circumstance for the average worker, introduced in new Section 43H, is if the employee takes the view that it is an exceptionally serious matter.
How on earth does the average worker know that it is an exceptionally serious matter, not just a serious matter or not just an exceptional matter? It must be "exceptionally serious". How does the employee know that? The noble Lord, Lord Borrie, gave us an example, but it was not a list. That is the part of the Bill that I find unsatisfactory in its present state.
I believe that in many cases—I cannot say the majority—workers will feel that they do not wish to go to the employer; they wish to go elsewhere. Unless the Government tell us that there will be specified residuary bodies established across the whole area covered by the

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Bill—and maybe they will tell us that tonight—so that everyone will have someone to go to, it will remain a problem. Unless one receives guidance on what is an "exceptionally serious" matter, one is in difficulty.
I would like the Government to comment on those matters. Shall we have better definitions in the regulations? Will the regulations make clear how the various exceptions relate to each other? Surely, after the Bill is passed there must be something like a code of practice or an explanatory memorandum. The noble Baroness said that the citizens' advice bureaux could help. Yes, of course, but we cannot expect them to advise in a vacuum as to what is an exceptionally serious case. We must have guidance; there must be documentation if we are to give people some idea so that they know when they are protected and when they are not. Nevertheless, it is an excellent Bill and we look forward to hearing what the Minister says.
8.1 p.m.
Lord Newby: My Lords, from these Benches we too welcome the Bill and are grateful to the noble Lord, Lord Borne, for introducing it. I myself am grateful to Guy Dehn of Public Concern at Work for his briefing and advice. It surely must be in the public interest to offer protection to workers who draw attention to malpractice in the organisation which employs them, whether that malpractice relates to a straightforward criminal offence, damage to the environment or threats to the health and safety of others.
The key aim of the Bill is to change the culture on disclosure. Employees will know that they have legal support for acting in the public interest if they sound the alarm on malpractice. Equally, employers will also know that they will not be able to use the threat of victimisation to prevent concerns being raised.
As a number of speakers have already made clear, the Bill will not, of course, make it easy to be a whistle-blower. Employees who discover malpractice will still need considerable courage to raise the issue with their employer, because in some cases they will be unsure about whether there is complicity on the part of the person to whom they are making the disclosure and because victimisation can take many forms over an extended period, some cases of which can be extremely difficult to prove.
I do not intend to detain the House for long, but, like a number of other noble Lords, I have several questions for the Minister. First, the Bill does not provide help in cases where disclosure of information involves the discloser in a criminal act. This means that a civil servant who breaks the Official Secrets Act is not protected by the Bill. So, if a Foreign Office official believed that officials and Ministers were colluding, say, to break UN sanctions and he raised the matter, perhaps with the chairman of the Select Committee on Foreign Affairs, he would not be protected by the Bill because such a disclosure would clearly be a breach of the Official Secrets Act.
In previous such cases, the civil servant has not necessarily faced prosecution under the Official Secrets Act because the government of the day have
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accepted, however shamefacedly, that the disclosure was in the public interest. I assume that in future cases of that kind, in which the Government did not prosecute under the Official Secrets Act, that would not trigger Section 43B(3) of the Bill as it appears that this provision will only apply where an individual is convicted. I would welcome an assurance from the Minister that that is indeed the case.
Secondly, as has previously been mentioned, the Bill specifically excludes the police. At first sight, it seems a fairly major omission. I realise that in another place, as the noble Lord, Lord Borrie, explained, an assurance was given by the Government that the police would be given equivalent protection to that provided by the Bill. I wonder whether the Minister could explain what form that equivalent protection might take.
Thirdly, it is all very well passing the Bill but, if it is to be effective, both workers and employers must be aware of its provisions. Given that the support received from the CBI, the IoD and TUC among others, will Ministers hold discussions with them about how information about the Bill will be disseminated so that all those who should know about the protection it offers do indeed have that information?
Fourthly, while not necessarily wishing to have a requirement in the Bill for a formal regular report by the Government to Parliament on its operation, I believe that its operation should be subject to formal review. Could Ministers now or at Committee stage give an assurance that this will in fact happen and possibly explain what mechanisms may be adopted to ensure that it does?
In raising those questions, I do not wish in any way to impede the passage of the Bill or to question its overall aims. We look forward to seeing it on the statute book.
8.5 p.m.
Lord Fraser of Carmyllie: My Lords, as with all other speakers who have contributed to the brief debate, I congratulate the noble Lord, Lord Borne, on introducing the Bill into your Lordships' House, just as it was introduced into another place by Mr. Richard Shepherd. He has always been a brave advocate of what have not always been entirely fashionable causes. From these Benches, we hope that we can apply ourselves to the Bill in the most constructive manner.
Listening to the noble Lord, Lord McCarthy, I had an unfortunate image that perhaps the wheels of this wagon were beginning to grind into the sand as we went into problems that seemed to me to be more likely to impede the passage of the Bill than to accelerate it. However, doubtless when we reach the Committee stage we can deal with such matters more carefully.
The noble Lord, Lord Borrie, and those who promoted the Bill in another place have at least attempted in the most constructive fashion to address the dilemma which will always exist. Is it more appropriate that internal disclosure should be pursued first or that there should on every occasion be the opportunity to go outside the organisation? If such a black and white set of circumstances were promoted,

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I should have thought it was potentially destructive of the cohesion of any organisation, whether public or private. I would not advocate, as in the jurisprudence of the European Court of Human Rights, that one should always be required, by parallel, to exhaust domestic remedies before one seeks to pursue an external remedy.
Whether the exceptions provided in the Bill are entirely right is a matter for constructive debate. However, the attempt made in the Bill to require an approach to internal disclosure before an external one seems essentially the correct approach. When I had responsibility for the draftsmen, I thought that the approach of textual amendment to existing legislation was entirely the right way forward. Now that I sit on this side of the House, my enthusiasm for that approach has waned somewhat. It is much more difficult to understand the Bill in all its detail immediately where that approach has been followed. So if I have some of the detail wrong, I hope that I will be corrected by the noble Lord, Lord Borrie, or by the Minister later.
However, apart from those general observations, I have just three points I wish to make. The first is on the police. The noble Lord, Lord Borrie, correctly recalled that in another place, as the noble Lord, Lord Newby, observed, the Government indicated, as I understand it, that there would be comparable protection for police officers to that provided in the Bill. Of course, I am delighted to hear it, but it seems to me that given the civilianisation of much of the police, it is a clumsy solution to what will go on in police stations the length and breadth of the country if there are to be two separate systems to deal with a whistle-blowing incident. I hope that we may explore that a little to ascertain whether we can draw the two together more effectively.
Secondly, as I understand it—this has to be a change introduced into employment law—if anybody is employed in national security they are not to enjoy the protection afforded by this Bill. I do not want to engage in a debate about the extent of the Official Secrets Act and whether it is too great or too restrictive, but it must follow that there are potentially circumstances where the security services are engaged in some activity over which there ought to be some whistle-blowing power, internally or externally, which in no way prejudices national security or even what is presently defined within the Official Secrets Act. Again, perhaps at some point we can explore whether there is a way to introduce protection for those people. If the head of one's department in the security services has plush carpets and is wasting money on wonderful flocked wallpaper or taking extravagant holidays, is one to have no opportunity to blow the whistle about that? That is something we need to address.
My third point, which was fully and accurately touched upon by both the noble Baronesses, Lady Turner and Lady Dean, is the issue of the cap on damages that would be awarded under the Bill. I hope I have these figures correct. My understanding is that the maximum award will be £45,000. That figure may not be absolutely correct, but the noble Baroness, Lady Dean, made reference to the Maxwell pension scandal, and scandal it was. It is outrageous that someone like Mr. Templeton should have been sacked in the way he
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was. But without asking her to reveal or disclose any figures that she successfully negotiated on his behalf, in a scandal of that magnitude with the level of expertise that senior managers must have had, the type of jobs they occupied, the degree of specialisation that they had and the very narrow market place they dealt with, I am concerned about the limitation of damages that may be awarded.
Lord Borrie: My Lords, as there is a reasonable amount of time left at our disposal, perhaps I might intervene to refer the Minister to what Mr. McCartney said on 24th April. He said that the Government favoured the approach available currently for health and safety disclosure, making the point,
"Contrary to apparently popular belief, the sums available in such cases are by no means insignificant. Where someone is dismissed unfairly and does not get his job back despite a re-employment order having been made, the compensation is based on three times annual salary".—[Official Report, Commons, 24/4/98; col. 1137.]
He goes on to refer to various people on quite high salaries and three times such a salary would be much higher than the limits mentioned by the noble and learned Lord.
Lord Fraser of Carmyllie: My Lords, I am grateful to the noble Lord, Lord Borrie, and thankful that I put in my earlier caveat that I was not entirely sure I had followed all the detail from the Bill. But even the quotation from Mr. McCartney seems to indicate that the damages to emerge in circumstances where there has been an order to re-employ and that order has been rejected—I doubt a tribunal would have invited Mr. Templeton to go back to his job and, if it had been offered, I doubt that he would have wished to take it—are limited.
My point is simply this. If serious scandals have to be addressed and serious issues arise for senior managers to consider when they decide whether or not they will go outwith the organisation and make appropriate complaint, we ought at least to examine in your Lordships' House whether the appropriate levels of damages are sufficient. Having made that observation and spelt out the areas it may be appropriate for us to examine in Committee, I repeat my congratulations on the noble Lord's introduction of the Bill.
8.15 p.m.
Lord Haskel: My Lords, first, I too congratulate and pay tribute to my noble friend Lord Borrie on taking forward this Bill. As my noble friends said, it deals with a subject of great importance to workers, employers and the public at large. I thank my noble friend Lord Borrie for explaining the Bill. Much valuable work has been and continues to be carried out by the charity, Public Concern at Work, a charity my noble friend was instrumental in establishing. I congratulate also my noble friend Lady Dean on the part she played in the charity.
The Government have given full support to this important Bill. It will provide a remedy in cases, we

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hope few in number, where a worker was victimised for quite properly raising concerns about wrongdoing. It is plainly right that such procedures should exist, as my noble friend's quotation from the committee amply demonstrated. He made the point that it will help to encourage a climate of openness in the workplace and reduce the likelihood that failures or malpractice will occur. It is clear from the public consultation on the Bill that it has widespread support from all sides. The consultation was thorough and was carried out largely by Public Concern at Work. It resulted in over 80 responses from a variety of organisations, including employer organisations such as the CBI, the Institute of Directors, individual trade unions as well as the TUC, lawyers and others.
The Bill aims to encourage good practice and ensure that problems are dealt with at the earliest opportunity, without public exposure except in extreme circumstances. The Government join the noble and learned Lord, Lord Fraser, in the hope that the Bill will have the positive effect of encouraging employers to follow best practice by introducing procedures—or using existing ones—which will make it easier for workers to inform their employers about their concerns.
This Bill is very much in keeping with the Government's aim of encouraging best practice throughout industry. The procedures that employers adopt may vary according to their needs. But the Government hope that employers will ensure that they are effective and help promote greater openness in the workplace. For example, they may build upon existing grievance procedures or it may be more appropriate to designate a senior manager, the company's lawyer or an auditor as the person with whom concerns should be raised.
My noble friend Lord McCarthy asked about alternatives to the employer. The Bill provides powers for the Secretary of State to prescribe people or bodies to whom workers can turn as an alternative to their employer. Once the Bill has completed its parliamentary passage, we would intend to bring forward an order covering suitable bodies such as the Health and Safety Executive, the Environment Agency, OFT, the DTI's Insolvency Service and others. However, the Bill also protects workers where it is appropriate for them to disclose information to someone other than their own employer or the designated regulator. That may happen where it is unreasonable to expect internal disclosure because the worker reasonably believed that he or she would be victimised or that information would be covered up if the employer were alerted. Alternatively the worker may have raised the matter internally but been ignored or the wrongdoing may be so exceptionally serious that it must be disclosed immediately rather than delaying to find out whether there was a relevant designated body. In such cases the worker will be protected only if he or she acts reasonably—which is carefully defined, as my noble friend Lord Borne reminded us, in Clause 1, subsection 43G(3). There can therefore be no doubt about that.
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I should like to make clear that the Bill does not intend to increase the risk of employers being sued for breach of confidence. The courts apply a public interest test when considering whether to enforce a duty of confidentiality.
This Bill, in particular Clause 1 and proposed new Sections 43G and 43H, lays down a series of reasonable requirements which a worker must follow to attract protection. The way these provisions operate, and in particular the tests in new Section 43G which refer among other things to whether the disclosure breaches a duty of confidentiality, means that any disclosure protected under the Bill would be likely to be within the public interest test. As a result, the employer would not be liable for the worker's breach of confidence.
My noble friends Lady Dean, Lady Turner and Lord McCarthy asked about trade union officials. The Government hope that employers will work with employees and their representatives, including trade unions, to put in place appropriate procedures to enable internal disclosures to be made. It is possible that trade union representatives may be the appropriate people to whom disclosures will be made as part of these procedures. In those circumstances, a disclosure to a trade union official would be a protected disclosure. We would certainly encourage employers and workers to identify the most suitable procedure for their circumstances. However, where trade union representatives are not part of the internal disclosure procedure, a disclosure made to them would have to be considered under Section 43G. Provided that the disclosure met the test in that section, it would be regarded as a reasonable disclosure and thus protected.
My noble friend Lady Turner asked about the additional workload for employment tribunals. The Government believe in a partnership approach where the best companies recognise their employees as partners in the workplace. Our new agenda is providing minimum standards in the workplace to underline this approach and we are aiming to encourage a change in workplace culture where disputes are resolved in the workplace by employers, workers and their representatives working together. This Bill is part of that agenda and will encourage issues to be resolved internally without the need for recourse to tribunals. However, it is inevitable that there will be disputes which cannot be resolved in another way. The Government have taken action to relieve the burden on tribunals. I was glad to support the Employment Rights (Dispute Resolution) Act, introduced by my noble and learned friend Lord Archer of Sandwell, which gained Royal Assent on 8th April. That Act will improve and streamline tribunal procedures and promote alternative dispute resolution. It is an important measure to help tribunals cope with their potentially increasing workload. My noble friends Lord McCarthy, Lord Borne and Lady Turner all contributed to improving the Bill as it passed through your Lordships' House.
The noble and learned Lord, Lord Fraser, and my noble friends Lady Turner and Lady Dean asked about the cap on the compensation of higher-paid employees. This is an employment rights measure. The Government consider it important that compensation should be in line

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with current remedies. We believe that there is scope for those to provide adequate compensation. Perhaps I may give the figures to the noble and learned Lord, Lord Fraser. Awards made under the Bill will attract special payments ranging from £17,400 to £47,600 if based on the health and safety model. However, as the noble and learned Lord mentioned, much higher awards are possible where a re-employment order is made but not complied with. Compensation in that case is based on 156 weeks' pay. Higher earners would therefore benefit. Someone earning £200,000 a year could receive £600,000.
Noble Lords have said that employees may not seek re-employment because that is not what they want. However, the provisions of the Bill would protect them from victimisation if they were reinstated. I suppose that my advice could be that they should seek re-employment, as my noble friend Lord Borrie suggested. As I said, tribunals are able to award considerably larger amounts where a re-employment order is not complied with. However, we share some of the concerns of noble Lords. My honourable friend the Minister of State said in another place that in the longer term we will wish to consider whether the limits and the arrangements for reviewing them work in the best way to meet our aims. So I hope that we will be able to satisfy the concerns of my noble friend Lady Dean's friend Harry Templeton.
My noble friend Lord McCarthy asked about a code of practice. The Bill does not include an order-making power for a statutory code of practice. However, we will be preparing guidance on the Bill which will help employers and workers to understand it. This will include the use that should be made of internal company procedures and the conditions attached to protection when disclosure is made to others.
The noble Lord, Lord Newby, asked why the Bill does not override the Official Secrets Act and other statutes. It is not the intention of the Bill to override statutory provisions which have been agreed by Parliament. They have particular intentions. If they were unjustified they would need to be changed for all purposes, not just those in the Bill. The noble Lord, Lord Newby, and the noble and learned Lord, Lord Fraser, asked about the position of the police. The police are office-holders, not employees, and are covered by their own separate regulatory regime. For that technical reason it is necessary for any changes to be made by the Home Office under its regulations. The important point though is that the Government have agreed that the police should be covered by similar protection. It is a secondary matter how that will be achieved.
The noble and learned Lord, Lord Fraser, asked about the security services. All people who work for the security and intelligence services, including contract workers—cleaners, drivers and so on—are subject to security vetting. That is potentially because they have access to sensitive material. Such staff are more of a risk in not appreciating the implications of information they may disclose. The security and intelligence agencies use contractual clauses to restrict disclosures. This is more specific than general powers conferred by
904
the Official Secrets Act. Clause 1, new Section 43J, of the Bill, however, would prevent such contractual clauses—hence the exclusion.
I think I have responded to all the points raised in the debate. We believe that the protection in the Bill for conscientious workers is long overdue. I therefore join my noble friend Lord Borrie in commending the measure to the House.
Lord McCarthy: My Lords, before the noble Lord sits down, in the light of what he has said about trade union representation, I hope that the Government will look kindly on an amendment to new Section 43D, which at the moment reads:
"A qualifying disclosure is made in accordance with this section if it is made in the course of obtaining legal advice".
Surely the Government would look kindly on an amendment which stated,
"obtaining advice from a recognised trade union".
Lord Haskel: My Lords, the short answer is that if the noble Lord would like to table an amendment we shall certainly consider it.
Lord Borrie: My Lords, I thank my several noble friends and other noble Lords for taking part in this debate and for welcoming the main thrust and purposes of the Bill. I am particularly grateful to the Minister who has comprehensively answered a large number of questions raised in the debate and done so in a most helpful manner. I particularly welcome the fact that he said that the Bill is not intended to increase the risk of employers being sued for breach of confidence. That was a most helpful comment.
Obviously, there is no need for me to duplicate or replicate the many points the Minister made. As regards my noble friends Lady Turner and Lady Dean and also my noble friend Lord McCarthy and trade unions, although the phrase "trade unions" does not appear in the Bill, there is no doubt whatever that they are, have been and will be most helpful in the preparation of codes of practice and other forms in enabling workers to take advantage of the Bill and to bring about the change of culture to which the noble Lord, Lord Newby, referred. Trade union representatives will inevitably and happily be most helpful in their advisory role which clearly is needed if only for the types of questions which my noble friend Lord McCarthy very properly raised concerning the difficulties of interpretation. However good the Bill is, I suggest that there will be difficulties of interpretation. This Bill will become a statute which will not be easy for the ordinary worker in the workplace to interpret without some help. Undoubtedly, trade unions will have a role in that.
I thank noble Lords for their contributions and I ask the House to give the Bill a Second Reading.
On Question, Bill read a second time, and committed to a Committee of the Whole House.

Government of Wales Bill
8.31 p.m.
House again in Committee on Clause 5.
Clause 5, as amended, agreed to.
Clause 6 [Additional member system: calculation of electoral region figure]:
[Amendment No. 19 not moved.]
Lord Elis-Thomasmoved Amendment No. 20:
Page 4, line 13, leave out ("the aggregate of one and") and insert ("a divisor determined by").
The noble Lord said: Before we broke for dinner, the noble Lord who leads for the Scottish section of the attack from the Opposition Benches referred to my right honourable friend in another place, Mr. Ron Davies, as "Ron of the Assembly". Clearly, he has not been watching enough Welsh movies. In his early career our great leader and national hero, Ron Davies, was known as "Ron the Rents" when he was the rent rebel of Bedwas & Machen. More recently he has been known in the style of "Davies the Ocean" and that great entrepreneur from Wales as "Davies the Assembly". No doubt his noble friend on the other side of the Chamber is known as "Roberts the Doom".
But that is by way of enlivening my amendment, which is on a technical issue. However, it is an issue of principle. It relates to the formulae used in the allocation of seats in relation to votes in the proportional representation system. As the noble Lord, Lord Mackay, intimated earlier, obviously, how one fiddles or twiddles the electoral system affects the results. It is important to point out that the formulae for distributing the votes (as aggregated for the regional additional members) affects the election of those members. Some formulae are more party-friendly to certain parties than others. The d'Hondt divisor, which the Government have adopted for the European Parliament, the national assembly and the Scottish parliament, is a system which, because of its way of operating, favours the larger parties, but clearly the system I propose in this amendment and the divisor that I have set forward tends to favour smaller parties. That should not come as a surprise to the Committee.
The intention behind looking at the whole question of how the divisor operates in relation to the allocation of votes to seats is to draw attention to the fact that we need to review these aspects as well as the number of members who are elected. I had an assurance earlier from the Solicitor-General that the question of the way in which the proportional system operated would be reviewed after the first election. Can he assure me that the formulae or the mathematics of the aggregation of votes to seats will also be reviewed as part of any review that may take place?
I shall not go into the detail of the Sainte-Lague formula or my version of it, which appears here except to say that in the system proposed in the amendment there is a bias in favour of the smaller parties just as there is under the d'Hondt rule favoured by the Government, a bias against smaller parties. I take as my Bible on this the great work by Arend Lijphart entitled
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Electoral Systems and Party Systems: a study of twenty seven democracies 1945–90 which I am sure the Welsh Office will have read in detail, along with all its other preparations for this Bill. I beg to move.
Lord Mackay of Ardbrecknish: This is an interesting amendment. Perhaps I may ask the Minister to justify—as he jolly well ought to do—the particular system chosen by the Government. As the noble Lord, Lord Elis-Thomas, rightly said, they chose the d'Hondt system. That means that the first time one divides the total number of votes cast for all the parties in the second ballot. The second time, one divides it by the number of seats won the first time round, plus one. In some of the examples I gave earlier on, that means that those parties which had achieved no seats the first time round have a divisor which is set at only one. The next time one party gains a seat, the new divisor for that party is the number of seats won, plus one again. So it goes on until all four seats have been apportioned. That is the d'Hondt system, named after a mathematician. I cannot remember when he lived, but it was some time ago.
There are variations of it. One of the variations is called Sainte-Lague. I am not sure how to pronounce it and no one has helped me. Everyone gives a different pronunciation. Under that system, the divisor is one and then it goes up to three, five, seven and nine principles. Undoubtedly, that will help the smaller parties.
Earlier in the day I said that in my view proportional representation was a fiddled system. We did some fiddling before dinner and looked at various ways in which we could fiddle the number of additional members to achieve whatever result we wanted. Now we consider the divisors and how we can fiddle the different results. I suspect that, given some time and a good computer, I could devise a system which meant that Plaid Cymru won all of the seats regardless of the vote to begin with. That might he quite hard, but could try.
The Sainte-Lague divisor is one, three, five, seven, nine. There is a variation of that which means that on the first divisor the square root of two that is, 1.4 is adopted. One divides by 1.4 and then three, five, seven, nine as one goes up the list. The d'Hondt system is used in Luxembourg, Portugal, Spain and Holland. The Sainte-Lague system is used in some countries. The modified version which begins at 1.4 is used in Denmark, Norway and Sweden. I am not entirely sure where the noble Lord's variation of the Sainte-Lague system is used. That starts at two and not at the square root of two and then three, five, seven.
But all of the systems are designed to try to achieve proportionality in various ways and to various degrees. To a certain extent, you pays your money and takes your pick; or perhaps it rather depends on where you are in the electoral system. I have made it perfectly clear that despite the position in which my party finds itself in Scotland and Wales I would rather continue the first-past-the-post system. In that way the electorate has clear cut decisions. This afternoon I have been shown that the Government and the Liberal Democrats are at one in wanting to change. I am surprised that the Liberal Democrats have not intervened in this debate. I would

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be interested to know whether they approve of the d'Hondt system. I suspect that the latter does not entirely favour that party and that one of the variations of Sainte-Lague would favour that party even more.
For my part, I disapprove of all of them. It is a case of a plague on all your house. However, I would like to know why the Government have chosen d'Hondt so that I can understand it. I should also like to know why the noble Lord, Lord Elis-Thomas, has chosen the two, three, five system instead of either one, three, five or the square root of two, three, five which at least appears to have the legitimacy that it is used in some other countries. I look forward to hearing the interesting mathematical treatise of the noble and learned Lord, the Solicitor-General, on voting systems and their divisors.
Lord Falconer of Thoroton: The treatise spoken to by the noble Lord, Lord Mackay of Ardbrecknish, provides a very firm foundation for the debate to continue. The d'Hondt formula was the formula on which we campaigned in the referendum, although not explicitly. The examples provided were based on that formula. The noble Lord, Lord Mackay, has also referred to the Sainte-Lague formula and pointed out, quite correctly, that the formula proposed by noble Lord, Lord Elis-Thomas, is not quite the Sainte-Lague formula but something between the two.
There is great debate about which system produces greater proportionality. One view is that Sainte-Lague produces greater help for smaller parties. The proposal of the noble Lord, Lord Elis-Thomas, is not quite the Sainte-Lague formula. Analysis suggests that where one has comparatively few additional members, which is the position here, Sainte-Lague will not produce a materially different result from d'Hondt—all the more so when one is not going all the way with Sainte-Lague, as in the amendment moved by the noble Lord, Lord Elis-Thomas. We adopt d'Hondt because it is simple, easy to understand and leads to proportionality. In the light of the number of seats that we are dealing with here it makes no difference. It seems to us to be the sensible method to adopt. It is the system on which we campaigned in the referendum. In our view, the argument is strongly in favour of using d'Hondt as opposed to any other formula.
I repeat what I said before dinner. The Secretary of State has made clear that the Government may look again at the electoral arrangements if in the light of experience after 1999 they fail to meet the expectations that we have of them. If the Secretary of State looks at the electoral arrangements and they fail to meet the expectations that we have of them we will have to ascertain the reasons for that, and that will necessarily include the system. On that basis, I respectfully ask the noble Lord to withdraw his amendment.
8.45 p.m.
Lord Elis-Thomas: I am grateful to the Minister for his response. To reply to the noble Lord, Lord Mackay, I have modified Sainte-Lague for the very reason that a system which raises the first divisor from one to 1.4 makes it more difficult for small parties to win their first seat. It is fairly obvious from where I come. I recognise
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that the operation of the formula is almost like the d'Hondt system as far as concerns a party winning its first seat, because the difference between 1.4 and three is about the same as between one and two. But the Sainte-Lague system for seats afterwards respects the position of smaller parties more effectively. I have received an assurance from the Minister that this will be part of the review. In the spirit of unity which predominates in this Committee, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 21 to 23 not moved.}
Clause 6 agreed to.
Clause 7 [Additional member system: return of members]:
[Amendments Nos. 24 to 26 not moved.]
Lord Williams of Mostynmoved Amendment No. 27:
Page 4, line 43, leave out from ("list") to end of line 44.
The noble Lord said: I beg to move Amendment No. 27 and speak also to Amendment No. 31. These are technical amendments which provide for the updating of party lists. It has two purposes: first, to provide for the deletion from the list of the names of any persons who have been elected to the assembly either from a constituency or at each stage in the allocation of the additional members. At present, the Bill provides only for the name of someone returned from a constituency to be deleted from the list. It does not provide for the name of someone allocated an additional member seat to be deleted. The existing wording is therefore defective since the system for the allocation of additional member seats would not work without this amendment.
Secondly, the amendments provide for the deletion of the names of any persons whose election has been declared void. This is important. Without it the name of an assembly member whose return had been declared void would still be "live" on the list which the returning officer would be obliged to revisit to determine who should fill the vacancy resulting from the member's election having been declared void. One would be faced with the absurd spectacle of a returning officer having to declare elected a person whose earlier election had been declared void. There is a similar provision already in the Scotland Bill.
Lord Roberts of Conwy: I am grateful to the Minister for these tidying-up amendments. One provides that if a listed candidate is elected as an assembly member for a constituency he or she ceases to be available for selection as a regional member from the list. I believe that to be a sensible provision. The rearrangement within the clause is a clear improvement. The words in parenthesis are commendable in that they anticipate a situation that might arise.
On Question, amendment agreed to.
[Amendments Nos. 28 to 30 not moved.]
Lord Williams of Mostynmoved Amendment No. 31:
Page 5, line 18, at end insert—
("() For the purposes of subsection (5) and section 9 a person included on a list submitted by a registered political party who is returned as an Assembly member shall be treated as ceasing to be on the list (even if his return is void).").
On Question, Amendment agreed to.
Clause 7, as amended, agreed to.
Lord Elis-Thomasmoved Amendment No. 32:
After Clause 7, insert the following new clause—
SELECTION OF CANDIDATES FOR ASSEMBLY
(" .—(1) The Sex Discrimination Act 1975 shall be amended as follows.
(2) After section 49 there shall be inserted—
"Candidatures for National Assembly for Wales.
49A. Nothing in Parts II to IV shall render unlawful any act done by or on behalf of a registered political party within the meaning of the Government of Wales Act 1998 if it is an act done for the purpose of, or in connection with—

(a) selecting female candidates only, or male candidates only, for election to the National Assembly for Wales ("the Assembly"), or

(b) taking any steps preliminary to, or in connection with, such selection which either favour or subject to a detriment either female or male candidates,

provided that in the opinion of the party concerned the act in question is in the circumstances necessary to attempt to secure an equal number of members of the sex favoured as there are of the other sex as candidates of that party for election to the Assembly".").
The noble Lord said: This is an issue of some substance which was debated, again in detail, in another place on an amendment proposed by Julie Morgan, the honourable Member for Cardiff North, at col. 788 of the Official Report of 2nd March. I think it is important that we come back to these issues of relationships between the national assembly and gender. I do this not in the spirit of seeking to exploit any of the difficulties of other parties. I say that in advance of anything that may emanate from certain quarters in this Committee.
It appears to me from reading the Western Mail that the Conservative Party has a serious problem about gender balance in that the first 10 members selected for the assembly are of the male gender. I sincerely hope that at least a significant proportion of the members selected by Plaid Cymru, the party of Wales, will be of the male gender, in that I have some personal interest in that process. However, it is important that the whole question of relationship between sex discrimination legislation and the purposes of trying to secure gender balance in the assembly should be discussed in this debate.
The amendment seeks to ensure that there is no conflict between the wording of the 1975 Sex Discrimination Act or of the relevant European legislation as at present enacted and the process of selection of candidates for the assembly that could ensure that a registered political party could, in selecting candidates, take steps to achieve a gender balance in the selection. I am aware of the history of this matter and I do not need to repeat the various relevant legal cases
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about which the learned Front Bench has much greater knowledge than I have. I am merely a literary critic and textual analyst, and they are learned lawyers.
However, I am well aware of the case of Jepson v. The Labour Party in 1996 and of the relevance of that the Marschall v. Land judgment, and also of the consultation undertaken by the EOC earlier this year on the whole issue. It would be helpful if Ministers could indicate where they are in relation to the consultation of the EOC and whether indeed there has been consideration of whether the present amendments to the Treaty of Amsterdam make the situation clearer in this whole area—positive non-discrimination on the basis of sex, racial or ethnic origin, disability, religious belief, age or sexual orientation, which are the new aspects of that treaty, enabling member states to take appropriate action in those areas. That would indeed make it possible for the United Kingdom or any other member state to take the kind of action in the selection of candidates that is set out in the amendment.
It is not clear to me from reading the relevant papers that there is a clear indication of the legal position. The fact that the decision of the industrial tribunal in the Jepson case was not appealed does not make it clear, from what I have observed, that there is no basis for affirmative action, as set out in the amendment. The reason why this issue is so important is because Welsh politics have been traditionally gender-dominated by males, and there is a strong sexist political culture in Wales which does not benefit our democracy. We need to ensure that the national assembly, from day one, is a representative and inclusive body—representative of the multicultural nature of our society and indeed also of both genders.
There has been serious under-representation of women at all levels on public bodies in Wales: at local government level, in appointments to various public offices and indeed in this Chamber and the other place, although the situation there has improved recently. We are, by perpetuating that under-representation, ensuring not only a lack of equality in terms of gender but an under-use of resource in society and in the nation.
The typical traditional attitudes of certain members of Welsh local government historically, and indeed as regards Welsh Members in another place historically, has been discriminatory against the development of balanced gender representation. Some of us over the years in our various political parties have sought to right some of these wrongs. So far as the party of Wales, Plaid Cymru, is concerned, we have adopted a procedure whereby constituencies will select, but there will be a decision by the party nationally to use the regional additional member system to correct any gender imbalance that may appear during the selection procedure by the constituency parties for individual constituencies in first-past-the-post. I am advised that this course is within the law as currently drafted in the Sex Discrimination Act.
We need to have a clear indication from government that the intention is that the national assembly shall be as gender balanced as possible and that all the political parties involved in trying to select candidates for the

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assembly will ensure that this is the case. I hope that we will have agreement from all parties that this should be so and that my amendment will be supported. I beg to move.
Lord Thomas of Gresford: We on these Benches entirely support the sentiments expressed by the noble Lord, Lord Elis-Thomas. We are fortunate in the Liberal Democrats in Wales in that we have many young candidates and many female candidates. What we do question is whether this is something that requires statutory authority. We feel in the Welsh Liberal Democrats that we have the necessary procedures in place which will ensure gender balance. We agree with the noble Lord that that is an aim which we should seek to achieve.
Lord Mackay of Ardbrecknish: I am never very sure when we come to these matters whether people want to be purist and have a balance which is 50–50. That of course means that they have to manipulate the system in various ways: both the democratic system and the selection system. It will not surprise your Lordships to hear that I am always pretty nervous when I hear the case put for manipulation of the system in order to get what is now called gender balance.
It seems to me that it is treating at least some women as if they were the "token woman". I think we in the Conservative Party can speak with some strength in this matter because we are the only political party that has actually been led by a woman; my noble friend Lady Thatcher. I imagine that if I suggested for a moment that we elected my noble friend as a token woman, I would, in the phrase, have my head in my hands to play with. My noble friend was elected because she was seen to be the best person for the job, and she turned out so to be. She was elected entirely on her own merits and, as some of your Lordships who were in the other place at the time will recall, she was elected largely on her skills, shown during the passage of a Finance Act. Clearly, my colleagues in the other place then saw that she was head and shoulders above anybody else. They did not look upon her as a woman but as the most formidable person they could choose in order to oppose the Labour Party and to win the subsequent election. They were right in that.
I am not happy with the idea that we should look for balance in a kind of tokenist way. I would hate to think that when I was a government minister any of the four or five lady private secretaries I appointed thought of themselves as "token". I appointed them because in my view when I saw them at interview they were the best person—she in this case—needed to do the job. I did not do a mental calculation on the lines of "my last one was a male and so this one ought to be a female." I do not believe that political parties should be forced to do that. If they wish to do that then it is up to them, but the rules for political parties on choosing a candidate are entirely matters that they should attend to.
It is interesting to note that, if one allows democracy, the electorate, whether it be the narrow electorate of the party membership or the wider general electorate at large, may not always decide to go along with the rule
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that the constituency ought to have a woman representative. It may decide that the man in front is the better person. The converse could happen; a woman might be given one of the seats designed for a man. It is a complicated business and I do not intend the Conservative Party to become involved in it.
The Labour Party has the problem. When it introduced women-only shortlists for parliamentary elections it was found to be acting unlawfully under the Sex Discrimination Act 1975. Jepson and Dyas-Elliott v. the Labour Party and Others in 1996 showed that and the Labour Party did not appeal. I understand that the legal position is still somewhat unclear. Several leading lawyers argue that parliamentary election processes are not subject to the Act.
The new clause introduced by the noble Lord, Lord Elis-Thomas, in order to try and help the Labour Party—such generosity of spirit does him great credit—would exempt the selection of candidates for the assembly from the provisions of the Sex Discrimination Act. As regards the Government's reply, we cannot lose; either we have the Solicitor-General or the noble Lord, Lord Williams of Mostyn. Either way, we shall have extremely good legal advice tonight and I trust that we shall have it free. I understand that the noble and learned Lord the Solicitor-General is to reply. Perhaps he will turn his mind to whether the amendment might contravene the EU equal treatment directive. In 1995, in the case of Kalanke v. Hansestadt Bremen, the European Court of Justice ruled that positive discrimination was unlawful. However, in 1997, the court ruled that where there are fewer women than men in a particular public sector post it was not unlawful to give priority to a suitably qualified woman so long as a better qualified man could still be chosen. That would seem to me to leave the matter open for political parties. That was the case of Marschall v. Land Nordrhein Westfalen.
It is worth noting that in January the Equal Opportunities Commission issued a consultation document which sought views on possible amendments to the Act, including changes to allow for positive discrimination. The Conservative Party has laid out its selection procedures. As I indicated earlier to the noble Lord, Lord Harris of Greenwich, who was interested in my political well-being, we in Scotland are selecting the panel from which the constituencies will choose. I am happy to say that we have a significant number of extremely well-qualified women. I should like to think that on their own merits they will beat some of the men on the short list. I would hate to think that I had to point to a woman and say, "This woman must be taken, good, bad or indifferent, just because she is a woman". I should like to think that all the women I have interviewed would tell me what to do with my nomination if I suggested that.
The Labour Party put itself into more difficulties because it decided to twin constituencies for the purposes of selection of assembly candidates. A selection board appointed by the Welsh party executive will interview prospective candidates for an all-Welsh pool, from which two men and two women will be chosen by each pair of constituencies. I am not sure whether the constituencies are paired in equality of

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electoral chance or whether a good one is paired with a bad one. That would seem to be tilting the playing field. The two men and two women will then be ranked in order of preference by the local party members in one male and one female ballot. The winners in each will then be allocated to one or other of the two constituencies by mutual agreement. No decision has yet been made about how the regional lists will be ordered, but it will be interesting to hear whether anything can be said about it tonight.
However, a spanner was thrown in the works by the noble and learned Lord the Lord Chancellor when on 21st April he told a private meeting of MPs that in his view such twinning would be unlawful. One cannot get better advice than from the noble and learned Lord the Lord Chancellor. Although he is an English lawyer, he is a Scot, so he must be a cut above the others. I mean most of the others; just in case the two Ministers opposite have to do me a favour one day I put in a small caveat. In any event, if that is the view of the Lord Chancellor I would bet on the fact that it is unlawful. I understand that the Labour Party is still considering its position.
Why should I interfere in a private fight in the Labour Party? Why should the noble Lord, Lord Elis-Thomas, interfere? He has chosen to interfere in a helpful way and I hope that my suggestions, too, have been helpful to the Government. If I were the Government I would take the advice of the noble and learned Lord the Lord Chancellor because I cannot think where they would find better.
9 p.m.
Lord Islwyn: It is not often that I am slightly sympathetic to the point of view annunciated from the Front Bench opposite. I was slightly inflamed by the references made by my noble friend and colleague Lord Elis-Thomas to the situation in particular in South Wales relating to the male dominated political scene as he portrayed it. Of course, that had everything to do with the fact that there was a heavily industrialised society dominated by mining and steel and the men went out to work. They in turn participated in trade union and political affairs. From the point of view of political success, the Labour Party benefited from such a society.
I am a little nauseated by all the gender arguments that have been put forward. I believe that women should be encouraged in every way to participate in the political scene and every other social organisation in society. However, I resent such arbitrary mechanisms. I recall that during my 31 years in another place, particularly in the latter years, when one voted for the shadow Cabinet one first had to vote for four females. In other words, if we did not vote for the four females, our ballot paper was declared void. I always thought that was a load of rubbish.
With the rise of feminism as we see it today, surely women are coming to the fore and they can stand on their own two feet. If they are selected, all well and good; if they are defeated, so be it.
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I recall too a situation which I witnessed firsthand, although I never took any part in that kind of argument. In my old constituency of Newport East, there were a great many what I would call, with great respect, working-class women. They were dead against the idea of any sort of arbitrary mechanism to ensure that they were elected. In fact, if the records are looked at, it will be found that just over two years ago at the annual conference of the Labour Party, there was a resolution from the Newport East constituency which was put forward largely, as I know, by the women members who opposed such an arbitrary mechanism.
I think of the noble Baroness, Lady Thatcher. She did not need any assistance nor did my noble friend Lady Castle, Jennie Lee, Joan Lestor and so on. They fought their own corner. As I say, with the rise of feminism, that will surely happen generally. When we go to Swansea this weekend for the Labour Party Welsh Conference, I hope that the delegates there will reject the idea of twinning. I entirely disagree with it and I speak as a member of the Labour Party for over 50 years. We want a democratic system, by all means, but with women as they are. They can put their own point of view so clearly and concisely that I believe that they can certainly stand on their own two feet now. I hope that that democratic system will prevail so that the constituencies will choose the best person available.
Lord Falconer of Thoroton: The proposed new clause put forward by the noble Lord, Lord Elis-Thomas, would have the effect of amending the Sex Discrimination Act 1975 to remove from its scope the selection procedure for candidates standing for the assembly. If that is removed from the scope of the Sex Discrimination Act, it would allow positive discrimination in favour of women.
We must remember that domestic legislation must be looked at in the context of European employment law, and I am grateful to the noble Lord, Lord Mackay of Ardbrecknish, for reminding us of that and in particular for reminding us of the equal treatment directive with which we must comply as a matter of European law.
During the debate in another place on the Scotland Bill on 31st March of this year, Mr. Henry McLeish, the Minister at the Scottish Office, explained that any amendment to the 1975 Act could be open to challenge as being in contravention of European employment law. He was putting that forward as the Government's view and that remains the Government's view as a matter of law.
Indeed, the Government take the view that the initiative lies with the political parties themselves to improve the balance of women and men in their selection procedures. They can provide the encouragement for more to participate in the political process, including the offer of relevant advice, training and support for women and men to come forward as candidates for selection. Furthermore, the Equal Opportunities Commission has offered to make available its expertise if parties would find that helpful. The EOC will advise parties on the training of women to seek candidacies and the training of selectors to ensure that there is no discriminatory practice of any

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sort in the process of selecting candidates. I am sure that we all share the view that there must be no discrimination in the selection of candidates.
It would be remiss of me if I failed to mention that the Bill will require the assembly to have regard to the principle of equality in the way that it does business and in the exercise of its functions. The relevant clauses are Clauses 49 and 120, the latter also requiring the assembly, after each financial year, to publish a report outlining the arrangements made and assessing how effective those arrangements have been. That guiding principle of equality has been and will continue to be a constant. In the light of what I have said, I hope that the noble Lord will withdraw his amendment.
Lord Elis-Thomas: I am grateful to the noble and learned Lord the Solicitor-General and to other Members of the Committee who have taken part in the debate. This is one of the few areas where I part company with the noble Lord, Lord Islwyn. We are on a par on most social and political issues but on this issue, I must disagree with him.
I can only quote what Ms Julie Morgan said:
"In Wales, women have been more dramatically under-represented in public and political life than in any other part of Britain. Wales has the lowest percentage of female councillors, and until May, only four women had ever represented Welsh constituencies. The three new women Members elected in May bring the grand total to four out of 40 and were selected from women-only shortlists. Positive action was required to ensure that more women were elected to represent Wales ".—[Official Report, Commons, 2/3/98; col. 789]
That seems to me to be equally true of the position in relation to the national assembly. The noble and learned Lord the Solicitor-General emphasised that it is up to political parties to ensure greater equality.
I am pleased to tell Members of the Committee that the party of Wales Plaid Cymru, in the recent selection process for the European elections, introduced a method of selection whereby we as delegates were able to vote on a gender basis for a male person and for a female person. Then there was a run-off. I am pleased to say that Councillor Jill Evans was selected by a large majority to top the list to represent the party of Wales in the forthcoming European elections. It is to be hoped that, under the list system, she will be elected. Indeed, I would say that that is almost certain, knowing the quality of the candidate. That is the way that I believe all parties should respond in the forthcoming election to the national assembly.
However, I still take the view that we should be pursuing the opportunity to ensure that any action taken by political parties is within European directives and, indeed, within the more recent enabling provisions of the Treaty of Amsterdam, which will enable affirmative action to be taken in this area. I understand that I am not going to make much progress on the matter. But this has not been just for the sake of the record; it is a matter for the future. In that spirit, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 8 [Vacancies in Assembly constituency seats]:
[Amendments Nos. 33 and 34 not moved.]
Clause 8 agreed to.
Clause 9 [Vacancies in Assembly electoral region seats]:
[Amendment No. 35 not moved.]
The Deputy Chairman of Committees (Lord Dean of Harptree): I should point out to Members of the Committee that if Amendment No. 36 is agreed to, I cannot call Amendments Nos. 37 or 38.
9.15 p.m.
Lord Falconer of Thorotonmoved Amendment No. 36:
Page 6, leave out lines 8 to 11 and insert—

("(a) is included on that list,

(b) is willing to serve as an Assembly member for the Assembly electoral region, and

(c) is not a person to whom subsection (3A) applies.

(3A) This subsection applies to a person if—

(a) he is not a member of the party, and

(b) the party gives notice to the regional returning officer that his name is not to be notified to the presiding officer as the name of the person who is to fill the vacancy.").

The noble and learned Lord said: This government amendment deals with concerns expressed about the fairness of allowing people who had left a political party to remain on a party list put forward at an assembly election by that party. We believe that it would be an injustice and a disservice to the electorate if we were to allow a casual vacancy in a party list seat to be filled by someone who had been on the list at the time of the election but who had since left the party.
The electoral region ballot in the assembly elections will involve a choice between party lists or independent candidates. If they choose to vote for a party list, most voters will be voting for the party list as a whole rather than for any individual candidate on that list. The allocation of the electoral region seats in each electoral region is determined so as to compensate for any disproportionality in the seats won by the parties in the constituencies within that region.
It would be inconsistent with those circumstances if a vacancy in an electoral region seat won at the election by a party list were to pass to another allegiance because the next person on the original list was no longer a member.
The government amendment addresses that anomaly. It would introduce a new test for the regional returning officer to apply in respect of the next available person from the original party list. If the next person on the list were not a member of the party and the party itself were to inform the regional returning officer that the name of that person should not be notified to the assembly presiding officer to fill the vacancy, that person's name could not be put forward by the regional returning officer. That officer would be obliged to pass on to the next available person on the extant list and apply the same tests.
The government amendment differs from the amendment tabled by noble Lords from the party opposite in that it imposes a burden of proof of

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non-membership rather than proof of membership. There may be circumstances in which a party may be content for someone who is not a member—perhaps, for example, he has forgotten to renew his subscription—to fill the vacancy. Our amendment would provide for that circumstance, whereas the other amendment would not. In those circumstances, I beg to move.
Lord Mackay of Ardbrecknish: I am grateful to the noble and learned Lord for that explanation. Perfectly clearly, we were on the same wavelength, at least to some degree, when we considered this particular issue. As the noble and learned Lord said, we are talking about a circumstance where a vacancy occurs and the next person on the list has in fact left his party. It seems to me that it would not be right for him to be elected on his former party's ticket. That is why I have tabled this amendment. However, I am happy to bow to the Government's amendment which is drafted slightly differently.
I believe that the Minister answered one of the two questions that concerned me as regards the Government's amendment; namely, if a person is no longer a member of a party, the party would inform the returning officer that the person is no longer a member and should not be considered. That seems to be sensible. We are at all fours on that. But if he is not a member of the party, I find it difficult to understand why the party would tell the regional returning officer to accept him. The Minister suggested that the person concerned may have forgotten to renew his party membership. I can see that that could happen, but I think it is pretty unlikely. If I were the next person on the list to be elected to the assembly or to the European Parliament, and I realised that if someone higher on the list "fell off his perch" I could be elected, I would make sure that I retained my membership of the party. I believe it would be a foolish man or woman in that position who would allow his party membership to lapse. However, I understand what the Minister said. My deeply suspicious mind made me wonder whether there was some other point behind that, but, as I say, I accept entirely what the Minister has said.
I take it that "and" does not mean "or". I find that lawyers have a habit of mixing "and" and "or", at least to my simple mind. In other words, as regards someone who is still a member of the party, the party may give notice to the regional returning officer that it did not want that person to be considered. This could be a case of the "control freaks" in a party apparatus wanting to make sure that anyone who deviated from the straight and narrow was immediately denied the possibility of being elected to the Welsh assembly in the event of people higher on the list dying or retiring. I hope that the Minister can assure me that "and" does not mean "or"; in other words, that someone who is next on the list will not be denied the chance to be elected because the party has decided that that person's face no longer fits, although he may still be a member of the party. I do not think that the Minister dealt with that point, and I should be grateful if he would assist me on it.
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My next point may perhaps be more appropriate to a clause stand part debate, but it is related to the point that we are discussing. I hope I may discuss it now. I refer to the case of someone on the list who is elected but leaves the party during the course of his membership of the assembly. We have the first-past-the-post tradition in this country. People are elected for themselves. Therefore if they cross the Floor and join another party, while people shout that they should resign and a by-election should be held, we all accept in reality that they were elected for themselves and therefore they are quite entitled to retain their seat even if they have changed their party. It seems to me that the regional list concept alters that argument; indeed I believe it negates that argument. I had wondered whether to table an amendment to make provision for that. However, my ingenuity fell short of tabling an amendment that satisfied me as I also realised that if the party did not like the way someone voted it could drum that person out of the party and push him or her off the list. I considered that would be unfair and therefore I was confronted with a difficult dilemma.
I hope that the Minister can address the point of someone who is already elected who decides to leave his party. As I read the Bill, he would be able to stay in the assembly despite the fact that he was definitely flying under false colours as it were. With that small reservation about the list system, I welcome the amendment that the Minister has tabled. I am pleased that we have been able to clear up what may have constituted an anomaly at some stage in the future.
Lord Thomas of Gresford: We on these Benches also welcome the amendment that is proposed by the Government. Perhaps I may follow the noble Lord, Lord Mackay, on the subsidiary point about the person who crosses the Floor. We, in our party, have certainly not suffered in that respect over these last many years. Numerous people have joined us from other parties, both at council level, in another place and, indeed, in this Chamber. Nevertheless, it could give rise to problems if it should so happen that in the course of a session of the Welsh assembly a member elected on a regional list changes party. All I would ask the Government to do is to consider whether they require an amendment to the Bill to make it absolutely clear what the position is in those circumstances.
Lord Falconer of Thoroton: I think two points remain. First, does "and" mean "and" or "or"; and, secondly, what is the position in relation to somebody who, after election on a regional list, crosses the Floor and joins another party.
First, I assure the noble Lord and the Committee that "and" does, indeed, mean "and". That means that where a casual vacancy arises, if somebody remains a member of the political party on the list which he appeared and if he is next in line, he cannot be passed over by the fiat of his party because two conditions have to be satisfied; namely, non-membership of the party and his name not being put forward. It is a matter for the party which is seeking to rely on it to establish that he is no longer a member. That was the critical difference between our amendments.

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The second point is the question of the crossing of the Floor after election. As the noble Lord, Lord Mackay of Ardbrecknish, rightly identified, the Bill, as presently drafted, including the amendment, does not seek to act in any way against elected members of the assembly who change their allegiances during the term of assembly—that is, after election. We have taken the view that there is a long tradition in British politics of tolerating Members who cross the Floor. I do not think it would be in the interests of anyone if we sought to expel an elected member simply for moving from one allegiance to another. The British political tradition is one which extols the virtues and advantages of the representative rather than the delegate and we would be loath to depart from that principle in respect of the assembly elections. So we have thought about it and taken the view that we should not deal with it in any way. Even if you cross the Floor, you retain the right to remain in the assembly until the next time there is an election. I hope that answers all the outstanding points in relation to this amendment.
On Question, amendment agreed to.
[Amendment Nos. 37 to 39 not moved.]
Clause 9 agreed to.
Clause 10 [Entitlement to vote]:
The Earl of Balfourmoved Amendment No. 40:
Page 6, line 29, at end insert (", on the day of the poll").
The noble Earl said: The amendment deals with the election of members. It is grouped with Amendment No. 41. I shall leave my noble friends, either the noble Lord, Lord Roberts or the noble Lord, Lord Mackay, to speak to it.
A person's position can change quite dramatically over a short period of time. The words I have put down,
"on the day of the poll",
are taken straight from the equivalent clause, Clause 10, in the Scottish Bill. With the usual canny cautiousness of Scottish parliamentary draftsmen, they have pinned it down to a specific date. It is in that respect that I hope my amendment finds some favour. I beg to move.
9.30 p.m.
Lord Roberts of Conwy: The Government have spared no effort in enhancing the status of the national assembly of Wales. Its status is clearly superior to any form of local government. We agree with that, and that the assembly should have some of the trappings of Parliament, as some of our later amendments suggest.
It comes as some surprise therefore to find that the register to be used to determine entitlement to vote is the local authority rather than the parliamentary register of electors. I cannot believe that the sole reason is to allow noble Lords to vote in assembly elections. In any case noble Lords are cared for in our amendment which seeks to substitute the parliamentary for the local government register.
Our main reason for seeking the change is that we do not believe that the assembly is a local government body. Nor should it be treated as such. We think that that is an important point. There are differences between the two registers. The local government franchise would
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allow any EU citizen living in Wales to vote but would exclude Welsh people living abroad. The parliamentary franchise would exclude EU citizens but would include Irish and Commonwealth citizens. British subjects living overseas would also be allowed to vote. These are important matters. We are anxious to hear the Government's reply.
Lord Williams of Mostyn: I speak to Amendments Nos. 40 and 41, if I may. I am most grateful to the noble Earl, Lord Balfour, for his helpful suggestion. There will be examples of persons who would be eligible on one day but not on another, as the noble Earl said, because circumstances change.
I have had the opportunity to look at Clause 10(1) again. I think that the existing wording is a little vague and could be improved by making it more time specific. Accordingly, I welcome and support Amendment No. 40 put forward by the noble Earl. Alas, the noble and learned Lord, Lord Simon of Glaisdale, again is not here.
On Amendment No. 41, we think that we should hold the assembly elections on the basis of the local government elections. The referendum was held on that basis and we had many lengthy debates about that in this Chamber. The assembly is not downgraded by using the local government register. It is concerned with the governance of Wales. It is to affect all those resident in Wales. If we use the local government register, as we propose, that allows citizens of the European Union who are resident in Wales and registered in Wales to participate in a democratic process because it affects their lives as much as anyone else who lives in Wales. It has the benefit that Peers who are resident in Wales, and registered in Wales, would be entitled to vote. I am told that there are a little fewer than 40 such creatures still in captivity.
As regards the proposal of the noble Lord, Lord Roberts, I understand his sub-theme. However, I believe that the conclusion at which one arrives is wrong. The register on the parliamentary basis would exclude Peers—I have dealt with their position—and resident EU citizens but would grant the vote to overseas voters who by definition are neither registered nor resident in Wales. We think that that would be wrong.
Citizens of other EU countries who are resident in Wales and wish to be registered in Wales, if they so choose, contribute to diversity of life and prosperity in Wales. They have a stake in the future of our country, and I believe that it would be invidious to exclude them.
The assembly will have no responsibility for United Kingdom citizens from Wales (Welsh born or otherwise) who are resident overseas. We do not believe that there is any reason for an overseas voter to vote in an election for the assembly. The decisions of the assembly would be unlikely to have any impact on them.
One of the effects of the amendment would be to require a third register to be drawn up—solely for the purpose of allowing Peers to vote in assembly elections. Peers are well regarded, cherished, loved and revered in Wales. However, there are fewer than 40 of them, and I wonder whether the trouble of having a separate register

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would be worthwhile. Therefore I take the point made by the noble Lord. We are not, of course, diminishing the status of the assembly; we are using the most practical form of register appropriate to the condition of the Welsh assembly. I therefore hope that with that explanation the noble Lord, Lord Roberts of Conwy, will feel able to withdraw his amendment.
The Earl of Balfour: I am grateful to the Minister. I commend Amendment No. 40.
On Question, amendment agreed to.
Lord Roberts of Conwyhad given notice of his intention to move Amendment No. 41:
Page 6, line 30, leave out from ("a") to end of line 34 and insert ("parliamentary election or who would be so entitled if they were not peers.").
The noble Lord said: I am grateful to the Minister for his comments. I am content not to move Amendment No. 41.
[Amendment No. 41 not moved.]
Clause 10, as amended, agreed to.
Clause 11 [Power to make provision about elections etc]:
Lord Mackay of Ardbrecknishmoved Amendment No. 42:
Page 7, line 8, leave out ("and registered political parties").
The noble Lord said: I congratulate my noble friend Lord Balfour on securing a small but significant victory against the Government. We shall report these matters, in order to show fairness to the noble Lord, Lord Williams of Mostyn, to the noble and learned Lord, Lord Simon of Glaisdale, in the morning. Perhaps I may even have the same luck with Amendment No. 42.
This amendment turns to the portion of the Bill which discusses the limitation on election expenses of candidates for election. We are all used to the limit of election expenses on each candidate for election to Westminster. It is quite straightforward. There is a limit, returns have to be made and everybody accepts and understands that—sometimes more so than at other times. Basically, it is an accepted part of the system that there is a limit to the amount of money that the individual candidate in a constituency can spend in order to get himself or herself elected. That does not bother me at all. However, I noted that in subsection (2)(c) the words, "and registered political parties", were added. This would be the first time that there was a limit of election expenses on registered political parties. I shall resist the temptation to ask how one defines "registered political parties" since I am imminently to find out. I shall therefore resist that temptation for the moment.
What puzzles me is that, at present, in elections to the other place, and indeed to local government, political parties are allowed to spend nationally—not in the pursuit of an individual candidate's return, but nationally—as much money as they can persuade their supporters to raise or give to them. That has been a traditional part of the way we run matters in this country.
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Two matters are changing. First, the suggestion has been made in some quarters that we ought to change that system. As I understand it, the Neill Committee is looking into these matters, but has not yet reported. The fact that it has not yet reported is important.
Secondly, because we are moving to the additional member system here, the registered political parties could spend money in the pursuit of the election of the list in one of the European seats. Therefore it is perhaps not as simple as it is in the other place where the billboards and other paraphernalia of election campaigning are placed throughout the country. Sometimes, posters appear in the most unlikely places. I find it hard to understand why my party thought that billboards in the constituency in which I live, Glasgow Govan, would have much influence on that seat. I imagine that the same could be true for some Labour posters put up in safe Tory areas. The point is the availability of poster sites and that people commute past them. Those are arguments people would use to defend the good sense of putting up posters in constituencies where they do not seem to have much chance of bringing about the desired result.
Those and all the other paraphernalia and modern techniques that go on throughout the country cost money and are uncapped, to use a local government financial expression. They are not capped in any way, whereas the campaigns run for me when I was a candidate were tightly controlled by the limits.
In the Bill there is the suggestion that the total amount of money being spent by a political party—not a specific amount spent in the pursuit of individual candidatures—should be limited. I suggest that that is premature because the Neill Committee is to report on the issue and we ought to await its report.
Secondly, if we decide to go down that road, we ought to do so by primary legislation not secondary legislation. After all, it is secondary legislation that is involved here. While I understand the temptation to the Government to try to make things neat in the Welsh Bill, the phrase is, jumping the gun on Neill and also jumping the gun on legislation. Even if Neill recommends that such limits ought to be imposed on the other place, naturally I accept that if that happened, then those limits should quite legitimately be imposed on the Welsh assembly and the Scottish parliament. In those circumstances, that ought to be subject to primary legislation because it would be making a significant change to the way we have carried out our electioneering in this country. I hope that the Minister understands that I am not trying to be difficult, I am just questioning why the words are in the Bill long before we have come to any conclusion on the issue of general expenses of political parties in electioneering. I beg to move.
Lord Thomas of Gresford: I recall that in the Wynstay Arms in Ruabon many years ago there used to be on the wall a printed list of expenses incurred by Sir Watkyn Williams-Wynn to obtain the seat for one of the Denbigh boroughs. He had spent in that campaign in the early 19th century some £22,000, much of which went in direct payments to the voters to vote for him.

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There was the ox roast, the beer and everything else. That is the traditional way in which British politics were carried out and I am surprised to hear the noble Lord, Lord Mackay, talk about the traditional way in which we do things now.
It is right that the Neill Committee has yet to report, but the grain of British politics is surely running against the untrammelled spending by political parties on elections. The amounts involved are so huge that they have led to overseas funding and not very successful attempts by millionaires to purchase political power. The time has surely come, whether or not the Neill Report has appeared, when limits should be set on the amount of money that can be spent without any check or hindrance by a political party on election campaigning.
9.45 p.m.
Lord Crickhowell: Perhaps I can follow that extraordinary intervention, which referred to what went on in the early 19th century when clearly my noble friend was talking about modern politics.
The point being made by the noble Lord, Lord Thomas, reinforces the case made by my noble friend, and it is a matter that should await Neill. If this is the trend, it should be done on a proper basis across politics as a whole and not slipped in on the back of a Welsh Bill. I felt that perhaps this was a probing amendment and we would hear the Government's answer—I hope to hear a convincing Government answer—hut in fact this is a subject to which we shall probably have to return.
Lord Williams of Mostyn: The noble Lord, Lord Thomas, seems to spend all his time on licensed premises! However, the true point here is that the introduction of the additional member system will bring in a new form of political campaigning. We will have the usual well-known constituency contests focusing on individual candidates in specific constituencies. Added to that will be the campaigning for the party lists.
We impose expense limits on individual constituency candidates and believe it is intellectually consistent and proper that we impose expense limits on the party list candidates in exactly the same way. That is not pre-judging the noble Lord, Lord Neill, whose remit is much wider and is cast in quite a different form. We are simply saying that if one has a coincident election with a voter having one vote for the individual constituency candidate and at the same time, at the same ballot, the same voter casts his or her second vote for the party list, it is only sensible and consistent to have some sort of limit available to be designated for the party list contest. There is nothing sinister about that; there is nothing revolutionary about it; it does not pre-judge Neill; it simply deals with the circumstances that we can envisage in a rather simple way.
I hope that on that basis the noble Lord, Lord Mackay of Ardbrecknish, will feel willing to withdraw his amendment. If any Member of your Lordships'
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Committee has specific suggestions as to how the limit should be operated, speaking for myself I am more than willing to listen to any suggestions on a detailed basis.
Lord Mackay of Ardbrecknish: I am not entirely sure that the noble Lord, Lord Williams of Mostyn, properly answered the questions put, but perhaps I did not put them correctly. I shall therefore try to clarify what I believe I heard and we can see whether or not I am right. As my noble friend Lord Crickhowell said, we shall perhaps have to look at this in some detail between now and Report stage.
I cannot begin without saying to the noble Lord, Lord Thomas of Gresford, that I do not believe he could have been listening or understanding. I should have thought that the traditional form is the one we have right now, to which I link myself—I did not stand in the early 19th century—and it is one where the limit on the candidates is rigorously enforced. It is not a high limit, though it may recently have increased to a more realistic rate. For some time it was a low limit, given the way expenses were rising and campaigning was changing.
I was not defending the situation in the last century and it does not do debate any good to so misunderstand the motives of the person arguing the case that I have to stand here and make it perfectly clear that in no way was I defending a situation where votes were bought. I have no doubt that the noble Lord's own party, in its day, played a not insignificant part in that enterprise.
I was talking about current-day politics, and the tradition as long as I have been around politics—that is now quite a long time—is that there is a limit on each individual candidate. I was not asking for that to be changed in any way. It is a limit which is looked at carefully. Two or three Members in the other place are currently having their electoral expenses looked into, which underlines the fact that it is a limit observed by political parties and they all look at each other's election expenses in some detail.
I understand the Minister saying to me that in the party list contest for four additional members there is surely a perfectly good case for arguing that there ought to be election expenses of some kind so that in whatever European seat it may be there is some limit on the amount of money the party can use to compete for the election of those four additional members. I understand that. However, over and above that, the party in the whole of Wales could be undertaking simple campaigning on behalf of the Labour Party, the Conservative Party, the Liberal Democrat Party or Plaid Cymru—they could be using the usual poster sites and so on—which was not specific to either individual candidates or to the additional member systems. So far as I read this, the words that I have asked to be removed would include that all-Wales campaigning as well as campaigning in the individual additional member seats. I can see that it might be a quite difficult issue to tease the two lots apart but I think it is important to know exactly what the words here mean so that people know what issues secondary legislation might address.
I have no trouble with the individual candidates at all. I think one can have an argument about the four candidates in additional member seats and advocating

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their election, saying, "Our number one on the list, Joe Bloggs, is a thoroughly excellent fellow, as is number two, Jean Bloggs, and as are numbers three and four." You name them and say that those are the people you will be voting for if you vote for the party on the second vote. I can understand the argument that there ought to be some limit on that but it is the next step, the limit on the total vote, that bothers me, especially as we are looking at it—the noble Lord, Lord Thomas of Gresford, admitted this—in the Neill Committee. If we are to do something about that issue, we should deal with it separately, after Neill, and by primary legislation and not secondary legislation.
I wonder whether the Minister can help me so that when we consider these matters later we will be in a better position to know whether we have any cause for concern. Is my distinction an accurate one, or is the Minister saying that all expenditure by the party, whether it is specifically directed at additional member seats or over the whole of Wales, will be caught up under subsection (2)(c)?.
Lord Thomas of Gresford: I fully understand the noble Lord's argument and I follow the points he was seeking to make. My point is that it is a mistake to rely too much on tradition. Just as the situation in Victorian England in relation to individual candidates moved on so that limits on expenses were introduced in respect of individual candidates, so today we are moving to a position—the grain is moving in this direction—whereby there should be limits on political parties and on their overall expenditure on elections. It is not right that votes should be bought by the largest purse. That leads to the kind of matters to which I referred earlier.
Lord Mackay of Ardbrecknish: I am grateful to the noble Lord for his intervention. The difficulty there—I did not intend to introduce this—is how one defines money spent in pursuit of a political party. Is it just what that party itself spends, or is it what some of its friends may spend in order to bolster its election? One can think of various ways in which that could be done. Frankly, I think this is a difficult area to deal with and it will be extraordinarily difficult to police.
Lord Williams of Mostyn: I took and understood the remarks of the noble Lord, Lord Thomas, in the way that he indicated. In fact, in the same election it was better in Carmarthen because all the voters took the £22,000 bribe and then did not vote for the person who had bribed them. So not only did he spend the money but he did not have the seat either.
Of course, there are difficulties here, but they are no different in kind, quality and difficulty from the question one has at the moment between party expenditure, properly so-called, and individual candidate expenditure, properly so described. What we are saying is perfectly straightforward and I do not believe that I have heard an intellectually sustainable argument to the contrary. We are going to have coincident elections. There will be two votes for each voter. He or she will be voting for a candidate who will be expense-limited,
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and rightly so, as I believe everyone agrees, and also for a party list. We are simply saying that there should be power for the Secretary of State to limit the party list political expenditure in exactly the same way—although not necessarily with exactly the same detail because that is a matter for the future—as one limits the expenditure of individual candidates. I do not see any difficulty with that; quite the reverse. I see much to commend it. Of course we shall attend to what the Neill Committee says, but that does not attend to the principle for which I contend here.
Lord Crickhowell: The Minister has used the words put forward by my noble friend. He said that he was inclined to limit the expenditure on party lists. I do not have any great difficulty with that. My complaint about the intervention of the noble Lord, Lord Thomas of Gresford, is that I thought he was trying to take us much further and into a much wider area of debate that ought to be covered by primary legislation.
There are grave difficulties here. Those of us who have fought elections know just how tight the controls are and how difficult they are to administer and interpret. What worries us is that by using the words "political parties" rather than a more confined wording, the Minister is underestimating the practical difficulties. My noble friend commented that recently there had been a number of challenges. We do not want to create a number of post-election challenges simply because the matter has been ill thought out and badly defined.
This is a case where the Minister would be wise to take away the arguments that have been advanced and to consider whether it is possible to have more precision in the drafting of the legislation so that we can have confidence about the order. That is all we are asking for at the present time. Real difficulties have been enunciated by my noble friend about the use of "political parties" without further clarification. On the experience of fighting elections and watching the controls in operation, I believe that the Minister would be sensible to take away the arguments and to consider them rather more carefully than he appears to have done.
Lord Williams of Mostyn: Before that codicil I was about to say that I would do exactly what the noble Lord, Lord Crickhowell, has asked me to do. I have not failed to consider the arguments. In fact, I thought I made it plain that I recognised that there are difficulties. On the basis that fundamentally I believe there is no disagreement in principle, then I am more than happy to do as I undertook to do at Second Reading and as regards the first amendment today; namely, to think with some care about what noble Lords have said today. I said that if there were specific proposals about the way in which we deal with this matter—I believe that it was in regard to this amendment that I said it—I am more than happy to have detailed suggestions to which we shall give every proper consideration.
I do not say that the propositions put forward by the noble Lords, Lord Mackay and Lord Crickhowell, should be dismissed out of hand simply because of their

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paternity. There are questions here that we need to tease out. But fundamentally I do not believe that we are at odds.
Lord Mackay of Ardbrecknish: With that assurance I am certainly a little happier. I shall study the Minister's words quite carefully. But I believe that there is a distinction, which my noble friend has underlined, between the political parties operating on a list campaign and political parties operating on a general campaign. That is the point which concerns me about the wording. We can return to this if we are still concerned when we read Hansard tomorrow. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 11 agreed to.
10 p.m.
Clause 12 [Disqualification from being Assembly member]:
The Deputy Chairman of Committees: I must inform the Committee that if Amendment No. 43 is agreed to, I cannot call Amendment No. 44.
Lord Roberts of Conwymoved Amendment No. 43:
Page 8, leave out lines 1 to 3.
The noble Lord said: Clause 12 is a disconcerting clause, in that it gives extensive powers to disqualify people from being members of the assembly. A government amendment has been tabled to amplify further those powers in what appears to be a wholly unacceptable way.
I deal first with the clause as it stands. There are three amendments to it which, if carried, would mean that the provisions disqualifying persons from sitting in the assembly would be the same as those disqualifying people from sitting in Parliament. That is at least our intention. Amendment No. 43 expresses our concern about disqualifying by order. That concern is hardly allayed by the Government's amendment which we have yet to reach. The second amendment, Amendment No. 45, removes the provision for disqualifying persons who, under the Audit Commission Act 1998, are prevented from being members of a local authority. I have already said that the assembly is not a local authority. In our opinion, it should not be treated as such. The third amendment, Amendment No. 48, is consequential, and achieves our purpose of limiting disqualification under the provisions of the House of Commons Disqualification Act 1975 to the Auditor General for Wales and the office holders specified in subsection (4). I shall not comment on the Government's amendment or the amendment in the name of my noble friend until they have been moved.
Lord Crickhowell: I hesitated because I was not sure whether the Minister would speak to his amendment at this stage. I propose to speak to Amendment No. 46 which stands in my name. When I spoke at Second Reading and raised the possibility that the Secretary of State for Wales might wish to be both Secretary of State for Wales and leader of the administration of the
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assembly, I did so in a lighthearted manner. I had seen a press report to that effect and thought that it was worth registering that matter to see whether I could obtain a clear answer. I hardly credited that it was a serious proposition.
At Second Reading, referring to Mr. Ron Davies, I said:
"He apparently thinks that if the post [of Secretary of State] survives for a short time he might also succeed in remaining Secretary of State for Wales and a member of the UK Cabinet. That proposition is untenable. It would involve conflicts of interest of the gravest kind. You cannot be a member of two separate cabinets, each with collective responsibility and separate interests, without such conflict being an unavoidable fact. I believe that we should remove the temptation from Mr. Davies and introduce a clause making such a dual role impossible".—[Official Report, 21/4/98; col. 1060.]
I thought the Minister would say that those reports should not be taken seriously. I was astounded when the Solicitor-General in his response (at col. 1134) gave a quite different reply:
"The Bill does not prevent one person being both assembly first secretary and Secretary of State for Wales. Whether one person would fill both posts is a matter for the political parties in selecting candidates, for the electorate at the ballot box, for the assembly in choosing who is to lead it and for the Prime Minister of the day. The Secretary of State will be chosen by the Prime Minister and will he hound by Cabinet collective responsibility while the first secretary will depend on the confidence of the assembly. Therefore, there will be a role for the Secretary of State in Cabinet in the UK Government. The Secretary of State can also be the first secretary, subject to the views of the assembly and the Prime Minister".
I find that a very remarkable proposition.
I repeat that I find it very hard to see how you can accept collective responsibility for one administration and have a rival collective responsibility for another administration in another elected assembly. Conflicts of interest are bound to arise, and arise very frequently. I think that this Committee should certainly make it impossible for it to happen. I may he told that of course it is possible under the order-making powers to remove the possibility in individual cases if the occasion should arise. I do not think this is an acceptable way out of the dilemma.
If it really is the proposition, then we have been debating the whole of this Bill almost under false pretences. I know I shall be told that the term "Secretary of State" in legislation covers any Minister, and if one Minister cannot perform the duties another Secretary of State can do so. Nonetheless there is a whole string of references to which we are entitled to refer to the Secretary of State for Wales. While there may be occasions when it is quite clear that another Minister has to step in, it really will be a great surprise for us if time and time again, as a consequence of clause after clause, we find the Secretary of State for Wales coming into obvious conflict and unable to perform duties which then have to be performed by someone else.
I do not propose at this late hour to go through the whole Bill and look at all the potential conflicts which may arise simply from the clauses in the Bill, let alone the situations which inevitably arise in government when great and controversial issues are debated. We will come later to talk about the role of the assembly in Europe and how we deal with agricultural matters and

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so on. We had an interesting example on the Floor of the House about a week ago, I think. We talked about the difficulties that might arise between the negotiating position of the Government on European regional policy and perhaps the position taken by the assembly. We will come back to that on later amendments.
Listening to debate on the Bill earlier today, one can identify a whole string of amendments. We were told this evening that the Secretary of State will review the electoral system after 1997. I am not sure that we realised at the time that the person who would be reviewing the system might be the leader of the assembly himself. In Clause 22 the Secretary of State will lay the order for the transfer of functions. In Clause 32 the Secretary of State shall undertake that the assembly will undertake such consultations about its legislative programme for the session as may be required. It is a very interesting concept that the Secretary of State should apparently consult with himself about the legislative programme. Clause 82 says that the Secretary of State from time to time will make payments to the assembly of money provided by Parliament in such amounts as he may determine. It is slightly unexpected to discover that a Secretary of State sitting in a British Cabinet is going to hand over sums of money to an assembly of which he is the head. And so we can go on. He can make loans under Clause 84 and he has to prepare accounts in relation to those loans under Clause 85.
I have to say that if this was a company prospectus or a set of company accounts, the rules laid down by the Stock Exchange and by bodies like Cadbury one would immediately say that this was quite out of order in proper government terms. I do not believe that this Committee should take lightly the possibility of such a situation being permitted.
I am told by those who always seem to be better informed about these things that the Government will resist this amendment. If they do so then I really think I shall have to consider how the matter is to be further considered at a rather more suitable time than eight minutes past 10 in the evening by a light House. In my view, the issue is of significant constitutional importance and is one upon which this House should take a view after proper consideration. I touch on the issue tonight with the indication that if I do not receive a satisfactory assurance, I shall return to it on another occasion.
Lord Elis-Thomas: I am constantly surprised and enthralled by the views of the noble Lord, Lord Crickhowell. As a distinguished former Secretary of State, he seems to be arguing that the position, hypothetically, in which a Secretary of State might also be the first secretary of the assembly is somehow different from the position he distinguishedly occupied for eight years. Surely, all the arguments that he has adduced about the position of Secretary of State in Cabinet in relation to the Treasury, and the Secretary of State acting as first secretary administering funding in Cardiff, applied to him when he was in that position.
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The noble Lord's amendment seeks to prevent any Minister of the Crown being a member of the assembly. I do not know on which continent the former Secretary of State lives, but if he will glance over at mainland Europe he will find many Secretaries and Ministers who are members for a transitional or longer period at the level of local government, municipal level, local mayoral level, regional assembly level, the European Parliament and member states. That brings a coherence to government between the different levels and ensures that politicians who develop a skill at one level can make it available at another.
In the emerging federation of the peoples and nations of these islands in the United Kingdom, surely we will look for a way in which politicians will be able to serve at different levels and sometimes simultaneously. If that is possible, the potential talents at different levels will develop and make those switches.
There is another equally important point. We will later deal with European and UK issues as set out in Amendment No. 204, which we will not consider tonight. That amendment proposes that Members of this House and the European Parliament should be able to participate in the assembly or its committees but not vote. In other words, I argue that people other than the Secretary of State should be members of the assembly and may hold office, depending on the circumstances of the day. Other Members of this House, another place and the European Parliament might be able directly to contribute to the debates of the assembly and to scrutinise work—for example, in the European committee which many of us would like to see established—or in the administration. To prevent that happening, as the noble Lord seeks to do, is to separate in a graphic way the levels of administration in government and governance within this kingdom. Indeed, perhaps I may be so bold as to suggest at this time of night that the noble Lord, Lord Crickhowell, is becoming a separatist.
10.15 p.m.
Lord Williams of Mostyn: Perhaps I might indicate the amendments with which we are dealing in this group. Amendment No. 43 stands in the name of the noble Lord, Lord Roberts of Conwy. Amendment No. 44 is in my name. Amendment No. 45 is in the name of the noble Lord, Lord Roberts of Conwy. Amendment No. 46 is in the name of the noble Lord, Lord Crickhowell. Amendment No. 47 is in my name and Amendment No. 48 is in the name of the noble Lord, Lord Roberts of Conwy. Obviously they are grouped together because they inter-relate.
The amendment tabled by the noble Lord, Lord Crickhowell, would disqualify from membership of the assembly any serving Minister of the Crown. I recall a concern which he raised on Second Reading and reiterated tonight about a person simultaneously being a member of the United Kingdom Cabinet and the executive committee of the assembly. His present amendment goes significantly further than that and, as the noble Lord, Lord Elis-Thomas, indicated,

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disqualifies any Minister of the Crown from membership of the assembly as a whole rather than the executive committee.
As the noble Lord, Lord Crickhowell, developed his arguments, my mind turned to the experience of continental Europe which was fully set out and amplified by the noble Lord, Lord Elis-Thomas. I shall not repeat or return to it.
We believe that it may be very useful for the assembly, particularly, perhaps, in the first five years or so, to have among its members people who have good experience in other political institutions such as this House, another place, the European Parliament and local councils. After all, the assembly's work will be to work closely and positively with all those other bodies. People who are members of both bodies may be very useful in establishing and cementing those relations, for the benefit of all sides, not simply from the Welsh assembly but also for the bodies from which members may well come.
I remind the Committee that the Bill allows the Secretary of State to make provision to abate the salaries of assembly members so that there would be no necessary question of members being able to draw two full salaries for public service. I really cannot see the virtue of excluding members of other bodies from being members of the assembly because we hope that that assembly will attract people who wish to serve it and therefore Wales as a whole; secondly, people with appropriate experience; and, thirdly, people who are not simply doing it for enhanced salaries.
The noble Lord said that he thought that simultaneous membership of the Cabinet and the executive committee is almost conceptually impossible. It seems to me that essentially it is a matter for the Prime Minister of the day to decide who should be a member of his Cabinet. I do not see the conflict in quite such a harsh, irreconcilable way as does the noble Lord, Lord Crickhowell. I understand the nature of his concern and I understand quite clearly that he proposes to return to this matter in due course.
Amendments Nos. 44 and 47 are drafting and technical amendments. The first maintains a consistency in terminology throughout the Bill. The second is necessary to tighten up any possible loopholes arising in circumstances where there are people undertaking the work of a post designated in the Order in Council but where there is no formal post title.
Amendments Nos. 43, 45 and 48 would firstly remove the power, to be exercised by Order in Council, to disqualify from membership of the assembly the holders of certain designated offices; and, secondly, remove the provision which disqualifies from membership of the assembly persons who have been disqualified from being a member of a local authority under Section 17(2)(b) or 18(7) of the Audit Commission Act 1998; that is—and this is important—members of local authorities who are responsible for incurring or authorising unlawful expenditure or whose wilful misconduct has caused a loss or deficiency.
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We believe that there should be that exclusionary power. Persons are excluded, by similar provision, from the House of Commons. The purpose of the Order in Council power is precisely that exclusion.
The Order in Council power will be exercised by Her Majesty on the recommendation of the Secretary of State. Subsection (5) specifies that no recommendation may normally be made unless a draft SI containing the order has been placed before, and been approved by resolution of, both Houses of Parliament. Both Houses of Parliament will, therefore, be able to consider the order proposed under subsection (1)(b) and express any concerns at that point. The only Orders in Council which will not be subject to that procedure will be those where the Order in Council varies or revokes an existing Order in Council and the assembly itself has resolved to ask the Secretary of State to recommend the making of the new order.
The provisions relating to disqualification are perfectly sensible and proper. I am sure that the Committee would agree that people should not be allowed to stand for election and to sit in assembly places if those very same people have been deemed unfit—and after all, that is not lightly done—to be members of a local authority.
I realise that the amendments interlock and that is why I have dealt with them together in that way. I recognise the force of the concerns and I answer them generally in this way. These are new arrangements for a new assembly. We cannot be governed endlessly by the dictates of the past or the requirements of historical experience. As the noble Lord, Lord Elis-Thomas, said, this is a new world and we are looking for new arrangements. That is precisely why we have a devolution Bill.
Lord Roberts of Conwy: Perhaps I may begin by making a brief comment on the government amendment, Amendment No. 47, which amplifies the power to designate by order the offices whose holders are disqualified by allowing designation of an office,
"by reference to any characteristic of a person holding it".
Do we really mean "any characteristic"? Indeed, the mind boggles. Then there is that subtle extension of the definition of office to include, "any post or employment". I know that we are moving into a new world with the assembly, but need we really have such an extensive order-making power? It seems to be far too widely drawn for us to feel comfortable with it.
However, I should like to concentrate my remarks on the amendment tabled in the name of my noble friend Lord Crickhowell. He is absolutely right to seek to debar Ministers of the Crown from membership of the assembly, for the all- powerful reasons that he outlined. My noble friend raised the matter on Second Reading and forewarned the Government of his intention to bring forward a prohibitive amendment.
The situation arises because the Secretary of State, Mr. Ron Davies, has already indicated that he is to throw his hat into the ring and seek membership of the assembly, as indeed the Secretary of State for Scotland, Mr. Donald Dewar, has said that he will seek

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membership of the Scottish parliament. However, what is not at all clear to us is whether they will cease to be MPs and, therefore, members of the UK Government. We are grateful to the noble and learned Lord the Solicitor-General for his speech at the end of the Second Reading debate in which he said:
"The Secretary of State can also be the first secretary, subject to the views of the assembly and the Prime Minister".—[Official Report, 21/4/98; col. 1134.]
There are various strands here to be separated. First, there is the fact that it is open to MPs to seek membership of the assembly. There is nothing unusual in a dual mandate of that kind. Some of us recall members of a Northern Irish Parliament at Stormont also holding seats at Westminster, and Westminster parliamentarians also sitting in the European Parliament. Indeed, there are arguments in favour and against such dual mandates. It can be argued that dual membership does help maintain cohesion between representative bodies, as the noble Lord, Lord Elis-Thomas, suggested, but there are problems with it.
The second strand is that if MPs are allowed to hold seats in the assembly, it is possible that they could become Ministers in the UK Government and/or members of the assembly executive. There are all kinds of possible permutations and combinations, but the one that has clearly gained prominence in recent weeks is the possibility of the Secretary of State for Wales holding, additionally, the post of first secretary to the assembly. The first position, that of Secretary of State for Wales, depends on the Prime Minister and the second on the assembly, together with the approval of the majority party within it. We all realise that there is a superficial attraction in the notion that the Secretary of State could hold both offices for a transitional period and that that would somehow ensure a smooth start for the assembly.
However, of one thing we can be certain: if the Secretary of State and the first secretary do not understand each other's roles and work together in reasonable harmony, there will be serious difficulties. It is this possibility that has nurtured the idea of combining the two posts, at least for a time. The internal disagreements and personality clashes within the Labour Party in Wales have not helped to inspire confidence.
As my noble friend emphasised, the combination of the two offices is constitutionally unsound. As a member of the United Kingdom Government, let alone the Cabinet, the Secretary of State will share in their collective responsibility to this Parliament. As first secretary of the assembly executive he will share in that executive's collective responsibility to the assembly. Therefore a conflict of interests and loyalties could easily arise. The joint holder of these offices could find himself subject to opposing decisions and resolutions endorsed by Parliament and the assembly, as regards resources, for example, as my noble friend Lord Crickhowell indicated.
Under this Bill the Secretary of State has a number of specific responsibilities in relation to the assembly and he is responsible to Parliament for their discharge. They are quite separate and distinct from the
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responsibilities of the first secretary and the executive. Those responsibilities in toto do not lie well together. Their combination in one person would make a nonsense of devolution. I am astonished that the noble Lord, Lord Elis-Thomas, suggested otherwise because we would have not devolution but a substitute for the governor-general that we heard so much about in the old days, with a tremendous accretion of powers within himself.
Finally, I must point out that there is the strongest presumption in this clause against office holders becoming members of the assembly. That is what the clause is all about. Of course the Secretary of State is himself an office holder under the Crown. I strongly support my noble friend's amendment. I am sure that we shall return to it in due course.
Lord Thomas of Gresford: I see nothing constitutionally difficult about the proposal that the Secretary of State for Wales and the first secretary should be the same person. If the same political party is in power both in Westminster and in Cardiff, it would seem to make complete sense that he should be in a position to convey to his executive in Cardiff the policy of the Westminster government, and at the same time he should be able to convey to the Cabinet the policy of the Cardiff government. There seems to me to be no difficulty or inconsistency in that. If, of course, there are different parties involved, different considerations would have to apply. But whatever arrangement there may be, I would hope that in a reformed second Chamber the first secretary of the Welsh assembly would, for the period of his office, play his role within the second Chamber and thereby have a communicative role to this Chamber as to the policies of the government which he represented.
Lord Roberts of Conwy: I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Williams of Mostynmoved Amendment No. 44:
Page 8, line 2, leave out ("members of the Assembly") and insert ("Assembly members").
On Question, amendment agreed to.
[Amendment No. 45 not moved.]
Lord Crickhowellhad given notice of his intention to move Amendment No. 46:
Page 8, line 9, at end insert (", or
(e) he is a Minister of the Crown in the Government of the United Kingdom.").
The noble Lord said: Earlier this evening I believe the noble Lord, Lord Elis-Thomas, said that Mr. Ron Davies was now known as "Ron the Assembly". I rather fear that if this amendment is not passed, there is a danger that he will be known as "Ron Double Bed". The trouble with people who share beds is that they sometimes find that the loyalty to wife and mistress causes grave difficulties and is likely to create conflict.

935
It is interesting that the noble Lord speaking for the Liberal Benches has talked over the past few weeks about this wider collective view of the assembly. It has been said that it will be all embracing and will take a Welsh collective view which embraces all the parties which will play a part. However, now it appears that the same political party will exert power at each end. Even with the same political party exerting power at each end, the head of an assembly in Cardiff will frequently find himself in an intolerable position of conflict if he is also a member of a British Cabinet. I note that the Minister understands full well my determination to return to this issue on a later occasion when we can debate the matter adequately and in full. On that basis, I shall not proceed with the amendment.
[Amendment No. 46 not moved]
Lord Williams of Mostynmoved Amendment No. 47:
Page 8, line 23, at end insert—
("() An Order in Council under paragraph (b) of subsection (1) may designate particular offices or offices of any description and may designate an office by reference to any characteristic of a person holding it; and in that paragraph and this subsection "office" includes any post or employment.").
On Question, amendment agreed to.
[Amendment No. 48 not moved.]
Clause 12, as amended, agreed to.
Clause 13 agreed to.
Clause 14 [Effect of disqualification]:
Lord Williams of Mostynmoved Amendment No. 49:
Page 9, line 19, at end insert—
("() Subsection (2) also has effect subject to section 141 of the Mental Health Act 1983 (mental illness) and section 427 of the Insolvency Act 1986 (bankruptcy etc.); and where, in consequence of either of those sections, the seat of a disqualified Assembly member is not vacant he shall not cease to be an Assembly member until his seat becomes vacant but—

(a) he shall not participate in any proceedings of the Assembly (including proceedings of a committee of the Assembly or of a sub-committee of such a committee), and

(b) any of his other rights and privileges as an Assembly member may be withdrawn by the Assembly.").

The noble Lord said: In moving Amendment No. 49, I speak also to Amendment No. 253.
I am sure Members of the Committee will find these amendments entirely non-controversial. They extend to the assembly provisions similar to those which apply in another place in respect of the treatment of Members who are suffering from mental illness or have been declared bankrupt.
936
Mental illness is a ground for disqualification from membership of the House of Commons at common law and therefore under Clause 12(2) of the Bill becomes a ground for disqualification from the assembly. Section 427(1) of the Insolvency Act 1986 provides that where a court has adjudged an individual to be bankrupt that individual is disqualified from membership of the House of Commons and thus by extension under Clause 12(2) of the assembly.
The effect of Clause 14(2) as it stands is that on being disqualified from membership of the assembly in either of these circumstances, a member's seat would become vacant. This is not what happens in the House of Commons because Section 141 of the Mental Health Act 1983, taken with Section 427 of the Insolvency Act 1986, allow, in effect, for a six-month period of grace before the seat becomes vacant. If the circumstances of the disqualified Member are restored before the end of that period membership is restored, but if circumstances remain the same after six months his seat becomes vacant.
These amendments amend the Mental Health Act and the Insolvency Act to extend to members of the assembly similar six-month periods of grace.
The amendment to Clause 14 makes clear that during the period of his disqualification while his seat is not vacant, the disqualified member may not participate in any proceedings. The assembly would have discretion to withdraw other rights and privileges as appropriate.
We do not think that it is appropriate to treat members of the assembly differently from Members of the House of Commons in these respects. That is the basis upon which I urge Members of the Committee to accept these amendments.
Lord Roberts of Conwy: We have the utmost sympathy with members of the assembly who may become mentally ill or insolvent and agree that they should be treated like Members of the House of Commons in the same circumstances.
Lord Williams of Mostyn: I am most grateful. I beg to move.
On Question, amendment agreed to.
Clause 14, as amended, agreed to.
Clauses 15 to 20 agreed to.
Lord Carter: I beg to move that the House do now resume.
Moved accordingly, and, on Question, Motion agreed to.
House resumed.
House adjourned at twenty-six minutes before eleven o'clock.

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